Oversupply of strawberries during the UK season is likely to get worse, a leading marketing desk has warned.
Nick Marston, md of KG Fruits, speaking at the Fruit Focus exhibition in Kent this week, claimed the industry still has much to do when it comes to ironing out the peaks and troughs in berry availability.
“Increased supply because of later or earlier varieties is great news for customers, but a couple of years ago we had three days of oversupply and this year we have already had four weeks and that situation is probably going to increase,” he warned.
In order to survive in the future, growers have a clear choice to make, KG chairman Angus Davison of Haygrove added. “Producers are going to have to differentiate and decide whether they want to stay with low-cost production and supply big names like Tesco, or whether they want to target the premium market with niche lines. Rationalisation is inevitable.”
He forecasts fewer larger growers in the marketplace. “It’s up to growers to decide where they fit into the market,” said Davison. KG is working closely with breeders to establish core varieties at different times of the season.
This season was not typical and presented KG with some marketing challenges, said Marston. “The season started late this year with a shortage in June followed by a large overhang of fruit production into July. Good weather bolstered early July sales and production steadily exceeded supermarket demand. The situation worsened last week and again this week as poorer weather has caused sales to fall further.”
On the positive side, KG has sold 11,956 tonnes of UK strawberries so far this year compared with 11,465t at this stage of the 2004 season. “This volume of production has come from a static production surface area and is four per cent up year-on-year in spite of the lateness of the season,” said Marston.
He conceded that the problems of supply and demand have been worrying for growers. The issue of margins and trying to get good returns will shape the future. “If you’ve got a 24 week season, the reality is you will have eight weeks [with volumes] on target, eight weeks below and eight weeks above but that is the nature of it,” said Marston.
Overall KG remains positive that as a company it has a considerable range of new varieties coming through, much of it exclusive to KG and its growers. “By offering improved varieties with better eating quality and shelf life, we are sure we can secure the growth of future demand,” Davison said.
Market penetration is at 75 per cent for strawberries with people buying the fruit only seven times a year on average, leaving room for potential increases. Marston forecasts that demand for the berry will continue to grow by about 10 per cent a year.
Davison believes that KG is well equipped to tackle the new era. “We have actually anticipated for it and we are well positioned,” he said. “Our own breeding programme is great - we have access to some of the best strawberry genetics in the world.”
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