Almost wholly reliant on imports, the exotics category is always among the first to suffer from any volatility in exchange rates.
That said, the Brexit fallout and subsequent uncertainty has not yet shaken sales performance in the category, with value up 12.1 per cent and volumes up 8.8 per cent [Kantar Worldpanel, 52 w/e 9 October 2016].
And in spite of the worries surrounding potential import tariffs and currency, it seems exotic suppliers are in fact preparing for longer-term growth in the category, with investments in production and varieties.
Spanish supplier Anecoop recently signalled its commitment to exotics with news that it will become the first to develop commercial papaya production in Spain, following a project initiated seven years ago with the University of Almería. The group carried out its first exports to Europe earlier this year and between May 2016 and May 2017 it expects to ship around 2,000 tonnes of papaya, in a major advancement to European tropical fruit supply.
In the UK, the recent Hindu festival Diwali saw demand spike for some exotic fruit such as pomegranate, according to George Perry managing director Mark Tate, who reports that overall demand has been a “lot higher than last year”. But annual religious festivals such as Eid or Diwali are far from the only drivers of such strong growth in exotics – demand is also being stoked by increasing availability of fruit, according to Esra Söyleyen, marketing manager for leading Turkish supplier Aksun.
“Over the last 10 years, growers are planting lots of pomegranate trees and all these investments have started to come through, with bigger volumes over the last two to three years,” she says. “So every year we are getting more volumes from pomegranates. On the other hand growers are improving pomegranate production and growing techniques, so every year we get better colour and quality.”
Alina Iefimov, marketing manager at Israeli exotics exporter Galilee, agrees that “the exotic fruit market is increasing in the UK”. “We see more interest in pomegranates this year, and we had good growing conditions over the summer. As a result we’ve had more premium-quality fruits this year,” she says.
Aksun has also spotted room for growth in the fig market, Söyleyen continues, with sales up 23.5 per cent on last year, following a 30 per cent rise in production. “We have found three new countries to supply figs and started to organise partial deliveries there, so business is growing for exotics for sure,” she adds.
Söyleyen says the company is focused on growing retail programmes in the UK, rather than targeting the wholesale sector where the Turkish fig supply is already well established. Indeed, growth at retail level remains robust, according to Kantar analysts, who note that exotics growth has been driven by higher frequency from existing shoppers, as well as new shoppers entering the category.
General manager of Evesham importer Vitaal Exotics, Richard Dyde, says the upcoming rainy season in Kenya is expected to affect volumes on some exotic veg lines. “We are also in changeover periods between production regions for other products as the seasons change, but that’s all the fun of the fair,” he says. “Overall, I’d say we’re seeing steady growth in the exotic category as a whole. Within that there are product lines where demand is stable, such as fine beans, mangetout and sugarsnap, whereas we’ve experienced increases in other products. From a cost point of view, we’re seeing higher costs as a result of sterling weakening against other currencies.”
On longer-term trends, Dyde points out that many exotic lines have become more mainstream, suggesting others could follow. “Not too long ago sweet potatoes and butternut squash were seen as exotic. Healthy eating, cultural influences, more discerning tastes and demand for culinary variety have driven the growth of exotics, and made many products day-to-day items,” he says.
Consumer education will play a big part in growing the exotics category further, says Dyde. Ripe and ready-to-eat formats have been largely credited with the boom in the mango category as well as other exotic fruit, but there is perhaps more work to be done on helping consumers prepare and eat exotic veg.
“Showing people how to store, prepare, cook and eat many of the exotic lines can only help with promoting these niche products. We’ve seen growth in added-value, user-friendly product lines, so we need to continue to be innovative in making products easy to use,” adds Dyde. “As well as continuing to innovate, managing cost is going to be a major challenge over the next couple of years. A weak sterling increases costs for imported produce, but the category needs to remain competitive and relevant within the overall fresh produce sector.” With Brexit deals far from over, strong demand is the safety net to exchange rate uncertainty - and long may it continue.
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