British confectionery companies set to benefit from new trade agreements Down Under
The UK government has set Valentine’s Day 2024 as a target for the removal of tariffs that will enable British confectionery companies to benefit under new Free Trade Agreements (FTAs) with Australia and New Zealand.
The UK-Australia and UK-New Zealand trade deals are the first the UK has negotiated from scratch since Brexit, when the UK left the European Union on 1 January 2021. They are set to come into force later in the year and is expected to boost the UK economy by £2.3 billion and £800 million respectively, the UK government claims.
British confectionery companies such as London-based chocolatiers Seed & Bean are celebrating a potential export boost and are keen to restart exports Down Under. The company says it estimates the FTAs could unlock a £100,000 export opportunity should they find a distributor.
Seed & Bean said in the build-up to this year’s Valentine’s Day, it experienced a 25% online traffic boost as lovers look to gift sweet treats.
The company’s Chief Chocolatier Oliver Shorts said: “The trade deals with Australia and New Zealand will help us reduce the landed cost of our organic chocolate bars into the two countries.
“One of the big barriers to entry are the costs involved in getting the goods in, and this will allow us to help any potential distributor margins and permit the product to be a more viable opportunity in the market.”
And With Valentine’s Day spending in Australia increasing year-on-year, British bakeries and chocolate manufacturers could soon benefit as soon as the deals come into force.
Minister of State at the Department for Business and Trade, Nigel Huddleston, said: “Our new deals with Australia and New Zealand will allow our fantastic British confectionery businesses like Original Cake Company and Seed & Bean to become more competitive and export their top-notch products Down Under with ease.
“These landmark trade deals are expected to stimulate trade, drive economic growth and lead to better paying jobs, bolstering British businesses and empowering them to tap into significant markets in the flourishing Asia-Pacific region.”
According to the market research company Statista, the Australian confectionery and snacks market is worth £13.2 billion in 2023 and is expected to grow annually by 1.64% over the next four years, demonstrating the strong growth potential of this market.
In New Zealand, this market is projected to reach £61 million in 2023 and is expected to show an annual growth rate of 16.97% over the next 4 years.
The government claims UK food and drink exports to Australia and New Zealand have more than doubled in the past decade and, under the FTAs, UK businesses will benefit from the elimination of tariffs on all products. The agreement will also ensure food and drink products exit customs quickly, providing businesses with certainty when exporting products to Australia and New Zealand.