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Divided berry market predicted

Wed 01/07/2020 by Richard Wilkinson
Divided berry market predicted, copyright. Mercados revista

The future of the berry sector was the focus of discussion at Mercados magazine’s Digital Berry Meeting. Agrifood consultant David del Pino made several predictions for the new reality that awaits us, but it will not contain the birth of a new world, rather a slowly growing appreciation for the work done by farmers. What is 100% certain, according to del Pino, is a deep economic crisis, which will accelerate the transformations that were underway and make individuals more selfish. This will lead to an increase in demand for healthy eating, which will favour the fruit and vegetable sector. Within this trend, there will be a further commitment to products with added value, and with rational, emotional, social and natural attributes.

However, del Pino foresees a divided market model similar to what some analysts had already pointed out at the beginning of the century. This implies a change in the behaviour of middle-class consumers, who will abandon the traditional consumption pyramid model. The middle class will disappear as a compact group and with a model of typical consumption behaviour.

“Now they have more access than ever to premium and affordable products as a result of the crisis, but they will stop valuing the basics, as they have easy access throughout the year, with standard quality. This forces the sector to sell commodities at lower prices and to turn to products of prestige that have a perception of luxury, but that are affordable for mass consumption,” said del Pino.

Retailers have experienced problems responding to the traditional middle class now it is divided into basic and premium. High-level chains and discounters tend to enjoy strong growth in crises, according to Del Pino. The latter have spent years with a hybrid strategy of offering basic products at very low prices alongside premium products, thus responding to the bipolar model.

“What we saw coming is happening; and the implications of this change are crucial for distribution and for producers because it forces them to choose one type of strategy or another, focused on commodity or hybrid. It is a trend that is already here,” said del Pino.

To conclude, del Pino advised caution and controlled liquidity, contracts, storage capacity, and many other factors to prepare for an unknown future.

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