Budget requests: Boost export and R&D funding

Extra funding was needed to prepare existing food and drink exporters, and firms planning overseas sales, for life after Brexit. It also needed funding for its pilot ‘Food and Drink Export Academy’ – a training scheme for exporters, also run by the Food and Drink Exporters Association, it said. It also called for incentives to encourage companies to base R&D facilities in the UK, to boost the UK’s innovation reputation.

‘Severe pressures’​

In an open letter to the chancellor, FDF director general Ian Wright said: “Brexit will have a profound impact on the entire agri-food sector and on manufacturers in particular.​ Our members are already experiencing severe pressures from increased instability and rising input prices, affecting raw commodities and packaging.​

“The current value of sterling does offer opportunity for companies to export more, and we urge government to use this Budget to boost its support for current and would-be exporters so UK firms can take advantage of increased global opportunities.”​

The calls for funding came after an FDF survey revealed 41% of food and drink manufacturers were less confident about the UK’s business environment, compared with the organisation’s last survey in October. Ninety per cent of manufacturers’ ingredients and raw materials had increased in price since October, and 65% saw their product margins become tighter.

‘Already tight margins being squeezed still further’​

Wright said: “Almost half of our members are less confident in the prospects for business than they were four months ago. That is driven by ingredient price rises and from already tight margins being squeezed still further as competition continues to rage between the supermarkets.​

“But it’s a mixed picture. Nearly two thirds of members expect to see sales in the UK grow over the coming months. The same number see sales outside the EU growing too. We also know around half of our members expect sales within the EU to grow, so they’re optimistic about their future while worrying about the trading environment.”​

Meanwhile, the Freight Transport Association urged Hammond to avoid “ditching diesel”​​ in his Budget.