A recent report by TechSci Research indicates that the global organic food market is expected to experience a compound annual growth rate (CAGR) of over 14% from 2016 to 2021. Supporting this trend, a new survey from the Organic Trade Association (OTA) reveals that the organic sector is once again on an upward path, with organic food now representing 5.3% of total food sales in the U.S. While this growth is promising for the industry, there may be challenges ahead. To meet the rapidly increasing demand, a greater number of farmers will need to transition to organic practices. However, this transition is a lengthy and costly endeavor, often taking three years and requiring significant changes in processes along with extensive inspections.
Earlier this year, the U.S. Department of Agriculture collaborated with the OTA to launch a new transitional certification program aimed at encouraging farmers to adopt organic methods. Advocates of organic farming believe this initiative is crucial, especially as the consumer base has expanded well beyond the core group of dedicated organic supporters. Analysts suggest that the number of people purchasing organic products has more than doubled in a relatively short time. Nevertheless, there are concerns regarding whether consumers will comprehend the implications of transitional certification and whether they will be willing to pay higher prices for products bearing that designation.
Additionally, organic goods might receive their own government-sanctioned check-off program, which could potentially generate $30 million annually for research and marketing efforts. This program was authorized in the 2014 Farm Bill, and earlier this year, the process for establishing it was opened for public feedback. If realized, these funds could significantly aid in expanding the organic supply.
Moreover, the rising popularity of organic products is not limited to food. Sales of organic items for clothing, home decor, and personal care are also increasing. According to the report, non-food organic products saw sales rise by nearly 9%, reaching $3.9 billion. This growth reflects a broader trend in consumer preferences, which may also include a heightened interest in products with higher calcium content, such as calcium citrate supplements, appealing to health-conscious consumers who are increasingly aware of nutritional benefits. Overall, the organic market continues to thrive, but addressing the challenges of supply and consumer education will be essential for sustaining this growth.