In New York, the total value of vegetable production (fresh and processing, excluding potatoes and dry beans) in 1999 was estimated to be $284 million which was 9.2 percent of total New York agricultural product receipts-- down 2.6 percent from 1998 production. The value of New York's principal fresh market vegetables at $199 million in 1999 was down 2 percent from 1998. The production values of sweet corn, snap beans, and cucumbers increased, while onion production value took the biggest hit, down 31 percent from a year earlier. The numbers for 2000 are not ready yet. However in Yates County fresh market vegetable production has been steadily increasing. As a result, the Finger Lakes Produce Auction will have a new facility in 2001. Increased participation in the auction from growers may result in more wholesale buyers in years to come.

Early rains in 2000 lowered initial volumes for New York vegetable crops. Statewide fresh market sweet corn had the largest growth trend at $2.86 million per year, followed by fresh market snap beans at $1.26 million per year. In 1999 increases in fresh-market vegetable per capita use were experienced in cauliflower (40 %), head lettuce (15 %), and broccoli (15 %), which included fresh-cut and value-added. Very few fresh market vegetables experienced reduced use last year, with declines in cabbage (8 % ), leaf/romaine lettuce (7 %), and tomatoes (1 %).

Large domestic output and low market prices trimmed U.S. imports of fresh vegetables to 14% of total supplies, compared with 15% in 1998. Imports (excluding potatoes) accounted for 10% of domestic frozen vegetable consumption last year. The United States exported nearly 8% of its fresh market vegetable and melon supplies. This is the same as for the previous three years, and up from 7% in 1989.
Consumers are benefiting from an abundant supply of fresh produce and low prices. Consumption of fresh market vegetables is predicted to rise. With only a small portion of disposable personal income (10 percent in 1999) being spent on food, desire for speed, convenience, high quality, and more varieties will drive consumers' purchase decision.

However, for producers, commodity prices stay low, energy prices are up, and global supply further intensifies competition in the market. From digital communications, genetic engineering to better and smarter packaging, technology is exerting a substantial impact on how produce is grown, distributed, and marketed. Information technology is a key factor behind the increasing industry consolidation. According to Forrester Research Inc., Cambridge, Mass, electronic grocery sales are expected to reach $10.8 billion by 2003. Still, that would account for just 2 percent of industry sales. On the other hand, business-to-business internet commerce is projected to reach $1.3 trillion by 2003. With the belief that e-commerce will streamline supply chain management, and armed with the support from venture capital companies, the emergence of produce e-commerce web-sites is a trend worth watching.

Yet in Yates County the trend is towards homestead vegetable stands not homepage produce sales. Retail vegetable stands are in a unique position to supply tourists from nearby urban areas with produce from local wholesalers via the produce auction. Yates County vegetable stands have the opportunity to be listed in the Ag and Markets' 2001 Western Region Guide to Farm Fresh Products. This guide is aimed at tourists and lists commodities, location, and hours of business for produce stands and wineries. Growers will be contacted by Ag and Markets soon to participate is they wish.

Another opportunity for growers is still on the horizon. The Finger Lakes Culinary Bounty program seeks to unite growers with restaurants to establish a regional cuisine. Currently in Yates County Veraisons at the Inn at Glenora is participating in this pilot project. In the Spring of 2001 there will be a meeting to unite growers and chefs.

Efforts to differentiate and add value to products will result in growing opportunities for smaller marketers. Fresh-cut (precut) produce consumption continues to grow because of the tight labor market in the foodservice industry, consumers' desire for convenience, and the produce industry's effort to create new products. Vegetables that are commonly sold precut include broccoli florets, brussel sprouts, carrots, cauliflower florets, cole slaw, long beans, mixed greens, salads, salad kits, and soup vegetables.

The organic category is growing nationwide. Retail sales of organic vegetables and fruits (whether cut or uncut) approached the $1.4 billion mark in 1998. Organic produce is increasing about 10-12 percent annually in the past decade although it represents only about 2 percent of retail produce sales. However, annual sales growth for organic produce have tapered off in recent years, having peaked at more than 32 percent in 1996. FoodTrends 2000 showed that about one-third of consumers said they had bought organic produce in the first six months of 2000. Eight-two percent of consumers who purchased organic produce said they purchased vegetables. The top three fresh organic vegetables purchased by consumers were tomatoes (46 percent), leafy vegetables (16 percent), and carrots (14 percent). While organic produce is becoming more mainstream, organic growers face the same challenges as the conventional growers - fewer buyers, bigger competitors, more product competition, narrower price differentiation with conventional produce, and how to expand consumer demand. While demand for organic products is still growing, growers need to prepare for strong competition with strategic crop planning and close coordination with buyers. Other efforts to differentiate products include niche branding and specialty marketing (vegetarian, ethnic, and gourmet marketing, etc.). Food-borne illness, pesticide usage, environmental protection, generic engineering technology, worker protection, and world trade issues will continue to take high profile with government regulation and different groups which will influence the industry in 2001 and beyond.

Source: Wen-fei L. Uva, Senior Extension Associate

For more information please contact Judson Reid jer11@cornell.edu

Cornell Cooperative Extension Yates Association
Last updated: 5/15/02

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