Food safety scares help fruit and veg processors

By Sarah Hills

- Last updated on GMT

Related tags Vegetable Salmonella

The recent salmonella scare which affected fresh tomatoes and Jalapeno peppers could give processed fruit and vegetables a boost in difficult times as they are considered safer, according to a new report.

Fruit and veg processors could also benefit from environmental concerns about waste, and the convenience factor as reasons for consumers opting for processed rather than fresh products, according to George Van Horn, senior analyst at IBISWorld, which published the Canned Fruit & Vegetable Processing in the US ​report.

It comes as revenue in the the fruit and vegetable processing industry is expected to decline moderately in the current economic crisis. And sales of value added products (such as organic and those with additional herbs and flavoring) are estimated to be adversely affected by the downturn in consumers confidence associated with the sub prime mortgage crisis and its affects on the credit market.

The report said: “The industry will remain reliant on a growing population and sporadic advertising campaigns throughout the year to drive industry sales.

It is also expected to “benefit slightly from a salmonella outbreak in imported Jalapeno peppers, and a warning regarding eating certain types of tomato”.

However, Van Horn added a note of caution as food quality concerns, such as the salmonella scare which only affected raw products, tend to be very short term and do not have a significant influence.

He also told “While we have seen some evidence that consumers are buying more canned products during the most recent 12-18 months (per capita consumption seemed to improve starting in 2007), it is difficult to distinguish if the improvements are solely in response to industry media campaigns or consumers allocating slightly more of their budget to canned goods vs. fresh (to reduce waste).”

Fresh ‘v’ processed

The report said the industry is likely to be influenced by consumer health concerns as a large proportion of consumers seek a balanced diet on the back of increasing evidence suggests that Americans do not consume enough fruit and vegetables.

This has had a negative effect on sales, but it was partially offset by consumers becoming increasingly time poor, “thus finding a majority of processed fruits and vegetables, in particular canned juices and soups are more convenient for their busy lifestyles”​.

IBISWorld estimates that during 2008 (in constant 2008 prices), the industry will record revenue of $33.13bn, a 1.7 percent decline from the previous year. Domestic demand is put at $35.15bn, a 1.5 percent decline. Forecast revenue growth to 2013 is 0.7 percent.

The industry accounts for 6.8 percent of the food manufacturing industry. It processes fresh fruit and vegetables into food products packaged in jars, cans and other packaging. Processors also acquire ingredients such as salt, sugar, preservatives and colorings which are blended into the end product.

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