Spain’s market for organic products grew 12.5% in 2017 to be worth EUR1.68 billion, propelling it into the global top ten of national markets for organic for the first time. Once again, it’s millennials who are behind much of the growth in organic retail sales.
The findings are featured in Organic Sector in Spain 2018, the biennial report on the Spanish organic products industry compiled by top bio consultancy EcoLogical.
Headline findings from the report include:
- The organic market in Spain grew 12.55% in 2017 to be worth EUR1.68 billion
- For the first time, Spain has moved into the global top ten of national markets for organic food and other products
- The market is on track to be worth EUR2 billion in 2019
- Spain retains its position as the leader of organic agricultural area in Europe (ranking 5th in the world), with 2.01 million hectares
Organic market growth in Spain has been boosted in the last few years by increasing retail availability, with the effects now becoming visible nationally. Limited access to organic products in the past has held back growth of the domestic market in Spain in comparison to other European markets. The key development here has been the development of a specialist independent retail channel – organic food shops, health stores and eco-stores. But increasing engagement with organic by the major grocery retailers – in particular, discounters like Aldi and Lidl – has also played a role in increasing overall availability. The development of organic lines by major food brands is additional factor helping to increase visibility of organic in Spanish retail.
Market stimulation – both through supportive national and regional organic policies, and corporate investment – has also been helping to promote growth in the sector, reports EcoLogic. Recently, Spain’s Ministry of Agriculture launched its Strategy for Organic Production 2018-2020, which employs a four-pronged strategy for organic market development. At the same time, food industry investors have spotted the opportunity that organic presents, leading to acquisitions of pioneer organic brands by major food corporates and the development of organic ranges by conventional food brand owners.
“As has been shown in other markets in Europe, the millennials demographic is now the most actively engaged with organic. Latest consumer data shows that 30% of organic consumers are under 25”
Millennials driving growth
As has been shown in other markets in Europe, the millennials demographic is now the most actively engaged with organic, underpinned by a greater consciousness for healthier shopping habits and consumption. Latest consumer data shows that 30% of organic consumers are under 25. EcoLogic predicts that these younger consumers will play a key role in market growth in the coming years as their disposable income increases and they start families.
The report shows that organic consumption generally starts with fresh produce, progressing then through other food, beauty and eco categories to create a wider organic repertoire. Health and the absence of pesticides are reported as the main reasons for choosing organic, followed by high quality, taste, eco-friendliness, local sourcing and high animal husbandry standards.
While this latest survey of Spain’s organic market is upbeat overall, it acknowledges that challenges remain in some important areas. One of these is Spain’s trade balance in organic. As with other countries experiencing rapid growth in their home markets, Spain is experiencing an imbalance between certain imports and exports. The report notes that imports “present higher added value than exports, which may generate a competitiveness problem in the long term”.
And despite good market growth in recent years, per capita organic consumption is comparatively low. Spain currently ranks 18th in the world, with a per capita spend of EUR36.3, compared top ranking Switzerland (EUR274) and Denmark (EUR227). However, movement is now being observed in this metric. Per capita spend increased 12.58% in Spain in 2017, and looks set to continue on a growth trajectory. • Download the full report at the EcoLogical website.
Main image: Leading Spanish organic retailer Veritas/2018 report from EcoLogical
Organic Food Iberia, a major new trade show for Spain’s increasingly important organic industry, will launch at the IFEMA exhibition centre in Madrid in 2019.