Transcript No Slide Title

Trends in the Global Fresh
Produce Industry: Focus on
Citrus
DR. ROBERTA COOK
Dept. of Ag and Resource Economics
University of California Davis
November 2005
World Area and Production of Fruits and
Vegetables, Million Metric Tons and Hectares
Fruit Area
Fruit Production
Vegetable Area
Vegetable
Production
Total Area
Total Production
2004
52.1
497.4
51.3
1990
41.2
351.6
31.0
855.1
462.1
103.4
1,352
72.2
813.7
Source:
FAO
Food Demand Trends
• Global per capita availability of fruits and
vegetables grew from 155 kg in 1990 to
212 in 2004.
• Consumers in Latin American and Asia are
registering the fastest growth in food
demand in the world – in the face of slow
growth mature food markets in the
developed world.
• Growing global importance of supermarket
chains plays a key role in stimulating
fresh produce trade – shelf space needs
to be full year-round. This is a positive
factor for citrus demand.
%
Convergence…Supermarket Share of
Grocery Sales, by Selected Country
100
80
60
40
20
USA
France
0
Brazil & Korea
China
1940 1950 1960 1970 1980 1990 2000 2010
Source: Tom Reardon
The 2004 World
Fruit Pie, Share of
Production
21%
1%
13%
11%
Apple
Other Deciduous
Grape
Orange
Other Citrus
Banana
Other Tropical
Berry
15%
15%
10%
13%
Source: World Apple
Review 2005
World Production of Citrus and Total Fruit,
1,000 Metric Tons
79-81 89-91
99-01
02-04
02-04 v.
89-91%
Total Citrus
59,321
77,073
103,620
106,274
+38%
Oranges
38,751
53,578
63,433
61,808
+15%
20,570
23,495
40,187
44,466
+89%
275,663 311,642
440,242
458,736
+47%
Other
Citrus
Total Fruit
• This compares with 40% growth in
population.
• Citrus production growth has lagged
population as demand has diversified for
other fruit.
• On the other hand, developing countries
are increasing consumption of fresh
produce, including citrus, as incomes
improve.
• Developing countries also have higher
rates of population growth.
• Trade liberalization through the WTO is
opening markets and reducing tariffs.
Citrus markets and trade will continue
to diversify:
– between 1990 and 2003 imports of oranges,
tangerines and clementines into all countries
grew by an average of 23%, v. 20% into
developed countries and 39% into developing
countries.
– between 1990 and 2003 imports of
grapefruit and pomelos into all countries
grew by 9%, v. 6% into developed countries
and 63% into developing countries.
The US and the EU dominate global
horticultural trade.
Source: World Apple
Review 2005
U.S. Horticultural Imports and Exports
by Key Product Category, $Billion
30
25
Process/Other
20
Tree Nuts
15
Nursery/Flower
10
Wine
5
Fresh
0
2004 IMP
2004 EXP
2003 IMP
2003 EXP
2002 IMP
2002 EXP
2001 IMP
2001 EXP
2000 IMP
2000 EXP
1999 IMP
1999 EXP
Source: FAS/USDA, as compiled by Roberta Cook.
EU Exports of Horticultural
Products by Category
Billion
$25
$20
$15
$10
$5
$0
1997
1998
1999
2000
Other
Processed Fruit & Vegetables
Tree Nuts
Fruit & Vegetable Juices
2001
2002
2003
2004
Fresh Fruit
Wine & Beer
Fresh Vegetables
Source: Global Trade Atlas, includes: Vegetables, Fruits, Nuts, Essential Oils, Nursery Products, Cut Flowers,
Wine, and Beer.
Total Consumption of Fresh Oranges in Selected
Countries, in 1000 Metric Tons (excludes processing)
20
04
20
02
Mexico
Argentina
20
00
19
98
China
Spain
Korea
19
96
19
94
19
92
Brazil
USA
Japan
19
90
Source:
FAS PSD
Oct.
2005
19
88
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
0
Japan: Per Capita Consumption of Fresh Fruit
in kg
Source: World Apple Review 2005
35
30
25
20
15
10
5
0
Apples
Grapes
Bananas
Peaches
Total Fresh
Mandarin/oranges
Strawberries
Pears
Other Fresh
1990 1995 1998 1999 2000 2001 2002 2003
United Kingdom: Per Capita Consumption of
Fresh Fruit, in kg
Source: World Apple Review 2005
45
40
35
30
25
20
15
10
5
0
Apples
Oranges
Bananas
Other Fresh
Total Fresh
1990
1995
97-98
98-99
99-00
00-01
'01-02 '02-03
United Kingdom: Per Capita Weekly Consumption of
Fruits and Vegetables, by Age Group, 2002-03, grams
2000
1500
Fruit
1000
Veg.
500
0
< 30
30-39 40-49 50-64 65-74 75 & >
Source: World Apple Review 2005
USA: Per Capita Consumption of Fresh Citrus
in kilos, 1976-2004
10
Oranges
8
Lemons
Grapefruit
6
4
2
'0
4
'0
2
'0
0
98
96
94
92
90
88
86
84
82
80
78
76
0
Source: ERS/USDA
Per Capita Consumption of Oranges, Selected
Countries, in kilos
40
35
30
25
20
15
10
5
0
1990
Mexico
Spain
China
Japan
2000
2001
2002
Korea
2003
2004
Sources: FAS/USDA PSD, Oct. 2005 and IDB demographic data, as compiled by Roberta Cook.
USA: Per Capita Consumption of Oranges,
Fresh and Juice, kilos, 1976-2004 Source: ERS/USDA
50
40
30
20
Oranges, all
Fresh
Juice
10
'0
4
'0
2
'0
0
98
96
94
92
90
88
86
84
82
80
78
76
0
Obesity Goes Global: Globesity!
• WHO estimates that obesity grew from
200 million people in 1995 to over 300
million in 2000.
• 115 million of the obese live in developing
countries.
• Even in France, obese people are now 11%
(vs. 8% in 2000) of the population and
expected to reach 20% in 2020.
• The number of obese people in Britain
almost tripled between 1980 and 2001;
overweight or obese pre-school children
doubled in the 90s.
Concern over Globesity Affects Public Policy
• Fresh produce is set to benefit.
• Competition from non-healthy snack foods
is finally being challenged by health
messages and changes in availability, such
as in schools.
• Growing evidence on the health benefits
of fresh citrus must be aggressively
communicated and promoted, to all age
groups.
• Citrus can be made more convenient to
consume, witness the launching of
Sunkist’s Fun Fruit program.
TOP GLOBAL GROCERY RETAILERS, 2004
Net Sales
Company and Origin
Wal-Mart U.S.
Carrefour/Promodès France
Ahold
Holland
Germany/Switz
Tesco
U.K.
U.S.
Germany
Costco U.S.
Grocery Net Grocery
($ billion) Sales ($ billion)
Rank
285.2
138.72
1
90.3
84.54
2
88.8
75.03
3
70.1
38.35
8
62.2
50.45
4
56.4
41.22
6
50.7
41.54
5
47.1
30.74
13
30 grocery retailers account for 29% of modern global grocery retail sales.
TOP GLOBAL GROCERY RETAILERS, 2004
Net Sales
Company and Origin
Grocery
($ billion)
Net Grocery
Sales ($ billion)
Target U.S.
46.9
17.15
26
Aldi Germany
43.0
38.75
12
Schwarz Germany
42.6
37.79
11
ITM France
42.3
32.47
18
40.0
28.78
17
AEON UK
38.8
30.13
14
Walgreen’s U.S.
37.5
14.53
31
Auchan France
37.3
30.22
15
U.S.
Source: PlanetRetail, June 2005
Rank
TOP GLOBAL GROCERY RETAILERS, 2004
Net Sales
Company and Origin
Grocery
($ billion)
Net Grocery
Sales ($ billion)
Rank
Safeway U.S.
35.8
29.54
16
Ito-Yokado Japan
39.5
37.52
9
32.8
22.72
19
32.5
33.11
7
30.6
10.16
38
29.8
21.73
20
Casino France
28.8
37.53
10
Sainsbury U.K.
28.2
23.02
21
France
Edeka
Germany
CVS U.S.
Tengelmann Germany
Source: PlanetRetail, June 2005
TOP GLOBAL GROCERY RETAILERS, 2004
Net Sales
Company and Origin
Coles Myer Australia
Grocery
($ billion)
23.7
Net Grocery
Sales ($ billion)
14.37
Rank
30
Morrisons
25.5
20.06
24
Delhaize “Le Lion” Belgium
22.3
18.58
23
Woolworths Australia
20.7
16.46
22
Loblaw Canada
20.1
17.41
25
El Corte Ingles
Total Estimated Top 30
Others
Total Worldwide
19.2
Source: PlanetRetail, June 2005
5.44
1,054.42
2,610.33
3,664.75
62
TOP GROCERY RETAILERS IN MEXICO, 2004
Retail Banner Sales
Company
Wal-Mart
Grocery
($ billion)
Sales ($ billion)
13.2
5.9
Soriana
3.9
2.4
Gigante
2.9
2.0
Comercial Mexicana
2.6
1.8
OXXO
2.1
1.5
Costco
1.4
.81
Chedraui
1.2
.66
HEB
.64
Source: PlanetRetail as compiled by Roberta Cook.
.58
TOP GROCERY RETAILERS IN MEXICO, 2004
Retail Banner Sales
Company
Grocery
($ billion)
Sales ($ billion)
Carrefour
.72
.50
Calimax
.31
.27
Subtotal Top 10
28.76
16.35
Other
54.41
49.71
Total
83.164
49.713
Top 10 grocery retailers account for 25% of modern
grocery retail sales in Mexico. Much of food sales move
through traditional channels.
Source: PlanetRetail as compiled by Roberta Cook
Key Drivers
• global retail players
• global retail brands?
• growing role of private labels
• retailer–supplier contracts/partnerships,
interest in large year-round suppliers
• declining role of spot market
• Suppliers all coming up to the same level