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1.1: Gross Value Added of the UK agri-food sector, 2018
|Agriculture and Fishing||£10.6bn|
|Food and Drink Manufacturing||£29.0bn|
|Food and Drink Wholesaling||£14.4bn|
|Food and Drink Retailing||£30.1bn|
|Total Food Sector||£109.6bn|
|Total Agri-Food Sector||£120.2bn|
The agri-food sector contributed £120.2 billion or 9.4% to national Gross Value Added in 2018.
The GVA of the food sector (excluding agriculture and fishing) increased 4.4% in 2018, following a 4.3% increase in 2017. Wholesaling GVA increased by 12.1%, whilst manufacturing rose by 2.2% and catering rose by 3.5%. Retailing GVA rose by 4.2%.
Longer term, the food sector (excluding agriculture and fishing) increased by 41.6% between 2008 and 2018 while the whole economy increased by 41%. The food sector has less scope for growth as there is a limit to consumer intake capacity and therefore it relies largely on quality improvements.
Note that we have changed the basis for calculating the contribution to national Gross Value Added, from GVA of the wider economy, to GVA of the whole economy. This is the same calculation used in our Total Factor Productivity of the United Kingdom Food Chain publication.
1.2: Trends in the total factor productivity of the UK food sector
Total factor productivity of the UK food chain beyond the farmgate has risen by 0.9% between 2017 and 2018. Productivity in the wider economy rose by just 0.1%.
The TFP of the UK food sector is an indicator of the efficiency and competitiveness of the food industry within the UK. An increase in TFP indicates the industry is improving its competitiveness. In 2018, productivity in wholesaling saw the highest increase of 2.2%, while food catering rose by 0.3%.
The calculation is based on reliable data on business sales and costs, employment by industry and on price indices all collected by the Office for National Statistics.
1.3: Agri-food sector employees (GB), Q4 2019
|Q4 2019||million employees|
|Agriculture and Fishing||0.43|
|Food and Drink Manufacturing||0.41|
|Food and Drink Wholesaling||0.25|
|Food and Drink Retailing||1.11|
|Total food sector||3.62|
|Total agri-food sector||4.05|
The food sector1 in GB employed 3.6 million people in Q4 2019 (4.1 million if agriculture and fishing are included along with self-employed farmers), a 0.3% increase on a year earlier. It covered 12% of GB employment in Q4 2019 (13% if agriculture and fishing are included along with self-employed farmers).
Non-residential catering accounted for 51% of the post-farm gate food chain in Q4 2019. Employment in this sector increased 2.3% on a year earlier, equating to around 43,000 jobs. Retailing accounted for around one third of food chain jobs (excluding agriculture) in Q4 2019 and decreased by 2.5% from a year earlier, or around 28,000 jobs.
In Q4 2019, just over one half of food sector jobs were part time. Women accounted for 56% of employees in food retailing and 54% in non-residential catering.
1 ‘Food’ includes non-alcoholic drinks. ‘Drink’ is alcoholic drinks
1.4: UK food and drink manufacturing by product type
|Product||Number of SMEs in 2019|
|Meat and meat products||795|
|Fish and crustaceans||245|
|Fruit and vegetables||360|
|Oils and fats||40|
|Grain and starch products||110|
|Other food products||1,315|
|Prepared animal feeds||350|
|Product||GVA of sector in 2018 £ billion|
|Meat and meat products||4.1|
|Fish and crustaceans||0.5|
|Fruit and vegetables||2.2|
|Oils and fats||0.2|
|Grain and starch products||1.3|
|Other food products||6.3|
|Prepared animal feeds||1.6|
There were approximately 7,130 micro, small and medium sized enterprises (SMEs) in the food and drink sector with turnover of around £21 billion and 135,000 employees in 2019. In the food sector (excluding beverages) SMEs accounted for 79% of businesses, 27% of employment and 17% of turnover. Around a third of the SMEs are manufacturers of bakery products.
In terms of Gross Value Added2 (GVA), the ‘other food products’ category (SIC code 0108) was the largest manufacturing category with a value of £6.3 billion in 2018; contributing 22% to the total food and drink manufacturing GVA. This includes items such as prepared meals, confectionery, condiments and seasonings. Meat and meat products (SIC code 0101) had a GVA of £4.1 billion in 2018 contributing 14% to the total food and drink manufacturing GVA.
2 For disclosure reasons some small contributions (less than 4% overall) to food and drink manufacturing GVA have been treated as zeros.
1.5: UK grocery market shares 2018-19
|Retailer||% of market share|
|Shop not on list||5|
|Marks and Spencer||4|
The combined market share of food and non-alcoholic drinks of the largest four food and drink retailers was 51% in 2018-19, up from 50% in 2017-18. Tesco commanded the largest market share at 19.6%, down from 20.5% in 2017-18. The three largest discounters (Aldi, Iceland and Lidl) had a combined market share of 17.4%, up from 7% in 2011. Internet food shopping, which includes the largest supermarkets, represented 6 % of sales of food and non-alcoholic drinks, a slight fall on the previous three years.
Data comes from the Living Costs and Food Survey which is fully representative of UK household food shopping.
Alternative market share estimates from the Kantar Worldpanel 3 are more up to date although not restricted to foods and not as representative.
3 Kantar Worldpanel is a market research company, providing up to date statistics on sales by the grocery sector. Market shares also include sales of non-food.
1.6: UK Consumer expenditure on food, drink and catering
Total consumer expenditure on food, drink4 and catering has continued to rise, by 2.5% in 2019 to £234 billion. Expenditure on food (including non-alcoholic drinks) increased by 2.1%, alcoholic drinks by 2.5% and catering by 3.1%.
Spend on food shopping has increased 37% since 2010. In 2019 it accounted for 46% of spend in the sector. Spend on catering accounted for 29% of sector spend in 2019 and has increased by 37% since 2010.
Spend on all alcoholic drinks accounted for 26% of sector spend in 2019. It has increased by 44% since 2010. Spend reduced between 2008 and 2009, but has increased yearly thereafter.
Source: Consumer Trends, (ONS).
4 Food’ includes non-alcoholic drinks. ‘Drink’ is alcoholic drinks
1.7: Volume of total food and drink purchased by consumers in 2020, and year-on-year percentage change
Notes: Data for Great Britain, Northern Ireland not included.
Immediately prior to the implementation of a nationwide lockdown (week ending 22 March 2020), the volume of food purchased by consumers peaked at 1.07 billion kilograms/litres/packs.
This accounted for a 44% year-on-year increase in purchased volume of food from the same week in 2019.
Spend on groceries hit record peaks in March and then retailers recorded one of the sharpest historical falls in consumer food spending (week ending 29/03/2020).
This could have been for a number of reasons including;
- Limited stock availability for some product categories
- Introduction of social distancing measures (23 March 2020) and reduced shop visits
Source: Kantar FMCG
1.8: Volume of total food and drink purchased by consumers per trip, and number of trips per household in 2020
Notes: Data for Great Britain, Northern Ireland not included.
Consumer purchasing activity began to change week ending 15 March 2020 with the number of trips per household rapidly increasing, and the purchased volume per trip beginning to decrease. In the week prior to the implementation of the lockdown (week ending 22 March 2020), trips per household peaked at an average of 6.73 trips (an increase of 31% from the previous week), while the volume of total food and drink purchased by consumers fell by 11% from the previous week to an average of 5.71 kilograms/litres/packs per trip.
Since the start of the lockdown (week ending 29 March 2020) to the most current week (week ending 12 July 2020), there has been a significant drop in number of shopping trips compared to the previous year.
The decline in the number of trips could be for a variety of reasons, including;
- Lockdown: After the Prime Ministers announcement on 23 March to restrict movement and enforce a ‘stay at home’ period to prevent the spread of the virus, people may have purposefully decreased the amount of time spent outside the home in order to reduce the risk of contracting the virus.
- Shielding: Vulnerable groups including those with existing health conditions, pregnant or over 70 were told that they should take extra safety precautions and stay at home.
Source: Kantar FMCG
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