Further to the ONS data released in March on food and drink exports to the EU, the Food and Drink Federation (FDF) has produced a Food and Drink Trade snapshot looking at HMRC data for the month of January, which was published in the last few weeks.
The key findings are as follows:
• Exports fell significantly in January 2021, driven by a fall in sales to the EU of 75.5% compared to January 2020, a drop of nearly £0.75bn.
• Impacts of COVID and stockpiling by UK businesses in the EU ahead of the end of the transition period were contributing factors, but much of this is likely due to new non-tariff barriers faced by UK exporters and the collapse of groupage movements which has shut out many SME exporters.
• Exports to all EU Member States fell, with Ireland, Germany and Italy each down more than 80%.
• In January 2020, Ireland was the UK’s biggest market, representing around 18% of total food and drink exported, however in January 2021 this figure has dropped to only 5%.
• Each of the UK’s top 10 products exported to the EU fell by between 45% and 98% in January 2021. Salmon fell by 98% and beef by 91.5% compared to the same period in January 2020.
• Imports also fell significantly in January 2021, driven by a drop of nearly 25% from the EU compared to January 2020 worth around £700m.
• Impacts of COVID will be a major issue, particularly due to the continued closure of much of the UK’s hospitality sector. The phased implementation of border checks is likely to mean that the full impacts of the end of the transition on imports from the EU will not be seen until 2022.
• Imports from the majority of EU Member States fell in January 2021.
• The top nine markets which supply the overwhelming majority of EU sales of food and drink to the UK all fell, with the Netherlands, Ireland and Germany each down around a third.
• Each of the UK’s top 10 products imported from the EU fell in January 2021 compared to the same period in 2020. Pork sales were down nearly 50%, chicken fell 42.7% while beef was down by 37.2%
Discussing the snapshot, 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.'