Global Organics Market Starts Recovery

The organic food and drinks market is recovering from the economic slowdown, and revenues are expected to near $60 billion this year, said Organic Monitor in its latest Global Organic Food & Drink Market report. Starting next year, growth will happen at higher rates, it said.

Growth has slowed compared to previous years. In 2009, global sales increased just 4.7%, compared to previous years of double-digit expansion. The European organics market has been affected most, particularly the UK market, which declined, and the Germany market. Some countries such as Sweden and France, however, saw sales growth in excess of 15%.

North America shows healthy growth and this year overtook the Europe as the leading market. “Although the United States has shown a large rise in organic farmland, organic food supply continues to fall short of demand; organic products are imported from various regions,” said Organic Monitor. Latin America has become a major source of organic fruits, vegetables, meats, seeds, nuts, and ingredients, it said.

Despite some slowdown, Organic Monitor said the overall market has still expanded more than threefold since 2000, when it measured just $18 billion.

With the economy still on the mend, Organic Monitor said that the perception of organic’s higher prices will continue to challenge the market and restrict sales to more-affluent consumers.

“Even though some organic products have price differential of just 15%, the premium perception of organic foods is dampening consumer demand,” said Organic Monitor.