US organics buck recessionary trend

By Caroline Scott-Thomas

- Last updated on GMT

Related tags: Organic food

US sales of organic food have surged despite dire predictions for its resilience as consumers look for ways to cut spending, according to a new survey on American organics.

During 2008, sales were up 15.8 percent on the year before, according to a survey carried out by the Lieberman Research Group on behalf of the Organic Trade Association (OTA).

Predictions for organic product sales have been gloomy, with market researchers foreseeing a slump in more pricy goods, including organic food. But this has not been the case, the OTA said.

OTA’s executive director Christine Bushway said: “Organic products represent value to consumers, who have shown continued resilience in seeking out these products.This marks another milestone for the organic food market.”

Value beats price alone

This view echoes a host of other studies carried out recently by market researchers looking into the importance of consumers’ perception of value, suggesting that the concept encompasses quality as well as price.

This latest survey found that organic food accounted for about 3.5 percent of US food sales last year, with a total value of $22.9bn. Additionally, organic food sales grew at a much faster rate than general US food sales, which grew by 4.9 percent during the year – or about a third as much as organics.

Global contrast

The findings stand in contrast to global organic market reports, which have pointed to a freeze on growth in the organic food sector. Mintel, for example, has predicted “slowing but steady growth”​ in the years ahead, while the UK organic sector experienced a sober 1.7 percent growth rate during 2008 as British consumers switched to cheaper organics, according to a report from UK organic organization The Soil Association. It said it was cheered by even this rate of growth, however, as it suggested that consumers would still prefer to buy organics, rather than conventionally produced products.

Organic sales breakdown

In the US, fruit and vegetables still represent the biggest sub-sector of organic food sales at 37 percent, followed by beverage and dairy at 14 percent each. Areas of fastest growth include the organic beverage sector, which grew by 40 percent in 2008, and organic breads and grains, which achieved 35 percent growth over the year.

The OTA research comes just weeks after the US Department of Agriculture (USDA) announced it would be conducting its own survey of the organic sector from a farming perspective, the first large-scale national survey of its kind. USDA’s results are due to be published in the coming winter.

Related topics: Suppliers, Organics

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