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Produce and potatoes in the UK benefit from smaller Christmas celebrations

Covid-19 delivered a Christmas like no other. National and local lockdowns created a lot of uncertainty during the run up to the festive period, with many Christmas plans forced to change last minute due to government restrictions, AHDB says in a news article.

The industry body says all that uncertainty did not stop people from celebrating. “2020 was the biggest ever Christmas in the UK for food retail, with food and drink sales excluding alcohol growing by £912m to £8.1bn (Kantar, 4 w/e 27 Dec 20). However, this was not enough to outweigh the losses we saw in the out of home market, which declined by £1.4bn.”

AHDB’s main article on Christmas covers more detail at a total grocery level.

Fresh produce and potatoes

With more consumers cooking Christmas dinner at home due to restrictions, many areas of produce saw an increase in household penetration.

Total potatoes, including fresh, frozen, chilled, crisps and snacks, grew by 12% in value, which is in line with the total market. Spend on fresh potatoes grew faster than ever but, at only +6%, they still lost market share.  Volumes grew more than spend (+14.1%) but some major supermarkets sold more potatoes on promotion, leading to an average price drop of 7%, down to only £0.53/kg.

Promotions on fresh produce are part of many retailer strategies to encourage people in-store to do their big Christmas shop. However, this is to the detriment of potato category value as they are a staple Christmas product and people need little encouragement to buy them at this time of year.

Retailers with the biggest volume growth in fresh potatoes actually increased prices, proving that a change in consumer buying habits drove sales this year rather than promotions. However, this was a very different story last year, so is one to watch in the future.

Frozen potatoes have been hugely popular all year. However, frozen roast potatoes struggled at Christmas, while chilled roast potatoes saw strong growth. Chilled potato products, as a whole, were in decline during 2020, as customers cooked more from scratch and tightened budgets.

This Christmas, dauphinoise and roast potatoes proved popular but did not grow fast enough to cover declines in chilled mash and jacket potatoes.

Many other areas of fresh produce have seen a similar scenario to fresh potatoes. Carrots saw volume growth of 14% but only 4% growth in value. For parsnips, promotions were too deep and this led to a value decline of 1%, despite growing in volume. However, sprouts have managed to escape the price cuts, with value growing faster than volumes.

Opportunities for produce in Christmas 2021

  • Volume sales of produce remain strong but price cuts are driving value down. Retailers need to decide if this strategy actually adds value.
  • Shoppers are looking for shortcuts, even at Christmas. Chilled prepared potatoes need to play up time saving and taste elements to justify the higher price tag.

Source: AHDB
Photo: Heart

Lukie Pieterse, Editor and Publisher of Potato News Today

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Haith

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