Over the last 10 years, the US fresh produce industry has seen a significant change in terms of the volumes produced and the direction of international trade. It might well be argued it has emerged as a leaner, more cosmopolitan and fitter industry as a result.

This has been driven by a combination of factors, not least emerging competition in terms of supply, as well as opportunities in a range of developing markets around the world.

And in more recent years, we have seen the impact of the global financial crisis impact on the sector in the US with the economy still struggling to show genuine recovery.

As a combination, it makes for a heady cocktail of forces for change which will continue to drive the development of the US horticultural sector over the next 10 years too. And looking at a number of key categories, a series of recurring themes begins to emerge.

Fruit production: struggling to keep pace

In the apple industry, whereas world production has grown by just over 20 per cent in a 10-year period from 57 million to 69m tonnes, US production has actually gone backwards from 4.6mt to 4.2mt – a fall of some 10 per cent. In other key producing countries, production has continued to surge ahead in comparison.

China has seen production increase by some 60 per cent from 20mt to 33mt, India by some 70 per cent and in Poland by another 28 per cent, Chile by around 36 per cent, Brazil by 10 per cent, Argentina by 26 per cent and the Ukraine 38 per cent. South Africa has seen production increase over 10 years by around 26 per cent. Even in the UK, we have seen an increase of 12 per cent in the same time. The other key market where production has fallen has been in the EU, where French production has fallen by some 20 per cent and Italy has seen the overall volume, at best, remain static.

For grapefruit, whereas world production has increased from some 5.5mt per annum to around 7mt – an increase of around 27 per cent – total US production has fallen by 55 per cent from 2.5mt to just over 1.2mt. There have been significant increases in countries such as China of almost 1,000 per cent and up to 2.8mt, as well as in other producing areas such as Mexico, Thailand, North Africa, India and Turkey.

In the pear sector, world production has increased from just over 16mt to just under 23mt per annum – an increase of around almost 40 per cent in all. Following a familiar pattern, US production has fallen by 14 per cent to just over 700,000t. There have been significant increases among other producers such as China (by 78 per cent from 8.5mt up to just over 15mt per year), India, Argentina and Turkey.

In the grape sector, production at a global level has only grown modestly from 65mt to around 67mt – although this figure also includes wine grapes. Production for fresh consumption has increased from some 10mt to 18mt in the same period. US production has fallen modestly by around three per cent and is still at a level of 6.7mt, while there have been major increases in China, Chile, Brazil and in a number of former Soviet Union (FSU) countries, Peru and parts of North Africa. Chinese production has increased by a massive 155 per cent from 3.3mt to around 8.6mt per annum. Significantly, falls have also been seen in most of the EU-based producers.

Cherry production bucks the trend for the US and global production has seen an increase from 1.7mt to just over 2mt – around 16 per cent. The US share of this has remained strong and actually increased from 185,000t to almost 285,000t per annum – this equates to some 53 per cent. There have also been significant increases in other producing regions of the world such as Turkey, Chile, India and again parts of the FSU, but with consistent falls in overall production in key EU countries, such as Italy, Spain, Greece and France.

Fruit exports:a change of direction

When it comes to US exports, again there have been significant changes in the volume and direction of trade over the last 10 years. These look set to continue. For apples, US exports have increased significantly by 170,000t in a 10-year period to over 830,000t. While the Mexican and Canadian markets are still hugely significant (accounting for around 38 per cent between them), exports to other international markets such as India (up by a massive 70,000t), China (up by 19,000t) Indonesia (up by 25,000t), Vietnam (up by 11,200t) and Russia (up by 8,500t) have all accounted for an increasing share of overall US exports along with a plethora of other emerging markets which might include a combination of Thailand, the UAE, Peru, Colombia, Sri Lanka and the Dominican Republic. In contrast, UK imports of US apples have fallen consistently from around 30,000t down to just 10,000t per annum.

US exports of grapes have also increased by around 70,000t per annum over a 10-year period, but grapefruit exports have fallen over a 10-year period from just under 400,000t per annum to just 225,000t over a 10-year.

For the cherry sector, US exports are booming, and up from 42,000t to 78,000t per annum over a 10-year period. Japan and Canada still account for over 50 per cent of overall US exports, but the strategic long-term growth is coming from Asia and in particular the likes of markets in China, Hong Kong, South Korea and Thailand. UK imports of US cherry on a direct basis have remained relatively constant at around 2,000–3,000t per annum.

What does it all mean?

The historical view of the US fruit sector was that with a huge domestic market to serve, it was as much focused on the North American market, if not more so, as it was the export business. This has all changed. While US production – with the exception of cherries – has struggled to keep pace with developments in the likes of China, India, Turkey and parts of the FSU market, in terms of sheer volume, this has meant that the industry has had to increasingly focus on its high-quality, premium position in international markets.

Only to find that this is a crowded space, plenty of others have the same idea and aspiration, not least from traditional competitors in the EU, South Africa and New Zealand but also from new-generation suppliers in the likes of Peru, Turkey and Latin America. The problems of the US economy over the last five to six years have only served to accentuate an increased interest in developing exports. While the Canadian and Mexican markets are still of extreme importance, the real growth is coming from the emerging markets of Russia, India, China, the Pacific Rim, Central America and the Middle East. These markets are still often fragmented and difficult to serve. Europe is probably on the back burner.

In this respect, the US is now more like any other major international supplier – seeing mature markets offering the current volume opportunities but with emerging markets showing the way for the future. The US fruit sector has also benefited in the past from substantial promotional support, not least via the USDA Market Access Programme (MAP). As has periodically been the case in the past, this seems to be under ongoing scrutiny in terms of it providing value for money to hard-pressed US taxpayers.

The fact it is a relatively modest overall part of the total funding that the US gives to agriculture per se – around $200 million per annum from a total of some $690bn (i.e. €523bn) over a planned seven-year period compared to the proposed €370bn for seven years in the CAP.

While comparing the US Farm Bill with the CAP on a head-to-head basis is not always easy, the US is not the only country around the world asking this question in these difficult economic times. Some have already asked it – the UK government disbanding the generic export promotion agency, Food from Britain, a number of years ago, at a time that saw UK food exports soaring to both traditional and emerging markets.

And the role of the UK market in all of this change for the US? It is still seen as a flagship market, not least in meeting technical and environmental standards. The claim that if “you are good enough to supply the UK, you are good enough to supply anywhere else” still holds true.

For many in the US though, the UK clearly has been downgraded in overall importance over the last 10 years. This seems unlikely to change in the immediate future. The UK has now assumed the position of a classic “maintenance market” for most US horticultural products.

The US horticultural trade trapped in a domestic bubble? Not any more. It is now fully exposed to exactly the same pressures, opportunities and challenges as any other significant international supplier to the global fresh fruit market.