Organic growth continues, but at a slower pace
20 August 2019 - Media Release - The Packer
The organic produce category may not be expanding at the dizzying speed it was a few years ago, but the growth rate remains significant, and grower-shippers don’t see a substantial drop-off anytime soon.
Sales of organic fruits and vegetables rose to $17.4 billion in 2018 for a 5.6% rate of growth, the same as in 2017, according to the Organic Trade Association.
At the same time, the overall fruits and vegetables category, including organic and conventional products, grew by just 1.7% in 2018.
Fruits and vegetables now account for 36.3% of all organic food sales, and organic fruits and vegetables account for 14.6% of all the produce sold in the U.S., doubling their market share in the past 10 years, OTA says.
Organic grower-shippers seem thrilled with the direction the industry is headed as well as with the quality of their product.
“We have so much beautiful organic produce coming in from our fields, and our state-of-the-art cooler is packed full with almost all of our 50-plus commodities,” said Marliese McWherter, creative marketing manager for Lakeside Organic Gardens, Watsonville, Calif.
Lakeside’s organic spinach “is some of the best quality we’ve seen,” she said, and all varieties of leaf lettuce are “peak of season and incredibly fresh and crisp.”
The company also has had success with organic romanesco, sweet baby broccoli, root crops, napa cabbage and, most recently, Nantes carrots and purple Brussels sprouts.
Late summer and early fall bunched items include chards, kales, dandelions and parsley.
The tomato category also continues to grow, said Chris Veillon, chief marketing officer forPure Hothouse Foods Inc., Leamington, Ontario.
“We have seen greater interest year over year in our award-winning Organic Juno Bites Red Grape Tomatoes,” he said, and Pure Flavor added Canadian-grown organic tomatoes-on-the-vine and long English cucumbers to its product offerings for 2019.
“We continue to see a demand for more organic options to mirror the conventional items that are on display,” Veillon said.
Organic apples in particular have been in a growth pattern over the past few years, said Brianna Shales, communications manager for Stemilt Growers LLC., Wenatchee, Wash.
At Stemilt, 30% of the apple crop now is certified organic, with some varieties, like Honeycrisp, at much higher percentages.
“We’re anticipating a big crop of apples in Washington state this year, with great organic supplies,” she said.
Avocados are another organic favorite, said Bob Lucy, partner at Del Rey Avocado Co. Inc., Fallbrook, Calif.
“Del Rey is very involved in organic,” Lucy said. “It’s a big part of our business.”
The conventional avocado deal has been growing at a faster pace than conventional, he said.
The Hass Avocado Board said organic bagged and bulk sales were up 33% in 2018 compared to 2017, while conventional units were up 20%.
“The demand is there,” Lucy said.
Strawberries also are a popular organic item, but there could be changes in the works for the category.
“Organics had been growing great guns,” said Jim Grabowski, director of marketing for Well-Pict Inc., Watsonville, Calif. “I think this year it has leveled off a little bit.”
The category continues to grow, however, and he said Well-Pict plans to add organic acreage next year.
Santa Cruz, Calif.-based Awe Sum Organics currently is selling organic apples and kiwifruit from the Southern Hemisphere and is planning programs for its organic winter commodities — grapes, Northern Hemisphere kiwifruit and blueberries — said Heather Wood, marketing manager.
“We also have a year-round California organic citrus program,” she said, with navel oranges starting in November.
Awe Sum Organics’ biggest growth this year will be its organic Peruvian grape program starting in December and finishing around March, Wood said.
Erik Ezekiel Sturgeon, supplier relationship manager for Burnaby, British Columbia-based Pro Organics, said he has noticed some noteworthy trends on the organic produce scene that go beyond the supermarket.
One is interest in organics shown by companies that put together prepackaged meals and those that provide meal kits for home delivery.
“People are really looking for convenient items these days,” he said, and that includes organic consumers.
Pro Organics has been involved in discussions about incorporating organic produce into meal kits from a home delivery company.
“We definitely are paying more attention to that than we have in the past,” Sturgeon said.
But all is not rosy on the organic scene.
Low f.o.b. prices that don’t always reflect supermarket retail prices have forced some growers to abandon their organic acreage or turn to direct home delivery or famers markets to sell their product, said Bonnie Poux, president of Access Organics Inc., Kalispell, Mont.
“They’re having a hard time making ends meet,” she said.