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EU fruit & vegetable e-Commerce market study shows promising future for online sales

EU fruit & vegetable e-Commerce market study shows promising future for online sales

 

Freshfel Europe and the Scheme for the Application of International Standards for Fruit and Vegetables of the OECD have published the first  ever  extensive  study  on  fresh  produce  e-Commerce with  the title “Online  Sales  of  Fruit  and Vegetables in Europe”. The study explores the structure and regulatory challenges of selling fruit and vegetables online and analyses the format of existing web shops specialised in online sales of fruit and vegetables, their delivery model as well as compliance with the current EU regulatory framework for (online) marketing standards with multifaceted results.

While a big share of European fruits and vegetables online sales are conducted by online pure players and retailers with roughly 51% of all findings, surprisingly the study illustrated the growing share of agricultural suppliers with direct marketing to consumers. Freshfel’s Director Trade Policy and Business Development and co-author of the study, Nelli Hajdu remarks, that this study marks only the beginning of understanding  the  complexity  of this uprising outlet:  “The structure  of  the  online  landscape  is characterized by national shopping ‘traditions’ and trends, a challenge for creating a favourable regulatory environment. However, the impact of COVID-19 on market structure and consumer uptake is still to be examined in detail.”

Recently, online sales have become an important outlet for food products and the COVID-19 pandemic has accelerated this trend. As little was known about the online sales and distribution system of fruits and vegetables, Freshfel Europe teamed up with the OECD to explore the structure and size of the European online fruit and vegetable market as well as its compliance with existing regulatory requirements. To quantify the size of the market, seven sample EU Member States have been selected, to compare their organisational features (online-pure players/retailers, agricultural suppliers) as well as their distribution system (delivery vs. click-and-collect). The study also examined the verification of compliance with labelling requirements of Marketing Standard Regulation EU 543/2011.

For the first time ever the ground breaking study gave an accurate picture of the size and structure of EU e- Commerce suppliers. The study found that while the overall structure of online fruit and vegetable sales can be defined by its characteristic business format, either as an online-pure player, retailer or agricultural supplier, as well as by its distribution structure, this varies strongly at national level. For example, the German online fruit and vegetable market is mainly shaped by agricultural suppliers selling directly to consumers, while in Spain smaller local ‘Fruteria’ shops have gone online to expand their customer base. France stood out with a strong and established coverage of click-and-collect opportunities. Regarding market size, the online market shows a high range of fragmentation, however this doesn’t exceed 100 to 150 web shops per country, and is depending on the maturity of the market development at national level. Regarding the compliance with labelling requirements in the context of the Marketing Standard Regulation EU 543/2011, the rate highly diverged by operator and organisational structure.

While revealing promising signs for the future of online sales, this first study also revealed key questions, which  will  require  further investigation.  This includes  understanding  the characteristics  of  successful business models for  fruit  and vegetable online sales,  trustworthiness  and verification  of  information provided on websites and the overall uptake by consumers. These key areas for further investigation have become even more relevant as the Covid-19 pandemic continues to accelerate overall online food availability, especially fruit and vegetable sales, with urgent need for quantification. 

 

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Surinver offers fresh organic products and a convenience range

Surinver offers fresh organic products and a convenience range
Photo: Surinver

Surinver, an Alicante-based agricultural cooperative dedicated to the production and distribution of fruits and vegetables, is focused on increasing organic production this campaign, while also investing in the expansion of a factory for its convenience range and a new line of pumpkin production. The cooperative has over 400 members, 300 hectares of greenhouses and 1,600 total hectares of production of different vegetables, citrus and conventional and organic fruits. Surinver also has a range of conventional and organic convenience products, with some dedicated to the food service channel. Surinver’s organic assortment is registering very positive results, with an increase of 31% in turnover compared to last year. “For us, it is essential to guarantee the highest quality in the products we supply, as well as the best care in the field. For this, we have a quality system that guarantees products from the selection of the seed to the delivery of the product, passing through strict controls to ensure maximum quality and the efficient use of resources,” said Mª Dolores López Ruiz, of the department of marketing. Surinver’s facilities are located on an area of land of 103,000 m2, with an efficient air-conditioning system to reduce greenhouse gas emissions.

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Cold snap threatened Spain’s supplies and pushes up prices

Cold snap threatened Spain’s supplies and pushes up prices
Photo: Coexphal

The fruit and vegetable sector in Spain was struck by record minimum temperatures last week, with rain and snow falling incessantly throughout the week, which will compromise harvests. Production has fallen considerably and is affecting all products. Prices are high as there is no capacity to supply all the demand that exists, not even to meet most of the commercial agreements that the marketing companies had already closed.

The intense cold keeps the growth of plants and their fruits paralysed while also threatening to cause damage that could be irreparable at this point in the season. Farmers do not have enough volumes either in the field or in their warehouses to supply all orders.

According to the analysis carried out by Juan Carlos Pérez Mesa, professor of the department of economics and business at the University of Almería, “in percentage terms, the products that show the greatest increase are: aubergine, courgette and cucumber. These products have practically doubled in price in a week. The price of tomato grows almost 60%. The pepper is the product with the lowest increase (17%).”

The weekly monitoring data for tomato and cucumber available to COEXPHAL reflect that the rise in prices is due to a very significant drop in production. Pérez Mesa points out that in the case of tomatoes “the decrease during the first week of the year is 27% and the same figure will remain during the next week.” Similar is the behavior of cucumbers, whose volume could fall by 30% in week 2 of this year. In the case of courgette and aubergine, a similar behaviour is expected for the next few days.

The professor from the University of Almería recalls that “although the price increase is always good news, it is not so much when they exceed the threshold at which the customer decides to stop buying.” In addition, the significant drop in the number of kilos also compromises the profitability of farmers at a crucial time for the campaign. Everything indicates that this complicated situation will be extended in time as bad weather is forecast to continue.

Cold damage manifests in various ways, depending on the microclimate of the different production areas. In parts of the province furthest from the coast, such as Campohermoso and Berja, there have been nights with frost, reaching -4ºC at the end of December. There have been losses due to freezing in many farms, affecting 20% ​​of the plants. In some cases, with relatively young plants, the entire greenhouse has been lost.” In addition, he points out that “in Berja, the frosts have brought forward the end of pepper cultivation in many places”.

Jan van der Blom warns that “the cold causes the growth points to weaken, making it difficult to flower or set during a long season. Given this, many producers who had planned to carry out a long tomato campaign, are forced to cut the plants early to carry out a spring crop.”

 

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Philippines experience vegetable shortage 

Philippines experience vegetable shortage 
Photo: pia.gov.phz

The Philippine government has announced a shortfall in the country’s vegetable supply for this year. Despite Assistant Secretary for Strategic Communications Noel Reyes stating that there is enough vegetable supply in the country, his agency’s latest food supply outlook offered a different picture. Based on the DA’s 2021 supply and demand outlook for vegetables, the country’s projected local production of vegetables stood at 1.69 million tons. At the same time, the country is also expected to import vegetables of about 20,000 tons, which will boost the total supply up to 1.71 million tons.

The problem is that according to the same data, the projected annual demand stood at 2.01 million tons, which is based on the projected population of 110.19 million and a per capita consumption of 18.24 kilograms per year. Reyes said Agriculture Secretary William Dar had already ordered the DA’s regional offices to work with traders to make sure the supply is distributed efficiently in Metro Manila and other areas in the National Capital Region (NCR). There is also a move to build processing facilities and trading houses, as well as expand the agency’s urban agriculture programme, which will involve the distribution of free seeds and planting materials to barangays and schools across the country.

 

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Surge in demand for fresh produce in Spain in 2020

Spanish supermarkets gain market share during Covid-19 lockdown
Photo: Mercadona

Between January and November 2020, the volume of food purchases in Spain increased by 10% y-o-y to 31.5 million tons, while in value terms, the increase was 13% to €78.4 billion, as average prices increased by 2.7%, according to a study prepared by the Ministry of Agriculture, Fisheries and Food.

The purchase of fresh potatoes and vegetables by households increased by 13.7% and 11.1% respectively. In addition, onions, lettuce, endives, peppers and cabbages all saw growth in excess of 10%. Demand for fresh fruit was up 9%. Lemon purchases rose by 19.3%, while sales growth of over 10% was also recorded for apples, bananas, watermelon, grapes and kiwis, compared to the same period in 2019. 

 

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Spanish fruit and vegetables exports rise 8%

Spanish fruit and vegetables exports rise 8%

 

The value of Spanish fresh produce exports climbed 8% in the first eight months of 2020 compared to the same period in 2019, totalling €10.1 billion. However, in volume terms, they dropped 5% to 8.8 million tons, according to the latest data published by the Directorate General of Customs.

Fruit exports were up 11% in value compared to the same months in 2019, totalling €5.98 billion. Citrus fruit, the main export in this category, registered strong growth. Stone fruit export volumes were down, although they increased in value. Peach exports totalled 280,895 tons and were worth €348 million (+16.5%), while nectarine exports totalled 277,612 tons (-14%) and were worth €384 million (+20.5%). Strawberry exports fell both in volume and value terms by 3% to 279,568 tons (€563 million).

Vegetable exports grew by 4% in value compared to the same period in 2019, totalling €4,130 million. The main exported products were peppers €802 million (+4%), tomatoes €641 million (+0%), lettuces €468 million (-5%) , and cabbages €444 million (-11%). In volume terms, vegetable exports fell by 1.5% to 3.7 million tons.

Photo: Mercabarna

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Vegetables production and export from Russia, current results

Vegetables production and export from Russia, current results

By the end of October 2020, vegetables production in Russia totalled some 5.3 million tons or 6% more than by the end of October 2019, reported the Ministry of Agriculture. The crop of vegetables produced in hothouses amounted to 1.13 million tons, including 647,000 tons of cucumbers (+14.3%) and 410,000 tons of tomatoes (+18.6%). The leaders of the production of hothouses vegetables are the regions of Lipetsk, Moscow, Volgograd, Krasnodar, Novosibirsk and Kaluga.

Onion, tomatoes, cabbage and carrots are major vegetables grown in open fields. Their share in total production is 22.3%, 18.5%, 17.8% and 13.6 % respectively.
State-run assistance promotes the development of the sphere. The regions choose the priority targets themselves and obtain national investments. This, they can support local farmers.

Export of tomatoes would total 20,000 tons by the end of 2020, or 2,500 tons more than in 2019; export of cucumbers – 13,000 tons (comparing to 11,500 tons in 2019). Belorussia, Kazakhstan and Mongolia are major importers.

Source: https://mcx.gov.ru/press-service/news/proizvodstvo-ovoshchey-v-rossii-uvelichilos-na-6/

 

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Growth in demand for fresh produce slows

Growth in demand for fresh produce slows
© Eurofresh Distribution

 

Signs have appeared indicating a slowdown in the strong growth of consumption of fresh fruit and vegetables registered during the pandemic, according to the latest data published by Spain’s Ministry of Agriculture, Fisheries and Food. In June, the increase in consumption was 11%, but in July it was down to 4.5%, compared to the same months of 2019. This marks a significant drop from the  growth registered during the lockdown, with demand surging by 40% in April and 22% in May. 

Fresh fruit and vegetable consumption in Spanish households totalled 760.8 million kilos in June, 11% more than in the same month of 2019. The total comprised 428 million kilos of fruit (+8%), 247.2 million kilos of vegetables (+13%), and 85.6 million kilos of potatoes (+18%).
In July (when the lockdown ended), the total consumption was 784.3 million kilos, of which 451.7 million kilos were fruit (+5%), 242.3 million kilos vegetables (+3%) and 90.1 million kilos potatoes (+8%).

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Director of Proexport advocates diversification of production and markets to cope with Covid-19

Director of Proexport advocates diversification of production and markets to cope with Covid-19 - Fernando P. Gómez Molina, director of Proexport © Proexport
Fernando P. Gómez Molina, director of Proexport © Proexport

 

On Tuesday 13th October, director of Proexport, Fernando P. Gómez Molina, spoke at the PMA Fresh Summit (Produce Marketing Association), where, together with representatives from Chile and Hong-Kong, he analysed the impact of the pandemic on the European fruit and vegetable market. In his speech, Gómez addressed the situation facing the European fruit and vegetable sector and the characteristics that define the “new” consumer in light of the situation posed by Covid-19 and how fruit and vegetable companies must deal with this situation, innovating in their processes and adapting to new consumer demands.

“Fruit and vegetable suppliers must be prepared to keep costs low and productivity high, while we must defend the value of our product in a constantly innovating market,” Gómez said. In addition, a good strategy for the future would be “to diversify production at source and expand destination markets to reduce the risks of an unstable market.”

The PMA Fresh Summit session, Around the World in Fresh Products: An Update on International Challenges and Opportunities, addressed the impact on the global product market and ways to generate new opportunities or overcome barriers to business. Along with Gómez, Nicolás Moller Opazo, Vice President of Hortifrut (Chile) and Patrick Vizzone, Director of Food, Beverages and Agribusiness of ANZ Banking Group (Hong Kong) participated.

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Segura Food Bank distributes 257,600 meals in Murcia donated by School Fruit Programme

Segura Food Bank distributes 257,600 meals in Murcia donated by School Fruit Programme

 

Various charities in Spain’s Murcia Region are benefiting from the donations of fruit and vegetables. Part of the Programme of Consumption of Fruits and Vegetables in Schools of the Region of Murcia, the food is allocated by the Ministry of Water, Agriculture and Environment to the Segura Food Bank in response to the difficulties caused by Covid-19 for educational centres as 

In this project, which is funded by the European Union, the Government of Spain and the Region of Murcia and in which Proexport is an authorised distributor, a total of 422 schools and 92,055 Murcian students have participated during the 2019-2020 school year, 46% more of schoolchildren than in the previous edition.

Proexport is collaborating with the Food Bank in the distribution of vegetables throughout the month of September, through the weekly distribution of ready-to-eat plum and watermelon rations to entities that are in charge of caring for families with minors resources.

“Although the consequences of the pandemic have prevented us from reaching children directly with the fruit that we delivered to educational centres, we are grateful that the Ministry of Agriculture has decided to make this donation that, indirectly, will help those minors who, due to the situation economic of their families, they have more complicated the daily intake of these rations, they can also receive them,” said the head of the School Fruit Programme at Proexport, Natalia López Carrillo.

Some 20,000 kilos of fruit, distributed in more than 184,000 servings, have been delivered in September to entities such as Hermanitas de Caravaca and Yecla, Hospitalidad de Santa Teresa de Cartagena Foundation, Hospital de la Caridad de Cartagena, Asociación Un poco es mucho de Alhama from Murcia, Blessed Piedad de la Cruz de Alcantarilla and Jesús Abandonado de Murcia.

These amounts are added to those already donated during the month of March, when face-to-face classes were suspended and the State of Alarm was decreed. In total, the Segura Food Bank has distributed 31,443 kilos of fruits and vegetables, corresponding to 257,598 rations from the Murcia Region School Fruit Programme.

During the 2019-2020 school year, the distribution of 1,288,770 servings of various fruits and vegetables (apple, pear, banana, tomato, plum, apricot, nectarine, melon, orange, watermelon, celery and carrot) was expected, but due to the closure of schools due to the pandemic, only 515,705 rations could be distributed, so the Ministry of Agriculture opted to donate a substantial part of the products that could not be distributed to the Segura Food Bank.

Photo: Proexport