Demand Up

Demand Up

In line with growing health awareness and changing demographics, demand for fruits and vegetables is expected to increase in the long term, according to Rabobank’s recently published “North American Food & Agribusiness Outlook.”

“With consumers increasingly preparing meals at home, overall produce sales are on the rise,” says Rabobank Food and Agribusiness Research and Advisory (FAR) assistant vice president Marieke de Rijke. “However, in the short term, much of the growth will depend on the economy, which may temporarily drop demand for fresh-cut fruits and vegetables in favor of cheaper alternatives, such as canned and frozen produce.”

Demographics And Convenience

The Outlook chapter, “U.S. Fruits and Vegetables — Developments in the Processed Segment,” focuses on processed fruits and vegetables. Currently, this segment continues to make up a significant share of total fruit and vegetable consumption in the U.S. It accounts for approximately 50% of total produce consumption, but shares between categories have shifted over the years. 

Some of that change occurs as the ethnic composition of U.S. consumers changes. As the U.S. population grows more ethnically diverse within the next few decades, the volume and type of fruits and vegetables consumed in the U.S. is expected to change.

Additionally, convenience continues to play a large role in fruit and vegetable demand — especially considering that the average time to prepare a meal has dropped from 49 minutes to 31 minutes over the last decade. During that same time period, the increase in the number of single-person and double-income households, in combination with the increased desire to have more spare time, has resulted in a 50% increase in convenience food purchases.

Health Perceptions 

Health concerns have also driven demand for fruits and vegetables as consumers look for healthier and more nutritious options for their diets. The fresh-cut segment has been able to profit as consumers believe fresh-cut is the healthiest format for processed fruits and vegetables. However, frozen produce contains just as many vitamins as fresh even if consumers perceive it differently. Consumption of canned vegetables and juices, on the other hand, is declining as they have a less healthy image.

Competition Concerns

Conversely, while there are a number of elements driving increased demand of fruits and vegetables, there is also competition from low-cost producing countries; significant cost increases pressuring margins; and new requirements for tracing produce.

Labor-intensive industries are increasingly facing competition from countries with low production costs. As a result, for some processed fruits and vegetables, the U.S. has seen an increase in imports. “Over the past decade, imports of frozen vegetables have increased more than 90%,” says de Rijke.

“In order to be competitive, the processed fruit and vegetable segment could focus on niche markets and market its products as ‘grown in the U.S.,’ which also fits with increased consumer interest for local products,” says de Rijke.

Increased Costs

Additionally, fruit and vegetable producers — like all producers — have been faced with increased costs. To mitigate these increases, fruit and vegetable growers and processors have started to focus on restructuring operations to gain efficiency and reduce costs. They have also looked at improving yields, but have not made significant gains to offset price increases to consumers.

While adding costs, de Rijke says, “Traceability systems could be an opportunity for the U.S. produce sector since a nationwide traceability system could be used as a marketing tool and may result in consumer preference for U.S. produce rather than imported produce for food safety reasons.”

Information for this story was provided by Rabobank.

Leave a Reply

Featured Stories
CitrusPMA Comments On FDA’s Proposed FSMA Implementation Work Plans
May 27, 2015
In written comments submitted today to the FDA proposed Food Safety Modernization Act (FSMA) implementation work plans (Focus on Implementation Read More
A view from a low-altitude helicopter shows avocado groves in south Miami-Dade County.
Disease ControlEyes In The Sky Provide Early Detection Of Destructive Avocado Disease
May 27, 2015
Study using multispectral photography helps scientists successfully scout out laurel wilt-affected trees. Read More
BerriesThree Promising New Berries From USDA
May 27, 2015
USDA breeding programs in Maryland and Oregon have introduced three promising berry cultivars that could work well for growers both East Read More
EquipmentThe Benefits Of Vineyard Mechanization
May 27, 2015
Labor accounts for a substantial fraction of the production costs of most fruits, including grapes. Manual harvest is particularly laborious, Read More
FruitsRegistration Is Open For 2015 International Fruit Tree Association’s Study Tour In Washington
May 26, 2015
Registration is now open for the International Fruit Tree Association’s (IFTA) 2015 Regional Study Tour. This registration includes hotel accommodations Read More
Stone FruitEarly Cherry Harvest In Pacific Northwest
May 26, 2015
Cherry harvest is off to an early start in the Pacific Northwest reports the Tri-City Herald thanks to a warmer-than-average Read More
FruitsCalifornia’s Delta Growers To Cut Water Use By 25%
May 26, 2015
The California State Water Resources Control Board have approved a proposal from riparian water right holders in the Sacramento-San Joaquin Read More
CitrusSenate OKs Trade Priorities And Accountability Act
May 26, 2015
Late on the evening of Friday, May 22, the U.S. Senate approved the Trade Priorities And Accountability Act (TPA) of Read More
Apples & PearsSolve Your Labor Problems From Within
May 26, 2015
Summer is here, which means harvest season is just around the corner. Hopefully you’ll have the crews you need this Read More
FruitsWater Conservation Grants Awarded In Pacific Northwest
May 26, 2015
The U.S. Bureau of Reclamation has awarded 17 Water Conservation Field Services Program (WCFSP) grants in the Pacific Northwest Region, Read More
The Latest
CitrusPMA Comments On FDA’s Proposed FSMA Implementation Work…
May 27, 2015
In written comments submitted today to the FDA proposed Food Safety Modernization Act (FSMA) implementation work plans (Focus on Implementation Read More
A view from a low-altitude helicopter shows avocado groves in south Miami-Dade County.
Disease ControlEyes In The Sky Provide Early Detection Of Destructive …
May 27, 2015
Study using multispectral photography helps scientists successfully scout out laurel wilt-affected trees. Read More
BerriesThree Promising New Berries From USDA
May 27, 2015
USDA breeding programs in Maryland and Oregon have introduced three promising berry cultivars that could work well for growers both East Read More
EquipmentThe Benefits Of Vineyard Mechanization
May 27, 2015
Labor accounts for a substantial fraction of the production costs of most fruits, including grapes. Manual harvest is particularly laborious, Read More
FruitsRegistration Is Open For 2015 International Fruit Tree …
May 26, 2015
Registration is now open for the International Fruit Tree Association’s (IFTA) 2015 Regional Study Tour. This registration includes hotel accommodations Read More
Stone FruitEarly Cherry Harvest In Pacific Northwest
May 26, 2015
Cherry harvest is off to an early start in the Pacific Northwest reports the Tri-City Herald thanks to a warmer-than-average Read More
FruitsCalifornia’s Delta Growers To Cut Water Use By 25%
May 26, 2015
The California State Water Resources Control Board have approved a proposal from riparian water right holders in the Sacramento-San Joaquin Read More
CitrusSenate OKs Trade Priorities And Accountability Act
May 26, 2015
Late on the evening of Friday, May 22, the U.S. Senate approved the Trade Priorities And Accountability Act (TPA) of Read More
Apples & PearsSolve Your Labor Problems From Within
May 26, 2015
Summer is here, which means harvest season is just around the corner. Hopefully you’ll have the crews you need this Read More
FruitsWater Conservation Grants Awarded In Pacific Northwest
May 26, 2015
The U.S. Bureau of Reclamation has awarded 17 Water Conservation Field Services Program (WCFSP) grants in the Pacific Northwest Region, Read More
Disease ControlPartnerships Key To Healthy Northwest Vines
May 26, 2015
Washington’s grape industry has seen accelerating growth over the past several decades. That momentum is owed, in part, to the Read More
Apples & PearsSounding Off On Record Purchase Of Apples
May 26, 2015
Recently USDA’s Agriculture Marketing Service announced the purchase of 34.9 million pounds of fresh apples and 16.1 million pounds of Read More
Disease ControlInland Desert Nursery Is Main Source For WashingtonR…
May 26, 2015
The Judkins family has been in the business of clean grapevines for more than 40 years. Today, their Inland Desert Read More
Operation Outdoor Freedom participants
CitrusFlorida Proud To Be Home Of The Brave [Opinion]
May 25, 2015
Operation Outdoor Freedom invites wounded service members and veterans of the U.S. military to enjoy recreational activities in state forests and on private lands. Read More
OrganicDavid Peri of Peri & Sons Receives Outstanding Agri…
May 22, 2015
David Peri, president of Peri & Sons Farms, has been named the 2015 Nevada Outstanding Agriculturalist Award by the University Read More
FruitsQ&A With Penn State’s New Young Grower Alliance Coo…
May 22, 2015
Erin Dugan recently joined Penn State University extension as a specialty crop innovations program manager and Young Grower Alliance coordinator. Read More
FruitsHow To Start A Young Grower Association
May 22, 2015
You have recently returned to your family’s business. You have friends and family you can tap for their knowledge and Read More
Tomato bug
Insect ControlStop Tomato Bugs From Sucking Your Crops Dry
May 21, 2015
Learn how to identify, the survival and spread, as well as management methods of this vegetable pest. Read More