Posts Tagged “Rabobank”
By Rabobank
Despite efforts by governments to promote the benefits of a healthy diet, consumption of fruit & vegetables in Western Europe and the US has declined over the past decade. A report by Rabobank cites lower incomes and perceived price increases, alongside strong competition from processed and convenience foods, as the major factors driving this trend. Producers, processors and retailers must all explore ways to inspire greater consumption of fruit & vegetables if the industry is to flourish.
Cindy van Rijswick, Rabobank analyst commented: “The challenge for the fruits & vegetables industry is to close the gap between what consumers say they want and what they actually do. Surveys have shown that, in principle, consumers are positive-minded about healthy eating, but in practice they are easily swayed by creative marketing of processed food and beverages and exhibit a strong bias for convenience products”.
On a household level there is a clear relationship between income and fruit & vegetable intake, meaning that in a tough economic climate, consumers become more susceptible to fluctuations in price. This impact can be exacerbated by the common misperception among consumers that unhealthy food is cheaper to eat than healthy food. Between 2006 and 2011, in both the EU and US, average consumer prices for fruits & vegetables in fact increased less than prices of the total food category, but consumption levels fell.
Processed foods have become a strong competitor for fruits & vegetables for different reasons: availability, taste, marketing, product range and convenience. Even when consumers do opt for a healthy choice, they will likely select processed foods in the ‘health and wellness category’ over a fresh option (despite the fact that research has found that two-thirds of US and half of all European products referencing fruit on their packaging contained no or only a trace amounts of fruit). It is extremely difficult for the fresh produce industry to match the sophisticated marketing efforts of processed health foods as most fresh products are sold unpackaged and unbranded.
There are three ways in which the industry must invest/evolve in order to boost consumption levels:
- Reducing inconvenience: Convenience is often cited as a barrier to consumption of fruits & vegetables, a claim that is supported by the increasing popularity of prepared (i.e. washed, cut, diced, sliced and packaged) products. The industry must continue to find innovative ways to boost convenience e.g. offering chopped vegetables that can be heated directly in the microwave without removing packaging
- Marketing based on more than health benefits: Most consumers are already aware that fruit & vegetables are good for them and governments are the best vehicle for promoting the benefits of a healthy diet. Therefore, the industry should focus on informing consumers about the convenience, taste, enjoyment and versatility of fruits & vegetables
- Better cooperation along the supply chain: keeping inferior quality products off the market is crucial to securing consumer buy-in. Short dedicated supply chains in which the brand owner is in control can enable partners to work together more closely to improve basic features, such as quality and freshness (e.g. by reducing the time to market or choosing the tastiest varieties)
Strawberries continue to be a favorite of consumers, as well as other berries ranging from raspberries to blueberries and blackberries. The popularity of each continues to increase. The fruit not only is tasty, but healthy.
The agricultural lending company Rabobank sees retail berry sales continuing to incrase by seven percent annually for the next three years.
Rabobank’s Food and Agribusiness Research and Advisory group recently released a report, titled “The U.S. Fresh Berry Boom — Who Will Profit from the Growth?”
No surprising is the report notes California will continue to be the leading producer of fresh berries for strawberries, blueberries, raspberries and blackberries. Sharpest gains in recent years have been with strawberries and blueberries.
California produces 88 percent of the country’s fresh strawberries and significant portions of fresh blueberries, raspberries and blackberries. Florida is also a significant producer of fresh berries.
During the fall and winter months strawberry and blueberry importes from Mexico and Chile compete directly with Florida’s season. Chile now accounts for over 50 percent of imported blueberries.
Consumers are now purchasing more berries that been grown south from British Columbia and continuing all the way south along the coast to Chile. This shift will continue following seasonal patterns, but also seeing increased volume in the more southern regions.
Over the past five years, California has shown tremendous growth in strawberry production the past five years. In 2008, the state produced 114 million cartons of strawberries, which grew to 181 million cartons in 2010. In 2011, volume actually slipped to 178 million cartons but this year, but in 2013, the total volume should be in the 190 million carton range.
The majority of those gains come from increased yields. California’s strawberry acreage totalled 36,519 acres in 2008, but was down to 37,732 acres this year.
It is a different story for blueberries. Worldwide statistics show total world acreage of blueberries has grown significantly over the years. It has quadrupled in the past 15 years and now sits near 200,000 acres with most of that being in North and South America. The Americas represent close to 80 percent of the world’s blueberry acreage and production.