Once a year, farmers, packers, shippers, distributors, and retailers of Mexican-grown produce gather in Southern Arizona to celebrate recent successes and carp about setbacks in the industry, caused by nature and politicians.
They did so recently in Tubac at the 2019 version, celebrating 75 years as the Fresh Product Association of the Americas. Leader of the group is Lance Jungmeyer, who spoke to issues impacting the U.S.-Mexico border and the still-pending US-Mexico-Canada Agreement, which would become the new North American Free Trade Agreement, if approved.
“Despite our opposition, a new U.S./Mexico tomato suspension agreement was approved by Washington and prices have already started trending upward with organic tomatoes at 40 percent more than other tomatoes as a reference point,” he says.
“This is essentially a non-trade-tariff barrier. Prior to today, about 8 percent of Mexican tomatoes coming into the U.S. had been required to be federally inspected. With this new requirement, that number has risen to 92 percent.
“First of all, we don’t feel the inspections are justified because there’s just not a quality problem with tomatoes coming from Mexico. And even beyond that, we’ll be going from currently inspecting 15 percent of total Mexico produce coming across the border to 28 percent. That’s going to slow things down a lot and increase time, cost, and inconvenience.” [The new inspection rule begins about mid-March 2020.]
As to the progress of USMCA --- “Every week it goes from, ‘I think it might actually have the votes to pass this week’ to ‘There’s no way it’s going to happen,’” Jungmeyer said. “I’d say if we don’t get it signed by the end of this year, the chances of it happening in 2020 are very small, but I’ve learned to never rule anything out. A lot of politicians have a lot of jobs in their districts riding on this decision and even if they haven’t come out in public support yet, I think they eventually will.”
D.C. MORE CONTENTIOUS
Convention presenter Britton Clarke lobbies on behalf of the group in Washington, where she described the environment as “more contentious than ever.”
“We’ve been advocating for ratification and believe we have the votes to pass USMCA in the House and we’re asking Speaker Nancy Pelosi to take a vote on it before year-end,” she said. “We’ve done a vote count and think we’re on a path to ‘yes’ and believe every day brings us closer to agreement.”
Keynote speaker was Rick Stein, a Vice President of the Food Marketing Institute who started his career as a supermarket stock boy nearly 50 years ago.
“What I see happening now is younger consumers, Millennials and Gen Z, aren’t that interested in doing meal preparation and they’re opting for food that is already partially or fully prepared,” Stein said.
He is also tracking a change in what people are eating. “You have this whole plant-based protein issue now where people can get their protein from produce and vegetables. I remember when my spaghetti used to come with pasta. Now it’s served with zucchini noodles.”
In his 2019 Power of Produce presentation, he noted: “The retail food industry represents combined annual sales of almost $800 billion with produce being a $60 billion category only outdone by meat sales. It seems everyone is buying produce, a market that is nearly fully penetrated and to grow it, we’re going to have to either get more people to spend more for product or get them to buy it more often.”
CULINARY COMFORT ZONES
“We need to pull customers out of their culinary comfort zones, get them to try different produce, and to expand their consumption occasions. Hence our marketing about ‘Get Creative With Artichokes’ or ‘Instead of Apples, Try Quince.’ Currently 41 percent of consumers eat produce just about every day while another 36 percent eat the healthy stuff three times a week.”
Produce is a basket driver, however. When consumers shop without adding produce, their average checkout totals $41. Add some veggies at checkout and the tab rises to $63 average.
FMI’s 2019 U.S. Grocery Shopper Trends report found a rising number of households, at least a third of them, had one or more members who voluntarily followed a vegan or vegetarian diet, especially Gen Z and Millennial households.
“It used to be that consumers ate what farmers grew, nowadays farmers are growing what people will eat because the consumer drives everything we do. High quality, and therefore more expensive, produce is replacing low prices as a market driver. While the frozen produce segment is growing for younger consumers, 84 percent of produce currently sold is fresh.”
Nearly three out of four shoppers now serve plant-based meat alternatives for dinner on occasion. And on the subject of plant-based meatless innovations, Stein left his audience laughing when he noted that while veggies always found a place on his plate, he was reluctant to endorse plant-based burger products.
“The typical reaction is, ‘I was pleasantly surprised’ or ‘it’s not bad, in fact it’s pretty good’. All I can say is, if I were to describe my wife in those terms, I’d be in a world of trouble.”