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Vegetable and Ornamental Outlooks

Vegetable and Ornamental Outlooks. 2004 Agribusiness Economic Outlook Conference Wen-fei Uva Senior Extension Associate Department of Applied Economics and Management. Vegetable Outlook. 2002 Production Value of New York Vegetable Production Totaled $384 million.

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Vegetable and Ornamental Outlooks

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  1. Vegetable and Ornamental Outlooks 2004 Agribusiness Economic Outlook Conference Wen-fei Uva Senior Extension Associate Department of Applied Economics and Management

  2. VegetableOutlook

  3. 2002 Production Value of New York Vegetable Production Totaled $384 million Source: New York Agricultural Statistics, 2002-2003.

  4. NOTE: The total 2002 figure is NOT comparable to 2000 & 2001 figures • Estimates for 4 of the 6 crops added to the fresh market vegetable program in 2000 were discontinued in 2002 – bell peppers, eggplant, endive/escarole and spinach. • Estimates for processing beets and cabbage for kraut were discontinued in 2002 • Estimate for processing sweet corn was not published to avoid disclosure of individual operations in 2002.

  5. NYS Fresh Market Vegetables • $291 million in 2002 - 3% of U.S. total (down from 6% in 2001)

  6. Other Vegetable Crops Processing Vegetables • $25.5 million in 2002 – about 2% of the U.S. total Potatoes • $59.6 million in 2002 – up 13 percent from 2001 • Production totaled 5.5 million cwt in 2002- down 7% from 2001, & estimated to be 6.5 m cwt in 2003 (up 18%) • Increase in production value mainly from higher prices Dry Beans • $7.3 million in 2002 – up 52 percent from 2001 • Production totaled 333,000 cwt, - up 72% from 2001 • Production is expected to decline in all major production states in 2003 • Prices are expected to rise for most classes in 2003

  7. Consumption • In 2002, per capita use of all vegetables & melons was 439 lbs. Others include sweet potato, dry beans, and mushrooms. Source: ERS, USDA, Vegetable and Melons – Situation and Outlook Yearbook, July 2003.

  8. Consumption – Fresh Vegetables • Per capita consumption was 221 pounds (inc. potatoes, sweet potatoes & mushroom) in 2002 – down 2% from 2001 • Decline in 2002 was mainly in leafy green vegetables– lettuces, cabbages and broccoli – inclement weather & reduced output during the first 3 months. • Tomatoes, cucumber, onions, bell peppers, and asparagus used increased in 2002. • 2003 – per capita consumption is projected to recover to 2001 level

  9. Consumption – Processing Vegetables • Per capita use (excluding potatoes, sweet potatoes, and mushrooms) increased 3% to 118.5 lbs in 2002. • Per capita consumption of frozen sweet corn increased 2% in 2002 • Canned sweet corn, green peas, and beets continued their long-term decline. • Improvement in the general economy this summer and fall • Projected a 2% increase in per capita use of processing vegetable in 2003 – led by tomatoes and sweet corn

  10. Potato Consumption • Per capita use of potatoes fell 2% in 2002 to about 135 lbs. • Decrease in both fresh and processing uses. • Consumption of potatoes is showing a downward trend since 1996 (145 lbs) • Popularity of low-carb diets; more restaurants offering alternatives to potatoes Dry Bean Consumption • Per capita use of dry bean rose 3% to 7.5 lbs (22% higher than 1980s) • Popularity of vegetarian diets

  11. Industry Situation & Outlook The Organic Market • About 2% of U.S. vegetable acreage (NY similar) • More than 10% of the vegetables grown in Vermont, New Hampshire, Maine & Colorado • Assistance ($ 1 M) from USDA on certification costs • Continue to grow beyond health-food markets • New retailers (7-Eleven) and more producers (Foxy Food) are entering the field • Organic food company are expanding into non-traditional markets – convenient stores, sports stadiums, and food service channels (schools, hospitals & other institutions) • Overseas markets developing • Imports complement domestic offerings

  12. Industry Situation & Outlook Eating Healthy ------- • Demand for entrée salads in restaurants up 6.7%. • Applebee entered a 5-year partnership with Weight Watchers to slim down its menu. • Baja Fresh is playing up produce in lighter menu • Success of fast-food salads fueling demand for lettuce (demand up 12%) Wal-Mart Effect----- • 19% market share today – to 35% projected in 5 yrs • Survive as what Wal-Mart is not & become better managed, more efficient , more effective merchandising Country of Origin – September 30, 2004?

  13. Ornamental Outlook

  14. NY 2002 floriculture and nursery production totaled $315.0 million

  15. Floriculture Crop Production • Totaled $4.9 billion in the U.S. – up 1.6% from 2001 • Weak U.S. economy in 2001 & 2002 is responsible for flat sales • Expected to increase 2% to $5 billion in 2003 – from higher import prices and economy recovery • Grower wholesale prices flat in general

  16. Floriculture Crop Production • $185 million in NY, up 8% from 2001 • Ranked 6th in the nation

  17. Number of Growers Declining • U.S. -- 12,717 floriculture crop growers in 1997 – 10,216 in 2002 • NY – decreased for the fifth consecutive year -- from 731 growers in 2001 to 663 in 2002. • Large growers (>$100,000 annual sales) continue to expand – consolidation & expansion

  18. Small vs. Large, 2002

  19. Industry Situation & Outlook • Lawn and garden spending is stable at around $325/HH • Highest spending communities are in major metro locations and their suburbs - Along the East Coast from southern Maine to central Virginia, and on the West Coast from the Bay area south to San Diego. • Improving economic outlook • The housing market continues to be a solid part of the economic recovery • Mass marketers continue to present marketing challenges • Getting Bigger by going smaller - Wal-Mart’s Neighborhood Market, Home Depot’s Landscape Supply Stores

  20. Industry Situation & Outlook • Consumers continue to search for “that special thing” • Container gardening is going main stream • Growing at nearly a 20% annual rate • Lifestyle gardening • Outdoor living & indoor gardening • The whole package – furniture, fabric, music & fun • Organic & Eco-Labeling • Organic in Lowe’s • West Coast, urban Texas & the Northeast are the hot markets • Impact of International Trade • Outsourcing of plant production - Traceability and disease control - The Ralstonia Scare

  21. Industry Situation & Outlook • Focusing on Plants - Plants are the Basic • Diversify of products • Color, shape, use • Is that indoor or outdoor plant? • Promoting plants • National Brands - Proven Winner, Flower Fields, Simply Beautiful • Promotion Alliance among regional growers • American in Bloom campaign in about 40 communities • National growers promote regional qualities in plants • Monrovia’s POP allows retailers to customize signs with regional information • David Austin Roses & Flower Fields’ P. Allen Smith’s Garden Home Collection are testing plants for region-specific recommendations

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