Experts offer insights about what can be expected for produce in retail in 2021
The United Fresh Retail-Foodservice Board and Nielsen Fresh last week joined forces to host the FreshFacts on Retail Q4 2020/Year in Review 2020 Trends Discussion Webinar.
Discussion in the webinar centered on the retail price and sales trends in both the fourth quarter as well as 2020 as a whole. This was followed by a Q&A that offered some insight into what expectations are entering into 2021.
The event was moderated by Jeff Cady, director of produce and floral at Tops Friendly Markets with Mike Galaburda, client director at Nielsen Fresh as a speaker.
Retail for the fourth quarter of 2020 was reportedly very similar to Q3 in terms of dollar growth with value-added produce sales continuing to gain momentum and vegetables growing at a faster pace than fruit.
For 2020 as a whole, total fruit sales reach $33.7 billion with apples as the highest-selling fruit in dollar volume followed by grapes.
Vegetables meanwhile, had an excellent year with carrots being the only category that did not reach year over year growth. Bell peppers in particular reached over 20 percent growth. Total vegetable sales reached $35.8 billion.
Moving into the current year Galaburda stated “2021 is well underway now, but we’re still a ways off from business as usual. I know I’m certainly hoping for a continued positive trajectory for produce and hopefully a more normal 2021.”
However, he also predicted the trend for omnichannel shopping established in the past year would continue to be important. Even as restaurants begin to reopen in the spring and fall, 2020 is likely to have lasting effects.
“I think there’s going to be a duality,” said Galaburdy. “I think people are going to want to go back into the world and do some of the things that they’ve been missing out on for the last so there’s going to be a little bit of that catchup syndrome. But on the flip side of that, I think that a lot of people have seen personal cost savings from doing so much home shopping this year.”
“Although fingers crossed, we are nearing the end of the pandemic there may still be some economic ramifications for some time to come, and for those families that are continuing to look for ways to save, they may have found that home-cooking is a great way to do that.”
Organic produce is another trend that is expected to continue from 2020. Organics were one of the leading drivers of growth in 2020, rising by over 14 percent to sales of $8.6 billion. This thought to be because of healthier consumer preferences and buying habits.
Cady stated that more shelf space is likely to be allocated to organic produce. He expressed the opinion that people who typically buy conventional will start to buy more organic if they feel the cost is a good deal.
Additionally, he said the cost variance between conventional and organic produce is small enough that it’d better offer solely organic in some categories.
To this, Galaburda added, "The price gap between conventional and organic has been shrinking over time and I think what will happen is when consumers get to the shelf and they see both at parody in terms of price, they'll have to make a decision based on which item looks better, which smells better, and also rely on what they know about the benefits of organic."
However, he also stated that there is still some work to be done in terms of educating people on those benefits.