“The U.S. organic market is experiencing strong expansion, with organic food and farming continuing to gain in popularity. Consumers are making the correlation between what we eat and our health, and that knowledge is spurring heightened consumer interest in organic products,” said Laura Batcha, executive director and CEO of OTA.
OTA’s Organic Industry Survey, conducted and produced by Nutrition Business Journal, included responses from more than 200 companies, providing information on revenues reported, sales growth, revenue by product and sales channel breakdowns.
Organic food sales in 2013, at $32.3 billion, accounted for roughly 92% of total organic sales. A niche industry a decade ago, consumer purchases of organic food broke the $30 billion mark in 2012 and now account for more than 4% of the $760 billion annual food sales in the U.S. The fruit and vegetable category continues to lead the sector with $11.6 billion in sales, up 15%. The organic snack food sector was up 15% to $1.7 billion; organic bread and grain sales were up 12% to $3.8 billion; organic meat, poultry and fish sales were up 11% to $675 million; and the rapidly expanding organic packaged and prepared food sector was up 10% to $4.8 billion. The $4.9 billion dairy sector grew by 8%, and sales of organic beverages slowed to a 5% growth rate to around $4 billion.
As demand for organic continues to boom and accessibility to products increases, the industry is facing some critical challenges. Farmland in the U.S. is not being converted to organic at the pace needed to meet growing demand. Supplies of organic feed and grain have been tight and costly, which could limit growth, especially in the organic dairy and meat sectors. There is also lingering confusion among consumers about what organic means. The organic message can be lost next to the presence of “natural” products and the debate around GMOs. “The entire organic industry needs to rally around helping consumers better understand and appreciate all the values that certified organic brings to the table,” said Ms. Batcha. “Consumer education is critical to grow the organic industry.”