A tale of two interpretations in latest food and drink figures

Comment Martin Flanagan

It’s all how you look at things. It’s welcome news that the value of exports from the UK’S key food and drinks sector touched an all-time high of £10.2 billion in the first six months of this year.

And nice for Scotland that the top three export products included Scotch whisky and a storming performance from salmon – the latter up 53 per cent in exports value to more than £400 million, and also 24 per cent in volume. But the Food and Drink Federation (FDF) has had to admit that the fall in the value of the pound since last year’s Brexit vote may have helped the UK’S export competitiveness, but it has also driven up the cost for our food and drink manufacturers of imported ingredients and raw materials.

The result is that our food and drink trade deficit, the overarching picture of the sector’s economic wellbeing, jumped 16 per cent to minus £12.4bn in the period. Not so good.

Trade figures will become more interesting and germane as time goes on because at the heart of the Brexit debate is how well Britain will be able to make up on the global roundabouts what it loses on the EU withdrawal swings when we seek a new trading path with the rest of the world.

The FDF’S latest report shows that exports to the EU27 grew at a faster clip than to non-eu markets, increasing the share of sales to the EU to more than 60 per cent. The Brexit camp may say that is evidence the single trading bloc needs and wants us in terms of goods as much as we need and want them.

But the Remainers could also use the latest figures as ammunition for their argument of what we are putting at risk in export terms by leaving the single market, the single biggest one for our goods.

What cannot be denied is that the weakness of the pound has been very much a double-edged sword.