- Sales of organic food in the U.S. last year totaled a record $47.9 billion — 5.9% higher than 2017, according to the Organic Trade Association's latest Organic Industry Survey. While that's slower than the 6.4% growth rate for 2017, organic food sales outpaced the overall food market's 2.3% growth rate for 2018, OTA said.
- The group said 5.7% of all food sold in the U.S. last year was organic, with both food and non-food organic products commonly available in grocery stores. The top category is still organic fruits and vegetables, which saw a 5.6% growth rate for 2018, for a total of $17.4 billion in sales.
- Organic fruits and vegetables represented 36.3% of all organic food sales last year, comprising 14.6% of all produce sold in the U.S. The market share for organic fruits and vegetables has nearly doubled in the past 10 years, OTA noted. The survey of more than 200 companies was completed from January through April by Nutrition Business Journal on behalf of OTA.
Organic food continues to win fans, although OTA's figures show the growth rate in sales peaked at 12.2% in 2013 and has been declining since. The organic food sector is still growing faster than conventional foods, but certain products have faced hurdles.
Sales of organic dairy products slowed for a second straight year, which the group blamed on shifting dietary trends. Specialized diets and functional foods have forced consumers to shift their eating habits in recent years. But organic egg sales were up by 9.3% in 2018 to $858 million, a trend the group expects to continue as demand increases. Dairy and eggs still remain the No. 2 organic category in terms of size with combined sales of $6.5 billion last year, a bump of 0.8% from 2017.
Growth in plant-based foods and beverages have spurred more innovation in organic dairy products, and the survey noted new milk-based beverages have been introduced to the marketplace. These products include more protein, more fat, different flavors and grass-fed varieties. Although they haven't moved the needle much yet, they could do so in the future.
Still, last year's overall organic food sales increase signals ongoing changes. Consumers may be buying more organic products, or more farmers and manufacturers may be switching over to organics and providing additional organic options. It appears both of those factors contribute to the jump.
The price differential between organic and conventional food may not be playing as large a role as it once did. Nielsen figures for 2018 show the average prices for organic food dropped as more certified items were introduced. The premium was about 7.5% more last year, compared to 9% more in 2014. But organic milk and eggs were priced higher, at 88% and 86% more, due to government regulations about what "organic" means.
OTA predicted industry innovation and activism will continue to increase, along with a focus on maintaining the credibility of the USDA Organic seal and the trust of consumers. The OTA launched the Organic Fraud Prevention Solutions program to reduce organic fraud worldwide since the standards have weaknesses. That could help gain consumer trust and boost numbers.
However, organic certification may not be a top concern for consumers, according to a recent online survey. Far more consumers are interested in supporting companies with similar social, political and environmental values, with organic ranking as the least important label claim.
It may be that taste and flavor trump other considerations when it comes to buying organic food, as they often do with foods and beverages. Improved nutritional value and the absence of synthetic pesticides are other reasons shoppers give for choosing organic. So, while sales growth may fluctuate year over year, the trajectory for organics is still pointing upward.