Frozen Fruit & Juice Production: Brain Freeze: Low Demand For Frozen Juice Is Expected To Limit Revenue Growth

US INDUSTRY (SPECIALIZED) REPORT OD4628
Frozen Fruit & Juice Production

Brain freeze: Low demand for frozen juice is expected to limit revenue growth
Gordon Zheng | March 2020
IBISWorld.com +1-800-330-3772 [email protected]

Frozen Fruit & Juice Production OD4628 March 2020
Contents
About This Industry...........................................4 Competitive Landscape...................................26
Industry Definition..........................................................4 Market Share Concentration....................................... 26

Major Players................................................................. 4 Key Success Factors................................................... 26
Main Activities................................................................4 Cost Structure Benchmarks........................................ 27
Supply Chain...................................................................5 Basis of Competition................................................... 30
Similar Industries........................................................... 5 Barriers to Entry........................................................... 32
Related International Industries....................................5 Industry Globalization..................................................32
Industry at a Glance.......................................... 6 Major Companies............................................ 34
Executive Summary....................................................... 8 Major Players............................................................... 34

Other Players................................................................34
Industry Performance....................................... 9
Operating Conditions...................................... 36
Key External Drivers....................................................... 9
Current Performance................................................... 10 Capital Intensity........................................................... 36
Revenue Volatility........................................................ 38
Industry Outlook............................................. 14 Regulation & Policy...................................................... 39
Industry Assistance..................................................... 40
Outlook......................................................................... 14
Performance Outlook Data......................................... 15 Key Statistics.................................................. 42
Industry Life Cycle....................................................... 15
Industry Data................................................................42
Products and Markets..................................... 18 Annual Change.............................................................42
Key Ratios.................................................................... 42
Supply Chain................................................................ 18
Products and Services.................................................18 Additional Resources...................................... 43
Demand Determinants................................................ 20
Major Markets..............................................................21 Additional Resources.................................................. 43
International Trade.......................................................22 Industry Jargon............................................................ 43
Business Locations..................................................... 23 Glossary Terms............................................................43
2 IBISWorld.com
About IBISWorld
IBISWorld specializes in industry research with coverage on thousands of global industries. Our comprehensive
data and in-depth analysis help businesses of all types gain quick and actionable insights on industries around
the world. Busy professionals can spend less time researching and preparing for meetings, and more time
focused on making strategic business decisions that benefit you,your company and your clients. We offer
research on industries in the US, Canada, Australia, New Zealand, Germany, the UK, Ireland, China and Mexico,
as well as industries that are truly global in nature.
3 IBISWorld.com
About This Industry

Industry Definition This industry produces frozen fruit and frozen juices. Industry goods comprise
frozen fruit products including frozen berries and frozen concentrated juices. This
industry excludes fresh fruit and other frozen products.
Major Players There are no major players in this industry
Main Activities The primary activities of this industry:

Producing frozen fruit
Producing frozen concentrated orange juice
Producing other frozen concentrated juices
The major products and services in this industry:

Frozen strawberries
Frozen berries
Other frozen fruit
Other frozen juice concentrates
Frozen orange juice concentrate
4 IBISWorld.com
Supply Chain
SIMILAR INDUSTRIES
Frozen Food Production in Juice Production in the US Frozen Food Wholesaling in

the US the US
RELATED INTERNATIONAL INDUSTRIES
Tea, Coffee and Other Food Frozen Food Production in Prepared Meal Frozen Food Production in
Manufacturing in Australia China Manufacturing in the UK Canada
Tea, Coffee and Other Food

Manufacturing in New
Zealand
5 IBISWorld.com
Industry at a Glance
Key Statistics Key External Drivers % = 2014-2019 Annual Growth
$3.2bn 2.5%
Per capita disposable income
3.4%
Trade-weighted index
Revenue
1.1% 1.7%
Annual Growth Annual Growth Annual Growth Per capita fruit and vegetable consumption Price of fruit
2014-2019 2019-2024 2014-2024

Industry Structure
1.2% 0.4%
POSITIVE IMPACT
$-3.2m Concentration
Profit
Low
Annual Growth Annual Growth
2014-2019 2014-2024 MIXED IMPACT
-0.1% Life Cycle Revenue Volatility
Mature Medium
-0.1% Capital Intensity

Medium
Industry Assistance
Medium
Profit Margin
Regulation Technology Change
Annual Growth Annual Growth
Medium Medium
2014-2019 2014-2024
Barriers to Entry Globalization
-5.0% Medium Medium
Competition
41
Medium
Businesses
NEGATIVE IMPACT
Annual Growth Annual Growth Annual Growth
2014-2019 2019-2024 2014-2024 None
1.5% 1.0%
Key Trends
Consumer desires for healthier food options have spurred
6,999 demand for fruit products
Employment Major players have been able to pass high input costs on to
downstream buyers
Imports have been aided by an appreciating US dollar
2014-2019 2019-2024 2014-2024
New research shows that freezing foods preserves certain
1.2% 0.6% nutrients better than refrigeration
The industry will experience an increase in local operators
catering to their communities
$291.3m Industry operators try to expand their reach into emerging
Wages markets
The industry's two segments have experienced significantly
different growth trajectories
2014-2019 2019-2024 2014-2024
3.0% 0.6%
6 IBISWorld.com
Products & Services Segmentation
18.2% 8.8% 24.7% 22.1% 26.2%
Frozen strawberries Frozen berries Other frozen fruit Other frozen juice Frozen orange juice
concentrates concentrate
Source: IBISWorld
Major Players % = share of industry revenue SWOT
STRENGTHS
Low Product/Service Concentration
WEAKNESSES
Medium Imports
Low Profit vs. Sector Average
High Customer Class Concentration
High Capital Requirements
OPPORTUNITIES
High Revenue Growth (2014-2019)
High Revenue Growth (2019-2024)
High Performance Drivers
THREATS
Low Revenue Growth (2005-2019)
Low Outlier Growth
7 IBISWorld.com
Executive The Frozen Fruit and Juice Production industry has grown over the
Summary five years to 2019 despite restructuring of its key product
segments.
This industry consists of two distinct product groups: frozen juice concentrates and
frozen berries and other fruits. These two segments experienced significantly
different growth trajectories over the past five years. The frozen fruit segment has
benefited from rising health consciousness, new product development and
expanding shelf space in freezer aisles. Furthermore, the rapidly growing popularity
of ready-to-blend smoothie kits has helped drive demand for frozen berries and
tropical fruit varieties from the household market. In contrast, the frozen juice
concentrates segment has contended with an overall decline in per capita juice
consumption and rising external competition from fresh juice producers. Thus, over
the five years to 2019, industry revenue is expected to increase an annualized 1.2%
to $3.2 billion.
Although fruit products contain natural and added sugars, industry operators have
rebranded and reformulated goods over the past five years to cater to rising health
consciousness. Producers of frozen fruit have successfully commercialized the
benefits of fruit as an essential part of a healthy diet. With the help of trade
associations, frozen fruit processors have also promoted the health benefits of
frozen foods relative to their fresh, refrigerated or canned counterparts. Niche
operators offering organic, locally sourced goods have also expanded during the
current period. Despite these efforts, overall decrease in consumer confidence is
expected to decrease the industry revenue by 0.4% in 2019. Profit is expected to
drop in 2019 then recover over the outlook period.
The industry is anticipated to grow at a much slower rate over the five years to
2024, with strong demand for frozen fruit varieties partially offset by continued
weakness in the frozen juice segment. Additionally, industry performance will
continue to be constrained by external competition from fresh fruit marketers,
though consumer tastes and health consciousness trends are likely to remain
favorable for the industry's frozen fruit segment. Moreover, rising per capita
disposable income will enable consumers to trade up to organic and locally sourced
goods, creating opportunities for new companies to enter the industry. Overall,
IBISWorld projects industry revenue will increase an annualized 0.4% to $3.2 billion
over the five years to 2024.
8 IBISWorld.com
Industry Performance
Key External Per capita fruit and vegetable consumption

Drivers Consumers are incorporating more fruit into their diets as the cultural emphasis on
healthy lifestyles increases. Supporting this trend, some studies show that frozen
fruit provides the same nutritional content as its fresh counterpart. Therefore, an
increase in per capita fruit and vegetable consumption may benefit industry
operators. Per capita fruit and vegetable consumption is expected to increase in
2019, posing a potential opportunity to the industry.
Price of fruit
Raw fruit makes up the main input cost for industry participants. When the price of
fruit rises, producers either absorb the increased costs or pass them on to
downstream buyers in the form of higher prices. Large companies with strong
brand recognition can effectively raise product prices and thus revenue streams, as
can small operators that offer premium goods. In general, rising fruit prices are
favorable to this industry's performance. The price of fruit is expected to increase in
2019, representing a potential threat for the industry.
9 IBISWorld.com

On average, frozen fruit and juice are less expensive than fresh fruit and juice.
However, higher per capita disposable income enables consumers to purchase a
greater volume of industry goods and trade up to premium products. Therefore, as
income levels rise, industry revenue will benefit from the sale of more expensive
products. Per capita disposable income is expected to increase in 2019.
Import and export levels in the industry partly depend on the value of the dollar
compared with other currencies, as indicated by the trade-weighted index (TWI). A
declining TWI reflects a dollar that is falling in relative value, making US goods more
affordable for international markets. This boosts exports, which contribute
significantly to industry revenue. However, a high TWI leads to fewer exports and
thus negatively affects US producers. The TWI is expected to decrease in 2019.
Current Operators in the Frozen Fruit and Juice Production industry produce
Performance frozen juices and frozen fruit.
Over the five years to 2019, the industry has experienced mixed results in its two
main segments; however, gains ultimately outweighed losses. On the whole,
industry revenue has risen over the past five years, as frozen berries and other fruit
segments have performed significantly better than juice concentrates. The frozen
10 IBISWorld.com
fruit category has boomed due to favorable shifts in consumer trends, rising health
consciousness and the rapidly growing popularity of ready-to-drink smoothie kits
and cold-pressed juice. Meanwhile, these same trends have had the opposite effect
on the industry's frozen juice concentrates segment, which has contended with an
overall decline in per capita juice consumption, external competition from fresh
juice manufacturers and unfavorable shifts in consumer tastes, leading to moderate
revenue volatility during the period. Industry operators have quickly responded to
these challenges by continually churning out new products, such as blended fruit
varieties, that appeal to a broader range of health-conscious and time-strapped
consumers. Thus, over the five years to 2019, IBISWorld expects industry revenue to
increase at an annualized rate of 1.2% to $3.2 billion, despite an estimated decline
of 0.4% in 2019.
Shifting consumer tastes
Rising health consciousness, increased snacking and other broad

shifts in consumer behavior have been the key drivers of industry
performance over the past five years.
Consumer desires for healthier food options have spurred demand for fruit
products, leading manufacturers to focus on promoting the benefits of frozen fruit
as an indispensable part of a healthy diet. Additionally, the desire for convenient
and quickly prepared foods has drawn consumers to frozen fruit, which can easily
be added to smoothies, breakfast yogurt, oatmeal and other ready-to-eat snacks to
boost their nutritional value. People's schedules have become busier, making frozen
fruit more attractive in some instances than fresh fruit, which typically requires
washing, peeling, cutting and other time-intensive preparation. However, the
industry has been challenged over the past five years by a health and nutrition
movement emphasizing a shift from juice, particularly juice from concentrate, to
whole fruit. The biggest loser of this trend has been frozen orange juice
concentrate, which has experienced sharply declining sales over the past five years.
According to IRI data, sales of frozen orange juice concentrate declined 9.1% in
2017.
Nevertheless, the negative perceptions surrounding frozen fruit are slowly being
resolved. Consumers have become more aware of the science behind blanching
and freezing food products, a process that uses hot water or steam to kill bacteria
and prevent food-degrading enzymes. This process can cause some water-soluble
nutrients like vitamins C and B to break down or leach out. However, the
subsequent flash freezing process locks the fruit in a relatively nutrient-rich state.
Industry operators prefer the flash freezing method, as it preserves the taste and
fresh flavor of the fruits. The US Food and Drug Administration and the International
Food Information Council have both reported that fruit's nutrients are generally not
lost from freezing and that frozen products offer the same essential nutrients and
health benefits as fresh fruit. The highly publicized nature of these studies has
helped boost demand for frozen fruit products over the past five years.
Over the five years to 2019, many operators have invested heavily in promotional
campaigns to reduce negative perceptions associated with frozen foods.
Independent trade associations and advocacy groups have also played a significant
role in boosting industry performance. For example, the American Frozen Food
Institute launched a three-year campaign in mid-2014 with the help of all major US
11 IBISWorld.com
frozen food manufacturers to increase frozen fruit sales. Suitably named Frozen:
How Fresh Stays Fresh, this $90.0-million program used television, print and social
media ads to address common concerns of consumers, particularly regarding
nutritional content, quality and freshness. Furthermore, studies cosponsored by
other industry trade groups such as the Frozen Food Foundation have also helped
alleviate declining demand for frozen food from the household consumer market.
Frozen fruit producers have continued to advertise the benefits of frozen products
to stave off competition from fresh fruit producers. Consequently, strong demand
for frozen fruit varieties has kept the industry afloat over the past five years.
Industry structure
Frozen fruit and juice producers' profit is strongly affected by the

price of inputs.
Over the five years to 2019, the average price of fruit is expected to increase at an
annualized rate of 4.1%. This high cost has put pressure on industry profit, which is
expected to fall from 4.9% of revenue in 2014 to a net loss of 0.1% in 2019.
Over the past five years, smaller operators have entered the industry by offering
niche products such as all-natural, locally sourced, certified organic or fair-trade
options that are not typically offered by larger industry players. Thus, the number of
industry enterprises is expected to increase at an annualized rate of 1.5% to 41
companies over the five years to 2019. Growth in the number of new businesses
has been tempered by increased acquisition activity, particularly among larger
operators, and by several leading operators such as Inventure Foods exiting the
industry.
Although major industry operators have grown over the past five years, they have
increasingly distributed their assets toward added technology and other capital
goods instead of employment. Additionally, as input costs have increased,
operators have invested in automation to cut labor costs. However, leading frozen
fruit processors have also expanded their research, product development and
marketing teams as households have continued to demand fresher, more
innovative products. Thus, despite a push for higher levels of automation, industry
employment is expected to increase at an annualized rate of 1.2% to 6,999 workers
International trade
While international trade in this industry is moderate, major swings

in imports and exports significantly affect industry performance.
Over the past five years, the value of the US dollar has appreciated considerably,
making foreign goods relatively less expensive for US buyers and domestic goods
relatively more expensive and less attractive to purchase for foreign consumers. As
a result, over the five years to 2019, imports are expected to increase at an
annualized rate of 4.3% to $913.7 million.
Imports are expected to satisfy 25.2% of domestic demand in 2019, representing an

increase from 22.7% in 2014. Foreign producers typically use low-cost labor or less
expensive inputs and are more price-competitive than domestic operators. Imports
12 IBISWorld.com
have mainly been supported by the appreciating US dollar, which has made foreign
goods more affordable for the average consumer, and are primarily sourced from
Canada and Mexico due to their proximity to the United States. Brazil and Chile are
also major sources of industry imports, as both countries are well-known for their
vast agricultural resources and climates conducive to growing a variety of fruit,
including oranges, grapes and other tropical varieties.
Due to the rising value of the US dollar, exports are not expected to fare as well as
imports. Over the five years to 2019, exports are forecast to stay stagnant,
increasing at an annualized rate of 0.0% to $450.9 million. Consequently, exports
are expected to account for just 14.3% of industry revenue, a notable decline from
15.2% in 2014. Japan accounts for the highest share of exports; the country
represents a large market for frozen and otherwise processed foods, largely due to
its limited agricultural capacity. Canada accounts for the second-largest share of
industry exports, primarily due to its proximity to the United States.
Historical Performance Data

Year Revenue IVA Estab. Enterprises Employment Exports Imports Wages Domestic Price of
Demand fruit
($m) ($m) (Units) (Units) (Units) ($m) ($m) ($m) ($m) (Index)
2010 2,867 402 57 39 6,564 383 572 262 3,055 124
2011 3,171 447 55 38 6,454 461 683 257 3,393 118
2012 3,003 504 54 36 6,264 444 666 242 3,226 119
2013 3,069 504 55 37 6,345 450 700 246 3,319 121
2014 2,970 471 57 38 6,584 450 741 251 3,260 124
2015 3,159 434 55 37 6,866 441 777 270 3,495 124
2016 3,114 476 59 39 6,874 486 806 286 3,435 139
2017 3,107 448 60 40 6,878 473 798 286 3,432 148
2018 3,170 361 60 40 6,989 448 904 291 3,626 148
2019 3,158 362 61 41 6,999 451 914 291 3,621 152
13 IBISWorld.com
Industry Outlook
Outlook The Frozen Fruit and Juice Production industry is anticipated to
grow at a very slow rate over the five years to 2024, with strong
demand for frozen fruit varieties partially offset by continued
weakness in the frozen juice segment.
Additionally, industry performance
will continue to be constrained by
external competition from fresh fruit
marketers, though consumer tastes
and health consciousness trends are
likely to remain favorable for the
industry's frozen fruit segment.
Rising per capita disposable income
will enable consumers to trade up to
organic and locally sourced goods,
creating opportunities for new
companies to enter the industry.
Overall, IBISWorld projects industry
revenue will increase at an
annualized rate of 0.4% to $3.2
billion over the five years to 2024.
Fresh and frozen food

consumption trends
Industry operators have come a long way in addressing common

misconceptions associated with frozen foods, such as bland taste
and poor nutritional value.
While rising discretionary income will continue to divert some demand toward
fresher alternative goods at grocery stores or food service locations, the
convenience and increasingly nutritious nature of frozen fruit products will continue
to attract new customers. Moreover, frozen fruit production enables consumers to
enjoy their preferred fruits year-round, despite the seasonality of some produce.
Additionally, rising health consciousness is likely to benefit frozen fruit producers,

as new research continues to demonstrate that freezing foods preserves certain
nutrients better than refrigeration or canning. For example, a recent study by the
University of Georgia indicates that blueberries frozen at the peak of ripeness
maintain higher levels of antioxidants and other phytochemicals than fresh
blueberries. Since distribution from farms to stores is not immediate, many fruits
and vegetables are picked while still unripe and then artificially ripened in the
shipping process before being sold to the customer. The time between harvest and
final sale causes some nutrients to decompose, even if the produce still looks fresh
when it is sold. Freezing food slows down this decomposition process, thereby
preserving nutrients that would otherwise be lost. Notable brand Jasper Wyman &
Son touts its immediate flash freezing techniques to preserve a fruit's fresh flavor.
Sales of frozen berries and tropical varieties are expected to grow strongly as
14 IBISWorld.com
industry operators continue to promote such studies to highlight the nutritional

value of their products. At the retail level, grocery stores and supermarkets are likely
to devote a greater share of chilled shelf space to frozen fruit products and thus
offer a broader range of frozen fruit varieties or brands.
Industry structure and trade
Over the next five years, the industry will likely experience
consolidation trends parallel to those in the broader food-
processing sector, as larger operators continue to acquire smaller
companies to expand their market reach and boost their portfolios
of niche and premium brands.
However, the fragmented Frozen Fruit and Juice Production industry will also
experience an increase in local operators catering to their communities.
Accordingly, industry participation is expected to rise over the coming years, with
the number of enterprises growing at an annualized rate of 1.0% to 43 businesses
over the five years to 2024. As a result, industry employment is forecast to increase
at an annualized 0.6% to 7,229 workers during the same period.
The average industry profit margin, measured as earnings before interest and taxes,
is expected to recover over the next five years as companies recover from the
recent dip. Over the five years to 2024, the price of fruit is expected to increase at
an annualized rate of 2.6%. Thus, in 2024, the average margin is expected to reach
1.7% of revenue from the net loss of 0.1% in 2019.
Given improved freezing technology, products remain fresher when destined for
trade; therefore, imports and exports are both expected to rise over the next five
years. Producers abroad will continue to use low-cost labor to maximize their
competitive advantage over domestic operators. As a result, over the five years to
2024, imports are forecast to increase at an annualized rate of 0.2% to $920.7
million, capturing 25.0% of domestic demand in 2024. Meanwhile, frozen fruit and
juice producers in the United States will look to expand their reach into emerging
markets in countries where a burgeoning global middle class will continue to
demand convenient, flash-frozen fruit products. Additionally, the trade-weighted
index (TWI) is projected to decline over the next five years, resulting in domestically
produced goods becoming relatively less expensive for foreign consumers.
Therefore, exports are anticipated to rise at an annualized rate of 0.6% to $463.7
million over the five years to 2024.
Performance Outlook Data

Demand fruit
2019 3,158 362 61 41 6,999 451 914 291 3,621 152
2020 3,144 423 61 41 7,015 451 903 292 3,596 156
2021 3,137 423 62 41 7,038 451 899 292 3,586 160
2022 3,163 426 62 42 7,101 455 905 295 3,612 164
2023 3,191 430 63 42 7,166 460 911 298 3,642 169
2024 3,221 434 64 43 7,229 464 921 300 3,678 173
15 IBISWorld.com
Industry Life Cycle The life cycle stage of this industry is Mature
LIFE CYCLE REASONS

Industry value added is expected to grow at a slower rate than GDP
The industry has undergone consolidation over the past five years
There has been some new technology introduced, leading to increased operational
efficiency
The Frozen Fruit and Juice Production industry exhibits the traits characteristic of
an industry in the mature stage of its life cycle. Over the 10 years to 2024, industry
value added (IVA), which measures an industry's contribution to the overall
economy, is forecast to decrease at an annualized rate of 0.8%. Comparatively, US
GDP is anticipated to increase at an annualized rate of 2.2% over the 10 years to
2024. While projected IVA growth that is far slower than overall GDP growth can be
indicative of an industry in the declining stage of its life cycle, growth in producers
of niche products and the introduction of brand extensions of operators point to the
maturity of this industry.
Consumer interest in industry products has been bolstered in recent years by the
growing health and nutrition movement in the United States. At the same time,
rising consumer interest in fresh produce has hurt demand for the industry's more
established product lines, including juice concentrates. Although frozen juice
concentrates are not considered staples in many households, the product is still
fully accepted in the market. Moreover, frozen fruit products have been growing in
popularity over the past five years and are expected to continue gaining momentum
16 IBISWorld.com
over the next five years as consumers opt to create customized fruit juice and
smoothie blends at home.
Although the industry is characterized by well-defined product segments,

companies have regularly introduced new products or reformulated existing ones to
adjust to consumer trends. Health-conscious consumers have become wary of
frozen fruit cocktail concentrates because of their high added sugar content and
questionable nutritional value. Industry operators have responded by introducing
healthier alternatives, in addition to reformulating existing product lines with fresher
ingredients and less added sugars. Technological advancements have also
improved operating efficiencies for industry operators. Developments in freezing
technology have been made to increase efficiency while using less electricity.
Additionally, the industry has increasingly adopted sorting and packaging
machinery to improve operations and cut costs without additional labor. Lastly, the
industry has undergone consolidation over the past five years. Large companies
have acquired smaller competitors to expand their product offerings and gain
market share. As a result, the number of industry enterprises is expected to rise
only modestly over the 10 years to 2024.
17 IBISWorld.com
Products and Markets

Supply Chain KEY BUYING INDUSTRIES KEY SELLING INDUSTRIES
1st Tier 1st Tier
Grocery Wholesaling in the US Orange & Citrus Groves in the US
Supermarkets & Grocery Stores in the US Fruit & Nut Farming in the US
2nd Tier 2nd Tier

Convenience Stores in the US Sugar Processing in the US
Food Service Contractors in the US Plastic Film, Sheet & Bag Manufacturing
in the US
Products and
Services
The Frozen Fruit and Juice Production industry's product breakdown

has shifted considerably over the five years to 2019.
While frozen fruit juice concentrates have historically dominated the industry by far,
in 2019, they are expected to account for less than 50.0% of industry revenue. This
category's decline was primarily due to unfavorable shifts in consumer tastes and
much stronger demand for products within the frozen fruit segment.
18 IBISWorld.com
Frozen fruit
In 2019, IBISWorld expects manufacturers' shipments of frozen

berries (including strawberries, blueberries, blackberries and mixed
varieties) to account for a combined 27.0% of industry revenue,
while shipments of all other fruit varieties will account for the
remaining 24.7%. Within this category, demand for mixed berries
and tropical fruit varieties, which are most commonly used in
smoothies or eaten right out of the bag, has grown the most.
Meanwhile, demand for traditional fruit varieties typically used in desserts, such as
strawberries, apples and peaches, has increased modestly. A key driver of growth
for this segment is the rapidly rising popularity of fruit smoothies and cold-pressed
juices made at home. In addition, consumers are increasingly purchasing frozen
fruit to add to breakfast oatmeal, yogurt and other healthy snacks. In response,
industry operators have increasingly touted the nutritional (i.e. high antioxidant
content) and convenience (i.e. resealable packaging) of frozen fruit products, in
addition to encouraging retailers to devote a greater share of the frozen food aisle
to their brands.
Sales of both brand-name and private label (e.g. store brands) varieties have
increased over the past five years, though demand for premium and organic
selections has been especially strong. Overall, rising health consciousness among
all age groups and strong demand from younger consumers in particular has
helped boost sales of frozen fruit during the period. As a result of these factors, this
product segment has experienced strong growth, helping offset sharp declines in
the ailing frozen juice concentrate segment. Demand for frozen fruit products is
expected to continue rising steadily as more households turn to these products,
raising the segment's share of industry revenue over the five years to 2024.
Frozen juice concentrates
Frozen fruit concentrates are expected to account for a combined

48.4% of industry revenue in 2019.
Within this segment, small and bulk shipments of frozen orange juice products are
expected to generate 26.2% of revenue. Bulk sizes are typically sold to the
institutional and foodservice markets, though they are also available for retail sale
at certain mass-merchandisers and club stores. Frozen juice concentrates made
from other fruit accounts for the remaining 22.1% of revenue. Products in this
category include frozen apple juice, grapefruit juice, cranberry juice, grape juice,
mixed fruit and cocktails and other frozen concentrate products.
The same trends that have helped boost demand for frozen fruit products have
paradoxically had the opposite effect on frozen juice concentrates. Consumers
have increasingly preferred whole fruit products to fruit juice, particularly juice
cocktails that contain added sugar and preservatives. The growing popularity of
premium, blended juice brands such as Naked Juice or Odwalla has also reduced
demand for more traditional varieties, such as 100.0% orange and apple juice.
According to the United States Department of Agriculture, per capita consumption
of orange juice (including both fresh and frozen concentrate) has steadily declined
19 IBISWorld.com
since 2000, reaching a 30-year low in 2016 and is expected to fall further in 2018.
Since frozen orange juice concentrate has historically represented a large segment
of the industry, sharp and consistent declines in per capita frozen juice
consumption have hampered overall industry performance, despite strong gains in
the retail frozen fruit segment over this period.
These trends have become even more pronounced in recent years, causing the
frozen juice concentrates segment's share of industry revenue to drop to a five-year
low in 2019. The frozen juice segment is likely to continue declining over the five
years to 2024, as consumers continue to turn away from these products toward
fresher alternatives.
Demand Demand for the Frozen Fruit and Juice Production industry is
Determinants determined by household disposable income, consumer preferences
and the presence of substitute products, all of which have fluctuated
Demand for frozen fruit has grown alongside the burgeoning health-consciousness
movement in the United States during the period. Americans responded to rising
obesity rates and related medical conditions by upping their intake of fruits and
vegetables. Frozen fruit producers are capitalizing on this trend by marketing a
greater array of products to customers. In addition, the introduction of single-
serving frozen fruit products has appealed to Americans desire for healthy, portion-
controlled treats. Some consumers prefer frozen fruit products to fresh fruit,
because frozen items tend to retain their flavor, freshness and nutritional content
longer. Furthermore, seasonal fruit varieties, especially berries and tropical fruit, are
generally available year-round in contrast to their fresh or refrigerated counterparts.
Americans are also becoming busier, so they have less time to wash, prepare and
chop fruits. Frozen fruits present a solution to that problem because they are
already washed and come whole or pre-cut. Frozen juice concentrates are another
industry product that are easy to prepare. Normally stored in a can, fruit
concentrates can be used for a variety of meal or snack options, such as popsicles
or smoothies. They also have a much longer shelf life than refrigerated juice
products. Juice concentrates are ideal for some Americans looking for a convenient
way to meet their daily fruit consumption needs.
Aside from convenience, frozen fruit and juices are usually less expensive than
fresher alternatives, thereby providing cost savings for consumers who are on a
budget. Generally, as consumers gain more disposable income, they purchase more
goods. However, in some instances, having more spending money prompts
consumers to use it on higher-quality and higher-priced foods rather than increase
the volume purchased. Many consumers continue to consider frozen fruits and
juices to be inferior to fresh alternatives. As disposable income increases,
consumers will tend to spend more on fresh products. Nonetheless, the
convenience factor softens the effect of rising disposable income on demand.
Moreover, frozen products provide consumers with the option of having their
favorite fruits all year long, despite seasonality. Lastly, the presence and price of
substitute products, such as fresh fruit and ready-to-drink juices, also affect
20 IBISWorld.com
industry demand. If fresh fruit and juices are readily available or less expensive than
frozen fruits and juices, demand for industry products may suffer.
Major Markets
Wholesalers
Operators in the Frozen Fruit and Juice Production industry typically sell their
products to consumer and commercial markets via intermediary distributors known
as wholesalers. Wholesalers purchase frozen fruit and juice from operators and
resell it to a wide variety of downstream customers. This is helpful since many
operators are small family-owned businesses without broad connections to various
retailers. However, some operators, particularly larger companies, such as Dole, use
their internal sales and distribution networks to bring their products directly to
downstream markets. In 2019, packaged frozen food merchant wholesalers and
general line grocery wholesalers are expected to account for 53.4% and 30.5% of
the market, respectively. However, general wholesaler's share of the market has
declined over the past five years, as large retailers with greater economies of scale
and purchasing power have reduced their purchase costs by buying frozen foods
directly from manufacturers at a lower cost.
Retail
While the majority of products are distributed through wholesalers, and specifically
frozen food wholesalers, a small portion of industry goods are sent directly from
producers to retailers. Generally, only large retailers with warehouse space are able
to bypass wholesalers. The retail market for frozen fruit and juice products is
expected to generate a combined 1.8% of industry revenue in 2019. This market
segment includes direct sales to retailers such as traditional grocery stores,
supermarkets, convenience stores and department stores that have grocery aisles.
Additionally, large mass-merchandisers and club store chains generally purchase
industry products directly from manufacturers, using their own distribution
networks to supply individual retail locations.
Although it comprises a much smaller share, this segment also includes

restaurants and other foodservice establishments, as well as catering institutions
that serve hotels, hospitals, schools and corporate cafeterias. These facilities
generally rely on broadline and foodservice wholesalers for industry products,
though larger foodservice and hospitality chains may also purchase directly from
manufacturers. While demand from hotels and motels has remained steady due to
21 IBISWorld.com
the slow recovery of the tourism sector, demand from restaurants has increased
over the past five years, driven primarily by the growing popularity of juice bars and
fast-casual restaurants that offer fruit smoothies.
Exports
Exports are expected to account for 14.3% of industry revenue in 2019, representing
a decrease from 15.2% in 2014. Exports have declined significantly over the past
five years, driven by the US dollar's recent appreciation and weak international
demand for processed frozen juice products. The largest international markets for
frozen fruit products include Japan, Canada, Mexico and Korea. For more
information on exports, see the International Trade section.
International Exports in this industry are Medium and Steady

Trade
Imports in this industry are Medium and Increasing
Imports
In 2019, imports are expected to

account for 25.2% of domestic
demand, representing a notable
increase from 22.7% in 2014. Over
the five years to 2019, Frozen Fruit
and Juice Production industry
revenue has increased at a far
slower pace than imports. Imports
are expected to increase at an
annualized rate of 4.3% over the five
years to 2019, largely due to the
increase in the trade-weighted index
(TWI). The TWI measures the value
of the US dollar against its major
trading partners. When the TWI
increased, imports tend to increase
as well, as foreign-made goods
become relatively less expensive for
domestic consumers and markets.
Over the five years to 2019, the TWI
is expected to increase an
annualized 2.3%. As a result, imports
experienced substantial growth
during the period.
Canada and Mexico have historically been leading import sources for the industry,
due to their proximity to the United States and their participation in the North
America Free Trade Agreement (NAFTA). As a result, in 2019, Canada is expected
to account for 32.2% of total industry imports, while Mexico is expected to account
for 30.7% of industry imports. The third-largest source of imports is Brazil, which is
22 IBISWorld.com
the world's leading producer of oranges and other citrus products, in addition to a
variety of other fruits commonly frozen or concentrated. As a result, Brazil is
expected to account for 10.5% of industry imports in 2019, with Chile, the fourth-
largest source of imports, expected to account for 5.6% of imports.
Exports
Over the five years to 2019, exports are expected to experience far slower growth
than imports. Industry exports are largely tied to the TWI. As the TWI increased over
the past five years, domestically produced goods became relatively more expensive
for our major trading partners, resulting in weakening demand from overseas
consumers. Moreover, while frozen fruit producers were able to improve their
freezing technology during the period, economic growth in various emerging
economies has decelerated, constraining demand for frozen fruit and other
processed food products from these markets. As a result, over the five years to
2019, exports are expected to increase at a low annualized rate of 0.0% to $450.9
million. Thus, in 2019, exports are expected to account for just 14.3% of industry
revenue, representing a decline from 15.2% in 2014.
Over the five years to 2019, Japan has been the top export destination for US-
produced industry products. However, they have decreased as a share of total
exports. Similarly, Canada has accounted for a high share of industry exports in the
past; yet, much like Japan, they have decreased as a share of total exports over the
past five years. Thus, in 2019, Japan is expected to account for 21.5% of total
industry exports, while Canada is expected to account for 16.4% of exports. Mexico
and Korea fill out the remaining top four export destinations, accounting for 9.9%
and 7.8%, respectively.
23 IBISWorld.com
Business
Locations Business Concentration in the United States
WA
MT ME
ND
VT
OR MN
NH
ID WI
SD NY MA
WY MI CT RI
IA PA
NV NJ
NE
OH MD
IL IN DC DE
UT
CO WV VA
KS MO
CA KY
NC
AZ TN
OK
NM SC
AR
AL GA
MS
TX LA
FL
AK
HI
Establishments (%)
0 6 12 18
Source: IBISWorld
The geographic spread of establishments within the Frozen Fruit and Juice
Production industry is located close to sources of inputs, such as fruit farms, since
fruit is best frozen immediately after harvest. Establishments are also located
within a serviceable distance to large city markets and population centers.
West
The West region holds the largest proportion of establishments, at 40.5%. California
holds the largest proportion of establishments compared with any other state, with
18.5% of total establishments. California has a large agricultural sector with many
fruit growers, pickers and processors, which supplies industry operators with a
consistent supply of inputs and reduces transportation costs. Washington and
Oregon are home to 13.1% and 8.6% of total establishments, respectively, due to
their proximity to other fruit growers on the west coast. The West region is also
home to many large city markets, including Los Angeles, San Francisco and Seattle,
as well as the headquarters and main production facilities of Dole, Townsend
Farms and several other large operators.
24 IBISWorld.com
Southeast
The Southeast region has the second-largest concentration of industry

establishments, with 15.3% of total establishments. Florida is the main contributor,
holding 8.1% of establishments. Florida has an extensive orange grove that
producers use to make frozen orange juice concentrate. Additionally, Florida's major
cities, including Miami and Orlando, make the Southeast region an attractive
location because producers can easily transport their products to grocery
wholesalers and retailers.
Great Lakes and others
The Great Lakes region has the third-largest proportion of establishments,

containing 14.4% of establishments. Michigan and Wisconsin each hold 5.0% of
total establishments. The Great Lakes is a significant region for the industry due to
its favorable fruit growing conditions, in which producers can easily obtain their
supply of inputs. Lastly, the Mid-Atlantic (7.7% of establishments), New England
(5.0%), Rocky Mountains (5.9%), Plains (7.7%) and Southwest regions (3.6%) hold
the remaining establishments. These areas are either far from fruit and other
agricultural districts or do not have as large a population to serve as other more
profitable markets.
25 IBISWorld.com
Competitive Landscape
Market Share Concentration in this industry is Low
Concentration
The Frozen Fruit and Juice Production
industry has a low level of market share
concentration, with the top four players
expected to generate less than 10.0% of
industry revenue in 2019. Industry
concentration has increased over the past
five years due to merger and acquisition
activity. These acquisitions are mainly
occurring among smaller operators that
are aiming to expand their market reach
and capitalize on economies of scale. For
example, The WhiteWave Foods Co.
acquired Earthbound Farm, a producer of
organic fruit and snack products, for
$600.0 million in 2013. Moreover, in 2018,
former industry player Old Orchard was
acquired by Canadian company, Lassonde Industries, while former industry player
Inventure Foods sold off its relevant segment to an overseas operator and was
acquired by non-relevant company Utz. Despite ongoing consolidation activity, the
industry as a whole will continue to have a low level of concentration over the five
years to 2024, due to the strong presence of smaller niche fruit processors and
regional private label manufacturers.
26 IBISWorld.com
Key Success IBISWorld identifies 250 Key Success Factors for a business. The most important for this
Factors industry are:
Supply contracts in place for key inputs: Successful operators have reliable contracts
with farmers and other input suppliers for a steady supply of fruit and sugar to use in
production. Guaranteed supplies at fixed prices minimize supply costs and aid production
planning.
Economies of scale: The scale and breadth of production largely determines marginal
costs. It also affects the volume that a producer is able to supply, which is a key
determinant of success in capturing market share.
Ability to pass on cost increases: Given the volatility of commodity and energy prices,
especially for sugar, successful companies are able to pass unexpected cost increases
down the supply chain to maintain profitability.
Ability to differentiate products: Since frozen fruit and juice products are homogeneous
in nature, successful companies must differentiate their products to maintain market share
and increase revenue, with the primary goal of reducing direct competition.
Ability to adapt to change: Successful producers are able to anticipate and respond to
changes in consumer preferences in a timely manner.
Cost Structure
Benchmarks
27 IBISWorld.com
Profit
The average industry profit margin, measured as

earnings before interest and taxes, is expected
to decrease 0.1% in 2019. Profit took a large dip
this year due to external economic volatility, but
is expected to recover over the outlook period.
Larger companies with these branding
capabilities are able to generate a higher profit
margin than smaller companies or generic and
private label frozen fruit producers. Input costs
are also an important component in determining
profit. Over the five years to 2019, the price of
fruit increased at an annualized rate of 4.1%.
Larger operators with established brands are
able to pass the added cost of fruit down to
loyal customers in the form of higher prices
during the period, yet smaller operators may
struggle.
Wages
Over the past five years, wages have increased

slightly as a share of total industry revenue. In
2019, wages are expected to account for 9.2%
of industry revenue. Employees in the industry
weigh, clean and prepare ingredients, supervise
equipment and perform quality assurance
checks. Although these manual labor tasks are
necessary, industry operators are relying more
on machinery to automate processes and
improve operating efficiencies, which reduces
the need for labor. However, leading frozen fruit
processors have also expanded their research,
product development and marketing teams as
households continued to demand fresher, more
innovative products. Since these workers
typically earn higher wages than employees
involved in the production and distribution of
products, total industry wages have increased
as a share of revenue during the five-year period.
28 IBISWorld.com
Purchases
Purchases make up the largest cost for industry

operators. In 2019, purchases are expected to
account for 56.4% of revenue and primarily
include the aggregate cost of fruit, which is the
main input in the production of frozen fruit and
juice concentrate products. Purchases have
risen as a share of revenue over the past five
years due to rising material costs, as evidenced
by the increase in the price of fruit and a few
other agricultural commodities. In addition to
food inputs, producers also purchase a
significant amount of plastic or cardboard to
create safe packaging materials that can
effectively preserve the finished product. Many
industry operators have mitigated volatile plastic
prices by reducing the size of product
packaging, while an increasing number of
producers are using a combination of thinner
plastic and paperboard to lower purchase costs.
Depreciation
In 2019, depreciation is expected to make up an

estimated 2.3% of revenue. Depreciation costs
have remained stable over the past five years as
operators have increasingly used machinery to
automate processes and improve operating
efficiencies.
Marketing
Operators spend on marketing efforts to

promote their products and create brand loyalty.
Large companies in the industry with significant
capital invest a larger proportion of revenue into
marketing to drive brand recognition. On the
other hand, marketing costs are much lower for
generic or private label brands. Marketing costs
are expected to increase as companies aim to
market products against fresh fruit and show
the affordable and nutritious properties of
frozen products. In 2019, marketing is expected
to account for just 0.4% of industry revenue.
29 IBISWorld.com
Rent
Rent is anticipated to account for 0.7% of

revenue in 2019.
Utilities
Utilities are expected to account for 1.9% of

revenue.
Other Costs
Other expenses include administrative fees,

legal fees, research and development, and
overhead expenses. This segment has remained
relatively stable as a share of revenue at 29.2%.
Basis of Competition in this industry is Medium and Increasing

Competition
The Frozen Fruit and Juice Production industry is characterized by a
moderate level of competition.
There are multiple major brands within the industry, but smaller companies are also
finding a foothold in niche markets. Companies primarily compete based on price,
quality, product development and relationship with downstream markets.
30 IBISWorld.com
Internal competition
Price is one of the most important bases of competition, as

consumers are often price-sensitive and tend to switch to lower-
priced alternatives.
The growing prevalence of low-priced, private label frozen fruit and juice products
has intensified price competition over the past five years, though many specialty
operators are able to differentiate their products on the basis of product taste and
quality. Quality determines the price that consumers are willing to pay for a good.
Name brand frozen fruit and juice concentrates, such as Dole and Welch's,
command a premium because of the perceived higher quality that keeps their
products competitive. In addition, freshness and taste are crucial to determining
demand. Technological developments have improved packaging that sustains the
freshness of these products for longer periods of time. Innovation and product
differentiation constitute another important area in which all companies compete,
especially because frozen fruit and juice concentrates are homogeneous in nature.
To differentiate themselves from other companies, companies are developing
frozen single-serving fruit cups as a way to satisfy Americans' desire for healthy,
portion-controlled snacks. Packaging and marketing are other areas where
operators can differentiate themselves from the competition.
Developing and maintaining strong relationships with both upstream suppliers and
downstream customers is also critical to remain competitive in this industry.
Guaranteed access to high-quality inputs and ingredients at a reasonable price
enables producers to hedge against seasonal fluctuations in commodity prices and
maintain the prices they charge their downstream markets. Lastly, the ability to
secure optimal shelf space in retail channels has conventionally set market leaders
apart from their competitors. The most recognizable and strategically placed
brands have the highest potential to maximize sales at the retail level. Grocery
stores and supermarkets have historically limited the amount of shelf space
dedicated to frozen fruits within the chilled foods aisle, making it especially
important for industry operators to work with these retailers to enhance the visibility
of their product. In addition to developing stronger relationships with traditional
grocers, manufacturers have expanded their distribution networks to include
convenience stores, gas stations and other unconventional retail channels as
competition in this industry has intensified.
External competition
The Frozen Fruit and Juice Production industry competes against

the fresh fruit and ready-to-drink market.
If these substitute products are more readily available, offered at a lower price or
perceived to be a healthier option, consumers will be more likely to buy them.
However, many major industry players also sell fresh produce and manufacture
ready-to-drink juices, so smaller companies that offer a smaller product portfolio
are more susceptible to competition. Furthermore, although fresh produce has
historically been perceived to be more nutritious than their frozen counterparts, a
recent study co-sponsored by the Frozen Found Foundation and the University of
California-Davis suggests that freezing fruit helps preserve flavor and nutritional
content more effectively than refrigeration or leaving at room temperature. The
31 IBISWorld.com
industry also competes against imports; in 2019, imports are expected to satisfy
25.2% of domestic demand.
Barriers to Entry Barriers to entry in this industry are Medium and Steady
The barriers to entry for the Frozen Fruit

and Juice Production industry are Barriers to entry checklist
moderate. Capital investments include Competition Medium
expenses relating to the construction or
Concentration Low
purchase of a processing facility, plant
equipment, warehousing and Life Cycle Stage Mature
distribution. A major threat to new
Technology Change Medium
entrants is the entrenched position that
major players already hold in the market. Regulation & Policy Medium
These top companies have strong
Industry Assistance Medium
product portfolios and brands that are
well-known to consumers, such as Dole
and Welch's. Furthermore, these companies have large marketing and advertising
budgets that enable them to continue growing their brand. Larger operators enjoy
lower per-unit costs from economies of scale, whereas new entrants are smaller
and generally have higher per-unit costs due to lower production capacity. Although
these factors are not barriers to entry in themselves, they may hamper the success
of new entrants.
Another major threat that new entrants experience is establishing relationships with
major downstream retailers. Generally, supermarkets stock their most visible
shelves with products that have a track record of high sales. Since new entrants do
not have a long history of sales, they must first obtain contracts and then increase
sales to prove the success of the product. Not having contracts with retailers may
reduce product visibility and sales, making it difficult for new players to expand their
business beyond local or regional markets.
Industry Globalization in this industry Medium and Steady

Globalization
The Frozen Fruit and Juice Production industry is moderately globalized. An
industry's level of globalization is determined by several factors, including the level
of foreign ownership of companies and international trade that the industry
engages in. Within this industry, the majority of operators are US-owned businesses
focused on domestic operations. Although none of the major companies are
foreign-owned, many of them manufacture and sell their products throughout the
world. For example, Dole markets and sells its products in over 90 countries. The
industry is also exposed to globalization through international trade. Over the five
years to 2019, exports are expected to increase at an annualized rate of 0.0% to
$450.9 million, accounting for 14.3% of industry revenue, representing a decrease
from 15.2% in 2014. Moreover, over the five years to 2019, imports are expected to
increase at an annualized rate of 4.3% to $913.7 million, accounting for 25.2% of
domestic demand, a notable increase from 22.7% in 2014.
32 IBISWorld.com
33 IBISWorld.com
Major Companies
Major Players THERE ARE NO MAJOR PLAYERS IN THIS INDUSTRY
Other Players The Frozen Fruit and Juice Production industry comprises many small operators
that serve local regions. In addition to the companies listed below, other notable
operators include Seneca Foods Corporation, Pinnacle Foods, Sunrise Growers (a
subsidiary of SunOpta Inc.), Townsend Farms and Cascadian Farm (a subsidiary of
General Mills).
DOLE FOOD COMPANY
The Dole Food Company (Dole) is currently one of the world's largest fresh fruit and
vegetable producers. Its main executive offices are located in California, but it
grows, processes, markets and distributes more than 200 products in 90 countries.
Dole Packaged Foods is the leading manufacturer of brand name frozen fruit
products in the United States. In 2012, Dole sold Dole Packaged Foods to Itochu
Corporation, a Japanese conglomerate, thereby decreasing its presence in the
industry. However, the company still produces a variety of industry-relevant
products.
Prior to the sale, Dole struggled to maintain positive growth due to volatile demand
and lower earnings from its mainstay fruit, the banana. In response, the company
sought to consolidate much of its holdings by selling off a large portion of its
business. Since then, Dole has driven revenue growth mainly through new product
development. For example, the company introduced a new line of frozen blended
fruit products containing mandarin oranges and mixed wild berries. In 2016, Dole
introduced Mixations fruit cups, which cater to the growing healthy snacking trend.
The company has also benefited from strong brand recognition and increased shelf
space at major supermarket and mass-merchandiser chains. In 2019, IBISWorld
estimates Dole's industry-specific revenue will reach $94.9 million.
JASPER WYMAN & SON
Jasper Wyman and Son (Wyman) was founded in 1874 as a family-run blueberry
farm. Today, the company grows its own fruit in Maine, New Brunswick, Nova Scotia
and Prince Edward Island and then harvests, packages and distributes goods to
various retailers. Wyman's Wild Blueberries are harvested using the latest
technology, including color laser sorters and individual quick freezing of each berry
to ensure the freshest taste. The company has also expanded from only blueberries
to include strawberries, raspberries, blackberries and even mangoes sourced from
other family farms. Wyman also imports frozen berries with to create its own frozen
fruit products. As a family-owned operation, the company does not disclose any
financial information. IBISWorld estimates the company's industry-relevant revenue
will be $68.8 million in 2019.
34 IBISWorld.com
LASSONDE INDUSTRIES INC.
Founded in 1918, Lassonde Industries Inc. (Lassonde) began as a vegetable

canning factory in Canada. The company has grown to become one of the largest
producers of fruit and vegetable juices in North America. Lassonde became
industry-relevant in May 2018, when it acquired Old Orchard Brands (OOB). OOB
was founded in the 1980s as a family-owned farm. Since then, it has grown to
produce and sell more than 100 products throughout the United States and the
world. OOB is located in Sparta, MI due to the area's high volume of fruit farms. The
company sells both ready-to-drink and frozen juices. In fact, according to OOB's
website, the company is the second-largest frozen juice producer and fourth-largest
bottled juice company. It has not become clear how Lassonde's acquisition of OOB
will affect the company's production capacity; however, its facilities remain in the
United States. Thus, in 2019, IBISWorld expects Lassonde to generate $17.9 million
in industry-relevant revenue.
NATIONAL GRAPE COOPERATIVE
Welch's was founded in 1869 in Vineland, NJ, but was acquired in 1956 by the
National Grape Cooperative Association, a collection of family farms that primarily
grow Concord grapes for the US market. The cooperative contains 1,054 grape
growers in Michigan, New York, Ohio, Pennsylvania, Washington, and Ontario,
Canada. Welch's is now headquartered in Concord, MA. Since the company's
founding, it has grown to produce, market and sell more than 400 grape-based
products in the United States and over 35 other countries. Welch's is best known for
its Concord grape juice, but the company participates in this industry through its
frozen concentrates business, which produces a wide range of frozen 100.0% juice
and juice cocktail products for the retail market.
The company's frozen juice concentrate business has faltered in recent years due
to unfavorable shifts in consumer preferences at the retail level and increased
competition from private label manufacturers at the food service level. Over the five
years to 2019, Welch's has struggled to maintain positive growth due to some
unexpected shortfalls. Revenue fell due to a lower volume of products sold and an
increase in promotional spending to protect the company's brand. Recently, the
company reported gains in refrigerated juices and sparkling beverages,
demonstrating a shift away from its frozen concentrate juices. IBISWorld estimates
Welch's industry-relevant revenue to reach $12.1 million in 2019.
35 IBISWorld.com
Operating Conditions
36 IBISWorld.com
Capital Intensity The level of capital intensity is Medium
The Frozen Fruit and Juice Production

industry has a moderate level of capital
intensity. Using wages as a proxy for labor
and depreciation as a proxy for capital,
IBISWorld estimates that for every dollar spent
on labor in the industry, $0.25 will be spent on
capital in 2019. This figure represents a
moderate decrease from $0.30 in 2014. Labor
in the industry is used to weigh, clean and
prepare ingredients, supervise equipment and
perform quality assurance checks. Although
manual labor is required for these operations,
industry operators use machinery to improve
operations and cut costs without additional
labor by streamlining operations. Capital
expenditure in this industry is required for
machinery that is used to automate the
sorting, processing, flash freezing and
packaging procedures in the production
process. The purchase and maintenance of
freezing, preservative and packaging
equipment also represents a significant
portion of the industry's depreciation costs.
The Frozen Fruit and Juice Production industry is not subject to

significant technology disruption.
Although technology changes like automation are present, they only work to
increase efficiency and do not threaten the overall industry.
The level of technology change is Medium
Operators in the Frozen Fruit and Juice Production industry require

technology and equipment to process, freeze and package fruit and
juices.
Fruit can be processed in many different ways, depending on the desired end-
product. After they are sorted and cleaned, fruits are chopped or kept whole and
then placed in a freezer to lengthen the shelf life, while still maintaining the fruit's
nutritional quality. The techniques most frequently used in this industry are
blanching and flash freezing. Blanching and flash freezing are different methods to
preserve or slow down the rate at which foods spoil. Blanching is usually more
appropriate for processing apples, peaches and similar fruit varieties. Flash
freezing is effective for preserving most other fruit varieties, especially berries,
citrus fruits and other varieties with high water content. The aim for both of these
processes is to lengthen the shelf life of the product. There are often secondary
objectives as well, such as making the product more convenient or improving the
37 IBISWorld.com
packaging, presentation and taste of a product. All of these objectives fall into
improving product quality while minimizing processing costs.
There are various types of freezers, including air-blast freezers, tunnel freezers, belt
freezers, fluidized bed freezers, contact freezers, immersion freezers and plate
freezers. To use air-blast freezers, operators place fruit on trays, which travel down
a tunnel of cold air, freezing fruit in minutes. Fluidized bed freezers blow cold air
upward through the bed at a high force. Operators also use the counter-current
extraction (CCE) technique. This process enables producers to separate multiple
liquids with differing proportions, and has been known to increase yields by up to
60.0% when compared with conventional forms of processing from the mid-1990s.
Technology for quick freezing equipment has not changed significantly over the
past five years, but incremental improvements are continually made to increase the
efficiency of cooling appliances, which can significantly reduce the high electricity
costs usually associated with these appliances. Following the freezing process,
manufacturers use conveyor belts and automatic fillers to insert the frozen fruit into
bags. Juice concentrates are frozen in their cans so no further processing needs to
be done, unless the product requires labeling. The packaging material is designed
to be moisture-proof so it is not damaged when condensation forms.
Lastly, computerized systems enable companies to keep track of their input and
product inventory to reduce costs through improved production planning. These
systems also help operators keep track of products moving along the supply line
from upstream farmers and fruit processors to downstream grocery wholesalers
and retailers.
Revenue Volatility The level of volatility is Medium
Note: Revenue growth and decline reflective of 5-year annualized trend. Y-axis is in
logarithmic scale. Y-axis crosses at long-run GDP. X-axis crosses at high volatility
threshold.
38 IBISWorld.com
The Frozen Fruit and Juice Production industry exhibits a moderate

level of revenue volatility.
In general, the industry's revenue fluctuations are influenced by changes in the cost
of raw materials, energy and oil prices, weather conditions, household incomes and
changes to downstream demand. Fruit is the primary input in the production
process and price fluctuations affect industry supply. Additionally, weather
conditions play a part in the fruit's quality and quantity, although this has been
partially tempered by the growth in horticultural enterprises and the ability of
operators to sell flash-frozen fruit products year-round. Moreover, consumer tastes
and perceptions of the health benefits of industry products also contributes to
revenue volatility. Over the five years to 2019, revenue declined as much as 3.2% in
2014 and increased as much as 6.4% in 2015.
Consumer tastes, which can often change quickly, aid in creating industry volatility.
Similarly, consumers with less disposable income typically purchase frozen fruit as
an inexpensive alternative to fresh fruit, boosting revenue. Although industry
revenue typically drops when consumers have more disposable income to buy more
expensive fresh fruit, recent consumer purchasing patterns and shifts in health
consciousness have generally been favorable to the industry's frozen fruit segment.
Additionally, over the past five years, there have been many studies into the
perceived health benefits or detriments to eating frozen fruit rather than fresh fruit.
Thus, when consumers feel frozen fruit is a healthy option, revenue tends to
increase. Conversely, when frozen fruit is perceived to have fewer health benefits
when compared with fresh fruit, revenue tends to suffer.
Regulation & The level of regulation is Medium and is Increasing

Policy
The Frozen Fruit and Juice Production industry experiences a
moderate level of regulation, and this level is increasing.
Among others, industry operators must comply with the Food and Drug
Administration (FDA) and the Environmental Protection Agency (EPA). Failure to
abide by these regulations can impair a manufacturer's credibility, result in
expensive product recalls, and be liable to civil or criminal penalties. Compliance
can be seen as a way to reduce costs and avoid hefty fines, as well as a way to
improve product quality.
Food and Drug Administration
The Food and Drug Administration's (FDA) mission is to promote and

protect the public health by helping safe and effective products
reach the market in a timely way and monitoring products for
continued safety after they are in use.
The FDA regulates the Frozen Fruit and Juice Production industry through the
Federal Food, Drug, and Cosmetic Act (FD&C) and the Fair Packaging and Labeling
Act. The Nutrition Labeling and Education Act, which amended the FD&C, requires
39 IBISWorld.com
foods to bear nutrition labeling and requires labels that have nutrient content claims
and certain health messages to be accurate and truthful. The FDA also instituted
the Food Ingredient Safety Program that governs and evaluates claims about
ingredients and nutritional content.
Environmental Protection Agency
The Environmental Protection Agency (EPA) regulates this industry

through the Food Quality Protection Act of 1996.
Under this act, the EPA manages the concentration level and type of pesticide that
producers use on fruits and other foods. This regulation is most relevant to
vertically integrated producers, such as Welch's, which uses a cooperative of
farmers.
The EPA also regulates the industry regarding waste management through the
Clean Water Act (CWA), Clean Air Act, Pollution Prevention Act (PPA) and Resource
Conservation and Recovery Act (RCRA). The CWA's increasingly rigorous
regulations for discharging wastewater are the primary regulatory drivers for the
food processing industry. Unless located in remote areas, most food processing
facilities pre-treat and discharge wastewater directly to a publicly owned treatment
plant. When a facility discharges any waste to the environment, they are required to
have a National Pollutant Discharge Elimination System (NPDES) permit as
mandated in the CWA. However, waste products from frozen fruit and juice
production typically generate small amounts of waste.
Industry The level of industry assistance is Medium and is Steady

Assistance
The Frozen Fruit and Juice Production industry receives a moderate
level of industry assistance.
Industry operators receive assistance in the form of tariffs, as well as assistance
from various associations. For instance, frozen orange and grapefruit juice incur a
tariff ranging from 7.85 cents per liter to 18.0 cents per liter. Frozen pineapple juice
incurs a tariff ranging from 1.0 cent per liter to 18.0 cents per liter. Grape juice
incurs a tariff between 4.4 cents per liter to 26.0 cents per liter. Additionally, frozen
strawberries incur a tariff of 11.2% per kilogram, while frozen bananas and
plantains incur a tariff of just 2.4% per kilogram.
The industry also receives indirect assistance from private trade associations, such
as the American Frozen Food Institute (AFFI). The AFFI represents the broader
frozen food industry supply chain, including producers, distributors, suppliers and
packagers. The AFFI offers various assistance programs to producers of frozen
food products, such as research and development, technical advice and public and
trade relations, in addition to advocating for trade agreements that permit the
United States to export more frozen foods more effectively. For example, the
association was a critical voice in passing the free trade agreement with South
Korea, which went into effect in March 2012 and quickly made South Korea a major
export market for frozen fruit products. The association also provides workshops
40 IBISWorld.com
for industry operators to help improve the quality of their products or educate them
about new food handling techniques. More recently, the trade organization
launched a national marketing campaign to address misconceptions that
consumers commonly associate with frozen foods. Aptly named “Frozen. How
Fresh Stays Fresh”, the campaign intends to show that properly frozen fruit and
juice products are just as nutritious as fresh or refrigerated alternatives.
The National Frozen and Refrigerated Foods Association (NFRA) and Frozen Food
Foundation also work closely with the AFFI. The NFRA represents the interests
across every segment of the Frozen and Refrigerated Foods industry including
manufacturers, distributors, retailers, wholesalers, suppliers and sales agents. The
association provides assistance with marketing, promotion, research and
development and new product innovation. The Frozen Food Foundation has co-
sponsored studies with several universities and other research facilities to show
that flash-freezing food preserves nutrients and taste better than refrigerating or
canning. For example, the organization recently sponsored a study with the
University of California-Davis to determine the nutrient content of eight commonly
frozen fruits and vegetables.
41 IBISWorld.com
Key Statistics
Industry Data
Demand fruit
2010 2,867 402 57 39 6,564 383 572 262 3,055 124
2011 3,171 447 55 38 6,454 461 683 257 3,393 118
2012 3,003 504 54 36 6,264 444 666 242 3,226 119
2013 3,069 504 55 37 6,345 450 700 246 3,319 121
2014 2,970 471 57 38 6,584 450 741 251 3,260 124
2015 3,159 434 55 37 6,866 441 777 270 3,495 124
2016 3,114 476 59 39 6,874 486 806 286 3,435 139
2017 3,107 448 60 40 6,878 473 798 286 3,432 148
2018 3,170 361 60 40 6,989 448 904 291 3,626 148
2019 3,158 362 61 41 6,999 451 914 291 3,621 152
2020 3,144 423 61 41 7,015 451 903 292 3,596 156
2021 3,137 423 62 41 7,038 451 899 292 3,586 160
2022 3,163 426 62 42 7,101 455 905 295 3,612 164
2023 3,191 430 63 42 7,166 460 911 298 3,642 169
2024 3,221 434 64 43 7,229 464 921 300 3,678 173
Annual Change
Demand fruit
(%) (%) (%) (%) (%) (%) (%) (%) (%) (%)
2010 5.95 -15.4 6 5 -3 17.0 11.7 -1.95 5.73 12.2
2011 10.6 11.2 -4 -3 -2 20.4 19.5 -1.80 11.1 -4.93
2012 -5.28 12.6 -2 -5 -3 -3.74 -2.57 -5.65 -4.94 1.11
2013 2.19 0.03 2 3 1 1.51 5.13 1.52 2.89 1.81
2014 -3.25 -6.55 4 3 4 -0.03 5.80 2.07 -1.77 2.70
2015 6.36 -7.84 -4 -3 4 -2.14 4.94 7.40 7.22 -0.24
2016 -1.42 9.74 7 5 0 10.2 3.74 6.15 -1.73 11.7
2017 -0.23 -5.97 2 3 0 -2.58 -1.06 0.00 -0.09 6.58
2018 2.02 -19.4 0 0 2 -5.41 13.3 1.67 5.67 -0.21
2019 -0.37 0.24 2 3 0 0.73 1.07 0.03 -0.14 3.21
2020 -0.45 16.8 0 0 0 0.06 -1.20 0.10 -0.70 2.57
2021 -0.23 0.07 2 0 0 -0.14 -0.38 0.20 -0.28 2.56
2022 0.83 0.66 0 2 1 0.99 0.57 0.88 0.75 2.57
2023 0.89 0.89 2 0 1 1.01 0.69 0.91 0.83 2.57
2024 0.94 0.93 2 2 1 0.87 1.07 0.87 0.98 2.57
Key Ratios
Year IVA/Revenue Imports/Demand Exports/Revenue Revenue per Wages/Revenue Employees per Average Wage
Employee estab.
(%) (%) (%) ($'000) (%)
2010 14.0 18.7 13.4 437 9.13 115 39,854
2011 14.1 20.1 14.5 491 8.10 117 39,805
2012 16.8 20.6 14.8 479 8.07 116 38,697
2013 16.4 21.1 14.7 484 8.02 115 38,786
2014 15.9 22.7 15.2 451 8.46 116 38,153
2015 13.7 22.2 14.0 460 8.54 125 39,295
2016 15.3 23.5 15.6 453 9.20 117 41,664
2017 14.4 23.2 15.2 452 9.22 115 41,640
2018 11.4 24.9 14.1 454 9.19 116 41,665
2019 11.5 25.2 14.3 451 9.22 115 41,620
2020 13.4 25.1 14.4 448 9.27 115 41,568
2021 13.5 25.1 14.4 446 9.31 114 41,517
2022 13.5 25.0 14.4 445 9.32 115 41,515
2023 13.5 25.0 14.4 445 9.32 114 41,515
2024 13.5 25.0 14.4 446 9.32 113 41,513
42 IBISWorld.com
Additional Resources
Additional Western Farm Press
Resources http://www.westernfarmpress.com
US Department of Agriculture
http://www.usda.gov
Frozen and Refrigerated Buyer

http://www.frbuyer.com
American Frozen Food Institute

http://www.affi.org
Industry Jargon COOPERATIVE

An association of trade professionals who are united voluntarily to meet a common
economic goal.
ECONOMIES OF SCALE
The increase in efficiency of production as the number of goods being produced increases.
FLASH FREEZING
A freezing technique in which water contained inside a food source is subjected to
temperatures well below its freezing point, which prevents ice crystal from forming within
the food.
VERTICALLY INTEGRATED
Companies that participate in multiple parts of the supply chain.
WHOLESALE BYPASS
A popular trend within retail and manufacturing industries where producers supply goods
directly to stores, eliminating the middleman.
Glossary Terms BARRIERS TO ENTRY

High barriers to entry mean that new companies struggle to enter an industry, while low
barriers mean it is easy for new companies to enter an industry.
43 IBISWorld.com
CAPITAL INTENSITY
Compares the amount of money spent on capital (plant, machinery and equipment) with
that spent on labor. IBISWorld uses the ratio of depreciation to wages as a proxy for capital
intensity. High capital intensity is more than $0.333 of capital to $1 of labor; medium is
$0.125 to $0.333 of capital to $1 of labor; low is less than $0.125 of capital for every $1 of
labor.
CONSTANT PRICES
The dollar figures in the Key Statistics table, including forecasts, are adjusted for inflation
using the current year (i.e. year published) as the base year. This removes the impact of
changes in the purchasing power of the dollar, leaving only the "real" growth or decline in
industry metrics. The inflation adjustments in IBISWorld’s reports are made using the US
Bureau of Economic Analysis’ implicit GDP price deflator.
DOMESTIC DEMAND
Spending on industry goods and services within the United States, regardless of their
country of origin. It is derived by adding imports to industry revenue, and then subtracting
exports.
EMPLOYMENT
The number of permanent, part-time, temporary and seasonal employees, working
proprietors, partners, managers and executives within the industry.
ENTERPRISE
A division that is separately managed and keeps management accounts. Each enterprise
consists of one or more establishments that are under common ownership or control.
ESTABLISHMENT
The smallest type of accounting unit within an enterprise, an establishment is a single
physical location where business is conducted or where services or industrial operations are
performed. Multiple establishments under common control make up an enterprise.
EXPORTS
Total value of industry goods and services sold by US companies to customers abroad.
IMPORTS
Total value of industry goods and services brought in from foreign countries to be sold in
the United States.
INDUSTRY CONCENTRATION
An indicator of the dominance of the top four players in an industry. Concentration is
considered high if the top players account for more than 70% of industry revenue. Medium
is 40% to 70% of industry revenue. Low is less than 40%.
44 IBISWorld.com
INDUSTRY REVENUE
The total sales of industry goods and services (exclusive of excise and sales tax); subsidies
on production; all other operating income from outside the firm (such as commission
income, repair and service income, and rent, leasing and hiring income); and capital work
done by rental or lease. Receipts from interest royalties, dividends and the sale of fixed
tangible assets are excluded.
INDUSTRY VALUE ADDED (IVA)

The market value of goods and services produced by the industry minus the cost of goods
and services used in production. IVA is also described as the industry's contribution to GDP,
or profit plus wages and depreciation.
INTERNATIONAL TRADE
The level of international trade is determined by ratios of exports to revenue and imports to
domestic demand. For exports/revenue: low is less than 5%, medium is 5% to 20%, and high
is more than 20%. Imports/domestic demand: low is less than 5%, medium is 5% to 35%,
and high is more than 35%.
LIFE CYCLE
All industries go through periods of growth, maturity and decline. IBISWorld determines an
industry's life cycle by considering its growth rate (measured by IVA) compared with GDP;
the growth rate of the number of establishments; the amount of change the industry's
products are undergoing; the rate of technological change; and the level of customer
acceptance of industry products and services.
NONEMPLOYING ESTABLISHMENT
Businesses with no paid employment or payroll, also known as nonemployers. These are
mostly set up by self-employed individuals.
PROFIT
IBISWorld uses earnings before interest and tax (EBIT) as an indicator of a company’s
profitability. It is calculated as revenue minus expenses, excluding interest and tax.
45 IBISWorld.com
REGIONS
West | CA, NV, OR, WA, HI, AK
Great Lakes | OH, IN, IL, WI, MI
Mid-Atlantic | NY, NJ, PA, DE, MD
New England | ME, NH, VT, MA, CT, RI
Plains | MN, IA, MO, KS, NE, SD, ND
Rocky Mountains | CO, UT, WY, ID, MT
Southeast | VA, WV, KY, TN, AR, LA, MS, AL, GA, FL, SC, NC
Southwest | OK, TX, NM, AZ
VOLATILITY
The level of volatility is determined by averaging the absolute change in revenue in each of
the past five years. Volatility levels: very high is more than ±20%; high volatility is ±10% to
±20%; moderate volatility is ±3% to ±10%; and low volatility is less than ±3%.
WAGES
The gross total wages and salaries of all employees in the industry. The cost of benefits is
also included in this figure.
46 IBISWorld.com
IBISWorld helps you find the industry information
you need – fast
With our trusted research covering thousands of global industries, you’ll get a quick and intelligent overview of any industry
so you can get up to speed in minutes. In every report, you’ll find actionable insights, comprehensive data and in-depth
analysis to help you make smarter, faster business decisions.If you're not yet a member of IBISWorld, contact us at
+1-800-330-3772 or [email protected] to learn more.
Disclaimer
This product has been supplied by IBISWorld Inc. ('IBISWorld') solely for use by its authorized licenses strictly in
accordance with their license agreements with IBISWorld. IBISWorld makes no representation to any other person with
regard to the completeness or accuracy of the data or information contained herein, and it accepts no responsibility and
disclaims all liability (save for liability which cannot be lawfully disclaimed) for loss or damage whatsoever suffered or
incurred by any other person resulting from the use of, or reliance upon, the data or information contained herein.
Copyright in this publication is owned by IBISWorld Inc. The publication is sold on the basis that the purchaser agrees not
to copy the material contained within it for other than the purchasers own purposes. In the event that the purchaser uses or
quotes from the material in this publication - in papers, reports, or opinions prepared for any other person - it is agreed that
it will be sourced to: IBISWorld Inc.
Copyright 2020 IBISWorld Inc.
IBISWorld.com +1-800-330-3772 [email protected]

Frozen Fruit & Juice Production: Brain Freeze: Low Demand For Frozen Juice Is Expected To Limit Revenue Growth

Uploaded by

Copyright:

Available Formats

Frozen Fruit & Juice Production: Brain Freeze: Low Demand For Frozen Juice Is Expected To Limit Revenue Growth

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Frozen Fruit & Juice Production: Brain Freeze: Low Demand For Frozen Juice Is Expected To Limit Revenue Growth

Uploaded by

Copyright:

Available Formats

US INDUSTRY (SPECIALIZED) REPORT OD4628

Frozen Fruit & Juice Production

IBISWorld.com +1-800-330-3772 [email protected]

About This Industry...........................................4 Competitive Landscape...................................26

Industry Definition..........................................................4 Market Share Concentration....................................... 26

Industry at a Glance.......................................... 6 Major Companies............................................ 34

Executive Summary....................................................... 8 Major Players............................................................... 34

About This Industry

Major Players There are no major players in this industry

Main Activities The primary activities of this industry:

Producing frozen concentrated orange juice

Producing other frozen concentrated juices

The major products and services in this industry:

Other frozen fruit

Other frozen juice concentrates

Frozen orange juice concentrate

Frozen Food Production in Juice Production in the US Frozen Food Wholesaling in

RELATED INTERNATIONAL INDUSTRIES

Tea, Coffee and Other Food

2014-2019 2019-2024 2014-2024

-0.1% Capital Intensity

6,999 demand for fruit products

Products & Services Segmentation

18.2% 8.8% 24.7% 22.1% 26.2%

Major Players % = share of industry revenue SWOT

Key External Per capita fruit and vegetable consumption

Per capita disposable income

Shifting consumer tastes

Rising health consciousness, increased snacking and other broad

Frozen fruit and juice producers' profit is strongly affected by the

While international trade in this industry is moderate, major swings

Imports are expected to satisfy 25.2% of domestic demand in 2019, representing an

Historical Performance Data

Fresh and frozen food

Industry operators have come a long way in addressing common

Additionally, rising health consciousness is likely to benefit frozen fruit producers,

industry operators continue to promote such studies to highlight the nutritional

Industry structure and trade

Performance Outlook Data

LIFE CYCLE REASONS

Although the industry is characterized by well-defined product segments,

Products and Markets

2nd Tier 2nd Tier

The Frozen Fruit and Juice Production industry's product breakdown

In 2019, IBISWorld expects manufacturers' shipments of frozen

Frozen juice concentrates

Frozen fruit concentrates are expected to account for a combined

Although it comprises a much smaller share, this segment also includes

International Exports in this industry are Medium and Steady

In 2019, imports are expected to

The Southeast region has the second-largest concentration of industry

Great Lakes and others

The Great Lakes region has the third-largest proportion of establishments,

The average industry profit margin, measured as

Over the past five years, wages have increased

Purchases make up the largest cost for industry

In 2019, depreciation is expected to make up an

Operators spend on marketing efforts to

Rent is anticipated to account for 0.7% of