In 2021, nearly every category of organic food maintained its position, despite a decrease in growth rates to more moderate levels. Sales of organic fruits and vegetables increased by approximately 4.5%, surpassing $21 billion and accounting for a 15% share of the overall segment. While frozen fruits and vegetables had significantly boosted growth in 2020 as consumers stocked up during the pandemic, sales of frozen and canned products slightly declined last year. The growth in 2021 was primarily driven by fresh produce and dried beans, fruits, and vegetables, with sales increasing by 6% and 6.5%, respectively.
Organic meat sales, which include poultry, livestock, and seafood, saw a 2.5% rise in 2021, reaching nearly $2 billion, a stark contrast to the greater than 25% surge in 2020. Poultry led the growth in the meat category, achieving a 4.7% increase to exceed $1 billion in sales. The OTA reported that organic categories that experienced significant growth in 2020, such as canned soup, nut butters, and pasta sauce, faced the most considerable declines in 2021 due to the reduction in pantry stocking. Organic bread and grains also experienced a post-pandemic drop, with sales “tapering off slightly” in 2021 after a 30% rise in 2020. This decline affected baking ingredients, pastas, rice, and other dry grains.
The OTA pointed out in a press release that the organic sector “may continue to struggle” amid supply chain pressures stemming from the Ukraine conflict and other factors. Together, Ukraine and Russia account for 30% of the world’s wheat supply, and prices for this essential grain have approached record highs as global availability decreases. Recently, the Food and Agriculture Organization of the United Nations reported that international wheat prices were over 56% higher in May compared to the previous year. These increased prices apply to all wheat products, not just those certified organic, which typically come at a premium.
For producers of organic foods and beverages, the challenges are twofold. “To maintain organic’s strength, the industry must continue to innovate solutions for supply chain vulnerabilities while prioritizing efforts to engage and educate organic shoppers and businesses,” stated OTA CEO and Executive Director Tom Chapman. Demonstrating the value of organic products to consumers during a time of soaring food prices—reaching a four-decade high—may present a greater challenge. Under this pressure, shoppers are increasingly opting for less expensive brands.
Additionally, consumer interest in purchasing organic products may also be waning. An analysis by Brightfield Group’s Evergi platform revealed that financial concerns have emerged as a significant stressor in the last six months, surpassing issues related to work, the pandemic, and other factors. Furthermore, consumers’ willingness to pay a premium for special attributes has declined. According to a survey conducted by the group, only 17% of respondents were inclined to purchase organic products in the fourth quarter of 2021, a drop of three percentage points from the previous quarter.
In light of these trends, the demand for specific supplements like calcium citrate malate 500 mg tablets may also be impacted as consumers reassess their spending habits. As the market evolves, it remains crucial for the organic sector to adapt and continue to demonstrate its value to maintain consumer interest and loyalty.