More than half of Midlands exporters grew Q2 sales despite global tensions, according to UK Trade Barometer
• 51% of Midlands firms trading globally grew order books, down from 57% in Q1
• Across UK, 45% of exporters to US forecast growth in next quarter
• East Midlands the second strongest for firms entering new markets in Q2
• But Canada now the market most businesses expect to enter for first time
• Five EU countries now feature in top 10 most popular export markets
• Sales to China set to surge in next three months, according to pulse-check
• Survey of 2,000 firms shows growing North-South divide
British exporters weathered the global trade storm well in Q2, despite sales softening amid a climate of geopolitical tensions.
Latest findings from The UK Trade Barometer show 54% of exporters increased sales to existing markets between April and July. That was down from 63% in Q1.
The Barometer – from the UK’s largest airports group MAG and The Growing Together Alliance of business groups – surveys more than 2,000 businesses about their export performance over the past three months and their expectations for the quarter ahead. MAG owns East Midlands Airport which is the UK’s largest express air freight hub which recently reported a 17.4% growth in cargo volumes it handled over the last three months compared to May-July 2024.
The Barometer shows 35% broke into a new market in Q2, compared with 47% in Q1. Looking forward, one in five (20%) expect to enter a new market in the next three months, broadly flat against Q1 (21%).
In the Midlands, 51% of exporters increased sales to existing markets, down from 57% in Q1. The US was the most popular market, with 19% naming it as the territory they grew sales in.
Across the Midlands, 29% entered a new market in Q2, compared with 34% in Q1. America also topped that chart, followed by Ireland, Poland and China.
There were differences within the Midlands, though. East Midlands and West Midlands firms fared similarly, with 42% and 45% respectively growing sales to existing markets.
It was East Midlands firms that grew their global footprint the most, with 58% entering a new market for the first time. That compared with 46% in the West Midlands. Only the North West was higher, at 68%.
The other key findings from the pulse-check, conducted by YouGov, were:
Calming of transatlantic tensions bodes well
· One in four firms already trading in the US (25%) said they had increased sales there in the last three months
· 45% expect to increase exports to America in the next quarter, compared to 41% in Q1 – the joint biggest increase
· But there were huge variances by sector. America dropped dramatically in popularity with manufacturers, while IT and Telecoms sold strongly across the pond
Talking our language
· Canada (Q2: 13% vs Q1: 10%) has risen above the United States (Q2: 9% vs Q1: 13%) as the most cited destination for those expecting to grow their global footprint in Q3
· Australia has also risen up the new market ranks (Q2: 9% vs Q1: 6%), indicating the popularity of English-speaking countries among firms looking to diversify order books
Exporters had Euro-vision in second quarter
· Five EU countries feature in the top 10 markets exporters grew sales to in Q2 (Germany, France, Spain, Netherlands, Ireland, Belgium), compared with just three in Q1 (Germany, France, Spain).
· Five also feature in the list of markets firms expect to enter for the first time next quarter (France, Germany, Italy, Belgium, Spain) vs four in Q1 (Germany, France, Belgium Denmark)
Far East fillip
· There was a strong rise in businesses saying they expect to grow sales to China in the next three months (Q2: 14% vs Q1: 10%)
· The number of businesses saying they had grown sales to China as an existing market also grew (Q2: 8% vs Q1: 7%)
· The number of businesses entering China for the first time also rose (Q2: 6% vs Q1: 4%)
Mind the gap
· 63% of London businesses said they currently export and have increased sales in Q2. That compares with 51% in the North, 51% in the Midlands and 49% in the East of England.
· While 51% of businesses polled in the capital expect to increase sales to an existing market in Q3, less than a quarter do in the North (24%) and Midlands (23%)
If we can make here, we can take it….anywhere
· Just 44% of manufacturers increased sales to existing markets vs 55% in Q1
· The US remained top existing market but with only 16% of manufacturers vs 29% in Q1
· China rose to be the second biggest existing market (Q2: 13% vs Q1: 8%), followed by Australia, Germany and France
· The US plummeted down the table of new markets entered by manufacturers, going from top spot (20%) in Q1 to fifth (3%) in Q2
· China was the most popular new market (8%), despite not making the top five in Q1
Tariff-free trading serves us well
· More than three-quarters (77%) of IT and Telecoms first grew sales to existing markets and 62% entered a new market
· America retained top spot on both measures: 44% grew sales to the US as an existing market (vs Q1: 45%) and 34% entered America for the first time (vs Q1: 36%).
MAG is the UK’s largest group of airports, owning Manchester, London Stansted and East Midlands Airports. Around three-quarters of UK businesses are based within two hours of one of its airports.
CEO Ken O’Toole said: "Last week's GDP growth figures were met with cautious optimism and a commitment from government to drive productivity and broader economic performance ahead of the Autumn Budget. This global trade data - covering the same period - gives us a valuable indication of how likely we are to see that play out.
"That's because we know businesses that export are more innovative, competitive and productive. Towns and cities with more businesses trading globally have higher living standards. We also know that the sectors Government is prioritising through its Modern Industrial Strategy are inherently global - reflecting our status as an island trading nation with an economy built on exportable services.
"What this data tells us is that British exporters are navigating global trade turbulence well. More than half grew sales in Q2 and their order books reflect a healthy variety of markets.
"It also highlights a clear opportunity for Government to boost productivity nationwide – and close the gap between London and the regions - by working with business and local leaders to identify the interventions that will help more companies go global."
The Growing Together Alliance brings together business groups from across the UK regions, including the Northern Powerhouse Partnership. Cambridge Ahead and BusinessLDN, among others.
TABLES
Key findings:
UK businesses look-back (last three months):
| % of businesses | Top 10 Markets |
| 54% of exporters increased sales to existing markets | 1. US – 32% 2. Germany – 12% 3. Australia – 9% 4. Canada – 7% 5. France – 8% 6. China – 8% 7. United Arab Emirates – 4% 8. Netherlands – 4% 9. Spain – 3% 10. Ireland – 3% |
| 35% of exporters started trading in a new market | 1. US – 14% 2. Germany – 6% 3. China – 6% 4. Australia – 5% 5. Canada – 4% 6. France – 3% 7. United Arab Emirates – 2% 8. Belgium – 1% 9. Brazil – 1% 10. Japan – 1% |
UK businesses next three months:
| % of businesses | Top 10 markets |
| 27% of exporters plan to increase sales to existing markets | 1. US – 45% 2. Germany – 20% 3. Australia – 17% 4. Canada – 17% 5. France – 14% 6. China – 14% 7. United Arab Emirates – 9% 8. Spain – 8% 9. Italy – 7% 10. Netherlands – 6% |
| 20% of exporters plan to start trading in a new market | 1. Canada – 13% 2. Germany – 11% 3. Italy – 10% 4. France – 9% 5. United States – 9% 6. Australia – 9% 7. Ireland – 8% 8. Belgium – 7% 9. United Arab Emirates – 6% 10. Japan – 5% |
Northern businesses look-back (last three months):
| % of businesses | Top 10 Markets |
| 57% of exporters increased sales to existing markets | 1. US – 36% 2. Germany – 12% 3. Canada – 9% 4. France – 8% 5. Australia – 8% 6. Spain – 6% 7. Belgium – 6% 8. Switzerland – 5% 9. South Africa – 5% 10. China – 5% |
| 38% of exporters started trading in a new market | 1. US – 22% 2. Germany – 8% 3. Canada – 8% 4. Australia – 5% 5. Austria – 3% 6. France – 3% 7. Switzerland – 2% 8. Spain – 2% 9. China – 2% 10. Saudi Arabia – 2% |
Northern businesses next three months:
| % of businesses | Top 10 markets |
| 22% of exporters plan to increase sales to existing markets | 1. US – 60% 2. Canada – 24% 3. Germany – 18% 4. France – 16% 5. Australia – 16% 6. Switzerland – 12% 7. South Africa – 9% 8. United Arab Emirates – 8% 9. Belgium – 8% 10. New Zealand – 8% |
| 16% of exporters plan to start trading in a new market | 1. France – 19% 2. Belgium – 17% 3. Canada – 15% 4. Germany – 14% 5. Australia – 14% 6. China – 13% 7. US – 11% 8. Portugal – 7% 9. Poland – 7% 10. Egypt – 7% |
Midlands businesses look-back (last three months):
| % of businesses | Top 10 Markets |
| 51% of exporters increased sales to existing markets | 1. US – 19% 2. Canada – 8% 3. Germany – 8% 4. Ireland – 8% 5. Australia – 6% 6. United Arab Emirates – 5% 7. Netherlands – 5% 8. China – 4% 9. France – 4% 10. Greece – 4%
|
| 29% of exporters started trading in a new market | 1. US – 10% 2. Ireland – 3% 3. Poland – 3% 4. China – 2% 5. Denmark – 2% 6. Finland – 2% 7. Greece – 2% 8. India – 2% 9. Kenya – 2% 10. Netherlands – 2% |
· No forward-looking data for the Midlands due to lack sample size
London businesses look-back (last three months):
| % of businesses | Top 10 Markets |
| 63% of exporters increased sales to existing markets | 1. US – 28% 2. China – 16% 3. Germany – 15% 4. Australia – 12% 5. France – 11% 6. Canada – 10% 7. Japan – 5% 8. United Arab Emirates – 4% 9. Belgium – 4% 10. Singapore – 4% |
| 45% of exporters started trading in a new market | 1. US – 16% 2. China – 11% 3. Germany – 10% 4. Australia – 8% 5. Canada – 6% 6. France – 6% 7. United Arab Emirates – 3% 8. Japan – 2% 9. Belgium – 2% 10. Spain – 2% |
London businesses next three months:
| % of businesses | Top 10 markets |
| 51% of exporters plan to increase sales to existing markets | 1. US – 49% 2. Germany – 24% 3. China – 22% 4. France – 18% 5. Australia – 17% 6. Canada – 15% 7. United Arab Emirates – 9% 8. Japan – 7% 9. Spain – 6% 10. Italy – 6% |
| 37% of exporters plan to start trading in a new market | 1. Italy – 21% 2. Canada – 15% 3. Ireland – 15% 4. Germany – 11% 5. United Arab Emirates – 11% 6. Japan – 10% 7. Australia – 9% 8. France – 8% 9. US – 8% 10. Denmark – 6% |
East of England businesses look-back (last three months):
| % of businesses | Top 10 Markets |
| 49% of exporters increased sales to existing markets | 1. US – 23% 2. Germany – 8% 3. Australia – 8% 4. France – 6% 5. Benin – 4% 6. China – 4% 7. Argentina – 3% 8. Canada – 2% 9. Switzerland – 2% 10. Italy – 2% |
| 37% of exporters started trading in a new market | 1. US – 19% 2. Germany – 9% 3. Australia – 9% 4. France– 6% 5. China – 5% 6. Belgium– 4% 7. Switzerland – 3% 8. Argentina – 3% 9. Denmark – 3% 10. Nigeria - 3% |
· No forward-looking data for the East of England due to lack sample size