Fresh With 2019 Data, Euromonitor Analyst Reveals Top Trends In The U.S. Fresh Produce Market At Global Trade Symposium
Jim Prevor’s Perishable Pundit, December 10, 2019
Sometimes what you need to succeed is just some good data. We were excited when Euromonitor told us they had some high quality data to share, so we asked Gill McShane, Contributing Editor for Pundit sister publication ProduceBusinessUK.com to get a “sneak preview” of the presentation:
Q: At this year’s Global Trade Symposium, you will present your analysis of U.S. fresh produce consumption within the larger context of the global fresh produce market, as well as provide key insights about the top trends and developments in fresh produce.
Can you give our readers a rundown of how your presentation will unfold?
A: Essentially, what I’m hoping to do is give the audience a global overview of the fresh produce market looking regionally at how different parts of the world are consuming fresh produce, which regions are consuming more or less, and the direction in which this is headed. Then I want to focus on the U.S., as that’s my personal focus area here at Euromonitor International. I will look at what fresh produce consumption looks like in the U.S. and where it is headed. Also, I will break that down into fruits, vegetables and starchy roots and how those categories are performing, and then even further in terms of which specific items are comprising those different categories.
One of the more interesting parts of the presentation will be diving into some of the key trends I’ve picked out in terms of fresh produce. The three trends are healthy living, convenience and sustainability. I chose them because I think they are pretty overarching in terms of overall fresh produce. I think there are some key, interesting points, and throughout the presentation I’ll be utilizing quite a lot of results from our consumer survey. It will be really telling to see some of the stats in terms of how consumers perceive health and fresh produce consumption.
Q: How recent is the analysis and data you’ll be presenting? Is there a specific report to which the data relates? Is Euromonitor the source for all data?
A: All of the data is very new. We research the fresh foods market on an annual basis, and this research was all done within the past few months. Something to keep in mind is that this presentation will include 2019 data, and, of course, that is based on partial-year projections. The data is all from Euromonitor International. It has been pulled from a variety of internal sources, including our fresh food system within Passport, which is Euromonitor’s syndicated research database. The data presented will be uploaded onto our online database very soon, which subscribers can access through ourwebsite.
Q: And the data refers to whole fresh produce, not canned, dried, frozen or juiced?
A: Yes. While we do track all types of shelf-stable and frozen fruits and vegetables, the data I will present refers to fresh, uncooked produce, including items like bananas, apples, potatoes, onions and tomatoes.
Q: So, how is fresh produce consumption in the U.S. performing within the larger context of the global fresh produce market?
A: Looking at the U.S. in the global context, you’ll find that we’re not above average in terms of per capita fresh produce consumption. I think quite a bit of that stems from the way we consume food. I think that oftentimes fruits and vegetables aren’t the base of many dishes, and certainly at-home cooking habits have an effect on that.
Also, if you look at disposable income, fruits and vegetables are often cheaper than other fresh foods like meat. So, in certain [global] regions where’s there’s less wealth, there’s often a higher consumption of produce because of the lower price point. In the U.S., compared with certain regions like Asia Pacific, where produce consumption is unusually high, there is more money being put toward more expensive packaged food options.
Q: Are these results what you expected?
A: It does make sense when you look at the numbers. If you look at consumption in Asia Pacific, the numbers are pretty staggering. On pure volume basis, you could be tempted to think that because Asia Pacific has a massive population, then, of course, fresh produce consumption will be high. But if you break it down to per capita, you realize that the average person there is consuming quite a bit more fresh produce than someone in the U.S. If you just look at grocery purchasing habits and cooking habits, then the numbers do make sense.
Q: So, what are the produce consumption habits in the U.S. at the moment?
A: In general, we’re seeing a mixed bag. On the one hand, you have the convenience trend. We are seeing consumers with busier lifestyles who often want to eat on-the-go, and consumers wanting to spend less time preparing meals. A lot of the time people want eating to fit in with their lifestyle, and they don’t want to have to adapt to eat healthily. At the same time, a lot of consumers realize that at-home preparation can be an easier way to eat healthily in comparison to eating out or snacking on packaged foods that maybe are more calorie-dense and less dense in nutrients.
Q: And, what is the current rate of fresh produce consumption in the U.S.?
A: Total per capita fresh produce consumption in the U.S. (2019) stands at 136kg (about 300 pounds) per person.
Q: Is that rate increasing or decreasing?
A: Currently in 2019 we’re projecting a bit of an increase in fresh produce consumption. But it’s pretty flat-lined, so I don’t want to call that super significant growth. In general, though, in our forecast, certainly we are expecting to see some increases. However, the growth of vegetarian diets sometimes gets overstated in terms of how much that will really lead to increased total consumption.
Q: What is your forecast?
A: All that I will share before the presentation is that it’s growing in the future; it’s going to be positive!
Q: How did you come to that conclusion?
A: There’s quite a bit that goes into our forecast. We look at historical trends, and we look ahead to take into account qualitative trends, and also socio-economic factors such as population growth, GDP growth, and what we expect disposable income to look like in the future. It’s based on a lot of metrics, and we try to make it very comprehensive.
Q: So, if produce consumption is projected to grow, what are the drivers or influencers?
A: We are expecting to see some growth as more consumers shift towards natural, healthy foods and especially away from some of the sugary, processed, packaged foods. Consumers are seeking out more natural, healthy and whole foods, and that’s going to be key.
Q: How does the U.S. forecast compare globally?
A: Actually, I would say the U.S. has a lower projected forecast for fresh produce than some of the other regions. I think consumption is pretty solid right now in the U.S. Certainly, there’s room for growth. I’ll discuss the shift toward natural products in my presentation, and the other trends that will certainly help the growth.
Q: Can you expand on these trends, and advise produce executives how they can help to drive the consumption and sales of fresh fruits and vegetables?
A: I wanted to keep the trends fairly overarching in my presentation. Convenience and health are important ones on which to focus. These are the trends that are going to be top-of-mind for end consumers. Fresh foods are often viewed as a commodity, whereas packaged foods are a bit more dynamic in terms of new product development; companies can do quite a bit more to alter their products to benefit consumer needs. But if fresh produce businesses can focus on these trends, they will have a better chance of playing to what consumers are looking for. That’s going to be key to maintain that growth through the forecast period.
Q: You mentioned that sustainability is another significant trend. What does sustainability mean to U.S. consumers?
A: When it comes to sustainability — and I don’t want to give away too much from the presentation — essentially we’re looking at plastic usage and the growth of local produce. With sustainability, definitely the health of the environment is going to be really key. Consumers want to have a positive environmental impact with their purchasing habits.
Q: Do any of these trends surprise you?
A: I’m not super surprised by them. We’re seeing these healthy living, convenience and sustainability trends, not just in fresh produce but within the entire food universe, across fresh food and packaged foods and even in the whole CPG [Consumer Packaged Goods] world. It’s nothing that should be super surprising to those who are familiar with consumer goods, but it’s really interesting to put them in the context of fruit and vegetables in terms of where the opportunities lie.
Q: What’s driving these trends of healthy living, convenience and sustainability?
A: I think part of it is changing lifestyles. People are changing. When it comes to sustainability people are more and more conscious of how their daily actions are impacting the environment. With healthy living, people are more aware, and – I think this is really key for fresh produce – people are more aware of how their diets impact their health. It’s no longer just about weight loss anymore. It’s about holistic health; it’s about what goes into your body and how that affects your general feeling of wellbeing and mental clarity.
Q: Going back to the current rate of consumption, how does performance break down by produce category?
A: Overall, we’re seeing a growth in the consumption of fruits and vegetables, and a decline for starchy roots (which includes regular potatoes, sweet potatoes, cassava and other root vegetables). There’s quite a bit of variety within fruits and vegetables, and consumers generally do consider fruits and vegetables to be quite healthy, while starchy roots have gained a somewhat negative reputation for their carbohydrate content.
I know sweet potatoes have gained a reputation based on their high concentration of vitamins and minerals, and they are showing some solid performance, but it’s definitely waning from what we saw 8-9 years ago. Certainly, potatoes are still an important part of the American diet but, in general, consumption is going down a bit with that carbohydrate avoidance.
Q: Does produce consumption vary by demographics and geography in the U.S.?
A: I do think so, yes. With fresh produce in the U.S., access to a grocery store in certain cases is not always a given for some people. I’ll talk about this when I discuss the trend of convenience. People often cite convenience as a reason for eating a less healthy diet because some people don’t always have the time to cook with fresh foods, or access to grocery stores, or access to high quality fresh foods at a low price point. I certainly think income is an important factor when you look at fresh produce consumption.
As for geography, we don’t have the data broken out for the different regions in the U.S. But I would imagine that certain areas with more fresh food distribution infrastructure will make it easier for consumers to access high quality fresh food in comparison to somewhere where grocery stores might be scarce. But even if access to a grocery store is scarce, fresh food could still be available in other less traditional grocery formats.
Q: Does your data indicate which fruits and vegetables are the highest and least consumed in the U.S.?
A: By volume, bananas are the largest [consumed] fruit, and onions are the largest in terms of vegetables.
Q: And where is the volume growth when it comes to consumption? Are there any specific products that are driving the consumption?
A: Something interesting that we are seeing in fruit is stronger growth for the more “snackable” fruits. That’s another thing that ties into the convenience trend. Oftentimes, consumers are on-the-go and they want something to help sustain them for even a few hours. A lot of the time, they want to turn to a more natural product, not necessarily a packaged, processed product. So, fruits like a banana are super easy to take on the go. Also, smaller fruit like berries and grapes are easy to take with you and grab as you go about your day. That’s a key area within fruit that follows the trend we’re discussing.
Q: Did you go as far as to look at the forms which US consumers are eating fruits and vegetables, e.g., are they consuming potatoes in the form of baked, mashed or fried?
A: We don’t have data on that. Essentially, we were tracking sales through retail, foodservice or the institutional channel. We don’t track what the end consumer does. Even in the case of foodservice, we’re tracking sales of potatoes to a restaurant but not what the restaurant does with those potatoes.
Q: On the basis of all your analysis, what are the key challenges and opportunities for the U.S. fresh produce market going forward?
A: In terms of challenges, the main one is how to drive growth in a market that by many consumers is viewed as a commodity market. It’s really easy to drive consumer interestwhen you’re dealing with real product innovation, but when you’re just looking at simple fresh produce, of course, there’s a spectrum of quality and the ways that it’s delivered, but the way to keep consumers engaged is really key.
That will lead to the opportunities. You are working with a product that is simple. By nature, it’s natural and fresh, and can’t be altered too much. I think the foundation is there because of healthy living being so important. Consumers want to be healthier. The key opportunity is to make that simpler for them. Looking at the inherent good qualities of produce is definitely going to be key.
Q: Finally, what are the key takeaways that you hope attendees will remember following your presentation? What do you want them to learn and apply in their businesses?
A: I’d say the key takeaways are that we’re expecting fresh produce sales to grow in the future. That should be key for the audience. And I really think that these trends I’ve picked out should be looked at as a focus area. I hope by discussing them in my presentation, it will provide a jumping-off point for further discussion.
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