E-commerce in food making inroads in Europe
PwC’s Global Consumer Insights Survey 2020, “The consumer transformed”, reports that food e-commerce has made a significant breakthrough in Europe during the downturn, with a 10% increase from pre-crisis levels. Online shopping has even become the preferred channel for 28% of Europeans living in urban areas. Read the report here.
Convenience shops take up the challenge of online sales
In Scotland during the health crisis, online sales of ready-to-use products accounted for 50% of total market share, and this growth appears to be continuing (FPC Fresh Talk Daily, 21 July) due to the advantages offered by home delivery for this type of product during the containment period. 54% of shoppers indicated that they would be willing to order from their convenience shop. Due to its ability to act quickly, the convenience shop sector is always in the best position to respond to market conditions. The market is expected to grow by 8% in 2020, thanks to increased volumes and sales throughout the containment period. There is growing demand for frozen, chilled, fresh and do-it-yourself bakery products.
One-third of Britons make more online purchases now than during lockdown
According to a survey of more than 2,000 UK adults by software provider Scurri and market researcher YouGov, the strong growth of online shopping in the UK during the period of containment is continuing (FPC Fresh Talk Daily, 6 August). 71% of UK consumers received between one and three online shopping orders delivered to their homes each week, while 12% received between four and six parcels per week during the containment period. 66% still report receiving between one and three online shopping orders per week, while 9% still receive between four and six parcels to their home. Currently, shoppers in Wales remain loyal to online shopping, with 39% more purchases than during the containment period, compared to 27% in Northern Ireland, 32% in England and 36% in Scotland.
Shift to online drives growth of UK food and grocery market in 2020
The UK grocery and food market is set to grow by 10% to £211 billion between 2019 and 2022, according to the latest market and channel forecast research from IGD (Fresh Fruit Portal, 21 August). The new report reveals the impact of Covid-19 on the overall market over the next three years, with a breakdown of expected implications and performance on individual channels. The online segment is expected to grow at a huge 59%, equivalent to £7 billion, with the category’s share of total sales rising from 6.2% in 2019 to 8.9% in 2022. Online will be the fastest-growing channel in 2020. The discount segment is forecast to rise by 25%, or £6.3 billion, and is expected to overtake online to be the fastest-growing channel in 2021 and 2022. The discount market share will increase from 12.8% in 2019 to 14.6% in 2022. The convenience channel is to grow by 13%, or £5.4 billion, increasing its share modestly from 21.4% to 22%. The channel benefited significantly from meeting local shoppers’ needs during lockdown.
Bain study: coronavirus is exploding online commerce
According to a study “How to ramp up online grocery-without breaking the bank” by management consulting firm Bain & Company, since the health crisis more and more consumers around the world are buying their food online (Fruchthandel, 3 September). In Germany, France, UK, Italy and USA, 350 million more online orders for food products are expected in 2020 compared to 2019. By mid-April 2020, the market share of food purchased online in the UK had increased to 12.4% (from 8.1% in 2019), in France from 6 to 10.2%, in the USA from 5.1 to 6.6%, and in Italy from 2 to 4.3%. In Germany, the level is lower but growing from 1.5% to 2.9%,
Global Consumer Insights study: the health crisis has turned consumer behaviour upside down
PwC consultancy Global Consumer Insights conducted an online survey in nine countries and 35 cities between April and May 2020 on consumer trends and behaviours during lockdown (PwC France, 31 July). The results show that many consumers (86%) want to continue shopping for food online even after the removal of physical distancing measures. The use of mobile phones (45% compared to 30% before the crisis) and computers (41% compared to 28% before the crisis) for non-food purchases has increased since the beginning of the crisis. A majority of consumers (69%) are more interested than before in their health and well-being. And 43% of respondents expect companies to report on their environmental impact.
Time for food e-commerce
Based on figures from Nielsen, Fevad, the Federation of e-commerce and distance selling, has announced record food sales in France and elsewhere during the confinement, and the trend could continue (Végétable, 30 July 2020). This phenomenon has been seen worldwide, beginning in China at the start of the year with a sharp drop in sales in physical shops and a powerful e-commerce dynamic. The explosion of online food sales followed in Europe (Spain, Italy, France) from the end of February, and the trend does not seem to be waning. In France, the growth in online sales remained higher than offline sales throughout the panic buying period (weeks 9 to 11), when the French were anticipating confinement and feared shortages. Online sales continued on an exceptional trajectory during the eight weeks of confinement. While e-commerce accounted for 5.7% of sales in 2019, it was able to exceed 10 points of market share on the mass market during this period. This progress seems to be resisting deconfinement, at least for the time being, with online sales up 66% compared with 2019 in the week following 11 May 2020.
Views on new consumer profiles
The global Covid-19 pandemic has brought much uncertainty to the fresh produce sector (Fresh Times, August). So far weathering well, many questions remain about how the fresh fruit and vegetable sector will fair in the next stage of the pandemic and in the post-Covid-19 era. BASF Vegetable Seeds has organised a series of interviews with experts to help actors along the supply chain understand what the future holds for them to enable better planning and decision making. Four interviews have been carried out covering retail, the hospitality sector, the economy in general, and the new consumer profile and market trends. [In Spanish]
CO2 Correct: New initiative simplifies carbon offsetting
A new initiative has just been launched by consultant Stephan Schneider to make it easier and cheaper for companies in the fruit and vegetable sector to offset CO2 emissions (Fruchthandel, 9 September). To do so, a company becomes a member of the CO2 Correct platform (www.co2corrrect.com) and fills in a table indicating the products it wishes to offset. A few days later, the system will indicate a compensation price per kilogram – usually only a few cents per kilogram, depending on the country of origin and final destination. “Fruit and vegetable products can then be sold with a corresponding label,” explains Stephan Schneider.
European fruit growers prepare for difficult harvest
In August many European producers feared a resurgence of Covid-19 resulting in localised border closures and the risk of no access for seasonal workers (FPC Fresh Talk Daily, 3 August). Added to this is the difficulty of enforcing physical distance on farms for some specific activities, which has resulted in the creation of clusters. The use of local workers differs from one country and farm to another. In Portugal, berry farms turned to thousands of migrant workers from South Asia, who were already in the country and had lost jobs in tourism during the closure. Local workers who have resumed their former jobs outside agriculture will not be available for the apple harvest in September. Even though producers can find local replacements, some complain that they are not as productive, resulting in higher costs. And European producers face an additional challenge in the weather. Heavy rains and hailstones have damaged some crops this year in Spain, the EU’s largest fruit exporter. According to APEOEXPA, an association of fruit producers and exporters in the region of Murcia (south-eastern Spain), local production has fallen by 20% due to the bad weather. Good levels of consumption and prices have compensated for this loss of volume.
Large regional differences in international vegetable consumption
A recent study in scientific journal “Nutrients” looked at vegetable consumption in many countries around the world, which for 88% of the countries included in the study remains well below the 240 g per day recommended by the World Health Organization (Fruchthandel, 17 August). The researchers noted vegetable consumption in 162 countries and vegetable availability in 136 countries. The results show that 186 g of vegetables are consumed on average per day, but there are important regional differences, for example 349 g (Far East) versus 56 g (Central America). The study also mentions that the average availability of vegetables per person is higher than the recommended amount of 431 g per day, but with a great disparity between countries, for example in Melanesia (71 g/day) versus the Far East (882 g/day). The study notes that 61% of the countries did not have sufficient availability of vegetables for their population.
Covid-19 highlights the value of locally produced food
The Covid-19 pandemic has highlighted the value of locally-sourced produce and sustainable food systems in the UK, according to industry experts (FPC Fresh Talk Daily, 20 August). Recent reports show that food transparency, local sourcing and “immunity” eating are key drivers for consumer purchasing decisions. Consumers have highlighted food transparency, local sourcing, and healthy food with minimal environmental impact as key factors in their purchasing decisions. 75% of consumers want to know more about the safety of the food they eat, and 51% want to understand the food they eat better. In addition, 48% of consumers are willing to pay more for local food and brands that highlight local provenance and supply chains. In March, analysis and research company GlobalData reported that 45% of consumers are actively buying products that are better for the environment. 50% of consumers are seeking to consume more responsibly. A new trend seems to be emerging: the “immune consumer”, who is looking for foods that offer benefits for their immune system. To meet this demand, the food industry will need to offer affordable products in the context of the economic crisis. Another challenge for governments is to enable disadvantaged people to access nutritious food produced in a sustainable way. It will be necessary to support charities and food cooperatives, but also to contract local producers.
Fairtrade bananas high on UK shopping lists
Fairtrade bananas have almost a quarter of the market share in the UK, and sales fell less than those of their non-certified counterpart during lockdown (Fresh Plaza, 28 August). This way, UK consumers have helped to drive this improvement in the quality of life of banana farmers. Amy Morris, Waitrose’s Sustainability Coordinator, said “Back in 2007 we committed to sourcing 100% of our bananas as Fairtrade. Since then we’ve seen the difference Fairtrade makes to the lives of farmers and workers within our banana supply chain and we continue to work closely with the Fairtrade Foundation to do what we can to support.”
Government must address UK’s low food self-sufficiency
Following the release of new data, the National Farmers’ Union (NFU) has told the UK government to prioritise food security (FPC Fresh Talk Daily, 24 August). The new figures show Britain’s self-sufficiency is at just 64%, a number that has remained stagnant for years. The UK is only 18% self-sufficient in fruit, 55% self-sufficient in fresh vegetables (–16%) and 71% self-sufficient in potatoes (–16%). NFU President Minette Batters said “We have a golden opportunity to put food security at the centre of our food system and to become a world leader in sustainable food production.”
Cities need to rethink their food systems to be more resilient and sustainable
The health crisis has revealed the fragility of cities’ food supply. The NGO Let’s Food has questioned local authorities and civil society around the world on the impacts and potential adaptations (Réussir Fruits et Légumes, 16 July). The majority of responses came from Europe, with 30% from associations and 28% from companies. Urban centres have been highly dependent on imports. Internet platforms have been set up by some major cities in France, and by civil society actors around the world (Colombia, Mexico, Chile, Italy) with the involvement of collective producer organisations or other structures facilitating the maintenance of trade and logistics. In France, wholesale markets have played an important role in the mutualisation and coordination of local producers. In France, in April 2020, during the containment period, e-commerce reached 9.5% market share. On a global scale, forecasts indicate that by 2024, 70% of consumers will use the internet for their food purchases (versus 25% today). This shift has led to greater access to local products, but has also accentuated the digital divide, and raises questions of sustainability (energy costs, multiplication of delivery services, etc.). Urban centres have strengthened cooperation with their local area (e.g. Ho Chi Minh City in Vietnam, Cork in Ireland), with their green belt, or even with urban production (balconies, shared gardens or even the jnens, food gardens around the city in Sfax in Tunisia) and have shown themselves to be more resilient, with an attenuation of the rise in fruit and vegetable prices.
Fruit and vegetables and cooking cans benefit from the coronavirus crisis
Experts from Dutch company ABN AMRO predict that consumption of fruit and vegetables in the Netherlands will increase by 2% in volume in 2020 as a result of the Covid-19 pandemic (Fruchtandel, 4 September). In terms of distribution, (online) supermarkets and specialist fruit and vegetable shops have gained market share, while the out-of-home catering and hotel sector and their suppliers have lost out. Online sales of ready-to-eat meals and easy-to-prepare dishes have increased by 14% in the first seven months of 2020. The study also notes differences in the vegetables consumed: a significant increase for peppers and aubergines, while asparagus was much less in demand.
The five largest organic markets in Europe
According to figures published by Agence Bio (France) in its 2020 report, the five largest European markets in 2018 (Germany, France, Italy, Sweden, UK) will account for more than €33 billion of organic expenditure, 78% of the total (Réussir Fruits et Légumes, 3 September).
- Germany (€11.9 billion, €144 per inhabitant per year; not including the out-of-home catering market) is the largest organic market in Europe. In 2019, 5.7% of home food consumption will be organic. Large-scale distribution (dominated by discount stores) holds 60% of the market share. Organic shops (including large producer shops) represent 27% of the market, which will grow in 2019.
- In France (€11.9 billion euros, €178 euros per person per year) the organic market grew by +13.5% in 2019. 6.1% of French households’ food purchases are organic. Mass distribution represents 55% of the organic market, with 35% of sales of fresh fruit and vegetables. Specialised organic distribution represents 28% of organic product sales (43% for fruit and vegetables) and direct sales 11% (22% for fruit and vegetables).
- Italy (€4.1 billion euros, €68 euros per person per year) saw a growing market in 2018 (+15.1% compared with 2017). Consumption of organic products represents 3.5% of total food consumption, with an export orientation. Large-scale distribution (nearly 50% market share), is growing strongly (+21% from 2017 to 2018), mainly in the discount sector. Specialised shops, on the other hand, are in decline (–2.3%). Out-of-home catering accounts for 15% of the market.
- Sweden (€2.7 billion euros, €264 euros per person per year) has tripled its organic market since 2010. 50% of the turnover is by the supermarkets due to lower prices (private labels and discounts). Out-of-home catering (20%) is a major distribution channel for organic products.
- In the UK, the organic sector has returned to growth since 2013 and now accounts for 1.6% of food purchases (€2.7 billion, €41 per person per year). Large-scale distribution (65%) is the main distribution channel for organic products, but e-commerce (15% of the market, +11% compared to 2018) is on the rise.