Fresh produce and CEAGESP

Companhia de Entrepostos e Armazéns Gerais de São Paulo

Anita de Souza Dias Gutierrez

Summary

1. Fresh produce consumption evolution

2. Brazilian agriculture

3. Fresh produce value chain

4. CEAGESP

Food and fresh produce

− Food– First pleasure at birth– Satisfy hunger– Source of joy, pleasure, delight, happiness

• The #1 reason for food purchase

− Fresh fruits and vegetables− Symbol of health, disease prevention, fitness, beauty,

freshness− Symbol of Nature, free from food industry and its ingredientes

– Consumer’s reason for supermarket choice– Mistery to buy: Is it good to eat?– Best quality at harvest

Food habits are changing

• Consumption of fresh and healthy food grows with GNP per capita in the world and with income level in Brasil

Income - R$ Fruits Vegetables Fresh produce400 16 11 27400 to 600 14 22 36600 a 1000 19 26 451000 a 1600 24 31 551600 a 3000 33 36 69More than 3000 45 42 87

IBGE

Fresh produce domestic consumption (kg per capita) at different income levels in Brasil

Dr. Manfred Kern - 2006

Vegetarian cow: symbol of eating behaviour changing tendency

David Bowers ilustration

Brasil is a big country

– GDP R$ 2,9 trillions– Agriculture R$ 163,5 billions– Indústria R$ 682,5 billions– Serviços R$1.595 billions

– GDP per capita US$ 20.000 in 2010– 2007 - US$ 6.940,00

– 5th largest area – 850 millions hectares– 47% of South America area– 115 millions hectares – Environmental conservation – 109 millions hectares – indian reservation– 62 millions hectares with agricultural crops - 7% total area

– Fruits and Vegetables – 26% of agricultural area

Brazilian population– Age

– 0 to 15 years – 32%– 15 to 29 years – 28%– 30 a 59 years – 33%– 60 years to – 7%

– Population growth rate is falling– Concentration

– 18 metropolitan regions – 70 millions (37%)– 2 big metropolitan regions – 31 millions (16%)

– 5.564 municipalities – 26 estates e one fedeal district (Brazilia)

– Urbanization – 20% in Brasil e 7% in São Paulo– Rural area

– 5.204.130 farmers– 18 millions workers

Confidencial

O AGRONEGÓCIO É O NEGÓCIO DO BRASIL

THE AGRIBUSINESS IS THE BUSINESS OF BRAZIL.

1970 to 2010Area growth – 27%Production growth – 213%

Fresh produce is unique

– High valuation of freshness, appearance and flavour– Perishability– Small, specialized farmers – Specialized whosalers– Seasonal, fragmented production– Farmer´s marketing high fragility– Retail and food service needs fresh and a mix of products

every day– A logistic center for reception, consolidation and

distribution is indispensable

Brazilian fruits origin - IBRAF

− The best quality is at harvest.

− It is only possible to mantain quality after harvest, not to improve it.

− The production of quality is the most difficult task of the fresh produce value chain.

− Brasil has conditions to produce during all the year in different places and seasons

Common knowledge

Lettuce near São Paulo city – 70 km

Atemoya – North of Minas Gerais – 1190 km

Banana – Vale do Ribeira - SP – 191 km

Cashew – Piauí – 2.634 km

Apple – Santa Catarina – 695 km

Mamão – Espírito Santo – 1.200 km

Mango – Juazeiro – 2.185 km

Passion fruit – Bahia – 1.979 km

Passion fruit

Melon – Rio Grande do Norte – 2.891 km

Strawberry – Rio Grande do Sul – 1.104 km

Cucumber – São Paulo – 320 km

Table grape – Petrolina – 2.191 km

Farmer Consumer

Retailer

Food Service

Whosaler

Dealer

Packer-shipper

Freight

Fresh produce value chain

Food retail– Supermarkets

– GDP – R$ 160 billions– 75.725 stores– 185.889 check-outs– 61% até 7 check-outs– 876.916 employees– 80% of food marketing– Five biggest – 41% of GDP

– Fresh fruit and vegetable– 9% of total food value– 19% of perishable food value– Supermarket choice

– Fresh fruit and vegetable mix, every day

Food service

– 15% growth each year since 2004 – 25% of food expenses

– Fresh fruit and vegetable mix, every day

– Food service companies – 8,9 milllions of meals each day – 19% of the expense is fresh fruit and vegetables– Potential market – 40 milllions of meals per day

– School Food Programa– 47 millions of children per day

Fresh produce terminal markets

– CEAGESP – 1969 – State of Sâo Paulo

– SINAC – COBAL – Nacional system – 21 terminal markets

– 1972 a 1988

– 34 terminal markets – biggest brazilian cities – Most state management not federal

– 50% of fresh fruit and vegetable production

CEAGESP

- State company - federal government- Fresh produce terminal markets and grain warehouses

Volume and valueTons R$

Fruits 1,70 millions 2,26 billions

Vegetables 1,34 millions 3,71 billions

Flowers 52 thousand 212,1 millions

Fishes 48 thousand 221,3 millions

Total 3,85 millions 4,74 billions

São Paulo Terminal Market

• 700.000 m2

• 10.000 tons per day• 50.000 persons• 2.500 whosalers: 1.190 fruits and vegetables• Origin

– 1.500 brazilian municipalities – 25 of the 27 brazilian states– 25.000 growers– 12 countries

• 74 fresh fruits and 95 fresh vegetables• 50% of all brazilian terminal markets • Destination – number of buyers

– São Paulo Metropolitan Region –76%– São Paulo State interior – 15%– Other 11 brazilian states – 6%

CEAGESP - Services Everyday market information

Volume and origin Price

Pesticides’ residue monitoring Research and development

Partneship with universities and research centers Development of fruits and vegetables’ quality standards Variety guide HortiEscolha – decision tool for food service Flavour school – child nutrition education Minimal handling – retail orientation Training agents of the value chain

CEAGESP

– The fresh produce value chain needs logistic centers for reception, consolidation and distribution

– Growing production of fresh fruits and vegetables– Growing demand for volume and quality– Growing value differentiation for quality

– Facing big challenges – Infrastructure– Logistic– Hygiene– Etc..

Anita de Souza Dias Gutierrez551136433825551136433890

cqh@ceagesp.gov.br

Fresh produce value chainA world full of challenges and opportunities