CBI Market Information presentation about the market trends in the Fresh Fruit and Vegetables sector.

1. › October 21 2019, MOM FFV
› Michel Peperkamp Fresh fruit and vegetables

2. › 15 years in commerce, international trade promotion
› Expertise: Agri-food, fresh fruit & veg, ingredients, Latin America, Europe
› Focus: Business development & market research
› Working with CBI since 2014
Today:
› What makes EU interesting for fresh fruit & vegetables?
› Which trends, countries & products?

3. › Written in easy to
understand English
› Practical and hands-on
Information
› Available free of charge
www.cbi.eu/market-information

4. Cacao FishNatural food
additives
Coffee Grains, pulses
& seeds
Fresh fruits
& vegetables
Herbs
& spices
Home Decoration
Home Textile
Natural ingredients
for cosmetics
TourismApparelProcessed fruits
& vegetables
OutsourcingNatural ingredients
for health products
Focus Sectors

5. › # Trend 1: Health consciousness
› # Trend 2: Convenience
› # Trend 3: Reducing risks
› # Trend 4: Sustainability
› # Trend 5: Local preference
› # Trend 6: Integration
› # Which countries offer opportunities
› # Which products offer opportunities

6. Trend 1: Health consciousness
consumers want to feel good about the food they eat
Health consciousness triggers:
✓ Healthy (snack) fruit
✓ Natural, clean food
✓ No pesticides, organic

7. Image by ICI Business
100% natural
0
2
4
6
8
10
12
14
16
Fresh coconut in inner shell
2014
2015
2016
2017
2018
In 1000 tonnes
Source: Eurostat

8. Healthy snacking
Image by ICI Business

9. Increase of healthy fruit
examples
In 1000 tonnes
Source: Eurostat
0
100
200
300
400
500
600
700
avocado blueberry
2014 2015 2016 2017 2018

10. Organic

11. Europe: Organic retail sales value in 2017
0 2000 4000 6000 8000 10000 12000
Germany
France
Italy
Switzerland
Sweden
United Kingdom
Spain
Austria
Denmark
Netherlands
Belgium
Norway
In million euros
Source: FiBL

13. › Try to produce your crop as clean and natural as possible
› Consider organic as a plus, not as a must. Certification and compliance can be expensive
› Make sure you understand well the European guidelines for organic products. See:
– https://ec.europa.eu/info/food-farming-fisheries/farming/organic-farming/organics-glance_en
Tips

14. Trend 2: Convenience
Modern lifestyles require fruit that is easy to
consume:
✓ Freshly cut fruit
✓ Snack fruit
✓ Ready to eat

15. Snack fruit
✓ Pre-packed and
snack fruit are
exceptionally strong
in northern the
Europe
✓ fast lifestyles
✓ strong supermarket
dominance
✓ Other parts in Europe
are on the rise as
well.
Image by ICI Business

16. Ready-to-eat
› Ready-to-eat is growing thanks
to improving ripening processes
in the import countries.
› To supply ripening companies
timing and the right level of
maturity will be your main
concerns.
Image by ICI Business

17. Freshly cut
Image by Fruit Consultancy Europe
› Adding value good idea for
producing countries?

18. › Optimize your postharvest, cooling and processing activities to preserve the optimal shelf
life
› Make sure your product arrives in perfect condition, shipping fruit for ripening at the right
maturity level
› Learn more about the pre-cutting your fresh produce through the FAO technical guide for
fresh-cut tropical fruits and vegetables:
– http://www.fao.org/3/i1909e/i1909e00.pdf
Tips

19. Trend 3: Reducing risks
The fresh segment is very important for
supermarkets
… But (intermediate) buyers are becoming more
cautious due to:
✓ Buyer concentration and stricter requirements
✓ Increasing production and oversupply
✓ Lower margins

20. Strong supplies result in price pressure
0,00
0,50
1,00
1,50
2,00
2,50
3,00
0
200
400
600
800
1000
1200
1400
2014 2015 2016 2017 2018
avocados
million euros 1000 tonnes euro/kg
0,00
1,00
2,00
3,00
4,00
5,00
6,00
7,00
8,00
0
100
200
300
400
500
600
2014 2015 2016 2017 2018
blueberries
million euros 1000 tonnes euro/kg (right axis)
Source: Eurostat

21. buyer concentration
Example of the Netherlands
Source: Planbureau voor de Leefomgeving (PBL), translated/adjusted by ICI Business

22. Retailer Country Exhaustion percentage of
single active sunstances
(% of legal EU MRL)
Lidl DE/NL/UK/BE/IR/FR 33,3%
Ahold NL/BE 50%
REWE DE 50%
EDEKA DE 70% / 50% (private label)
Metro DE 70%
Carrefour FR 100%
Strict retail requirements

23. Be prepared:
› Certification (GGAP, BRC)
› Spray registers
› Marketing standards
But:
› A bad market still brings out the worst in people
Certification is as important as the
product itself

24. › Study the CBI buyer requirements for fresh fruit and vegetables:
– https://www.cbi.eu/market-information/fresh-fruit-vegetables/buyer-requirements
› Have written agreements with clear and acceptable delivery terms. Check the ITC
model contract:
– http://www.intracen.org/WorkArea/DownloadAsset.aspx?id=37603
› Make sure your buyer specifically accepts the product and the quality as soon as it
arrives
› Read about your rights when doing business with a powerful buyer:
– https://ec.europa.eu/info/sites/info/files/food-farming-fisheries/key_policies/documents/brochure-utp-
directive_en.pdf
Tips

25. Trend 4: Sustainability
Sustainability is a pre-condition in the fresh trade
✓ Initiatives: SIFAV, BSCI
✓ Certifications: Sedex, grasp
✓ Retail standards: Tesco nurture
✓ Compliance: Water usage, working conditions,
reducing plastics

26. › SIFAV aims to drive 100%
sustainable imports of fruits and
vegetables from Africa, Asia and
South America by 2020.
› SIFAV – basket of standards:
https://www.idhsustainabletrade.com
/uploaded/2017/07/IDH_SIFAV_Benc
hmarking_10102017.pdf
The Sustainability Initiative Fruit and Vegetables (SIFAV)

27. › Common: GlobalGAP, Sedex SMETA, Grasp, Amfori-
BSCI
› National initiatives: PlanetProof (NL)
› Retail specific: Tesco nurture (UK)
Sustainability pre-condition for market entry

28. › Working conditions
› Plastic reduction
› Water usage
› Social projects
Specific actions
Plastic reduction: topseal
Image by ICI Business

33. › Investigate the various local options for sustainable packaging and materials
› See the CBI buyer requirements for fresh fruit and vegetables for sustainable initiatives
and certifications:
– https://www.cbi.eu/market-information/fresh-fruit-vegetables/buyer-requirements
Tips

34. Trend 5: Local preference
If it can be locally sourced, it will be locally sourced
… But external sourcing is still very much needed

36. Spain is Europe’s garden
But local production is not enough and does not cover the year round demand
European
production
(in 1000 tonnes)
production share
(%)
Tomatoes
Apples
Onions
Oranges
Watermelons
Smallcitrus
fruits
Peaches
Peppers
(capsicum)
Tablegrapes
Lemonsand
acidlimes
Plums
Berries(excl.
strawberries)
Avocados
European Union -
28 countries
17.399
10.041
6.740
6.206
3.204
2.927
2.906
2.654
1.642
1.419
1.297
601
103
Spain 30% 20% 54% 35% 67% 37% 48% 16% 65% 13% 14% 91%
Italy 32% 19% 25% 18% 22% 27% 56% 26% 16%
Greece 15% 20% 27% 19%
Poland 24% 10% 52%
Netherlands 26% 14%
France 17% 16%
Romania 15% 33%
Portugal 10%
NB: countries with >10% production in 2017
Source: Eurostat

37. Need for external sourcing
0
500
1000
1500
2000
2500
Guatemala
(134%)
Peru (96%) Mexico
(77%)
India (62%) Morocco
(62%)
South Africa
(44%)
Egypt (42%)
2014 2015 2016 2017 2018
Europe's largest supplying
developing countries
• more than €170+ million
• more than 38% five year growth
In milion euros
Source: ITC Trademap

38. › Look into competitive advantages you may have compared to other export countries
regarding trade policy. Check the trade agreements and custom tariffs in the European
Union.
– https://ec.europa.eu/trade/policy/countries-and-regions/
– https://ec.europa.eu/taxation_customs/dds2/taric/taric_consultation.jsp?Lang=en
Tip

39. Trend 6: Integration
Integration becomes important to increase
opportunities and a steady supply:
✓ Importers become service providers & supply chain
managers
✓ More buyer involvement in production
✓ Direct supply

42. › Pick your client well – look for specialisation – and be prepared to establish long-term
relationships
› Make sure to have own cultivation or direct access to reliable production volumes (contract
farming)
› Team up with other producers when you lack company size or product volume. Make
yourself an attractive and competitive supplier
Tips

43. Which countries offer opportunities?
Top markets:
✓ Germany (size)
✓ United Kingdom (diversified)
✓ Netherlands (trade)

44. Compare large markets vs large importers
0
500
1000
1500
2000
2500
3000
3500
4000
4500
Import value from developing countries
2014 2015 2016 2017 2018
0
2000
4000
6000
8000
10000
12000
Total import value
2014 2015 2016 2017 2018
in million euros
Source: ITC Trademap

45. Importance of satisfaction criteria for fresh
fruit and vegetables
Best place to buy fresh products
UK 1. Quality 47%
2. Price and promotions 10%
3. Assortment 9%
1. Waitrose 76%
2. Morrisons 65%
3. Tesco 63%
France 1. Quality 43%
2. Assortment 15%
3. Price and promotions 10%
1. Grand Frais
2. Auchan
3. Cora/ Match
Germany 1. Assortment 34%
2. Quality 31%
3. Product presentation 11%
1. Globus 79%
2. Edeka 70%
3. Kaufland 61%
Netherlands 1. Assortment 35%
2. Quality 33%
3. Product presentation 7%
1. Albert Heijn 76%
2. Lidl 75%
3. Emte 61%
Spain 1. Quality 47%
2. Price and promotions 10%
3. Assortment 9%
1. Bonpreu 83%
2. Hipercor 80%
3. Carrefour 67%
What do consumers expect?
Source: Oliver Wyman Fresh Survey 2018

46. › Stay up-to-date on the European market, using online news sources:
– https://www.freshplaza.com/
– http://www.fruitnet.com/
– https://www.fruitrop.com/en
– http://www.freshfruitportal.com/
› Diversify your markets in and outside of Europe in case of changes in demand, oversupply
or non-compliance
› Establish your own agricultural production or work as closely together as possible with
producers
tips

47. Which products offer opportunities?
✓ Main categories from developing countries: Bananas,
citrus and grapes
✓ High growth from developing countries: Berries,
avocados, watermelon, sweet potato
✓ Growing niche from on-EU supply: Plums

48. Main imported fruit into Europe from developing countries
0
1000
2000
3000
4000
5000
6000
Bananas Citrus fruit Grapes Avocados Pineapples Mangoes (incl
guavas and
mangosteens)
2014 2015 2016 2017 2018
in million euros
Source: ITC Trademap

49. Highest growth from developing countries
European import from developing countries
2018
(MM euro)
5yr
growth
Main suppliers from developing countries (share %)
Blueberries (incl. cranberries, bilberries and
other fruits of the genus Vaccinium) 449 249%
Peru 46%; Morocco 28%; South Africa 14%; Argentina
8.5%; Ukraine 1.2%
Raspberries, blackberries, mulberries and
loganberries (mainly raspberries) 309 198%
Morocco 75%; Mexico 14%; South Africa 3.7%;
Guatemala 1.9%; Serbia 1.4%
Avocados 1115 180%
Peru 49%; South Africa 14%; Mexico 13%; Kenya 7.4%;
Colombia 6.2%
Watermelons 283 129%
Morocco 43%; Brazil 21%; Costa Rica 16%; Turkey
7.2%; Panama 5.1%
Sweet potatoes 51 83%
Egypt 34%; China 23%; Honduras 17%; Senegal 7.3%;
Brazil 5.9%
Lemons and limes 830 71%
Argentina 33%; South Africa 20%; Brazil 16%; Turkey
14%; Mexico 13%
Oranges 770 52%
South Africa 54%; Egypt 22%; Morocco 7.2%; Argentina
4.7%; Zimbabwe 4.3%
Mangoes (incl guavas and mangosteens) 778 51%
Brazil 33%; Peru 33%; Ivory Coast 4.8%; Ghana 4.7%;
Senegal3.4%

50. High growth (niche) products
European Union (EU-28) import from
non-EU suppliers
2018
(1000T)
5yr
growth Main suppliers from non-EU countries (% share)
Plums 97 62%
South-Africa 40%, Chile 23%, Moldova 15%, Serbia 9%,
Macedonia 6%
Chilli pepper (Capsicum/Pimenta) 48 33%
Morocco 44%, Turkey 15%, Uganda 2%, Macedonia 2%, India
2%
Fresh coconut (with/without inner shell) 47 32%
Coconut with inner shell: Ivory Coast 62%, Thailand 16%,
India 10%, Nicaragua 5%, Vietnam 2%, DomRep 2%
Asparagus 42 12%
Peru 77%, Mexico 15%, Morocco 1%, Thailand <1%, Ecuador
<1%
Papaya 42 17%
Brazil 91%, Ghana 3%, Thailand 2%, Jamaica 1%, Mexico 1%
Tamarinds, cashew apples, lychees,
jackfruit, sapodilla plums, passion fruit,
carambola and pitahaya 41 14%
Madagascar (lychees) 40%, Colombia (passion fruit) 20%,
Vietnam (pitahaya) 11%, South Africa (lychees) 8%, Malaysia
4%
Sugar snaps, snow peas and other peas
(Pisum sativum) 30 12%
Guatemala 31%, Zimbabwe 19%, Kenya 18%, Peru 12%,
Egypt 8%
Other “niche” fruit (mainly pomegranates,
physalis, etc) 107 33%
Turkey 43%, Peru 20%, Israel 10%, Colombia (physalis) 6%,
South Africa 4%, Egypt 4%

51. › Look for specialised importers at the Fruit Logistica or Fruit Attraction:
– https://www.fruitlogistica.com/
– https://www.ifema.es/en/fruit-attraction
› Look at CBI website for:
– Buyer requirements
– Trends
– Product information
– Tips on finding buyers
– And more…
– www.cbi.eu/market-information
tips

52. GOOD LUCK IN BUSINESS!
ICI Business
› michel@icibusiness.com
› www.icibusiness.com
› www.cbi.eu/market-information

53. Thank you!
Happy to work together in reaching results
in sustainable economic development
www.cbi.eu/devco-ca
devco-ca@cbi.eu
CBI.EU / Connecting Central America
@cbi_nl