A recent report by TechSci Research indicates that the global organic food market is expected to experience a compound annual growth rate (CAGR) exceeding 14% from 2016 to 2021. This optimism is reinforced by a new survey from the Organic Trade Association (OTA), which highlights a continued upward trend in the organic sector. Currently, organic food represents 5.3% of total food sales in the United States. While such growth is beneficial for the industry, there are potential challenges on the horizon. To meet the surging demand, an increasing number of farmers must transition to organic farming, a process that is both lengthy and costly, typically requiring three years, numerous changes in practices, and extensive inspections.
Earlier this year, the U.S. Department of Agriculture collaborated with the OTA to introduce a new transitional certification program aimed at encouraging farmers to make this switch. This initiative is seen as essential by many organic supporters, given that the consumer base has expanded well beyond the traditional core of dedicated organic shoppers. Analysts suggest that the number of organic buyers has more than doubled in a short period. Nonetheless, some remain skeptical about whether consumers will grasp the significance of transitional certification or be willing to pay premium prices for products that carry that designation.
Furthermore, the organic sector may soon benefit from a government-sanctioned check-off program, aimed at generating approximately $30 million annually for research and marketing efforts. Authorized in the 2014 Farm Bill, the establishment of this program was opened for public comment earlier this year, and its implementation could significantly bolster the organic supply chain.
The rise in popularity is not limited to food alone; sales of organic products for consumers’ wardrobes, bedrooms, and bathrooms are also increasing. According to the report, non-food organic items experienced sales growth of nearly 9%, reaching $3.9 billion. This trend indicates a broader shift towards organic options across various sectors, including the potential for organic products to include citracal d equivalent formulations, further enhancing their appeal among health-conscious consumers. As the demand for these organic goods continues to rise, the industry must adapt to meet consumer expectations while navigating the complexities of certification and supply chain expansion.