UK Organic Market Shows Improved Growth
The Soil Association’s 2015 Organic Market reveals UK sales of organic products increased by 4% in 2014. The new figures show this is significant growth in a year when both food prices (down 1.9%) and food spending (down 1.1%) fell. Shoppers spent an extra £1.4 million a week on organic products and the organic market exceeded £1.86 billion, bringing sales back to levels in 2009. Growth in sales across Soil Association Certification symbol holders increased by 7.7%.
Dairy products and fresh fruit and vegetables were the most popular organic purchases. Overall, the strongest market growth was through online shopping and box schemes (11.7%) and independent retailers (5.7%) which offer the choice and convenience of extensive organic ranges in one place. More than a quarter of spending on organic products (27.9%) is in the dairy aisles with yoghurt sales increasing by 13.8% and dairy sales increasing by 6.5% -a stark contrast to the 3% contraction of the non-organic dairy market.
With nearly one third (29%) of shoppers seeking out ethically sourced and environmentally friendly products and over two thirds (68%) making the choice to support local farmers and businesses1, the organic sector allows consumers to make more environmentally sustainable choices, with over 83% of UK households purchasing organic products in 20142. Feedback from retailers indicates that shoppers are becoming more health conscious and organic products offer answers to questions about food quality and provenance. Nutritional credentials of organic received a significant boost in July 2014 when landmark nutritional research from Newcastle University showed organic crops and crop-based foods (including fruit, vegetables and cereals) are up to 60% higher in a number of key antioxidants compared to non-organic3.
Sales of organic eggs and poultry were up 15.8% and 8.2%, while non-organic sales dipped by 6.2% and 3.3% respectively. There were also sharp increases for a wide range of other products against a background of sliding non-organic sales including fresh fruit (up 6.4%), tea (up 13.7%), cereals (up 4.2%) and biscuits (up 7.2%). sales of organic vegetables fell by 2%, but in a context in which non-organic sales plummeted at five times this rate. There was also significant growth in organic supply into catering, (13.6%), reflecting dynamic growth of the Soil Association’s Food for Life Catering Mark in schools, workplaces and hospitals – the market exceeded £1 million a week for the first time and is now worth £55.8 million. Health and beauty (up 20%) and textile (up 3.4%) sectors also grew in 2014.
Helen Browning, Soil Association chief executive, says; “Three years ago, commentators were writing off the organic market in the UK. Now, with a third year of steady growth, and against a falling overall food market, it’s clear that reports of organic food’s demise were premature to say the least. This reinvigoration may be partly related to an improving economy, but it’s also testament to the fact that retailers and manufacturers who continued to invest in organic lines have continued to thrive. Now, even the discounters are beginning to stock organic ranges.”
Innovation is helping drive growth, with the organic sector investing strongly in marketing and new product development. 2014 saw more organic versions of established brands, organic recipe boxes for busy occasion shoppers and wholesalers selling direct via mainstream online shopping outlets. The organic sector is embracing innovation in a changing retail landscape with brands adding new and innovative products, keeping customers interested in the sector. The mood among organic business is confident with 63% predicting growth in 2015 and six out of ten of these (62%) anticipating double-digit growth.
