Sterling's slump has caused Britain's food and drink trade deficit to balloon, despite salmon and whisky sales helping exports touch a record high.
The Food & Drink Federation (FDF) said the Brexit-hit pound had ramped up the price of imported ingredients and materials, causing the trade gap to grow by 16% to minus £12.4 billion for the first half of the year.
On a positive note, strong overseas demand for whisky, salmon and beer has lifted exports by 8.5% to an all-time high of £10.2 billion for the period.
While the weakness of the UK currency has forced food producers to stomach increased costs, it has also helped drive international demand by making products cheaper on overseas markets.
Ian Wright, director general of the FDF, said the low level of the pound was a concern, but the expansion in the exports of food and alcoholic drinks was encouraging.
He said: "It is great to see such strong growth in our exports to EU Member States.
"The EU remains an essential market for UK exports as well as for supplies of key ingredients and raw materials used by our industry.
"We believe there are significant opportunities to grow our sector's exports further still.
"The continuing weakness of sterling is a concern.
"However, we hope that with the determination of businesses and the assistance of Government, we can open more channels and provide a further boost to the UK's competitiveness on the world market."
Export sales of branded food and non-alcoholic drink were leading the charge, climbing 11.3% for the first six months of the year.
The greatest export demand came from the European Union (EU), boosting its share of sales to 61.2% and outstripping the appetite from markets outside the 27-nation bloc.
It brings into sharp focus the importance of striking a free trade agreement with the EU following Brexit, with Britain set to crash out of the single market in 2019 and Tory ministers making zero headway on a new deal.
Britain's top three export markets were Ireland, France and the United States, the report said.
Food Minister George Eustice said: "These encouraging figures show that the UK's high quality foods and high standards are sought after around the world.
"Last week we announced further market access to China for pork producers and UK beef will soon be heading to the Philippines.
"We will continue to work with industry to open new opportunities."
Food sales remain a bright spot for UK retailers on home soil after inflation raced ahead of wage growth in response to the fall in the pound.
Retail sales came in ahead of expectations for July at 0.3%, with food sales picking up to 1.5% as all other areas, except household goods, recorded falls.
The Brexit-hit pound has also led to the demise supermarket salad provider Southern Salads, which called in the administrators on Wednesday and shed 260 jobs in response to the challenging market conditions caused by the currency.
David Williamson, of the Scotch Whisky Association, said: "As our biggest export by value, Scotch whisky continues to be a trailblazer for British food and drink, supporting jobs and investment across communities in Scotland and our wider UK supply chain.
"Looking ahead, we are working closely with government to ensure our Brexit priorities are delivered, including around our future trade relationship with the EU 27 and other export markets, frictionless customs rules, and an industrial strategy that supports whisky producers."
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereLast Updated:
Report this comment Cancel