Confectionery exports slump as UK food gets back on track

The only export sector in significant decline this quarter was sugar confectionery, which fell by 8.5 per cent.The growth marks a recovery in the UK's export markets, especially in the meat sector, which was hurt in the past by outbreaks of BSE and food and mouth disease.

Total UK food and drink exports for the six-month period January to June 2005 were worth £4.65bn, up by 3.1 per cent versus the same period in 2004, Food from Britain (FFB) reported.

"With June 2005 being the strongest month in the past three years, the outlook for the full year is very positive," the industry association stated in a report.

Total UK food and drink exports for the six-month period January to June 2005 were worth £4.65bn up by 3.1% versus the same period in 2004.

With June 2005 being the strongest month in the past three years, the outlook for the full year is very positive, the FFB stated.

Meat exports grew by 14 per cent during the six months to reach £351m. Fish exports grew by six per cent to £440m. Fruit and vegetables exports grew by four per cent to £242m.

Other significant sectors showed declines. Dairy exports fell by four per cent to £378m, sugar fell by seven per cent to £168m. Tea and coffee exports also suffered a five per cent decline to £168m.

The only bulk sector in growth is cereals, which had a slow year in 2004, but is recovering throughout the first half of this year.

Alcohol products make up the largest export sector in the food and drinks industry. The segment accounted for about £1.4bn in exports during the first half of 2005.

Total food and drink exports to the EU were worth £3.06bn for the half-year period, a growth of 3.6 per cent versus the same period in 2004. The EU makes up about 65 per cent of the UK's export market.

Traditionally strong markets such as Ireland continue to deliver growth for UK companies. Exports to Spain have improved by 12 per cent during the six-month period.

Exports to non-EU markets grew by two per cent compared to the same period in 2004 to reach £1.59bn.

Ireland is the UK's largest export market. Exports to Ireland accounted for £860m in the first half of 2005, up six per cent from the previous year. France continues to be ranked the second largest export market for UK food and drink products. The market was worth £561m in the six months, despite a decline of two per cent.

Germany and the Netherlands remained stable versus half year 2004, which halts the decline in recent quarters. Exports to Germany were worth £278m, and those to the Netherlands £205m.

The share of exports going to non-EU countries has stabilised, with a recovery of exports to regions such as Asia Oceania and the Middle East, the FFB stated.

Exports to new markets such as Singapore, Australia and Taiwan, as well as Poland and the Czech Republic have produced double-digit growth.

Overall, the UK's companies exported food worth £3.10bn in the six months, up by 3.5 per cent. Exports of drinks were worth £1.55bn, up 1.9 per cent.

Wheat exports grew by 52 per cent, shellfish by seven per cent, soft drinks by 20 per cent and cheese by 12 per cent.

Meanwhile exports of value added food and drink products grew by 1.4 per cent. Markets such as Ireland, and the US topped the list of growth markets. Value-added exports to Germany fell by 6.8 per cent, to Italy by 9.2 per cent and to France by 4.8 per cent.

Exports to South Korea were up 27.1 per cent during the same period and to Canada by 3.6 per cent.

Exports of beer rose by 14.6 per cent and meat by 16.5 per cent.

Prepared meat exports rose by 16 per cent, sausages by six per cent and breakfast cereals by five per cent.

Last year the UK's overseas sales of food and drink fell 1.8 per cent to £9.7bn, but increases in meat exports and entry into emerging markets indicated business was beginning to pick up, the FFB stated.

The decline was mainly due to a fall off in the drinks sector. The FFB said the strong upturn noted at the end of last year is so far continuing in 2005.

The FFB, a body funded by industry and government, forecast then that UK exporters would break the £10bn barrier in 2005 for the first time in a decade.

Before the BSE crisis in 1986, the UK's beef exports were worth about £1bn (€1.5bn) compared to £20m (€29m) in 2004, according to FFB.

Food and drink imports to the UK were worth £11bn in the first half of 2005, up by six per cent.