The U.S. Natural and Organic product industry continues to thrive with a growth rate of 6.5% to a total market value in the United States of $219 billion.
In a presentation on the state of the US organic market by Lacey Gautier of New Hope Network at the BioFach 2020 congress in Nuremberg, Germany participants were told that 70% of the market value in the organics and natural products segment is driven by the Food & Beverages industry with the other 30% split into Natural Living (9%) and Supplements (21%).
Within the Natural and Organic Food & Beverage segment most product groups showed healthy growth rates in 2018, which is the latest available data.
Meat, Fish and Poultry top the list with a growth rate of 6.6% as a result of consumers being more conscious about how their meat is sourced. At the other end of the list, the dairy sector remains stagnant as consumers are seen to rather to switch to dairy alternatives rather than switching from dairy to organic dairy.
The slow growth in the US dairy market is further underlined by increasing prices for milk in the US as Mintec Analytics shows that the price for 4.2% fat fresh milk increased from 33.8 US cents/kg at the beginning of 2018 to 40.5 US cents/kg towards the later half of the year, further easing the burden on consumers to switch, or try, dairy alternatives. Indeed, the situation worsened further throughout 2019 with prices for 4.2% fat fresh milk standing at over 50 US cents/kg at the end of 2019 according to Mintec Analytics.
Despite the growing organic market share, prices in the US for organic produce continued to increase. Participants at the congress put this down to increasing demand meeting unchanged supply. “Only 1% of US farming land continues to be dedicated to organic farming, which is unchanged for years and not enough to satisfy the growing demand,” Lacey explained.