HMRC figures released by the Food and Drink Federation (FDF) have revealed a significant fall in food and drink exports to the European Union (EU) and other international markets in the wake of the UK’s decision to leave the EU.
The report compared data from January 2021 to January 2020, which showed that year-on-year food and drink exports to the EU fell 75.5% – a drop of nearly £0.75 billion – while exports to non-EU countries also fell 11.1%.
According to the figures, the value of all UK food and drink exports stood at £1.7 billion in Jan 2020, and this figure fell 51.1% to £824.9 million as of January 2021.
The FDF claims that this is due largely to the new non-tariff barriers faced by UK exporters post-Brexit, as well as the ‘collapse of groupage movements, which has shut out many SME exporters’. The FDF also highlighted that the impact of Covid-19 and stockpiling by UK businesses prior to the end of the transition period with the EU were also contributing factors.
Exports to all EU member states fell, with exports to Ireland, Germany, Italy, Portugal, Austria, Romania, Estonia, Slovenia, Croatia and Luxembourg all declining more than 80%. Ireland previously stood as the UK’s largest food and drink market in the EU, representing around 18% of exports at a value of £299.5 million in January 2020. However, as of January 2021, this value dropped to £45.3 million; approximately 5% of all food and drink exports to the EU.
All ten of the UK’s largest food and drink product categories exported to the EU declined, with salmon exports plunging 98% and beef by 91.5% compared to the same period in January 2020. Whisky still stands as the UK’s largest food and drink export to the EU, but the value of exports slumped 63.1% from £105.4 million to £38.9 million.
Meanwhile, cheese exports plummeted 85.1% from £45.5 million to £6.8 million year-on-year, while chocolate exports fell from £41.4 million to £13.1 million.
Dominic Goudie, head of international trade at FDF, said: “It is extremely worrying that our exports to the EU have fallen by more than 75% in January.
“Businesses face significant challenges when trading with the EU and small businesses in particular have been shut out because groupage distribution is not working. In the absence of solutions, EU exporters will face much the same difficulties when the UK’s full border operating model enters into force in 2022.
“It is clear that the terms of the Trade and Cooperation Agreement (TCA) will not change and businesses face unavoidable changes to the terms of trade. However, there are opportunities to address the implementation of the deal. The EU-UK Partnership Council and its Trade Specialised Committees should be convened as a matter of urgency to put in place solutions that deliver the TCA’s aim of enhancing the ability of small businesses to benefit from trade.”
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