The decline was exacerbated by a sharp fall in the export of salmon
The value of the UK’s food and non-alcoholic drinks exports dropped to £6bn in the first six months of the year – 5.3% lower than the same period last year.
The figures released by the Food and Drink Federation (FDF) show that the value of exports to the EU shrank by 7.5% in the first half of the year. The rise of the British pound against the sharply depreciated Euro has made UK exports less competitive in key Eurozone markets, FDF said.
Exports to non-EU markets continued to grow – up 1% – and value added goods rose globally, with significant increases in exports of tomato ketchup (adding £3m) and bread, pastry and cakes (adding £7m). Confectionery exports to Canada were also up by £7m.
The largest percentage growth on the first half of 2014 was in the cereals and bakery sector – up 10% from £1bn to £1.1bn – while the other groceries segment, which includes foodstuffs such as fats and oils, preserved fruits and vegetables, fruit juices, sauces, vinegars and other miscellanous products, also grew.
Dairy exports saw losses of £157m on record highs in the same period last year, however exports remain above pre-2014 levels and exported volumes are up for both processed and unprocessed milk and cream.
Similarly, fish and seafood exports lost £137m in value, largely as a result of a sharp fall in salmon exports.
FDF economics and commercial services director Steve Barnes said: “Food and drink has been bucking the trend when it comes to exports for years and the value of the sector’s exports is still declining less than UK exports overall. However, we are starting to see the negative effect of exchange rates, particularly in Eurozone which remains the key destination for UK food and non-alcoholic drink exports.
“The good news is that volumes in many categories are still up and exports of value added goods to both EU and to non-EU countries are rising. Exports continue to be a key area of growth for food and drink companies and we hope that businesses will make use of the raft of free materials and expert advice during the upcoming Food & Drink Feature on Open to Export.”
Elsa Fairbanks, director of the Food & Drink Exporters Association, added: “Our latest export survey revealed that although the strength of sterling is a growing concern, FDEA members continue to see growth potential across Asia and the Middle East as well as established markets in North America and the EU. Success is coming both from traditional products like cheddar cheese (up £20m globally) and innovative products in the health and wellbeing categories.”
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