Retail produce sales strong; fresh share of produce dollar slips
Fresh produce sales at retail totaled $5.04 billion in the four September weeks, up 10.7% from the same period in 2019.
“Retail demand continued to be very strong throughout September, similar to the levels seen throughout July and August,” Joe Watson, vice president of membership and engagement for the Produce Marketing Association, said in a news release. “While shopping habits are trending back toward normal, at-home consumption remains elevated across meal occasions. We need to continue to support shoppers in their meal planning and preparation.
“Our best pandemic sales driver has been trip conversion, and our biggest win in the next few months is selling fresh produce every trip, online and offline,” Watson said.
IRI reported fresh fruit sales for the month were up 7.6% over last year, while vegetable sales were up 13.9%, consistent with the pattern seen throughout the pandemic. Vegetables have seen 28 weeks of double-digit growth since mid-March.
In 2019, fresh had 84% of the produce dollar share compared with 10% for shelf-stable and 6% for frozen. That share dipped to 70% in the first weeks of the pandemic but slowly climbed almost all the way back, to 83%, in July. For September, however, the fresh share of the produce dollar was 80.3%.
“It is important to point out that inflationary levels in frozen and canned goods have been higher than those in fresh produce, which impacts dollar shares,” Jonna Parker, fresh team lead for IRI, said in the release. “However, the pandemic has definitely fueled a consumer desire for items with longer shelf-life, whether that is hardier fresh fruits and vegetables or diverting dollars to canned and frozen.”
Volume growth of fresh produce outpaced dollar growth in September, led by strong sales the week of Labor Day.
“Retailers are very cognizant of the new economic reality, which could mean some are investing in price,” Watson said in the release. “Fresh produce promotions have always been an important trip and store driver and even more so during difficult economic times.”
IRI’s primary shopper survey conducted in late September indicates that, much like the rest of 2020, the holiday season is going to be different than previous years.
“Only 29% of consumers expect to host or attend a meal with extended family who do not live with them for Thanksgiving,” Anne-Marie Roerink, principal of 210 Analytics, wrote in the release. “This is down from 48% last year. Friendsgiving and traveling out of state are also more unlikely this year, as Americans are most likely to stay home and celebrate with immediate family, according to 34% of respondents. This will have a profound impact on grocery spending.
“Early indications for December holiday celebrations and grocery spending suggest a similar impact as Thanksgiving, and even more are planning to cut back on groceries to save money as many are expecting higher food prices come November and December compared with the 2019 holiday season,” Roerink wrote. “Shoppers plan to spend less on groceries, gifts and decorations across grocery, mass, club, dollar and especially drugstores and local small businesses. Online-only retailers are currently estimated to net a slight gain.”