Fresh Produce Realities – Understanding the Value

Ron Becroft – President, United Fresh New Zealand Inc
Food Security Workshop
22 September 2006

This morning I sat down to a breakfast of fresh ripe strawberries grown just down the road in Matakana and it's only September. Technology has changed what our parents knew about seasonality.

Today's fruit and vegetable shop will have produce from around the world. Much of it would be produced very cheaply, but add in the technology, the cool chains, the freight, the compliance and shareholders' profits on every step of the way, and it's easy to see why some people view fruit and vegetables as being expensive.

However, highly educated technologists and marketers don't work for nothing. And business investors expect some return on their investment. When we buy a 99c/kg banana do we think of the peasant farmer working 50-60 hours a week in the plantation in sweltering tropical heat among the snakes and nasties for a few dollars a week?

Throughout the world growers today receive a smaller proportion of what the consumer pays than ever in history. Yet consumers demand perfect product; they demand it all year round; they demand that it is safe; they demand traceability; they demand convenience. Mother Nature doesn't always do convenience and she still makes the rules, thankfully.

When I was 15 my grandfather gave me a shovel. He said, "Make this your friend and you will always be able to feed your family." Why do so few people grow their own vegetables today? Most low socio-economic suburbs in New Zealand are developed on our very best horticultural land. Look at the area from the Waitemata to Pukekohe for a start. When society says that the ultimate land use for the best soil type is to cover it in concrete, houses and tar seal, why would anyone expect cheap fruit and vegetables to continue to be available?

I figure I could feed the nation with the finest of fruit and vegetables out of the back gardens of suburbia. We only need a few more shovels, some seeds and the will, of course.

Think of a shovel (or spade) as gym equipment, the sun as abundant free Vitamin D and the process of embracing nature as a glorious awakening for the soul. There is something very spiritually comforting in enjoying a meal of fresh fruit and vegetables that you have produced yourself. Sun, soil, water and you. Magic!

One thing you will learn from this exercise though, is a great deal more respect for the product that is displayed in the local supermarket. It doesn't get there without a lot of knowledge, investment and hard work. The reality is fresh fruit and vegetables today are not expensive. Compared to average household incomes, fresh produce today is more affordable than it ever has been (even allowing for the grasping tentacles of suburbia).

Our horticultural sector exports over $2 billion of products to over 100 countries annually. We have no incentives (in fact we pay millions in tariffs to access many markets). We have no domestic border protection and are, and must always be, globally competitive. We sometime wish the rest of New Zealand would catch up.

If politicians had increased their efficiency as much as fruit and vegetable growers have over the last generation we would only have 25 MPs in Wellington today.

One area where we as an industry could do a lot more is in educating the public as to what to look for in the produce department in terms of value. I am constantly surprised how little many consumers know about fresh produce and identifying maturity and quality even understanding seasonality.

As grower numbers dwindle and supply chains tighten, purchase options for consumers also disappear. Some of you will remember when there were endless roadside fruit stalls out in Albany and West Auckland, all under-cutting each other. Suburbia and big business has eaten them all.

Farmers' markets, gas station forecourts and flea markets operate at extreme ends of the market either niche and expensive e.g. Matakana market or they involve product of dubious quality. Food safety and traceability seldom figures.

In spite of all these pressures, United Fresh is committed to growing the market. Today 5+ A Day's primary focus is to introduce our nation's children to the world of fruit and vegetables. By conditioning young palates to the tastes and textures of fresh fruit and vegetables rather than to our arch enemies, sugar and fat, we aim to set eating patterns that last a lifetime, and we are making headway.

Perhaps the solution for fruit and vegetable growers lies with the motorcar or more accurately, man's passion for the automobile. The rapidly rising price of fossil fuel is beginning to get interesting. The world's largest producer of sugar, Brazil, is diverting massive volumes of sugar into ethanol production to power their cars. This is having the effect of doubling the world wholesale price for sugar in less than a year. At the same time, bio diesel production is rapidly growing which is putting all fat products into a cost escalation cycle.

So expect the price of fruit and vegetables to ratchet up a bit over the next few years but the increase will be modest compared to our enemies, sugar and fat. Unless we can all learn to live without our motorcar and how likely is that!

Yet technology has many faces, we know obesity is a growing global phenomena, how about a bio diesel/hybrid car with micro liposuction seats that collect body fat and process it direct into the fuel tank. Some of us for the first time in our lives would be able to drive down the road and at the same time watch the needle on the fuel gauge actually going up.

No longer would we be stopping at BP or Shell to refuel, we could just go direct to McDonalds. The multi-national oil companies won't like that bit but Dr Cullen will turn very nasty indeed. Just watch the new taxes appear. No, you'll never beat the taxman, not while you're alive, and he could even get you later.