Coalition publishes survey results covering costs and revenues, with the outlook “daunting” for the international fruit and vegetable business
The Global Coalition of Fresh Produce has published the final results of its second survey into costs and revenues in the global fruit and vegetable industry, conducted in the spring of 2024.
“We conducted this survey as a follow-up to the survey conducted by the Coalition in 2023, when producers and traders the world over were facing unprecedented cost hikes,” said Ron Lemaire, chairman of the Coalition and president of the Canadian Produce Marketing Association.
“The aim of this new survey was to understand how the situation has evolved over the past year.”
According to the Coalition’s new report, the industry is continuing to grapple with substantial cost increases across various inputs, despite some moderation of the rises experienced during and immediately after the Covid-19 pandemic.
These include construction materials (up 56 per cent year-on-year), fertilisers (up 33 per cent), fuel (up 31 per cent), machinery (up 30 per cent), and shipping services (up 28 per cent).
A majority of respondents managed to increase their average selling prices compared to last year, the survey found, although, most remain unable to fully offset rising costs for various reasons.
These reasons include intense price competition in the fresh produce market, limited consumer purchasing power, and a lack of bargaining power with buyers.
Also, some 76 per cent of operators are operating at a break even or profit, compared to 81 per cent in 2023, the survey revealed.
“What is worrying,” noted Lemaire, “is that financial strain has affected operators’ ability to invest in critical areas like capital equipment, innovation, and expansion, which are all essential for long-term sustainability.”
Looking ahead, the outlook remains “daunting”, the Coalition said, with ongoing geopolitical tensions, climate change impacts, and persistent inflationary pressures expected to prolong cost escalations.
As a result, a substantial proportion of respondents fear for the future economic viability of their operations, with nearly 70 per cent considering the possibility of closure within the next two to three years.
On the positive side, Lemaire highlighted that “there is optimism within the market, and the industry has shown great resilience in adapting to immediate challenges”.
“However,” he added, “the path to sustainable recovery and growth hinges on addressing the systemic issues driving cost increases, and ensuring adequate support for long-term investment and innovation.”
The final report is available on the Global Coalition of Fresh Produce website at https://producecoalition.net/publications.
