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Strong US demand for fresh produce 

Strong US demand for fresh produce 
Photo: Eurofresh Distribution

January saw a 9.7% year-on-year rise in sales of produce, according to a report by the PMA, IRI and 210 Analytics. The figure excludes online-only and delivery e-commerce sales, which are well up on 2020 levels.

Joe Watson, VP of Membership and Engagement for the PMA, said: “Produce at retail had a strong January, driven by the two middle weeks ending January 17 and 24. We continue to see highly elevated sales results for vegetables, that are very much in line with the gains seen in the meat department — both pointing at more meals prepared at home. Retail fruit gains have been in the high single digits since the third quarter of 2020 and remain a big opportunity for more at-home snacking, breakfast and lunch.”

Fresh produce generated $6.3 billion in sales during the January weeks. This reflects $198 million in additional fruit sales and $383 million in additional vegetable sales. In fruit, berries remained a dominant force, as did citrus, with sales up 13.1% year-over-year, showing consumers’ consistent turn towards foods perceived to offer healthier lifestyles. Lemons and oranges were the fastest growers. Only grapes lost ground.

As for vegetables, there were double-digit gains for eight out of the 10 leading items.

 

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Demand for organic ginger skyrockets due to the pandemic

Demand for organic ginger skyrockets due to the pandemic

In 2020, Peruvian ginger reached export levels never recorded before. The healthy properties and nutritional benefits of ginger, added to the decrease in supply from China, the world’s leading producer, resulted in a great opportunity for Peru, whose campaign coincided with the expansion of the health crisis.

Matthew Seeley, CEO of Organic Produce Network, highlighted this during the presentation “Resiliency and Rebound” at the last PMA Fresh Summit, “the fact that people have stayed at home led them to try new products, as was the case with organic ginger, whose sales soared during the pandemic.”

“By the end of September this year, 30,000 tons of ginger had been exported nationwide, while the volume exported throughout 2019 was 23,000 tons,” said Kristel Camargo, manager of the Peruvian company Elisur Organic SAC, dedicated to the production and marketing of organic ginger and turmeric. “Internal demand in China has resulted in a notably lower supply for export, which has translated into higher prices in international markets. It is estimated that the closing of the campaign, which is usually at the end of March, will be brought forward to February and, in a very optimistic demand scenario, it could even end in January. Prices had been rising strongly since September, until a few weeks ago, when companies generated stocks in their warehouses to avoid having constant price variations. This caused the price to stop its abrupt increases, and even started a downward trend. At present, prices remain stable with a slight downward trend, however the few volumes that remain in the fields would generate a new change in prices as the season ends.”

Elisur Organic will reach 4,000 tons of organic ginger in 2021-2022

Since its inception in 2016, Elisur Organic has become one of the five largest ginger exporters nationwide, reaching markets such as Spain, Italy, Germany, the United Kingdom, the Netherlands, the United States and Canada. The projections are for further growth. For the 2020-2021 campaign, exports will reach 2,600 tons of fresh product, with expectations of about 4,000 tons in 2021-2022, from 200 hectares planted. Elisur Organic has a solid sustainability policy based on three pillars that reflects its attitude towards life and way of thinking. The first is the protection of nature. “Our activities are based on organic agriculture, on the proper and efficient use of resources, maintenance of fertility and recovery of the soils used, and the control of pests, diseases and weeds.” The second pillar is the development of people. “We trust in the talent of the people. We know that each professional has cultivated and learned specific skills in their area; which is why we are one of the few companies in this part of Peru that invests in trained and specialised personnel, health care and promotion of their personal and professional development.” All this effort is capitalised through the GRASP certification. The third pillar is economic growth. “Accessing foreign markets has helped us to increase the volume of production, improve the income margin, and have constant work throughout the year; all this has increased the jobs and improved the income conditions and quality of life of our partner farmers, having a positive impact on the economy of the central jungle of Peru.” Elisur Organic has been implementing the necessary conditions to certify as Fair Trade.

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Expedited supply chain demands lead to tomorrow´s standard processes

Expedited supply chain demands lead to tomorrow´s standard processes

                                                                                                                                                                                                    Press release

In any environment, managing fresh product supply is challenging. Today, that’s especially true. Regardless of any comprehensive planning you’ve done, supply shortages are bound to occur.

Because of this, many retail suppliers have established last minute supply chains to cover unexpected shortages. Unfortunately, volatility in demand pushes more and more volumes through these secondary channels. Channels that were not intended to handle such high demand. Across the board, we’re seeing expedited secondary supply chains become overwhelmed.

Adding suppliers and pairing faster shipping options can be the winning combination for retailers hoping to keep up with an environment that keeps throwing curve balls.

Plug into third party supply networks

Prior to 2020, consumer trends were already leading grocery retailers down the fast and next day delivery ecommerce path. In light of 2020 events, this shift to “always on” expedited supply chains has sped up exponentially.

As retailers rush to handle current needs, they should also focus on longer term, expedited supply chains. These expedited solutions, previously thought to be one-off situations, will likely become a part of regular strategies moving forward. In fact, it won’t be surprising to see these options become the heart of the supply chain.

By plugging into third party supply and distribution networks, retailers will be able to more successfully cover supply demands from both a volume and geographical perspective. This will also allow retailers to align supply networks with the growing need for these types of supplies. Your SKUs must be as close to the consumer as possible to execute at the point of sale.

Combine supply and service

Fast supply sourcing is only as good as having the means in which to deliver. Having the right supply in the wrong place is essentially having no supply at all. Fast, efficient shipping increases the return on investment of comprehensive supply networks.

Let’s look at a direct to store solution. Alone, this option doesn’t ensure supply is geographically aligned, which could slow down turnaround time. This is an unoptimized solution.
map-direct_to_store-robinson-fresh

The right supply in the right place with the wrong shipping option is another missed opportunity for fully expedited supply chain solutions.

map-the_right_supply-robinson-fresh

Now, a geographically aligned supply plus expedited shipping is the service combination that ensures an optimized approach so retailers can cover supply gaps and accommodate today’s consumer demand for fresh products.
map-geographically_aligned_supply-robinson-fresh

Robinson Fresh can help you develop these types of tailored, market-leading solutions, without sacrificing accuracy or efficiencies.

Secondary or expedited supply chains are needed long term

Even prior to the events of 2020, the demand for products requiring an expedited supply chain was increasing. Fresh cut produce, meal kits, and ready to eat products were driving the need for faster supply chains.

What were once considered fast supply chains will soon become the standard expectation, which will effectively shorten expedited shipping timelines even further. Consumers shopping in-store will expect supplies to be on shelves consistently and when not, their expectations for restocking will be hours versus days.

Volume surges may stabilize as COVID-19 passes, but consumer expectations will remain. Retailers who can utilize expedited supply chain models to instill long-term, organization-wide changes will be the best poised for growth and revenue generation in the future.

The meaning of successful supply chains is changing for retailers around the world. Navigating the changes and developing a balanced expedited strategy doesn’t have to be difficult if you work with a provider like Robinson Fresh that can reliably meet all of your fresh produce and cold chain logistics needs today and in the future. Connect with an expert today.

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In US, growth in organics outstrips growth in other food categories 

In US, growth in organics outstrips growth in other food categories 

 

Sales of organic products in the US reached $52.5 billion in 2018, up 6.3% from the previous year, according to the 2019 Organic Industry Survey by the OTA. Organic food sales increased 5.9% to $47.9 billion, outpacing total food sales growth at 2.3%.

Speaking to Foodbusinessnews, Angela Jagiello, director of education and insights at the OTA, said, “Shoppers consistently relate that they choose organic because they believe the product to be ‘better for me and my family’. In 2019, the Organic Trade Association led one of the largest-ever consumer research projects on behalf of organic. Shoppers told us that they value the fact that more than 700 chemicals are prohibited in organic, the strong standards and enforcement that underpin the USDA organic seal, and that they believe organic agricultural practices can play a role in mitigating climate change.”

Category trends

Fresh produce remains the largest organic category, representing more than 36% of all organic food sales, according to the OTA. In 2018, sales of organic fruits and vegetables increased 5.6% to $17.4 billion, while sales of all fruits and vegetables, including organic and conventional products, rose 1.7%. Organic fruits and vegetables comprise nearly 15% of all produce sold in the United States. Carrots, greens, apples and bananas remain popular picks in the organic section, while organic berries, mangos, papayas, avocados, Brussels sprouts and cauliflower are gaining steam.

“Millennials are the fastest-growing demographic of consumers who want what’s best not only for themselves but their families, too,” said Emmanuel Laroche, global marketing leader and vice president of marketing and consumer insights for Symrise. “So, when it comes to foods and beverages, organics are on the top of their grocery lists.”

Where is the organic market headed next? 

“Packaging may be a future frontier,” said Jagiello. “There’s a robust organic industry conversation about sustainable packaging. Industry members are working individually and collectively to press suppliers for more responsible, less plastic, alternatives. This will require education for shoppers, and for retailers, but will ultimately be positive for all. Organic will be the tip of the spear on this issue and will catalyse positive change throughout the food industry.”

 

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Gulf and Russia record rises in citrus imports

Gulf and Russia record rises in citrus imports

 

Taking the Gulf market as a whole, citrus consumption climbed steadily between 2012 and 2016 (from 1.6 million tons to 1.9 million tons), before dropping off slightly in 2017 (1.68 million tons). The main suppliers of fresh citrus to the Gulf in 2017 were Egypt (525,000 tons), South Africa (430,000 tons), Turkey (120,000 tons), Pakistan (110,000 tons), Lebanon (47,000 tons) and Spain (43,000 tons).

Russia’s fresh citrus market consisted of 3.9 million tons of fruit in 2017. The category is divided between oranges (37%), satsumas (30%), lemons (14%), clementines (12%) and grapefruit (7%). The country’s citrus imports climbed steadily between 2004 and 2013 (from 0.82 to 1.68 million tons), before falling off slightly. The major supplier of citrus to the Russian market is Turkey (38%), followed by Egypt (16%), Morocco (15%), South Africa (9%) and China (8%).

 

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Asia drives continued rise in global demand for pineapple

Worldwide demand for pineapples continued to increase between 2009 and 2016 and is the fastest growing fruit for the UK’s largest retailer, Tesco. According to market researcher IndexBox, the international wholesale market for the tropical fruit reached US$14.9 billion in 2016. Since 2009, the pineapple market has seen an average annual growth of 3.3%, although in 2017, this growth slowed somewhat. The growing demand, especially in Asia, means that the segment’s value is only likely to increase further, with the strongest consumption growth being seen in China, Indonesia, India, Vietnam and the Philippines. The same trend is likely to occur in Latin America as living standards rise across the continent with population increases and consumer trends shifting towards adopting more healthy lifestyles. There is also an increasing demand for canned pineapples worldwide, especially in the Philippines, Indonesia and China. The forecast for the coming years is for the segment’s growth to be 2.9% between 2016 and 2025, to reach volumes of 34.2 million tons.

Brazil is the world’s largest pineapple consumer, consuming 11% of the world’s supply, followed by the Philippines and Indonesia (8% each), India (7%); China (6%); Nigeria and Thailand (5% each); and Costa Rica and the US (4% each). Ghana recorded the fastest growth in pineapple demand between 2007 and 2016 (38.4%), followed by Angola (28.3%). the Dominican Republic (23.4%) and Costa Rica (22%). Highest annual per capita consumption was recorded in Costa Rica (242 kg), Angola (31.1 kg), the Philippines (21.2 kg) and Thailand (20.6 kg per year).

In line with the growth trend of the past nine years, global pineapple production rose to 26.9 million tons in 2016. The world’s biggest producer, Costa Rica, accounted for 12% of total production in 2016 (3.2 million tons), followed by Brazil and the Philippines (10% each), Indonesia (8%), India (7%), and China and Nigeria (6% each).

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Why China’s fruit supply outstrips demand

china merkets

Chinese producers are being encouraged to open up foreign markets to shift the excess of fruit production the country is seeing. Another cause of the imbalance is information asymmetry.
Most fruit producers in China are small-scale farmers, who sell their products to intermediaries. This leads to a time lag before information is fed back to producers, meaning they cannot respond to quickly to changing market conditions. Also, as fruit has a determined production cycle, wherein the period from planting to harvest can be as long as ten years, the paramount need for farmers to make decisions apprised of detailed information relating to market conditions is evident. It has been suggested that the Chinese Government and producers’ associations need to take the initiative in overall planning and be forward-looking.  

Another issue which Chinese farmers face is the competition from overseas production. Chinese consumers are increasingly demanding high-quality fruits now that they have tasted Australian mango, New Zealand cherries, and Canadian blueberries. Likewise, they demand higher levels of food safety, healthiness and taste. Therefore, it is clear that Chinese fruit production is going to have to develop both technically and commercially if it is to overcome the current lethargy in demand for its products.