UK food trade deficit hits highest level since 2000 at £21bn

Britain's trade deficit in food and drink has risen to more than £21 billion, the highest level since 2000, as exports decline and imports increase amid the impacts of Brexit, the war in the Middle East, and US tariffs.

According to data from the Food and Drink Federation, reported by The Guardian on Friday, food and drink exports fell by 11.7% in the first half of this year to 4 billion kilograms, nearing levels seen during the peak of the COVID-19 pandemic.

Exports to the European Union dropped by 0.9% in value, while exports to non-EU markets fell by 6.9%. Sales in the Middle East were particularly affected, with exports to the UAE down by about a quarter. Meanwhile, a 10% US tariff led to a 16.5% decline in transatlantic sales.

In contrast, food and drink imports rose to 19.1 billion kilograms in the first half of the year, the second highest level on record. Imports from outside the EU have increased by more than a fifth since 2023, driven by relaxed restrictions through trade agreements, especially with Australia, whose exports to Britain rose by 25% in value over the year. The suspension of tariffs on some processed foods, such as chocolate and biscuits, also contributed.

The Food and Drink Federation noted that manufacturers are facing increasing pressures from rising costs of energy, ingredients, transport, packaging, and labor, in addition to regulatory changes.