Yes, it’s time for good news, and it really is good: people are eating more fruits and vegetables. Even more than last year. As great as that is, what does it mean for food processors, especially those in fruit and vegetable? Well, it means the market is growing… yes, even in 2020. It also means it’s time to think of how you’re going to rise up to new opportunities.
US fruit and vegetable sale reports are in, and are up in year-over-year comparison. Not only are they up, they are across all three main categories (fresh market, frozen and shelf-stable [canned / jarred]). Even better, that trend continued even through the last week of August when compared to the same time last year… and last year included Labor Day in the US. Pandemic… normal week rather than comparable holiday… less gatherings… multiple severe weather events… all the things that for many industries are inhibitors. No matter, fruits and vegetables continue to power thorough, with consistent seasonal growth trends.
How much of an increase was it? Year-to-date, fresh market is up 10.9% and frozen is up a whopping 26.8%, led by vegetables. Amazingly, that frozen growth may be limited as purchase category share has shifted considerably. In March, when lockdown, consumers quickly shifted to shelf-stable, and modestly to frozen. Now, levels have returned to similar 2019 share levels, as the entire market lifts.
We mentioned opportunity – let’s dig into that.
You may be aware that while we work with processors across all fruit and vegetable categories, sweet corn is our specialty. Going into this year’s growing season, we talked to many processors in both the US and Europe who also maintain growing operations.
Several of them cited concern for where the market would go, and noted they were going to lessen acreage planted to mitigate risk. That market has been gobsmacked by the realization of opportunity cost.
While the final week in August was down vs 2019, that is largely attributed to the fact Labor Day in the US was late this year, a week later. This, therefore, isn’t a cob to cob comparison. In the extended view, dollar sales were up, and likely limited due to supply restraints.
Here’s where all of this good news becomes a consideration for next year:
You can see here that consumers still love their sweet corn and are going to eat it. When supply is back, how are you going to take advantage? Breaking into fresh market? Are you ready for the consumer trend / desire for wrapped tray packs and vacuum packed cut and husked cobs? Thinking of streamlining your frozen or canned lines? Considering the extension of your growing operation into the processing side?
We have ways to help you achieve your goals across all of these needs –
Several other fruits and vegetables highlighted growth vs 2019. Mushrooms have boomed, as have lettuce/leafy greens. For the latter, nearly 80% of purchases are in fresh-cut and packaged salad mixes, with growth in both volume and dollar gains. Peppers and cucumbers have as well, and we hope they’re being adequately washed, especially the crates used to transport them.
With growth anticipated to accelerate again next year, we have options to help.
Frozen fruit sales are still very high, as much as 30% above 2019. While that category grows, canned and jarred fruit dropped and canned growth was significantly less. We have several frozen berry options when you are ready to ramp up your production here.
With demand up this year, it is likely time to prepare for next year. However, what does your labor force and operational horizon look like? Are you ready to tackle increased processing? How confident are you in your ability to retain current staff, much less staff up? What are you going to do if demand is there, but workers are not?
We’d ready to help you plan for that, and plot your plan to growth and profitability.
Figures cited in this article were originally published in a September 10, 2020 article from the Produce Marketing Association (PMA).