The growth of plant based foods will create massive opportunites for horticulture

The CEO of the Produce Marketing Association (PMA) Cathy Burns has told Hort Connections that plant based foods are at a stage of rapid growth, and by 2020 it will be the source for 47 per cent of protein globally.

She brought up examples of plant based burgers, sausages, cheese and even steak made from wheat and soy, adding that this shift creates potential for the fruit and vegetable industry - but growers and producers need to become more involved in the process.

"The scariest part of all is that the growth of plant based products is happening everywhere but in our (industry)," she said. "So we think about what meat is doing, and all these centre store categories, they are adding plants as a main ingredient to their products. But we are the plant based product. So how do we tell our story? How do we get half the plate? How do we make a difference? Because what's happening is everyone is leading the food conversation, and the plant food conversation, but us."

Ms Burns also pointed out changes at retail level, as the traditional grocery store model is being challenged on a number of fronts. German Supermarket chain Lidl had to revise its target of 200 stores open in the U.S.A by 2018, down to just 20. While Amazon has just launched a new store in Seattle where there are no checkouts, it is done through a mobile app device. A similar store with a virtual basket is operating in Shanghai, while Walmart and Microsoft have joined forces to remove time challenges for consumers, such as queuing.

"What is the number one frustration as a customer going into a retail store? The queues," Ms Burns said. "When you walk in and leave this store, you actually feel like you are stealing. Until you get out of there and you are notified on your cell phone what you were just charged."

This is even stretching to the produce world, with a company opening up in California later this year with the same driverless, artificial intelligence and mobile components, which is aiming to cut 30-40 per cent of the cost for consumers. Ms Burns says businesses are also wary of keeping up the personal interaction in these stores.

"Retailers are looking for how they can create that sense of community," she said. "How do I connect and get that farmers market feel without adding a lot of labour. At the push of a button, the customer can talk to a chef, a nutritionist or a farmer for any type of information or interaction."

By 2023, online grocery sales are expected to double, with Australia to be considered more advanced than the U.S, according to Ms Burns. But she says the concerning part is that only 28 per cent of the basket is fresh produce, and Australian suppliers need to better leverage technology to capitalise, like the United Kingdom which has 44 per cent of online customers buying produce.

"It's a huge opportunity for our industry," Ms Burns said. "Only 28 per cent bought produce online - that is because of quality. Retailers and some of the online service providers haven't been able to figure out how to deliver a quality experience in the produce space with an online intervention."

Bryan Raymond from Citi Research agreed that Australia is behind in terms of the leading technology that is offshore. While Woolworths is investing in the nation's first ever fully automated distribution centres, he says our supermarkets are advanced in the fundamentals of online sales, such as click and collect and deliveries, but it is not the same as automated robots. Mr Raymond adds the biggest challenge is drastically improving shelf life, by speeding up the supply chain.

"The opportunity for improving shelf life is to get that supply chain down into the days," he said. "From where you take it out of the ground or off the tree, onto the shelf and into someone's home. That's where we are a long way behind the likes of Marks and Spencer in the U.K and other operators in the U.S who are really pushing into that. That's a huge investment and doesn't happen overnight."

Drew Yancy from growth strategy company Clareo supported the need to address challenges in extending shelf-life of fresh produce, and says the demand is there to do so.

"Demand is not the problem," he said. "I am not aware of too many retailers who are setting up shop in any part of the world, who before they set up shop, in the strategy room are saying that produce is going away and canned beans is where the growth is going to be. The demand is there and the channels are shifting quite heavily. Any time we are adding a last mile component, to the delivery of products, we create shelf life challenges."

He added that with the shift online, and the growth of Amazon, it could also create more opportunities for existing companies.

"If the distribution industry in the United States is open to working with Amazon, they are a great partner," Mr Yancy said. "I have peers who love Amazon coming into their market because Amazon still outsources most of the supply and they will for the next five years at least."

Other challenges that were raised in the presentation were sustainability and reducing the amount of plastics involved in the packaging of fresh produce, and also getting the nutrition in fruit and vegetables to people with a low socio-economic status. Ms Burns told the conference that if eating habits do not change, kids today will not live longer than their parents do.


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