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An Overview of the North American Dehydrated Fruit Industry

An Overview of the North American Dehydrated Fruit Industry

Summary:

  • The global dehydrated fruits and edible nuts industry will have a market value of USD241 billion by 2024.
  • 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. 
  • Valued at USD14.2 billion in 2018, the fastest growing country in North America’s dehydrated product industry is Mexico.
  • Shifting consumer focus to healthy snacking alternatives has driven recent growth in the dehydrated fruit industry.   
  • Almost 4 million tons of dehydrated fruit was consumed up to the end of 2020. 

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, a shifting consumer focus to healthy snacking alternatives has driven recent growth in the dehydrated fruit industry. And with the world consuming almost 4 million tons of dehydrated fruit up to the end of 2020, this industry isn’t showing any signs of slowing down.


As the region with the largest dehydrated fruit industry market share in the world, the North American dehydrated fruit industry represents a significant opportunity for businesses looking to produce healthy dehydrated fruit-based snacks. This article details how the North American dehydrated fruit industry has grown in recent years, industry growth drivers, analysis of the North American dehydrated fruit industry, and opportunities and threats that companies need to consider.


The North American Dehydrated Fruit Industry

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 North America in recent years. Valued at USD14.2 billion in 2018, the fastest growing country in North America’s dehydrated product industry is Mexico. The growing middle class in Mexico and consumer demand for convenience has driven a large portion of this growth. Outside Mexico, the growth drivers are similar. Consumers lead busy lifestyles, driving the need for food products that have a long shelf life, provide health benefits, and convenience in purchasing and consuming.


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 most popular dehydrated fruits that North American consumers purchase include pineapple, mango, peach, aguaymanto and berries. 

In Canada’s canned fruit and vegetable industry, which includes dehydrated fruit, the CAGR is consistent with the global CAGR in the dehydrated fruits and edible nuts industry. At a rate of 5.3 percent, the industry is growing consistently in Canada albeit not as quickly as other snacking segments such as meat snacks and other high-protein alternatives. For dehydrated fruit producers looking to enter the market or grow their market share in Canada, a focus on marketing the health benefits of the product will be critical in gaining traction.


The global fruit snacks market was worth USD4.6 billion in 2018, and it’s expected to grow at a CAGR of 8.4 percent from 2019 to 2025. By 2023, the North American dehydrated fruits and vegetable market is expected to be worth USD12.32 billion. As a relatively fragmented market, with this CAGR, there are significant opportunities for dehydrated fruit producers to capitalize on shifting snacking and food purchasing habits amongst consumers. Further, North America held 25 percent of the market share in the dehydrated fruit and vegetable market in 2018.


The key growth drivers in the North American dehydrated fruit industry are increased demand for dried fruit and the growing prevalence of small packaged foods as part of a consumer’s regular diet. In North America, dehydrated fruit is used in packaged foods such as soups, juices, confectionery, baked goods, and dehydrated fruit snacks. 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.


How the North American Dehydrated Fruit Industry has Evolved

The North American dehydrated fruit industry has shifted 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.


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 realize cost savings in logistics and freight while marketing healthy, high-quality products to consumers.


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 North Americans include blueberries, cranberries, strawberries, and apple.


In Canada, fresh fruit is the most popular snacking option selected by consumers in the morning and evening, and the most common attribute sought after in a snack is no added sugar. And with just 37 percent of consumers in Canada saying they prefer a salty snack and a further 22 percent indicating they would choose a chocolate bar, there’s a preference for sweet snacks in this market. Further, dehydrated fruit producers who add chocolate products or coatings to their goods may be able to capitalise on appealing to more Canadian consumers.


What do Consumers Like and Dislike about Dehydrated Fruit

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 — all major health issues in North America. In order to fully realize the health benefits of eating dehydrated fruit, however, consumers need to be aware of the ingredients in their snacks.


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.



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Opportunities and Threats in the North American Dehydrated Fruit Industry

Similar to the North American 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. 


For some producers, particularly in Canada where harsh conditions make it difficult to grow fruit, this may mean fruit needs to be imported. With consumers placing growing importance on locally-sourced products, companies should consider the impact that importing ingredients may have on their business both from commercial and reputational perspectives.


E-commerce is another key opportunity for North American dehydrated fruit producers looking to expand their reach. 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. According to eMarketer, e-commerce sales of food and beverages in the USA will be worth over USD22 billion this year. And in Canada, online food and beverage sales account for 3 percent of the country’s total ecommerce volume of USD25 billion. To fully capitalize 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.


According to research by trade publication, Convenience Store Decisions, 79% of consumers want to be able to understand the ingredient list on packaged products. With packaged snack products popular in convenience stores, the sheer number of these stores presents an attractive opportunity to producers looking to expand their reach across North America. According to Neilsen, there were 153,237 convenience stores (including gas stations) operating in the US as of 31 December 2018. With a smaller population, there are currently almost 12,000 convenience stores in Canada. Producers that can balance the risk of fluctuating fruit prices with distribution to retailers located in their target market’s demographics will have a competitive edge as the dehydrated fruit industry continues to grow.


To Summarise

For businesses looking to expand the distribution of their dehydrated fruit products, North America remains a key opportunity due to the size of the industry in the region, consumer’s healthy snacking habits, and significant market share in the region.

 

With 25 percent of market share in the dehydrated fruit and vegetable market in 2018 and the fragmented nature of the industry, there’s an abundance of commercial opportunities available in the region. Like other healthy snacks, such as jerkies and protein balls, a range of distribution channels are available depending on a company’s 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 opportunity for businesses to reach consumers directly.

 

As a fast-growing food category in North America, 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. If producers can address these important factors and tap into the continually growing healthy snacking trend over the coming years, the question isn’t if another dehydrated fruit producer will become a household name, it’s a matter of when.


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/

Mordor Intelligence. North America Freeze-Dried Product Market: Growth, Trends, and Forecasts (2019 - 2024), 2018. URL: https://www.mordorintelligence.com/industry-reports/north-america-freeze-dried-product-market.

Mordor Intelligence. North America Freeze-Dried Product Market: Growth, Trends, and Forecasts (2019 - 2024), 2018

Market Watch. Global Dried Fruits and Edible Nuts Market 2019 by Manufacturers, Regions, Type and Application, Forecast to 2024, 2019. URL: https://www.marketwatch.com/press-release/dried-fruits-and-edible-nuts-market-2019-business-revenue-future-growth-trends-plans-top-key-players-business-opportunities-industry-share-global-size-analysis-by-forecast-to-2024-360-research-reports-2019-08-30.

Market Watch. Global Dried Fruits and Edible Nuts Market 2019 by Manufacturers, Regions, Type and Application, Forecast to 2024, 2019.

Fresh Plaza. The World will Consumer 4 Million Tons of Dehydrated Fruit by 2020, 2019.

IbisWorld. Canned Fruit and Vegetable Processing in Canada: Industry Trends, 8 May 2020. URL: https://www.ibisworld.com/canada/market-research-reports/canned-fruit-vegetable-processing-industry/.

Global Market Insights. Global Fruit Snack Market by Type, 2019. URL: https://www.gminsights.com/industry-analysis/fruit-snacks-market?utm_source=globenewswire.com&utm_medium=referral&utm_campaign=Paid_globenewswire.

NBC29. Dehydrated Fruits & Vegetables Market Outlook 2019, Price Trends, Size Estimation, Industry Latest News, Sales, Research Report Analysis and Global Share and Consumption by Forecast to 2023, 28 June 2019. URL: https://www.nbc29.com/story/40720550/dehydrated-fruits-vegetables-market-outlook-2019-price-trends-size-estimation-industry-latest-news-sales-research-report-analysis-and-global-share.

Global Market Insights. Freeze Dried Fruits and Vegetables Market to Hit $60 Billion by 2025, 8 April 2019. URL: https://www.globenewswire.com/news-release/2019/04/08/1798903/0/en/Freeze-Dried-Fruits-and-Vegetables-Market-to-hit-60-billion-by-2025-Global-Market-Insights-Inc.html

Global Market Insights. Freeze Dried Fruits and Vegetables Market to Hit $60 Billion by 2025, 8 April 2019.

Business Wire. $47.3 Billion Freeze Dried Fruits and Vegetables Market - Global Growth, Trends and Forecast 2019-2024, 2 July 2019. https://www.businesswire.com/news/home/20190702005278/en/47.3-Bn-Freeze-Dried-Fruits-Vegetables-Market.

 Global Market Insights. Freeze Dried Fruits & Vegetables Market Size By Product, March 2019. URL: https://www.gminsights.com/industry-analysis/freeze-dried-fruits-and-vegetables-market?utm_source=globenewswire.com&utm_medium=referral&utm_campaign=Paid_globenewswire

Global Market Insights. Freeze Dried Fruits & Vegetables Market Size By Product, March 2019. 

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Global Market Insights. Freeze Dried Fruits & Vegetables Market Size By Product, March 2019.

Taylor and Francis Group. Dried Fruit and Public Health - What Does the Evidence Tell Us? 4 October 2018. URL: https://www.tandfonline.com/doi/full/10.1080/09637486.2019.1568398

eMarketer. Food and Beverage Ecommerce Sales Continue to Rise, but Shoppers Still Wary of Certain Categories, 3 June 2019. URL: https://www.emarketer.com/content/food-and-beverage-ecommerce-sales-continue-to-rise-but-shoppers-still-wary-of-certain-categories.

Statista. Canada Food and Beverage e-retail Share 2017-2025, 31 May 2021. URL: https://www.statista.com/statistics/641610/feed-beverage-eretail-share-canada/

Convenience Store Decisions. Do Meat Bars Match up? Anne Bay Ericksen, 16 November 2016. URL: https://cstoredecisions.com/2016/11/16/meat-bars-match/#_

Neilsen. US Convenience Store Count. URL: https://www.convenience.org/Research/FactSheets/ScopeofIndustry/IndustryStoreCount

Canadian Government, Summary - Canadian Industry Statistics, 26 February 20201. URL: https://www.ic.gc.ca/app/scr/app/cis/summary-sommaire/44512.

Global Market Insights. Freeze Dried Fruits and Vegetables Market to Hit $60 Billion by 2025, 8 April 2019. URL: https://www.globenewswire.com/news-release/2019/04/08/1798903/0/en/Freeze-Dried-Fruits-and-Vegetables-Market-to-hit-60-billion-by-2025-Global-Market-Insights-Inc.html.




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Joshua Hill

Josh is a keen prep-per testing the dehydrators out regularly, storing produce with long shelf life but still maintaining its flavour, it's his passion. So when in doubt talk to Josh, he can help you out.

info@commercialdehydrators.ca