Published on: November 21, 2019

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Organic Food Market Analysis

Organic food products are produced without the use of any chemical or synthetic fertilizers or pesticides. In the meat and egg category, the produce is obtained from animals that are fed an organic diet and not given any antibiotics or growth hormones. The farmers following organic food production also focus on conserving and recycling resources including soil, water, and other resources. We categorize organic packaged food is a part of the overall packaged foods and meats market. The packaged foods and meats market covers manufacturers or food processing vendors that are involved in food processing to eliminate microorganisms and to extend shelf life. The packaged foods and meats market is part of the global food and beverage market which was valued at USD 7.93 trillion in 2018 and is expected to grow at a moderate pace. 

 

Our reports on the organic food market provide a holistic analysis, market size and forecast, trends, growth drivers, and challenges, as well as vendor analysis covering around 50 vendors.

 

In 2018, the global organic food market size was estimated to be around USD 200 billion and growing at a CAGR of around 15% for the past five years. The packaged organic food market was valued at USD 39 billion in 2018. Both these markets are forecasted to grow at double-digit growth rates over the next five years, till 2024.

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We follow the below segmentation for organic food market analysis:

 

Organic food products

 

• • Fruits and vegetables
  • Meat, fish, and poultry
  • Organic dairy products
  • Organic bakery and confectionery products
  • Frozen and processed organic food products
  • Others

 

Organic beverages

 

• • Non-dairy organic beverages
  • Organic coffee and tea
  • Organic beer and wine
  • Others

 

Geographic segmentation

 

• • North America (NA)
  • South America (SA)
  • Europe
  • Asia Pacific (APAC)
  • Middle East and Africa (MEA)

 

Fruits and vegetables are the most commonly purchased organic food. For example, in the US, more than two-thirds of the organic food purchased falls in the category of fruits and vegetables. However, more and more customers are trying organic varieties of packaged food due to growing concerns around the use of pesticides and fertilizers.

Drivers and Trends

 

• Consumer awareness and preference for healthier food, which is pesticide-free, use organic fertilizers and are non-GMO
• Environmental benefits while growing organic food including better soil fertility, integrated pest management including physical and mechanical methods for pest and weed control
• Increasing investment and M&A by global food majors in organic food companies
  • Nestlé announced the acquisition of a majority stake in Terrafertil Goldenberries, a company that sells natural, organic, and plant-based food products and healthy snacks.
  • Aurora Organic Dairy, a producer and processor of organic milk, opened a new production and storage plant in Columbia, US. The new plant was about 127,000-square-foot and will process and package various products such as single-serve and shelf-stable bottled milk, fortified and flavored milk, creamers, extended shelf-life milk in half-gallon cartons, and others.

 

• Launch of several new products in the market

 

• • HappyMilk launched Mishti Doi, a fermented sweet product made with milk and sugar, that is made from organic milk in India.
  • Danone launched new organic protein milk under the Horizon Organic brand. The company claimed that the new product contained about 50% more protein per serving than traditional dairy milk products.
  • Lewis Road Creamery launched new premium organic milk under the Gold Top brand in New Zealand, which was non-homogenized organic Jersey milk that only contained A2 ß-casein protein and was sourced from Jersey Girl Organics in Matamata, New Zealand.
  • Bimbo Bakeries USA, the US subsidiary of Grupo Bimbo, launched a new organic bread line in the US. The line consisted of three variants, which included Arnold, Brownberry, and Oroweat Bread. The company claimed that the new products were USDA-certified organic and Non-GMO project verified. They also had no artificial preservatives, colors or flavors; no high fructose corn syrup; and 0g of trans fat.

 

Challenges

 

• Typically, organic food is costlier than conventionally grown food, subsequently increasing the cost of packaged organic food. For example, organic baby food is almost 25% more than conventional baby food
• Strict labeling requirements and regulations in several countries, such as USDA’s National Organic Program (NOP) in the US
• Preference of large food processors to purchase from large organic farms due to economies of scale limiting the participation of small-scale farmers in the market
• A large number of organic food product recalls due to contamination at source or at processing facilities

 

• • Perdue Farms Inc. (Perdue Farms) recalled its organic, gluten-free chicken breast nuggets sold under the Perdue SimplySmart Organics brand due to the presence of wooden pieces in the product.
  • Fullei Fresh recalled its organic bean sprouts due to the presence of a potentially deadly bacteria in a package of fresh sprouts at a retail store. The presence of the bacteria was identified by the Florida Department of Agriculture and Consumer Services, US.

 

Our reports on organic food covers several large and small vendors active in the market including Danone SA, Tyson Foods Inc., The Hershey Co., Nestle SA, LT Foods, Marico Ltd, Grupo Bimbo SAB de CV, Arla Foods amba, JBS SA, Perdue Farms Inc, Premium Brands Holdings Corp., China Mengniu Dairy Company Ltd., and several smaller players such as HappyMilk, iD Fresh Food, Inspired Organics, Life on Earth Inc., Lidl US LLC, Organic Valley, Uncle Dougies, and Bolthouse Farms Inc.

 

Backed with competitive intelligence and benchmarking, our organic food market research is designed to provide entry support, customer and M&A assessment, as well as go-to-market strategy support.