The US organic market has “settled into a period strong single-digit growth” as it increasingly becomes part of the mainstream, the executive director of the Organic Trade Association told an audience at this month’s Biofach Congress.
Giving a snapshot of the US market as part of a session on global organic trends, Batcha said that the OTA’s 2019 Organic Industry Survey revealed that organic sales overall grew by 6.3% in 2018 (compared to 2.8% in conventional grocery).
The organic market in the US is dominated by food (91% of all sales), said Batcha, which now has an impressive 5.7% share of the total US food and drink market. Non-food organic is growing quickly however (up 10.6% in 2018) as interest grows in issues around pesticides and health.
Shrinking organic price gap
Private label sales continue to increase and take a larger proportion of the market, and this has produced some downward price pressures. More widely, Batcha noted, “the price gap between organic and conventional is shrinking”.
Batch said that the food manufacturers generally are having to respond to consumer demands for greater transparency in supply chains, a development that advantages organic.
Another visible feature of the US organic scene in recent years has been the arrival of new certification schemes “that use organic as the baseline”. Recent additions include the Regenerative Organic Certification, Grass-fed Organic and Real Organic Project labels.
2019 was also a year of major promotions for organic. The industry-backed ‘Skip the the chemicals’ campaign (with its strapline ‘700 reason to just go with organic’) was the biggest ever organic promotion in the US.
Batched flagged up recent legalisation of the growing of industrial hemp in the US – “which happened just as demand for hemp-extracted CBD was taking off” – as an opportunity for the future.
But the US organic farming sector, along with conventional growers, faced challenges too. One of these was the impact of climate change. Some organic growers in water stressed states, like California, were moving to the north-west of the country because of unfavourable growing conditions. “There are some interesting market adaptions happening,” Batcha said.
Main image: Laura Batcha speaking at this month’s Biofach Congress