Q1 report from United puts spotlight on retail produce sales

Retail fresh produce sales totaled $17.8 billion in the first quarter of 2021, up 3.3% from the first quarter of 2020 and up 11.5% from the first quarter of 2019.

Berries saw significantly higher dollar sales versus the same period in 2020 despite inflation, according to the Q1 FreshFacts on Retail report from the United Fresh Produce Association. Categories including apples, bananas and oranges had higher average prices than the previous year and saw sales dip.

Jeff Cady, director of produce and floral for Williamsville, N.Y.-based Tops Markets, noted during the United webinar focused on the report that the banana business was adversely impacted in the first quarter of this year by hurricanes that hit major growing regions in late 2020.

“A couple were spared, but it put a lot of pressure on the banana world, and it still is today,” Cady said. “Whenever I’m looking at the data here, really I’m pleasantly surprised at what I see, to be quite honest with you, because that just is like kudos to the suppliers and vendors out there that in a very difficult situation managed to still keep us in supply (even while) handcuffed basically like that.”

On the vegetable side, pre-packaged salads, lettuce and mushrooms saw dollar sales grow despite higher prices, while potatoes, onions and carrots saw lower dollar sales. Potatoes, onions and carrots were also categories that saw enormous spikes in the pantry-loading early days of the pandemic.

United’s category spotlight section for the Q1 report, which looks ahead to popular items for the third quarter, includes avocados, cantaloupes, cauliflower and corn.

Cady noted that there has been high demand for corn even amid elevated prices.

“Being at the higher cost, what it was last year, we learned a lot of things about corn,” Cady said. “People buy corn. They do. I don’t think price is a huge barrier. Inelastic? Okay, I don’t know if I’d go and use that word, but I’d say pretty close.”

Inflation has been a major topic for the industry recently, and Cady said he expects it to continue. Labor, freight and pallets are among the areas that are significantly more expensive right now.

“We know the cost of doing business today is more than what it was two years ago, and unfortunately … for the consumer, I hate to say it, but eventually someone’s got to cover,” Cady said. “We all can’t absorb it. We can’t expect growers to absorb it, shippers, retail, somehow it has to be passed onto the consumer.”

United’s Q1 report also looks at trends in value-added fruits and vegetables, organic produce and popularity of different produce items based on demographics.