What's Happening?
The UK food and drink sector experienced a rise in export volumes in 2025, despite the challenges posed by U.S. tariffs and post-Brexit trading adjustments. According to the Food and Drink Federation (FDF), UK exports increased by 6% in kilograms and 6.2%
in liters, marking a recovery in shipments. However, the FDF noted that export volumes remain significantly lower than pre-Brexit levels. The value of UK food and drink exports reached a record £25.6 billion, with Europe remaining the dominant trading partner. Exports to the EU increased by 6% in value, while exports to the U.S. saw a decline in the second half of 2025 due to a 10% levy. Despite these challenges, certain categories like dairy products showed strong performance, with milk and cream exports rising significantly.
Why It's Important?
The increase in UK food and drink exports, despite U.S. tariffs, highlights the resilience and adaptability of the sector in the face of international trade challenges. The tariffs have led to a decline in exports to the U.S., affecting categories such as infant formula. This situation underscores the broader impact of geopolitical tensions on global trade, particularly for industries reliant on international markets. The ongoing adjustments to post-Brexit trading conditions further complicate the landscape for UK exporters. The ability of the UK to navigate these challenges will have significant implications for its economic stability and trade relationships, particularly with major partners like the EU and the U.S.
What's Next?
The UK and the EU are in discussions to implement a new sanitary and phytosanitary agreement by mid-2027, which could potentially ease some of the trading frictions. Additionally, the UK is leveraging new trade agreements, such as the free trade agreement with India and its accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), to diversify its export markets. These developments could provide new opportunities for UK exporters to expand their reach and mitigate the impact of tariffs and other trade barriers. The sector will need to continue building relationships and preparing for scale-up in these new markets.
