The United Kingdom (U.K.) holds the position of the fifth-largest importer of agricultural products globally by value. Consisting of England, Northern Ireland, Scotland, and Wales, the U.K. heavily relies on imports to meet the demands of its population, with agricultural production contributing less than 1 percent to its total economic value.
In 2022, the U.K. imported $92.1 billion in agricultural and related goods, exporting $34.8 billion. The majority of these imports include high-value consumer products, such as distilled spirits, dairy products, and processed foods. Climate change has spurred demand for new agricultural-related products, with the United States emerging as a significant supplier of wood pellets to replace coal.
Despite the U.K.’s departure from the European Union (EU) in 2020 (Brexit), strong trade ties with the EU persist, constituting over 70 percent of the U.K.’s agricultural imports. The post-Brexit era has seen the U.K. diversifying its sources of agricultural imports, with notable growth from China, the United States, and Brazil in biofuels, agricultural commodities, and consumer products.
The United States has played a crucial role in the U.K.’s import market, doubling the value of agricultural and related products from $1.19 billion in 1990 to $3.01 billion in 2022. The U.S. is a significant supplier of forest products, fuel ethanol, and various commodities like beer, wine, spirits, nuts, and soybeans.
Wood products, especially wood pellets and lumber, constitute a substantial portion of U.S. agricultural exports to the U.K. The U.S. is a major contributor to the U.K.’s transition to biomass, with wood pellets replacing coal in many power stations to meet greenhouse gas reduction targets.
In terms of exports, the U.K. has seen growth in trade with the EU, China, Singapore, and Australia, while exports to the United States have decreased, except for alcoholic beverages. The U.K. remains a top supplier of high-end single-origin spirits to the U.S., despite a declining market share.
Trade agreements have been underway between the U.S. and the U.K., covering specific products such as livestock commodities. The U.S. has reapproved U.K. beef and lamb exports, and the removal of restrictions is expected to boost trade.
In the post-Brexit landscape, the U.K.’s agriculture and food trade may shift towards areas of comparative advantage and cater to consumer demand for high-value specialty products. The U.S. sees opportunities for partnerships and expanded trade, especially in the wood products sector, driven by shared language, affordability, quality, familiarity, and established trade history. However, uncertainties persist regarding the U.K. economy, ongoing negotiations, and the future U.S.-U.K. trading relationship. (GT)
