Organics in great shape

Articles
February 15, 2011

Organics in great shape

If you guessed that the United States has recently become the world's largest organic food and beverage market, you'd be right. America surpassed Europe in 2009, as consumer-buying power wilted in many nations with the financial crisis and tepid global growth of 4.7% slowed to a shadow of its former double-digit self, according to Organic Monitor's Global Organic Food & Drink Market report.

If you guessed that the United States has recently become the world's largest organic food and beverage market, you'd be right. America surpassed Europe in 2009, as consumer-buying power wilted in many nations with the financial crisis and tepid global growth of 4.7% slowed to a shadow of its former double-digit self, according to Organic Monitor's Global Organic Food & Drink Market report
 
By contrast, the Organic Trade Association told USA Today that U.S. organic food sales were up by 5.1% and accounted for nearly 4% of total U.S. food sales in the full-year 2009. However, it's not raining green for brands that pioneered organic farming practices in America; many are being challenged in the marketplace today by private labels such as Safeway's O Organics, which is sold nationally and internationally. Savings-minded consumers have been open to store brands trial - and why not when retailers market and position them as brands.

With the concurrent popularity of farmers' markets and community-supported agriculture, it looks as if organic foods will continue to deepen its root system in many kinds of trading areas. And with up to $50 million of U.S. Department of Agriculture support for organic producers and others transitioning to organic practices, the U.S. might come closer to fulfilling its own demand.

F3 thought readers would like to compare the Top 12 organic food and beverage categories from four years ago with the leaders today. According to Nielsen LabelTrends data for U.S. food stores that ring up $2 million and over in annual sales (excluding supercenters), the leaders in both periods are pretty similar, though some differences exist. Specifically, the periods are the 52 weeks ended December 12, 2006 and November 27, 2010.

Among the top ten placing categories, several positions switched, though not by much. Also, the two categories that placed 11th and 12th four years ago - non-carbonated soft drinks and baby food - fell off of the leaders list. They were replaced by coffee and tea, which wound up in the 10th and 11th slots in 2010 on the strength of double-digit dollar sales gains during the 52-week period, the Nielsen data show.

Here's a closer look at the organic category leaders:

  • Milk was #1 at $592.0 million in the 2006 period, but slipped to #2 at $807.1 million in 2010 on a 3.8% dollar sales increase in the latest 52 weeks.
  • Fresh produce was #2 at $588.6 million in 2006, and rose to #1 at $1.11 billion in 2010 on a 14.9% dollar sales jump.
  • Yogurt was #3 at $191.1 million in 2006, and again in 2010 at $264.1 million on a 10.1% dollar sales advance.
  • Snacks were #4 at $143.8 million in 2006, and again in 2010 at $195.9 million on a 4.3% dollar sales rise.
  • Cereal was #5 at $123.6 million in 2006, but slipped to #6 in 2010 at $161.9 million on a 0.6% dollar sales bump.
  • Frozen prepared foods were #6 at $114.0 million, and rose to #5 at $165.8 million on an 8.0% dollar sales advance.
  • Eggs were #7 at $92.6 million in 2006, and again in 2010 at $156.2 million on an 8.1% dollar sales boost.
  • Soup was #8 at $91.6 million in 2006, and again in 2010 at $138.8 million on a 3.8% dollar sales gain.
  • Bread and baked goods were #9 at $68.0 million in 2006, and again in 2010 at $118.6 million on a 9.2% dollar sales rise.
  • Condiments/gravies/sauces were #10 in 2006 at $66.9 million, but slid to #12 in 2010 at $83.5 million on a 1.2% dollar sales bump.