Produce Industry Trends for 2023
Demand for fresh produce is expected to increase in the coming years. With a forecasted annual global market growth of 5.14% until 2027, the industry could become a US$210.9 billion market.
However, for this forecast to become a reality, growers and other players in the fresh produce industry will have to successfully overcome the challenges posed by climate change, economic inflation, and supply chain disruptions.
In 2023, these pain points will further drive the constant evolution of agribusiness to meet the changing needs of fresh produce production and trade. In this regard, the top 5 trends the industry will continue to push in 2023 are:
1. Sustainability and Food Traceability
Food sustainability, or environmentally-conscious food production processes, will become even more relevant. Consumers are now looking for food suppliers that are aware of climate change and its effects, and take actions to solve these problems.
In addition, due to consumers’ concerns about potential outbreaks of microbial contamination in fresh produce, the demand for food traceability is also expected to increase. The food traceability market is anticipated to reach a value of 37.9 billion dollars by 2029.
2. Challenges in the Produce Global Economy
Fresh produce growers and buyers are facing rising input costs, such as fertilizers and pesticides, as well as increased transportation costs due to higher fuel prices; these are the main reasons why fresh produce prices rose by 9.6% in 2022 and may continue to rise in 2023.
Given the economic recession scenario in which we are already immersed, the produce industry must focus on cost reduction, vertical integration, understanding consumer trends and preferences, and exploring opportunities for expansion and partnerships.
3. Persistence of Supply Chain Hurdles and Food Loss
Supply chain disruptions do not only affect the profitability of fresh produce growers, it also significantly contributes to loss and waste of food.
According to a ProducePay survey, 38% of growers consider supply chain disruptions to be their greatest concern for contributing to increases in material and transportation costs. The solution to this situation requires more direct access to buyers, improved storage and transportation, and digitization of the supply chain.
4. Go-to-market Challenges
Growers and buyers of fresh produce face several hurdles in accessing new markets, these include: reaching fair prices, finding consistent buyers, and the volatility of commodities’ prices.
To overcome these challenges and achieve profitability for their products in new markets, growers must consider their buyers’ requirements and work to provide greater value in their products. Produce suppliers can do this by offering differentiated propositions, as well as ensuring compliance with specific quality, safety, social responsibility, and food traceability requirements.
5. Increased Utilization of Digital Tools
Growers and retailers of fresh produce are seeing an increase in the use of online platforms to find buyers and distributors. According to a ProducePay’s survey, 17% of buyers look for sellers in online directories, while 10% already use a digital platform for their business transactions.
In addition, sellers are also using popular social media platforms such as Facebook and Instagram, as well as email campaigns, to promote their products and target consumers, so the B2B trading of fresh produce through online platforms is expected to continue.
ProducePay’s Role in these Emerging Trends
ProducePay offers the Marketplace, which helps sellers and buyers of fresh produce connect and trade securely and transparently. The platform gives access to Market Insights, financing solutions, sustainability programs, and supply chain services, which allow produce sellers to improve operations and expand growers’ market and customer portfolios.
If you want to know more about these trends, download the full report “The Top 5 Produce Industry Trends That Will Matter in 2023”.