Posts Tagged “organic sales”
U.S. organic sales soared to new highs in 2020, jumping by a record 12.4 percent to $61.9 billion.
It marked the first time that total sales of organic food and non-food products have surpassed the $60 billion mark, and reflected a growth rate more than twice the 2019 pace of 5 percent, according to the 2021 Organic Industry Survey released Tuesday by the Organic Trade Association.
Black beans, flour, and chicken broth are not typically out of stock. They were in 2020. In that unprecedented year, organic’s reputation of being better for you and the planet positioned it for dramatic growth.
In almost every organic food aisle, demand jumped by near-record levels, propelling U.S. organic food sales in 2020 up a record 12.8 percent to a new high of $56.4 billion. In 2020, almost 6 percent of the food sold in the United States was certified organic.
The COVID-19 pandemic caused consumer dollars to shift almost overnight from restaurants and carry-out to groceries, with traditional staples and pantry and freezer items flying off the shelves. Consumer habits were upended, online grocery shopping and grocery deliveries exploded, and new products were tried as families ate three meals a day at home.
“The pandemic caused abrupt changes in all of our lives. We’ve been eating at home with our families, and often cooking three meals a day. Good, healthy food has never been more important, and consumers have increasingly sought out the Organic label. Organic purchases have skyrocketed as shoppers choose high-quality organic to feed and nourish their families,” said Laura Batcha, CEO and Executive Director of the Organic Trade Association. Batcha announces the new data Tuesday at Organic Day at Natural Products Expo West.
Stocking the pantry, refrigerator and freezer with organic
Leading the charge for healthy food was the desire for fresh produce. Fresh organic produce sales rose by nearly 11 percent in 2020 to sales of $18.2 million. Frozen and canned fruits and vegetables also jumped with frozen sales alone rising by more than 28 percent. Including frozen, canned and dried products, total sales of organic fruit and vegetables in 2020 were $20.4 billion. More than 15 percent of the fruits and vegetables sold in this country now are organic.
Pantry stocking was overwhelmingly the main growth driver in 2020. As bread making and cookie baking took kitchens across the country by storm, sales of organic flours and baked goods grew by 30 percent.
Consumers also turned to “meal support” products to help them in the kitchen. Sales of sauces and spices pushed the $2.4 billion condiments category to a growth rate of 31 percent, and organic spice sales jumped by 51 percent, more than triple the growth rate of 15 percent in 2019.
Meat, poultry & fish, the smallest of the organic categories at $1.7 billion, had the second-highest growth rate of nearly 25 percent.
Supply constraints
“The only thing that constrained growth in the organic food sector was supply,” said Angela Jagiello, Director of Education & Insights for the Organic Trade Association. “Across all the organic categories, growth was limited by supply, causing producers, distributors, retailers and brands to wonder where numbers would have peaked if supply could have been met!”
Jagiello, who spearheads the coordination of the survey for the association, also noted that because of the pandemic, not only ingredients were taxed, but packaging—bottle lids, pouches, corrugated cardboard, bottles for dietary supplements—was in short supply as were workers and drivers to transport product, making it hard for producers to ramp up processing to meet consumer demand.
Steady growth in non-food sector
The organic non-food category did not see the same exceptional growth in 2020 as organic food, but its growth held steady with prior years. Sales of organic non-food products reached $5.4 billion, up 8.5 percent and only slightly below the 9.2 percent reported in 2019.
Reflecting the pandemic and as in the conventional market, organic sales were driven by personal hygiene, hand sanitizers and cleaning products. Sales of organic household products saw record growth of 20 percent.
Textiles and fibers, the biggest category of the organic non-food sector, saw sales slow as stores closed, and clothes buying dipped. That said, the category fared better than expected given its ties to brick-and-mortar retail and the shutdown of that sales channel for a significant period of time. For the year, U.S. organic fiber (linens, clothing and other textiles) sales grew at a rate of 5 percent, compared to 12 percent in 2019, reaching sales of $2.1 billion.
What’s ahead in the “new normal”
While the growth in organic food sales is not expected to continue at 2020’s fast rate, organic food sales are expected to stay on a strong growth path in 2021. It’s anticipated that the grocery industry at large will get a lasting lift from the pandemic for the foreseeable future as many consumers continue to cook more at home.
“We’ve seen a great many changes during the pandemic, and some of them are here to stay,” said Batcha. “What’s come out of COVID is a renewed awareness of the importance of maintaining our health, and the important role of nutritious food. For more and more consumers, that means organic. We’ll be eating in restaurants again, but many of us will also be eating and cooking more at home. We’ll see more organic everywhere – in the stores and on our plates.”
This year’s survey was conducted early in 2021 from January through March 2021 and was produced on behalf of the Organic Trade Association by Nutrition Business Journal (NBJ). Nearly 200 companies completed a significant portion of the in-depth survey. Executive summaries of the survey are available to the media upon request. The full report can be purchased; online orders can be placed on this page.
Organic strawberries continue to gain popularity with consumers; in fact, marketers moved 6.2 million pounds more organic berries in 2018 than in 2017. This is according to data from IRI/FreshLook Marketing.
More than one-tenth of sales of the fruit came from organic sales in 2018, even though the average retail price of organic strawberries fell 17 cents during that 12-month period.
Periodic purchases of organic strawberries did not vary much when studying income; age played a bigger factor. Shoppers younger than age 40 were twice as likely to always buy organic strawberries as those age 50-58, and the gap doubled again for those age 59 and older.
When considering region, Western shoppers were the most likely to buy organic strawberries at least some of the time, followed by those in the Northeast—a trend that continues from last year.
Consumers continue to look for organic strawberries; in fact, marketers moved 6.2 million pounds more organic berries in 2018 than in 2017, according to data from IRI/FreshLook Marketing. More than one-tenth of sales of the fruit came from organic sales in 2018, even though the average retail price of organic strawberries fell 17 cents during that 12-month period.
Periodic purchases of organic strawberries did not vary much when studying income; age played a bigger factor. Shoppers younger than age 40 were twice as likely to always buy organic strawberries as those age 50-58, and the gap doubled again for those age 59 and older.
When considering region, Western shoppers were the most likely to buy organic strawberries at least some of the time, followed by those in the Northeast—a trend that continues from last year.
Asian consumers comprised the most likely group to buy organic strawberries periodically, followed by Hispanic consumers. Asians were also the most likely to buy strawberries as exclusively organic.
Families with children living at home were a bit more likely to always buy organic berries, at 11%, than those without kids, at 8%.
The booming U.S. organic industry posted new records in 2015, with total organic product sales hitting a new benchmark of $43.3 billion, up 11 percent from the previous year’s record level and far outstripping the overall food market’s growth rate of 3 percent, according to the Organic Trade Association’s 2016 Organic Industry Survey.The industry saw its largest annual dollar gain ever in 2015, adding $4.2 billion in sales, up from the $3.9 billion in new sales recorded in 2014. Of the $43.3 billion in total organic sales, $39.7 billion were organic food sales, up 11 percent from the previous year, and non-food organic products accounted for $3.6 billion, up 13 percent. Nearly 5 percent of all food sold in the U.S. is organic.
U.S. organic sales and growth over time
2015 was a year of significant growth for the industry despite the continued struggle to meet the consumer demand for organic. Supply issues persisted to dominate the industry, as organic production in the U.S. lagged behind consumption. In response, the organic industry came together in creative and proactive ways to address the supply challenge, to improve and develop infrastructure, and to advocate for policy to advance the sector.
“The industry joined in collaborative ways to invest in infrastructure and education, and individual companies invested in their own supply chains to ensure a dependable stream of organic products for the consumer. Despite all the challenges, the organic industry saw its largest dollar growth ever,” said OTA’s CEO and Executive Director Laura Batcha.
Produce the gateway to organic
Organic produce retained its longstanding spot as the largest of all the organic categories with sales of $14.4 billion, up 10.6 percent. Produce has always been and continues to be a gateway to organic. It’s easy for shoppers to make the connection between agricultural practices used in the field and the fresh fruit or vegetables they bite into. Almost 13 percent of the produce sold in this country is now organic.
The demand for fresh organic was most evident in the continued growth of “fresh juices and drinks,” which saw explosive growth of 33.5 percent in 2015, making it the fastest-growing of all the organic subcategories. The fastest-growing of the eight major organic categories was condiments, which crossed the $1 billion mark in sales for the first time in 2015, on 18.5 percent growth.
More accessible, but challenges persist in supply chain
Increased consumer demand for organic products in 2015 could also be attributed to greater access to these products from mainstream retailers. As supermarkets, big box stores, membership warehouse clubs, and other outlets continued to up their organic offerings, organic options have become more available than ever before.
Despite strategic challenges, OTA’s Batcha is confident about the industry’s future prospects. “Organic is a bright spot in agriculture and the economy of America. Our success will continue to be built on a solid foundation of stakeholder engagement, transparency and meaningful organic standards that consumers trust in.”
OTA’s 2016 Organic Industry Survey was conducted and produced on behalf of OTA by Nutrition Business Journal (NBJ). The survey was conducted from January 7, 2016, through March 25, 2016. More than 200 companies responded to the survey.
In 2014, certified and exempt organic farms in the US sold a total of $5.5 billion in organic products, according to a report published by the USDA’s National Agricultural Statistics Service (NASS). The top 10 states in terms of sales accounted for 78 percent of total US organic sales, with California being the leading state with sales of $2.2 billion.
The selection of organic products sold by US farms in 2014 was diverse and ranged from dairy to proteins, fruits & vegetables and grains. Lettuce and apples rank 4th and 5th in the top five commodities in organic sales with a value of $264 million and $250 million respectively. They follow after milk, eggs and broiler chickens.
Organic producers are able to get their products from farm to table more efficiently as their products don’t travel far to the consumer. Almost half was sold within 100 miles of the farm and two percent was sold internationally.
Almost 40 percent of survey respondents indicated they intend to increase their organic production within the next five years.