Report: Fresh-cut Remains Fastest-growing Produce Segment

ALEXANDRIA, Va. – With $12 billion in annual sales, precut, prewashed packaged fruits and vegetables remain the fastest-growing segment in the produce sector, with plenty of room still to grow, according to new research from the International Fresh-cut Produce Association (IFPA).

According to IFPA, its "Fresh-cut Produce Fuels an America On-the-go" is a comprehensive report exploring the current and future fresh-cut marketplace, growth drivers, and facts and figures on the fresh-cut produce industry. The report was produced by PakIntell, LLC and sponsored by Del Monte Fresh Produce.

The report says that packaged salads are the second-fastest selling item in U.S. grocery stores, with $2.6 billion in annual retail sales, followed by fresh-cut vegetables at $1.4 billion. The still-young fresh-cut fruit category, which reports $300 million in annual retail sales, is likely to surpass the $1 billion mark over the next three to four years, according to the report. The industry boasts $6 billion in annual sales to the foodservice sector.

Among the trends driving the fresh-cut produce industry's continued strong growth: the nation's ongoing obesity epidemic, a federal nutrition panel's recommendations to include more fruits and vegetables in the pending new Food Pyramid guide, an increasing use of fresh-cut produce in foodservice establishments, and a growing number of convenience- and quality-seeking consumers.

"Demand for do-it-for-me convenience has been the big driver behind the tremendous growth of precut, prewashed, and packaged fruits and vegetables for the past 15 years," said IFPA president Jerry Welcome, "but convenience is now getting a big boost from growing concerns about obesity and health issues in general."

Welcome said the big challenge the industry faces now "is to project the convenience we have delivered to America's home kitchens into other channels. We need to keep pace with an 'America on-the-go,' where as many as 20 percent of all meals are consumed in automobiles and half of all meals are consumed away from home."

Despite record-breaking sales, fresh-cut produce represents only a 13 percent penetration of the total fresh produce market –- good news for processors and marketers of fresh-cut fruits and vegetables. The trade group's white paper challenges processors to address several key opportunities to sustain growth over the next 15 years, including focusing on the right consumers and determining what new products they truly want; promoting fresh-cut produce's role in a healthy, fast-paced lifestyle; diversifying product offerings and searching for new varieties of fruits and vegetables overseas; capitalizing on the merger of salads and protein as a main meal; and shortening the supply chain to keep the "fresh" in "fresh-cut."
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