Fresh produce dollar sales growth over 2019 topped 15% in the third week of June, boosted by Father’s Day weekend, with vegetables experiencing sales growth of more than 20%.
Produce retail sales have remained elevated amid COVID-19, but the growth compared to 2019 had been declining since mid-May, hitting 10% the week ending June 14, according to IRI.
That week, however, didn’t have the benefit of Father’s Day weekend, which the comparable week in 2019 did, so better numbers for the week ending June 21 were anticipated.
“We expected Father’s Day week to provide an above-average boost, and it sure did,” Joe Watson, vice president of member engagement for the Produce Marketing Association, said in a news release. “The bump put us right back at mid-April levels, with double-digit gains for both fruit and vegetables.
“There is a valuable lesson in this for holidays to come,” Watson said. “Consumers are still celebrating, but most are doing so at home in smaller numbers — boosting grocery spending far above prior-year levels. This means we have to adapt our merchandising and marketing tactics accordingly.”
Jonna Parker, team lead for fresh for IRI, noted that grilling is another traditional summer practice that has persisted amid the pandemic.
“The boost in fresh produce came hand-in-hand with a very strong week for the meat department, particularly grilling items,” Parker said in the release. “Despite all that has changed in the past four months, meat and produce continue to rule the grocery world. Now the question is how we can maintain this positive momentum.
“Clearly, firing up the grill bodes well for fresh sales,” Parker said. “Our survey data at IRI shows one-quarter of consumers cook more meals from scratch now than they did pre-pandemic; however, shoppers are running out of ideas. Grilling season provides us with a host of new recipes for tried-and-true vegetables and fruits.”
Supply and demand
For fresh produce overall, dollar sales growth and volume sales growth were similar: dollar sales were up 15.7%, and volume sales were up 14.2%. For many items, however, there were much more significant gaps for the week ending June 21.
Corn, papayas, mangoes, potatoes, garlic and tomatoes were among items seeing much larger dollar gains than volume gains, and celery, avocados, Brussels sprouts, limes, peppers and cherries were some of the items experiencing much larger volume gains than dollar gains, according to IRI.
“The later Father’s Day meant a bit of a down week for melons and corn last week, but good recovery this week,” Watson said in the release. “Corn is a strong item for cross-merchandising during grilling season. However, the corn market is making it hard for retailers to promote it at the moment, and that is one of the reasons why we saw it drop out of the top 10 items in terms of absolute dollar gains.”
Recent weeks have seen spikes in cases of COVID-19, prompting some areas that had relaxed restrictions to impose them again.
“The new outbreaks are likely to impact business activities, restaurant engagement and shopper behaviors in those regions,” Anne-Marie Roerink, principal of 210 Analytics, wrote in the release. “These outbreaks are also likely to prompt the continuation of social distancing measures and behaviors in hard-hit states. In IRI’s ongoing consumer sentiment tracking survey, nearly half of Americans are still extremely concerned about the coronavirus.
“Also, the share of consumers more concerned about COVID-19 than the week prior is up from 15% to 22%,” Roerink wrote. “The Trump administration announced last week that it is preparing for a second wave of COVID-19 that could hit the country in the fall. Between the continued impact of COVID-19 and significant economic pressure, it is likely that demand for produce in retail will remain strong in the next few weeks and months.”