The past year has not been an easy time to be a vegetable grower, with the appalling wet summer of 2012 ruining crops and delaying the harvest. And listening to the NFU last week warning about Britain’s declining self-sufficiency, one could be forgiven for thinking vegetable growers were in real trouble. The UK now relies on imports for over four months of the year, the NFU warned, and the situation has worsened considerably over the past 15 years. In 1998, the UK was 78 per cent self-sufficient in vegetables; by 2010 that figure had fallen to 60 per cent.
However, statistics from DEFRA show UK land given over to vegetable production is actually increasing – for potatoes production rose 15 per cent between 2010 and 2012 to 756,000 hectares; and for outdoor-grown vegetables production was up 1.65 per cent during the same period to 123,000ha in 2012.
Vegetable consumption is also in good health. Some 99.4 per cent of UK households purchased vegetables in the 52 week ending 7 July; that’s 93,000 more than in the year before. There was also a slight increase in volume per buyer to 136.6kg, an increase of 0.06 kg [Kantar]. “The key macro factor has been the unseasonal weather,” explains Andrew Ovens of Produce World. “The rain last year and the unusually cool spring and early summer this year meant consumers chose to eat their favourite vegetables rather than switch to salads. The roll out of convenience stores and online channels by the major multiples also means that a wide range of fresh vegetables are now more available than ever to consumers and this has also helped drive growth.”
This is a market of significant size and maturity, relying on high frequency of consumption. According to Mintel’s 2012 fruit and vegetable report, the analyst expects the fresh produce market to grow by 16 per cent over 2011-16 to reach £16.8 billion.
Retail prices increased over the past year, reflecting the poor harvest, but crucially volumes largely held steady, demonstrating how resilient a sector vegetables is. Total average vegetable prices increased by 11.3 per cent with potatoes the key driver, up 28.9 per cent. “All crops have been impacted by unusual weather patterns to some extent, both in the UK and abroad,”
says Ovens.
“The sophisticated supply chains now in place have mitigated a lot of the impact that would have been seen in previous decades and ensured supply. However, the fundamental economics of supply and demand have still been felt.” The greatest increases in value have been maincrop potatoes, up 27 per cent; baking potatoes, up 22.5 per cent; and new potatoes, up 17.6 per cent. This is due to an increase in average price per kilo of 28.9 per cent. While volumes of maincrop and baking potatoes dipped over the year as a result of the price hikes, new potatoes grew in volume, up 5.7 per cent with 469,700 new buyers [Kantar].
Total root crops had a strong year with value up 13.2 per cent and volume up 5.2 per cent; alliums were up 8.6 per cent by value and 4.9 per cent by volume as consumers purchased more per buyer. This reflects the continued growth in scratch cooking, according to John Patrick, British Onions chairman. Brassicas also benefited from strong value growth of 8.6 per cent. Many other vegetables have also seen a double-digit increase in value – peppers up 12.7 per cent, carrots up 13.8 per cent, lettuce up 10 per cent, broccoli up 13.2 per cent and cabbage up 12.3 per cent.
Last year the NFU warned some vegetables including cauliflower and Brussels sprouts were declining in popularity and dealing with production challenges to such an extent they faced extinction. Data shows a continued decline in cauliflower sales over the past year, down 2.3 per cent in volume. However, James Hallett, chief executive of the British Growers Association, is unconcerned. “There are certain products that are in fashion or out of fashion and there will be inevitable fluctuating volumes,” he says. “One could look at curly kale, which about 10 years ago was viewed as almost not being fit for human consumption, but nowadays is incredibly popular.”
While UK vegetable production is increasing, there is no doubt there is huge potential for more growth. Consumers want more British vegetables and growers could produce more, says Hayley Campbell-Gibbons, the NFU’s chief horticulture adviser, but they need the right signals from retailers first. “It would be a real shame if we didn’t unlock the ability to increase British production simply because the confidence to invest isn’t there, because the long-term security of having a contract isn’t there, and the transparency on price isn’t there,” she says. “We are losing self-sufficiency for the wrong reasons. “There is always this assumption that if you can’t get it here we can just import it,” she adds.
“But relying on imported produce is very risky because it is not always available. The UK is not the destination of choice for importers because of the dominance of the retailers, so [the supply] may not even be there.”
Hallett agrees there is huge potential to increase production of vegetables. Sales of British fresh produce total £3.7 billion, he says; imports of fresh produce total £4bn. “So we have got a trade deficit that is bigger than our existing production in the UK.
“Granted, I can’t ever imagine growing bananas and oranges in this country, but the opportunity must be in the region of £1bn to £2bn.” Vegetable growers should look at what has been achieved by some fruit growers extending seasons with better storage and new varieties that enable crops to grow in cooler or wetter conditions, he says.
According to Hallett, there are unproven but exciting breakthroughs that could enable growers to extend seasons and improve yields.
“There are scientists working on non-GM, genetic developments in certain crops that will allow certain plants to be far more temperature tolerant and therefore extend the season further into the winter or cope with extremes of heat in the summer,” he claims.“That is in the realms of commercial reality within five to seven years in
this country.”
According to Richard Mowbray, commercial director of TH Clements, prices need to rise further if growers are to be persuaded to expand production. “I think there is a lot of competition for land and a lot of options for landowners and so there are energy crops and solar panels which are a lot more lucrative,” he says.
Vegetables will always be subject to volatility because commodity prices will continue to dominate this market. However, this is a healthy and resilient sector with huge potential for future growth. —
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