Vegetable Farming in the US Industry Market Research Report Now Available from IBISWorld

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Despite campaigns toward healthy heating, per capita consumption of vegetables has been falling. Fortunately for farmers, high prices have helped offset the decline in demand and have actually caused revenue to grow. Imports are generally high in the industry because supermarkets demand produce year-round as well as the lowest price point. Import penetration is forecast to slow over the next five years, though, as domestic farmers are better able to provide for consumers through greenhouse-grown produce. For these reasons, industry research firm IBISWorld has added a report on the Vegetable Farming industry to its growing industry report collection.

IBISWorld Market Research

IBISWorld Market Research

The industry stayed afloat during the recession and expects moderate gains in the future

Vegetables are not going away anytime soon; their staple status in the American diet makes them a part of most consumers' daily routine. Although per capita vegetable consumption has declined at an average annual rate of 0.6% over the past five years, rising prices have generally offset the trend. Greenhouse growers have fared relatively well over the past five years because their product is of higher quality and is available year-round, which allows them to demand a premium rate. Vegetable Farming revenue is expected to grow at an average annual rate of 1.0% over the five years to 2012, including a 0.7% increase in 2012, taking the total to $25.4 billion. Over the past five-year period, imports have increasingly supplemented domestic production, growing at an average rate of 5.8% per year to $7.2 billion. “Imported vegetables are usually priced lower than domestically grown ones, which makes them attractive to downstream supermarkets and food service companies,” said IBISWorld industry analyst Nikoleta Panteva. Over the five years through 2017, though, imports of fresh vegetables are forecast to slow. As the domestic greenhouse cropping segment expands, the need for foreign-sourced, out-of-season vegetables will decrease.

Drastic changes are not expected within the Vegetable Farming industry over the next five years. Revenue will continue to inch up at a slow annualized rate. Vegetable consumption has plenty of room to grow to meet dietary standards; IBISWorld expects that industry associations and government spending will help promote healthy eating through vegetable marketing. Economies of scale will be an increasingly important factor for farmers remaining in the industry. According to Panteva, downstream wholesale bypass will also put increasing pressure on the farming sector as superstores continue to source directly from producers. Farmers who cannot meet high quality standards at shrinking prices will be squeezed out of vegetable farming.

The majority of farms, including those growing vegetables and melons, are small family-run enterprises. Farmers generally own and operate their farms supplementing family labor with hired hands only during key periods such as harvesting season. On the other end of the spectrum are a smaller number of commercial farms, which dominate industry revenue and acreage. Even so, the production value is dispersed such that no single farm receives a large proportion of the industry's total revenue. The distribution of employment is linked closely to production values, with the few commercial mega-farms employing the vast majority of laborers. This low concentration of market share results in a transfer of price-setting power to the large buyers. Farmers are price takers in many ways, with their options for improving margins limited to controlling costs or improving quality so that it can be sold to the fresh markets. In an effort to regain some of this diminished power, farmers commonly pool their resources to form cooperatives. These organizations act on behalf of their members to improve demand and returns, often through marketing and promotional activities. Additionally, these cooperatives may vertically integrate into storing, packing and transportation operations, resulting in additional returns and cost savings for farmers. For more information, visit IBISWorld’s Vegetable Farming in the US industry report page.

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IBISWorld industry Report Key Topics

Establishment in this industry grow vegetables and melons in open fields and in greenhouses. This report does not include some notable crops such as corn, soybeans or wheat, which have their own reports.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit or call 1-800-330-3772.

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Gavin Smith
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