In Scandinavia, a boost in demand for berries and other agricultural produce packed in plastic boxes with lid can be noticed. "Due to the COVID-19 outbreak, more hygienically appropriate packaging is becoming increasingly important as the demand for unpacked fruit and vegetables decreased by at least 50%", says Martin Dahlberg, the new CEO of Oboya. Over the last weeks, this manufacturer of, among other things, packaging material sees a sharp increase in orders.
Usually no boxes or without lids in Scandinavia
In Scandinavia, fruits and vegetables are usually not completely packed. “For example, strawberries are usually packed in a carton box without a lid and the consumer should put their own tomatoes in a plastic bag." According to Dahlberg, that’s probably why the demand for boxes with a lid is rising so fast in this area, opposed to other countries. "People are a bit hesitant towards loose products now, because of the virus.” Retail store owners do not want to sell loose produce anymore. “When we talk to them, they all say there’s a huge decrease in the demand for unpacked tomatoes, so they are all asking for packaged products.”
Extra costs/work for growers
Oboya offers the boxes and lids to the growers, who pack their produce and sell it to the grocery chain. Even though it is an extra cost for the grower, the retailer is demanding it nowadays and they all expect that the consumer is willing to pay a little extra. "Recently, a retail chain in Norway did an experiment. They offered strawberries in a box with lid and in a box without a lid. Everyone wanted the ones with a lid."
Offering something extra also means extra work. However, getting staff nowadays is a challenge as well. "For the growers, it might be harder this year to get enough season staff, who usually come from Eastern Europe or South Asia. However, the Swedish government did mark the agricultural sector as essential business, so the borders are open for workers."
Packed strawberries in a supermarket store in Norway, earlier this week.
Meeting the demand
Also for Oboya, these orders are extra, so on top of their usual orders. Fortunately, their factory in Poland has no problems producing more boxes and lids, explains Dahlberg. "We have enough people available to increase the production and we can run the factory 24/7 when needed. Also regarding material, we currently have enough, however it might become a challenge in the future. Currently, the same materials are used for face protection products. But for this year, we still have more than enough to meet the increased order intake as of today."
Why still plastic?
Why not shift to another product, paper for example, instead of plastic? “Some might say that plastic boxes are not such an environmentally friendly option, but in Scandinavia we are very good with recycling so it’s not necessarily true that paper containers are more sustainable”, says Martin. But even though Oboya advises plastic containers, for the quality of the produce, they also sell paper containers with plastic lids. "We always try to meet the demands of our customers and with our own factories, we are able to do so. On top of that, these own factories also enable us to guarantee the supply and deliver good quality. And of course, we can not stay behind in service. With multiple sales people in different countries we try to offer the best combination of local presence and global manufacturing footprint."
New segment very welcome
Unfortunately, Oboya Denmark - a subsidiary that was mainly focused on ornamental packaging - had to file for bankruptcy in March this year, “There were some issues already, but the drop in the flower industry due to COVID-19 meant the sales of packaging completely fell away,” says Dahlberg, for whom this was his first task as the new CEO. Therefore, this development of this 'new segment' in the Scandinavian produce market is received with open arms. "It is an extra demand that we did not have before."
Future of packaged produce in Scandinavia
And Dahlberg foresees a bright future for the packed produce industry. "People might get used to the pre-packed fruit and vegetables and I think it will become part of the ‘new normal’."