This month’s (July 2021) Food and Drink (F&D) export stats make interesting reading. July’s data is the first time in four months that a month-on-month comparison with 2020 shows a decrease in the value of UK F&D exported, with 2021 performance 3.7 per cent down on the same month’s data in 2020. The annual year to date data now shows that the value of UK F&D exported in 2021 is 5 per cent down on the amount exported by this time in 2020. While this paints a negative picture, when you consider the hugely problematic period that the sector had to endure post Brexit in January and February, the data still shows a quite remarkable recovery over the past 6 months or so. The UK exported nearly £21.4bn globally for the 12 months to December 2020 and I wonder whether there is a chance that parity could be achieved in the 12 months to December 2021 despite the Brexit related issues that the sector has faced?
Parity with 2020 looks a long way off
To reach parity with 2020, the industry is going to have to go some with growth required in the final 5 months v 2020 of about 7.5 per cent. This is going to be particularly challenging with the ongoing supply chain and people challenges being experienced across the sector. Many recognisable brands have recently sent warnings out suggesting that they are concerned that the well documented shortage of lorry drivers will result in food shortages during the crucial Christmas period.
Demand is not the problem
Demand for UK food and drink produce continues to increase both in the UK and overseas as pandemic related restrictions continue to lift and as global markets continue to show a desire to buy British produce. The labour shortage is in danger of hampering the industry at a time when business leaders should be considering strategic growth options and planning for the busy Christmas period.
So what are the positives?
It is heartening to see that some specific products are showing phenomenal growth trajectories despite all this. Beer exports (with alcohol or without) are motoring in the 7 months to July 2021 versus comparable numbers in 2020 as are exports of whisky, rum, sweets and seafood. My money is on whisky hitting global sales of close to c£5bn by the end of this year provided that the logistics issues already mentioned don’t cause further headaches throughout the final quarter. There is plentiful stock of around 22 million casks quietly maturing across locations in Scotland…!