Released at the end of last year, the Office of National Statistics has published the 2017 update to consumer food trends, giving some interesting reading for farmers.
For the first time in recent years, food prices started to rise in real terms in 2017, meaning that food price increases have exceeded the rate of inflation, with this increase being attributed to increases in the price of agricultural commodities and oil prices. Inflation appears to have hit across the board, with all baskets of food increasing, whatever the level of spend of the consumer.
Interestingly for farmers, with the cost of the back British farming campaigns constantly coming under scrutiny; of the consumers surveyed in 2016, 77% felt it was important to support British farmers, but only 45% felt that British food tasted better and 41% were prepared to pay more for British food. With 48% of those surveyed at least checking labels to see the origin of their food and 60% stating that they try to buy British when they can, it does at least appear that the campaigns are bringing the origin of food into consciousness.
In terms of the more specific product differentiation increasingly used to create a unique selling point for produce, fair trade and rainforest alliance products seem to be profiting while the organic tag does not seem to have been able to increase its level of spend over the last five years. There has however been more success in marketing with labels such as free range and sustainable; freedom foods sales alone increased by 29% in 2015.
When it comes to Brexit negotiations the statistics are mixed, giving few clues as to what would constitute successful negotiations. 49% of food consumed in the UK in 2016 was deemed to be of UK origin, with 30% from the EU, however the value of food imports was in excess of exports for all categories of food. Beverages were the exception due to exports of Scotch Whisky far exceeding the value of any imports. Within the top ten foods exported in 2017, Whisky was the number one, beer number four, with beef and pork at seven and eight respectively.
In 2017 the top three markets for UK food exports were Ireland, the USA and France; China and Hong Kong being the only other countries outside the EU to also feature in the top ten. Interestingly the five fastest growing export markets in the year were the Philippines, Latvia, Iceland, South Korea and Romania – of the top 20, 12 are countries outside of the EU, perhaps a reflection of the Brexit uncertainty.