Export strength is food and drink to Scotland’s producers

By SCOTT REID
Published on 28/03/2012 09:33

Scotland has surpassed a target to grow its food and drink exports by a third, six years before schedule, thanks to a booming whisky industry.

Official figures yesterday showed that export sales reached an all-time high of £5.4 billion in 2011, a rise of almost a fifth on a year earlier.

Sales of Scotch soared 23 per cent to just over £4.2bn while fish and shellfish was the highest-value food sector, with exports up 4 per cent to £648.4 million.

Industry leaders hailed the food and drink sector as a “real bright spot in tough economic times” but said there was more to do to tap into fast-growing markets such as China.

Trade organisation Scotland Food and Drink set a ten-year target in 2007 to grow exports from £3.7bn to £5.1bn – a figure that has now been comfortably exceeded.

James Withers, the body’s chief executive, said: “Whisky has been a trailblazer. But our food sector is now following its lead with exports up a staggering 62 per cent in just four years, as our reputation as a land of food and drink grows.”

The top export markets for Scottish producers were France (up 18 per cent to £825m) and the US (up 30 per cent to £726m). Strong growth was also achieved in Asia, with 44 per cent increases in both Singapore (to £319m) and China (to £92m).

A raft of food and drink firms have reported healthy international sales, including Walkers Shortbread, soup and sauce maker Baxters, and Devro, which has seen strong demand from emerging markets for its sausage skin casings.

Anne MacColl, chief executive of Scottish Development International (SDI), said: “These figures further reinforce Scotland’s growing international reputation as a world leader in the manufacturing of premium quality food and drink products.

“It’s vital that Scottish food and drink companies broaden their horizons and take advantage of the changing patterns of international trade in order to realise their own growth potential.”

Withers added: “These figures are a real bright spot in tough economic times. But our export industry has much further still to go.

“From next month SDI and Scotland Food and Drink, working with industry, will have a joint dedicated resource on the ground in China to open up opportunities in the market there. That model will be rolled out in other key markets.”

A breakdown of the whisky data showed that exports to the US had broken through the £600m mark for the first time, recording a 31 per cent hike to £654.9m. France was the second-biggest market, enjoying growth of 27 per cent to £535.4m.

Direct exports to Singapore, which serves as a distribution hub for much of Asia, rose by 44 per cent to £317.9m.

The Scotch Whisky Association (SWA) said distillers were investing record amounts in production capacity. In the past four years, an estimated £1bn has been invested in new facilities. Gavin Hewitt, chief executive of the SWA, said: “Despite continuing economic uncertainty, Scotch whisky continues to meet increasing demand from all corners of the globe.

“It continues to appeal to consumers in countries such as the USA and France and is being enjoyed by younger professionals in newer markets in Asia and Latin America.”

He added: “Exports have increased for seven years running, contributing to delivering an export-led recovery: a focus for both the UK and Scottish governments.

“Securing fair market access and reducing tariffs is a priority for the industry.

“A free trade agreement (FTA) between the European Union and South Korea came into force in July. India is a priority for this year. We are hopeful an FTA can be signed which will lead to a reduction in the onerous 150 per cent import tariff.

“The industry in investing in Scotland to ensure it can seize these overseas opportunities.”

The SWA figures derive from HM Revenue & Customs data. They are based on individual company declarations of the export customs value and volume of shipments to each market.

Commenting on the wider food and drink export figures, rural affairs secretary Richard Lochhead said: “Scotland is rightly hailed as a land of food and drink, which is underpinned by the record exports achieved in 2011. This demonstrates that people around the world are appreciating the high quality and delicious products that Scotland’s larder has to offer.

“With exports increasing by more than a fifth, the whisky industry has seen hugely impressive year-on-year growth, while Scotland’s iconic seafood remains at the heart of our food exports offering. It’s also heartening to see a substantial sixty per cent boost in fruit and vegetable exports.

“Food and drink is a Scottish success story at a time when other industries have struggled and economic conditions have been tough. Therefore I congratulate our hard working producers and organisations who deliver such excellent and premium food and drink.”

He added: “Strong food exports to our key European partners have been backed by significant growth in the key US market. And new and emerging markets in Asia and the Middle East are also continuing to expand. The sky is the limit for Scottish food and drink and I’m we will continue to build on this success in 2012.”

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