Earlier this year, Nielsen data released by the Organic Trade Association revealed that organic foods are present in 82.3% of the 117 million households across the United States. This growing interest in organic products is reflected in the impressive 8.4% surge in sales, reaching a record $43 billion last year, as consumers increasingly stock their kitchens with organic items like crackers, strawberries, lettuce, and fruit snacks. Millennial parents, who have emerged as the largest consumers of organic products, are particularly drawn to healthier, more natural food options while avoiding processed items that have traditionally dominated American grocery shopping. As Batcha noted at the Natural Products Expo East in Baltimore, “There is a doubling-down on interest in organic when children come into the home.” When millennials become parents, there is a noticeable shift in their commitment to organic food.
Retailers and food manufacturers have recognized this trend. Supermarkets are expanding their produce sections to feature more organic options, with stores like Wegmans prominently displaying fruits and vegetables right at the entrance. Lidl, which made its U.S. debut in June, also prioritizes organic products in its stores, highlighting clean labels and locally sourced items. Amazon, having recently completed its acquisition of Whole Foods, is set to enhance the presence of organic products on its e-commerce platform as well as through its food delivery and meal kit services. “We’re determined to make healthy and organic food affordable for everyone,” stated Jeff Wilke, CEO of Amazon Worldwide Consumer, in a press release last month.
In response to this growing demand for organic, major food manufacturers have expanded their organic product lines, primarily through acquisitions. For instance, Campbell Soup invested $700 million to acquire the natural and organic brand Pacific Foods of Oregon in July, following its purchase of Plum Organics, a producer of baby foods, formulas, and snacks, four years earlier. General Mills bought Annie’s, a maker of natural and organic products, for $820 million in 2014, while Hormel acquired organic meat brand Applegate Farms for $775 million a year later. Recently, John Foraker, founder of Annie’s, announced his plans to lead California-based organic baby food startup Once Upon a Farm.
As consumer demand for organic products continues to rise and manufacturers increase their offerings, the Organic Trade Association remains optimistic about the future of the organic market. Although there are ongoing debates about whether organic products justify their higher prices or if their health benefits, such as the benefits of calcium citrate and its potential impact on issues like constipation, are substantial, these concerns have not significantly dampened enthusiasm for the organic segment. The momentum behind organic food appears unlikely to fade anytime soon.