Healthier products are on the rise. The robust development of plant-based proteins of pulses and nuts contributed to an impressive global total volume performance of 4% in 2017. Categories with more complex associations in terms of health such as eggs, meat as well as sugar and sweeteners have fallen at the tail end of the spectrum of category growth.
Nevertheless, the fact that all top-level categories registered increases in total volume terms is testament to the fact that fresh food holds an advantage over its packaged, processed counterparts in the health stakes as it registered double the growth of total packaged food volumes in the same year. Coupled with this aspect has been continued growing population numbers across all continents, resulting in higher aggregated demand. Indeed the overall performance of the industry was heavily influenced by consumption patterns in India and China as these two population behemoths combined accounted for 60% of global absolute total volume growth in 2017.
Further trends impacting fresh food have invariably been linked to the move towards consumers in general becoming more discerning with their purchases and more willing to contemplate breaking the mould of their traditional diets. For example, as consumer education has deepened, so too has the preference for fresh food which can be considered wholesome. This manifests itself in a number of ways, including campaigns to increase public awareness of the usage of antibiotics within meat and fish, or consumers adapting their decision-making behaviour on the basis of the sustainability credentials of their purchases.
As a consequence, retailers have been adapting their strategies to capitalise on this, such as with the introduction and expansion of ‘wonky’, i.e. non-standard, produce ranges in fruits and vegetables as a means of addressing concerns over food waste, especially in the key Western European markets such as France, Germany and the UK. These measures have a double cost benefit in that consumers are able to buy at lower prices and retailers lessen their volume of waste and thereby reduce their losses. Concerns over red meat have also led to strong performances of alternative protein foods, such as nuts in India which are gaining more appeal as a snacking item, or poultry vastly outperforming beef and veal in Russia, especially as the latter has been hit by the sanctions on imports.
The healthy and ethical living trends have converged and come to the fore with certain foods scares in 2017. Most prominent in this regard have been alleged corrupt health inspection practices in Brazil for beef and the contamination of eggs with Fipronil which emanated from the Netherlands. Corresponding sharp drops in category sales tend to be short-term but feed into longer-term reservations about certain products and therefore there is a more pronounced urgency to enhance supply chain transparency and accountability. The emergence of blockchain technology, which promises a strong standard of certification, is set to be influential in the fresh food industry in this regard also, with the major US retailer Walmart for example initiating a trial using this system in 2017.
Given the vitality of the intersecting trends which are affecting the global fresh food market, there is ample scope for players in the industry to seize opportunities to grow. On a broad level, shifting global demographic dynamics, such as an ageing population or an increased incidence of single person households, opens up the possibility of creating growth through convenience formats such as pre-cut meat or re-sealable packaging. This element can also be used to induce more consumers to be more adventurous in their cooking, which would serve to drive fresh food volumes as these products form the core of such meals. Finally, premiuimising range offerings is a clear avenue to translate mature volume consumption in developed markets into higher value gains.
Producers and retailers are therefore called upon to look beyond the confines of their markets and to think innovatively on these issues in order to fulfil the burgeoning global consumer demand for higher quality products.