Summary:
The dehydrated fruit industry consists of dried fruits that can be consumed as snacks or used as an ingredient in the production of other foods. Much like other snacking industries, shifting consumer focus to healthy snacking alternatives has driven recent growth in the dehydrated fruit industry. And with the world expected to consume almost 4 million tons of dehydrated fruit by 2020, this industry isn’t showing any signs of slowing down.
The UK is Europe’s largest importer of dehydrated fruit. In 2018, dehydrated fruit imports were worth GBP145 million. Some of these imports were in the form of snacks distributed for retail sales, while other dehydrated fruit imports make up crucial ingredients for company’s products, demonstrating the versatility of this industry. This article details how the United Kingdom’s (UK) dehydrated fruit industry has grown in recent years, industry growth drivers, analysis of the UK’s dehydrated fruit industry, and opportunities and threats that companies need to consider.
To get an understanding of how the dehydrated fruit industry has grown, it’s important to understand how the wider dehydrated product industry has evolved and grown throughout the world in recent years. The global dehydrated fruits and edible nuts industry is expected to grow at a compound annual growth rate (CAGR) of 5.3 percent from 2019 to 2024. This equates to a total market value of USD241 billion by 2024.
The UK is a net importer of dehydrated fruit, with its export market worth GBP18 million in 2018. This relatively small market size compared to the value of the global dehydrated fruits industry doesn’t mean there aren’t opportunities available in the UK. In fact, re-export of dehydrated fruits and the use of imported fruits in other products is where value is created in the UK. For example, many processors in the UK produce chocolate-coated fruits, glazed fruit, and crystallised dried fruit. Other growth drivers of the UK’s dehydrated fruit export market comes in the form of re-exports. In 2015, for example, re-export of prunes imported from Chile and the USA to Turkey increased five-fold. Ireland is the other major export market, accounting for more than 50 per cent of the UK’s total dehydrated fruit exports.
As the largest European importer of dehydrated fruit, there's strong demand for a range of dehydrated fruits in the UK for various purposes. According to Fresh Plaza, the UK is the world’s largest consumer of dried grapes, while prunes, dried apples, tropical fruits, and super fruits are in strong demand as well. With the wide range of uses available for dehydrated fruits, entrepreneurial dehydrated fruit producers have a range of niches they can choose, based on the size of their business and target market. Like other packaged snack markets, focusing on consumer demand for healthy snacks with natural ingredients is where significant opportunity exists for small businesses producing dehydrated fruit. Other niches such as dehydrated and crystallised fruit for decorative purposes also have potential.
Demand for dehydrated fruit in the UK continues to grow as consumer demand for healthy snacks with all-natural ingredients has grown. This demand has been driven by growing income and wealth, the need for convenient foods and increasing health awareness amongst consumers. Technology has also played a large role in progressing the industry.
In other regions such as the USA, the use of improved dehydration technologies have given companies the ability to decrease the volume and weight of their products without compromising a product’s nutritional benefits. This can help companies realise cost savings in logistics and freight while marketing healthy, high-quality products to consumers. These technologies remain concentrated with large companies in the packing industry throughout the UK, demonstrating that there are opportunities for entrepreneurial companies to disrupt the market with the use of modern dehydration technology.
Compared to other processed and packaged foods, dehydrated fruit, and other dehydrated foods, maintain their nutrient content. As consumers lead busier lifestyles but still want healthy, high-quality foods, factors such as the nutrient content and convenience of buying, storing and consuming dehydrated fruit makes this market a strong opportunity for entrepreneurial dehydrated fruit producers. Some of the most popular dehydrated fruits consumed amongst health-conscious consumers in the UK include dried grapes, prunes, tropical fruits, and super fruits.
The key factors, excluding taste and texture, that consumers like about dehydrated fruit are the convenience of storage and consumption and the nutrient-dense nature of fruit. The key nutrients in fruit that consumers need include vitamins, potassium, magnesium and fiber. These vitamins and nutrients reduce the risk of heart disease, high blood pressure, and obesity. In order to fully realise the health benefits of eating dehydrated fruit, however, consumers need to be aware of the ingredients in their snacks.
In a recent study by Spanish company AINIAFORWARD, 50 per cent of respondents said they’ve increased the amount of healthy snacks they consume. These healthy snacks include items such as packaged chopped fruit, dried fruit, and nuts. Further, 73 per cent of respondents think that a snack must contain fruit to be healthy. Other healthy ingredients that consumers enjoy, according to the study, include quinoa, nut oils, and aloe vera. This demonstrates the importance of listing all of the ingredients in a product, and highlighting the healthy ingredients that consumers enjoy.
There is a general misconception amongst consumers about the sugar content in dehydrated fruit. Many consumers believe that all dehydrated fruit contains added sugar and juices, but that’s not the case. To resolve this confusion, companies need to ensure they are clear with their customers about the ingredients in their snacks. If your dehydrated fruit products don’t contain added sugar, this is a feature that should be highlighted on all product packaging and in marketing campaigns. Further, communicating with consumers about how your products can be consumed as a snack or added to other meals or recipes will demonstrate the versatility of your products as part of a healthy diet and lifestyle.
Given the market dynamics in the UK’s dehydrated fruit industry, the key opportunities available to producers are importing fruits to produce dehydrated products, or diversification by businesses who already produce other fruit-based products. For companies that already produce other fruit-based products, the prospect of using dehydration technologies to create other products provides additional revenue streams and reduces waste from disposing of produce that would otherwise be unsuitable for human consumption and retail sales.
Similar to the UK’s meat snack industry, the price of fruit is a key factor in the profit margins companies can secure on their products. As the price of fruit fluctuates, price increases can’t always be passed down the supply chain, which results in diminished profit margins. This is a key risk that dehydrated fruit producers need to keep top of mind and address in their business planning and strategy. Given the seasonal nature of fruit crops, producers also need to ensure they have an adequate supply of fruit available to produce their products year-round.
Brexit should remain a key consideration for UK-based dehydrated fruit producers, and businesses importing products to the European Union (EU) need to ensure they remain up to date with the latest trade rules. Fortunately, these rules have become clearer since the UK and EU agreed to a new trade deal on 24 December 2020. The new deal, which came into effect at 11pm GMT on 31 December 2020, outlines how trade across borders will be managed.
Prior to Brexit, UK companies could buy and sell goods across EU borders without tax implications. There also weren’t any limits on the number of goods that could be bought and sold. These two key enablers to free trade in the region remain in place under the new trade deal, which is good news for UK companies. While there won’t be any new taxes on goods moving across borders, there will be additional paperwork and checks at borders. These checks include safety checks and customs declarations. It’s important that companies are aware of the paperwork and procedures required, as incomplete paperwork could lead to significant delays at ports.
It’s important to note that while the UK and EU have agreed to identical rules, including those around buying and selling goods across borders, it doesn’t mean these rules will be identical in the future. For example, if one side of the deal negotiates an exception to the trade deal, it could trigger a dispute and the potential for the introduction of tariffs on specific products. This means that the potential for a trade dispute and tariffs is a possibility and risk that all UK companies must continually consider and mitigate.
E-commerce is another key opportunity for UK-based dehydrated fruit producers looking to expand their reach either through fruit re-exports or other dehydrated fruit products. With the ability to reach consumers all over the world, e-commerce sales of dehydrated fruit products are an effective way to proactively control your company’s message and brand and reach more customers. To fully capitalise on the reach of e-commerce, however, companies need to implement an effective marketing and sales strategy as they would with any other sales channel whether retail or wholesale.
For businesses looking to expand the distribution of their dehydrated fruit products, the UK and neighbouring markets in Europe are a key opportunity due to the size of the import industry in the region, consumer’s healthy snacking habits, and variety of products that can be produced with dehydrated fruit.
As a net importer of dehydrated fruit, the key opportunities available to UK-based companies are re-export of dehydrated fruits and the use of dehydrated fruit imports in the production of snacks and other products. Like other healthy snacks, such as jerkies and protein balls, a range of distribution channels are available depending on a company’s product offering, target market and size. For example, larger producers may opt to secure placement in grocery stores, while smaller companies may prefer convenience stores and independent retailers. The rise of e-commerce is also a key retail and wholesale opportunity for businesses.
As a fast-growing food category in the UK, and one that has adapted to and reflects current consumer trends, dehydrated fruit producers can set themselves apart by focusing on the health benefits of their product, using natural ingredients, and ensuring their products have a premium feel. There are also several opportunities available to produce dehydrated fruit for other products apart from snacks such as decorative products and ingredients for other foods. If producers can address these important factors, understand the various uses for dehydrated fruit, and tap into the continually growing healthy snacking trend over the coming years, there’s a significant opportunity to become an influential force in the UK’s growing dehydrated fruits industry.
Our Sources:
Fresh Plaza. The World will Consumer 4 Million Tons of Dehydrated Fruit by 2020, 2019. URL: https://www.freshplaza.com/article/2184074/the-world-will-consume-4-million-tons-of-dehydrated-fruits-by-2020/.
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CBI Ministry of Foreign Affairs. Processed Fruit and Vegetables and Edible Nuts, 2019.
CBI Ministry of Foreign Affairs. Processed Fruit and Vegetables and Edible Nuts, 2019.
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Global Market Insights. Freeze Dried Fruits & Vegetables Market Size By Product, March 2019.
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FrutaSana. Dehydrated, chopped or dried fruit are the most valued healthy snacks, 2019.
FrutaSana. Dehydrated, chopped or dried fruit are the most valued healthy snacks, 2019.
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