Organic claims 3.5% share of US food industry

Posted by Isobel Drake on 7th May 2009

American sales of organic products, both food and non-food, reached US$24.6 billion (A$32.8b) by the end of 2008, soaring 17.1 per cent over 2007 sales despite tough economic times, according to the Organic Trade Association (OTA).

While the overall economy went backwards, sales of organic products reaped strong growth during 2008. “Organic products represent value to consumers, who have shown continued resilience in seeking out these products,” Christine Bushway, OTA’s Executive Director, suggested.

The research, conducted by Lieberman Research Group on behalf of OTA, measured the growth of US sales of organic foods and beverages as well as non-food categories such as organic fibres, personal care products and pet foods during 2008. Results show organic food sales increased by 15.8 per cent to reach $22.9 billion, while organic non-food sales grew 39.4 percent. As a result, organic food sales now account for approximately 3.5 per cent of all food product sales in the United States.

“This marks another milestone for the organic food market,” Ms Bushway proclaimed.

The proliferation of organic products has allowed consumers greater opportunity to shop around. Increased use of coupons, the growth of private label brands, and value-positioned products offered by major organic brands all have contributed to increased sales, the OTA concluded.

In America many of the large supermarket chains have their own private label products, while the largest retailer of organic produce – Whole Foods Market – is based in the States and has around 250 stores in the country. In contrast, Australia has been much slower to embrace the organic movement. It remains less than one per cent of the food market, although it has grown over 80 per cent in the past five years to around a $600 million sector.