November 30, 2022

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The Food Universe

Organic food sales hit record $56.4B in 2020

Dive Temporary:

  • Product sales of organic food leaped 12.8% to hit a record $56.4 billion in 2020, according to the Organic and natural Trade Affiliation. This compares to a 4.6% growth rate in 2019. Whole profits of organic fruit and vegetables arrived at $20.4 billion in 2020, pushed by a extra than 28% jump in frozen. Revenue of natural and organic meat, poultry and fish rose practically 25% to achieve $1.7 billion. 
  • Among the pantry merchandise, product sales of organic flours and baked merchandise enhanced 30% as individuals embraced property cooking. Condiment revenue rose 31% on solid need for sauces and spices. The latter observed a 51% advancement level, extra than tripling its pace from 2019. 
  • In 2020, nearly 6% of the food offered in the United States was qualified natural, in accordance to the trade team. Even as a lot more people check out dining places in the months ahead, the OTA expects patterns these kinds of as house cooking and health consciousness to keep as tailwinds for organic.  

Dive Insight:

For organic and natural food items, the past 12 months furnished approximately the best natural environment for development.

“The only detail that constrained advancement in the organic and natural food sector was source,” Angela Jagiello, director of schooling and insights for the OTA, explained in a published assertion. She mentioned this held true across all organic groups. Jagiello oversaw the survey, which was conducted on behalf of OTA by Nourishment Business Journal between January and March. She reported supply was stretched in phrases of elements, packaging and labor. 

The indications that the pandemic would supercharge organic foods advancement ended up there early on. In spring 2020, the OTA reported a much more than 20% soar in profits for natural produce. While frozen continues to be the dominant force for organic fruit and veggies, contemporary continue to posted a approximately 11% income maximize to reach $18.2 million in whole-yr 2020. Now, organic owns extra than 15% share of complete make profits in the United States, according to the OTA, or $20.4 billion for everything from clean to frozen to dried.

The OTA numbers echo the growth development viewed in details from the Natural Develop Community and Group Partners, which measured a 14.2% jump in organic and natural produce gross sales in 2020, compared to a 10.7% raise for regular generate.

When the OTA does not anticipate natural foods’ double-digit advancement price to go on in 2021, it claimed the tempo need to remain potent. The group is self-confident that shoppers will continue on to cook much more at house article-pandemic than they did just before. A January survey carried out by current market exploration business Hunter found 71% of consumers count on to cook much more at household right after the pandemic ends.

The piqued fascination in balanced eating overall for the duration of COVID-19 also buoyed this pattern. One in a few buyers explained they ate much healthier in 2020, according to a study by the International Meals Data Council. Natural and organic meals tends to have a health and fitness halo among customers, in spite of a lack of details backing up that notion.

“What’s arrive out of COVID is a renewed awareness of the great importance of protecting our overall health, and the critical purpose of nutritious meals. For more and additional people, that usually means organic,” Laura Batcha, CEO and executive director of OTA, said in a written statement.

People are also dealing with greater meals prices coming out of the pandemic. Increases have been rippling throughout the broader food items and beverage landscape from greater freight, transportation and manufacturing expenditures and other pandemic-relevant charges. Some issue consumers’ willingness to fork out the bigger rate tags.

Even past 12 months, when develop product sales spiked early in the pandemic, the OTA cautioned consumers may well develop unwilling to pay the top quality that comes with the accredited natural and organic label. A 2017 survey by Mintel identified only about just one-fifth of consumers agreed organic food items was worth the further charge. 

Just as 2020 presented virtually ideal advancement ailments for natural and organic foods, this year could truly exam the profits circumstance for the segment, as additional individuals undertaking out of the house to try to eat — and come across better meals prices at the grocery keep.