OTA numbers solid but fall short of double digit yardstick – The Packer

Posted: May 31, 2017 at 11:43 am


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It wasnt double digit growth for organic food sales, but 8.4% growth for organic food sales in 2016 is nothing to quibble about.

The OTA report notes that the 8.4% increase in organic fruit and vegetable sales in 2016 - the same percentage as overall sales gains for organic food - is nearly triple the 3.3% growth for total fruit and vegetable sales. The survey claims that organic fruits and vegetables account for 15% of the produce that Americans eat. Does that sound a smidge too high? Perhaps a little, it seems to me.

The survey numbers from the OTA differ in no small degree from the United Fresh Produce Associations FreshFacts on Retail report, which pegged organic produce sales at retail (not including processing or foodservice outlet sales) at $4.46 billion in 2016, up 13.2% (double digit!) from 2015. Whats more, the United Fresh numbers - from Nielsen Fresh - said organic sales in 2016 accounted for 9% of all fresh produce sales. The 9% number from FreshFacts is fully 40% below the OTAs 15% estimate for organics share of the produce market.

Of course, the OTA release takes an enthusiastic approach to the sector, and there should be no apologies for that.

The first sentence of the news release reads:

The robust American organic sector stayed on its upward trajectory in 2016, gaining new market share and shattering records, as consumers across the United States ate and used more organic products than ever before, according to the Organic Trade Associations (OTAs) 2017 Organic Industry Survey....

This wording is only slightly different than about a year ago, when the Organic trade Associations 2016 Organic Industry Survey was released with these words:

The booming U.S. organic industry posted new records in 2015, with total organic product sales hitting a new benchmark of $43.3 billion, up a robust 11% from the previous years record level and far outstripping the overall food markets growth rate of 3%, according to the Organic Trade Associations 2016 Organic Industry Survey.

So, the OTA says, the double digit growth rate of 2015 and many previous years has settled down below 9%. The point is that organic sales are growing at several times faster than the overall market and warrant the attention and marketers and retailers.

Here are more highlights from the 2017 OTA survey:

Where to from here?

Organic Trade Association CEO and executive director Laura Batcha said the organic sales are growing but said more is needed to keep the sector growing. From the release: ...the organic sector is facing challenges to continue its growth. We need more organic farmers in this country to meet our growing organic demand, and the organic sector needs to have the necessary tools to compete on a level playing field. That means federal, state and local programs that help support organic research, and provide the organic farmer with a fully equipped tool kit to be successful, she said in the release.

We know the OTA wants a federal promotion and research checkoff for organic products, but nothing is assured for that outcome now.

When will organic growth plateau and begin to look like the pedestrian results of the overall U.S. food sector? The larger the sector gets, the harder it is to capture big percentage sales gains. Organic has room to grow, but the comfortable moniker of double digit organic produce sales gains must be revised - at least according to the OTA 2017 survey.

Read more:

OTA numbers solid but fall short of double digit yardstick - The Packer

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May 31st, 2017 at 11:43 am

Posted in Organic Food




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