Posts Tagged “organic produce sales”
MONTEREY, CA — Organic fresh produce sales grew by 3 percent in 2022, while volume declined by –3.7 percent, as total sales topped $9.4 billion for the year, according to the 2022 Organic Produce Performance Report released today by Organic Produce Network and Category Partners.
The organic fresh berry category (which includes strawberries, blueberries, raspberries, and blackberries) was the top organic produce category, holding more than 16 percent of organic fresh produce dollars in 2022. Overall fresh berry sales topped 1.6 billion for the year, with organic packaged salads a close second at $1.55 billion.
Total fresh produce sales gained 7.3 percent in dollars for the year but experienced a –1.3 percent decline in volume. Organic fresh produce made up 12 percent of all fresh produce sales and accounted for 7 percent of all fresh produce volume.
“In an inflationary time like this, we expect to see the growth of sales dollars and volume declines repeated for the majority of organic and conventional fresh produce items,” said Tom Barnes, President of Category Partners. “The average conventional price per pound grew by 9.2 percent compared to 2021 while organic produce price per pound rose by 7 percent. With rising prices, we may see more selective organic shopping from consumers as they substitute higher-priced organic items for conventional ones.”
Organic apples were the largest example of substitution as their price per pound increased by more than double the amount of conventional, resulting in a volume decline of –10.3 percent.
For 2022, 13 of the top 20 organic produce categories (by total sales) posted increases in dollars, with organic onions generating the largest increase (15.4 percent), followed by cucumbers, potatoes, and avocados. Conversely, green beans posted the largest drop in dollars (–5 percent), and lettuce and bell peppers also posted noticeable declines in dollars for the year.
Additionally, 14 of the top 20 organic produce sales categories posted declines in volume, with only 10 of those categories showing positive dollar growth. Organic bananas continued to be the biggest volume mover despite a –1.2 percent volume decline in 2022 and showed a modest 3.9 percent increase in sales from the previous year.
Of note, potatoes and cabbage, typically regarded as inflation busters, showed a 10 percent increase in dollar sales and a nominal 1 percent growth in volume. Organic grapes had a stellar year, with a 6.9 percent increase in volume and an 8.3 percent increase in sales.
Organic performance in 2022 was consistent among all regions of the nation—dollars grew and volume declined. The Northeast saw the lowest dollar growth and highest volume decline, while the South continues to show the most year-over-year improvement.
Organic fresh produce prices in aggregate remained substantially higher than conventional, with 2022 showing the price gap between conventional and organics the largest it has been in the past four years at $1.55 per pound. “In an inflationary time period, it is important for organic producers to understand how their pricing impacts behavior among various consumer segments and to reach those consumers with the health and value benefits associated with organics,” said Barnes.
The fourth quarter of 2022 saw the twelfth consecutive quarter of organic sales growth, with a modest 1.4 percent increase from the same period last year. Organic produce sales for the fourth quarter topped $2.1 billion, with the grape category leading the way in year-over-year dollar and volume growth.
The 2022 Organic Produce Performance Report utilized Nielsen retail scan data covering total food sales and outlets in the US from January through December 2022. A complete version of this report, including information on the top 20 organic fresh produce categories, will be made available on the Organic Produce Network website in mid-February.
OPN is a marketing organization that serves as the go-to resource for the organic fresh produce industry. The company’s mission is to inform and educate through a strong digital presence with an emphasis on original content and complemented by engaging live events that bring together various components of the organic produce community. OPN’s target audience includes organic producers, handlers, distributors, processors, wholesalers, foodservice operators, and retailers. www.organicproducenetwork.com
MONTEREY, CA — Total organic fresh produce sales for the first quarter of 2022 increased by 4 percent from the same period last year, topping $2.3 billion for the quarter, according to the Q1 2022 Organic Produce Performance Report released exclusively by Organic Produce Network and Category Partners.
While organic fresh produce sales continued to grow in Q1, overall volume declined due to elevated pricing. Conventional produce showed the same pattern, with sales up 7 percent for the quarter (totaling $16.8 billion) and volume declining by 2.7 percent.
Higher average retail pricing in Q1 is responsible for most of the sales gains of produce items, with conventional produce average pricing up more than 10 percent compared to Q1 of last year. By contrast, organic fresh produce pricing rose just below 5 percent, suggesting it has been able to absorb more of the increased costs related to the current inflationary environment.
“There are some strong takeaways from the Q1 data, most notably that overall volumes remain elevated from Q1 2019, before the Covid pandemic drove double-digit sales and volume gains at retail,” said Tom Barnes, CEO of Category Partners. “We believe the second quarter of this year will tell a similar story as we move further away from 2020 when the pandemic shuttered most foodservice, causing supermarket sales to soar.”
Packaged salads continued to dominate in total organic dollars, reaching nearly $400 million for the quarter, a gain of 1.5 percent year-over-year. The berry category (which includes strawberries, raspberries, blueberries, and blackberries) grew 9.3 percent in sales from Q1 2021, with strawberries posting gains in both dollars and volume of more than 16 percent. Blueberries, on the other hand, were down 7 percent in dollars and 19 percent in volume from the previous year.
“While organic fresh produce volume declined for the first time in a long while, organic dollar sales continue to grow even after consecutive years of growth due to higher prices across the entire produce department,” said Matt Seeley, CEO of Organic Produce Network. “There remains room for growth of organic fresh produce as long as suppliers remain aware of not only the rising costs of organic produce but also the opportunity presented by a significantly larger increase in conventional produce prices.”
The southern region of the US continued to show the most year-over-year improvement, with dollar growth rising 8 percent, and volume up 3.6 percent. The Northeast was the weakest region, with dollars declining 1.1 percent and volume down 7.7 percent.
The Q1 2022 Organic Produce Performance Report utilized Nielsen retail scan data covering total food sales and outlets in the US over the months of January, February, and March of this year. The full Q1 2022 Organic Produce Performance Report is available on the Organic Produce Network website here.
OPN is a marketing organization serving as the go-to resource for the organic fresh produce industry. The company’s mission is to inform and educate through a strong digital presence with an emphasis on original content and complemented by engaging live events that bring together various components of the organic produce community. The OPN audience includes organic producers, handlers, distributors, processors, wholesalers, foodservice operators, and retailers. www.organicproducenetwork.com
Noticeable gains during the pandemic for retail sales of organic produce have experienced , but it is not necessarily due to the public’s desire to eat healthier.
Category Partners LLC of Idaho Falls, ID has observed the sales increase, which also has been experienced by conventional fruit and vegetables. This may be more the result of shutdowns of other out-of-home choices for purchasing produce.
Category Partners contends organic produce was carrying a slightly higher growth rate than conventional prior to the pandemic and this has remained mostly consistent.
It is hard to say whether consumers are choosing organic fruit and vegetables because they may be perceived to be more healthful than conventional, the company notes. However, organic produce does come with a health perception that often is cited by users as a reason they buy it.
The main reason organic consumers give for buying organic produce is the perceived healthfulness of the product, the firm notes, so it is better for you from a nutrition standpoint, and it has lower levels of pesticide residues than conventional.
Sustainability also comes into play for younger consumers.
The price premium over conventional produce is the primary reason consumers give for not purchasing organic produce.
Shoppers are unlikely to purchase items if the price differential between organic and conventional is too great where they feel they can’t afford organic fruit and vegetables.
Accessibility and occasionally quality are other factors than may affect purchasing decisions.
Bananas are far easily the No. 1-selling organic item in the produce department, followed by carrots and apples.
It is believed bananas lead the pack in large part because they have among the smallest price premiums in the produce department between conventional and organic.
The price differences between organic and conventional vary by commodity.
The per-pound price difference between conventional and organic bananas is 13 cents, the firm reports. The difference for carrots is 38 cents and for apples, 62 cents.
On average, organic item are about double the cost versus a conventional product. In the future the gap is expected to narrow.
From a dollar standpoint, organic packaged salads lead the list, followed by strawberries and apples.
Bananas are No. 8 in dollar sales and carrots come in at No. 7.
Packaged salads have the second-highest price variance between conventional and organic — about an 80% price premium.
The 50% to 60% price premium range is where you see the items that are really driving the volume. Moving outside of that, you can may generate dollars, but you’re going to experience loss of volume.
As far as packaging, the trend away from packaged produce apparently has been disrupted by the pandemic. The long-term trend among consumers, especially younger consumers, seems to be away from plastic packaging.
However, packages that are proliferating, like the gusseted pouch bags, are having tremendous success with consumers.
Organic produce sales topped $1 billion in the first quarter of 2016, according to the latest United Fresh Produce Association FreshFacts report.Tracking sales data from January through March, the report found that organic fresh produce sales in the first quarter totaled $1.1 billion, up 15% from year-ago levels. Sales gains were boosted by an increase in the number of retailers offering organic produce, according to the release.
The growth in organic produce sales and other data from the report were featured in the workshop “Who’s Buying Your Produce?” at the United Fresh 2016 convention in Chicago, according to a news release.
The FreshFacts report reveals that fresh produce accounts for 34 percent of total fresh sales in supermarkets, second only to meat. Total first-quarter sales of fresh produce were up 5 percent from year-ago levels, and volume was up 1 percent, according to the report.
The United Fresh workshop, to be led by Jen Campuzano and Matt Lally from Nielsen Perishables Group, will address shopping behaviors by generation, income and ethnicity, according to the release. The workshop presenters will also provide recommendations on market strategies for produce suppliers and retailers, according to the release.
The FreshFacts report, produced in partnership with the Nielsen Perishables Group and sponsored by Del Monte Fresh Produce, is available online and can be downloaded with no charge for United Fresh members and $50 for non-members, according to the release.
Beyond its examination of organic sales and trends for the top ten fruits and vegetables, the first quarter FreshFacts report explores consumer perceptions of local produce and generational demand, according to the release.