With U.S. consumers increasingly seeking fresh, natural foods, the organic industry stands out as a key beneficiary of these trends. According to the latest data from the Organic Trade Association, sales in this sector reached $43 billion in 2016, marking a $3.3 billion increase from the previous year. Organic fruits, vegetables, meats, eggs, milk, and other products accounted for 5.3% of total food sales. Although organic food sales saw growth again in 2017, early reports suggest that this increase was not as strong, largely due to challenges faced in the dairy and egg markets, as noted by Laura Batcha, the CEO and executive director of the OTA, in an interview with Food Dive.
The organic sector is poised for a promising future, driven by rising demand for its products, especially among millennials, and innovation in areas such as children’s food and snacking. However, Batcha highlighted some challenges. During the interview, she emphasized the need to tackle fraud, enhance initiatives for farmers transitioning to organic agriculture, and educate both consumers and the White House regarding organic standards. “We have a learning curve with the new administration about the government’s role in what is essentially a voluntary, industry-driven standard,” Batcha remarked, referring to the Trump Administration’s recent decision to repeal a rule that aimed to establish animal welfare standards for organic agriculture. “For organic, the government should not dictate what constitutes organic.”
The interview has been condensed for clarity.
Food Dive: How was the growth in organic last year?
Batcha: We haven’t released the final data yet, but preliminary numbers indicate continued, albeit slightly slower, growth compared to last year. The primary factor in this trend is a measurable decline in dairy and egg sales. We are concerned that the USDA’s failure to advance organic animal welfare standards may be affecting the market. The growth rate has decreased compared to previous years. We are investigating the relationship between this delay and market dynamics, which could influence consumer confidence in the organic seal and create a competitive imbalance.
Food Dive: What is the current status of your lawsuit against the USDA regarding organic animal welfare standards?
Batcha: We are currently in active litigation with the Department of Agriculture, and we believe we have a strong case. We anticipate a hearing this spring. One key area of concern is the USDA’s failure to allow public comment on procedural delays concerning the rule. Additionally, we argue that their inaction violates the Organic Foods Production Act, as the standard was developed over a decade with unanimous support from the National Organic Standards Board. The USDA failed to consult with the Board during their reversal, and there is no indication that the Board supported such a change. Furthermore, they have not provided a valid rationale for altering a finalized regulation that was set to take effect.
Food Dive: How would you evaluate the Trump administration’s approach to organic issues so far?
Batcha: There seems to be a learning curve regarding the government’s role in a voluntary, industry-driven standard. The government should not determine what is considered organic; that responsibility lies with the National Organic Standards Board and industry stakeholders. The role of the government is to uphold and enforce the established standards. While there is a disconnect regarding this understanding, the administration does seem committed to enforcing these standards, as evidenced by the budget request for increased enforcement resources, particularly for imports. This aspect indicates a willingness to support the organic industry, but there is still a mixed outcome overall.
Food Dive: What’s next for organic?
Batcha: Fresh produce continues to lead in growth and market share, which is encouraging. Innovations in baby and children’s foods are emerging, and there is significant evidence that better-for-you snacking is trending, with organic playing an essential role in this movement.
Food Dive: Where do you see the growth coming from? Increased demand for fresh products, snacking, or clean labels?
Batcha: It’s a combination of all these factors. Consumers are increasingly seeking healthier options. The USDA label carries high awareness and trust, signaling oversight that matters to shoppers willing to pay more for better choices. This credibility will likely continue to position organic products as reliable options.
Food Dive: At Expo East last year, you mentioned millennials and millennial parents as key audiences for growth. Can you elaborate on that and overall growth trends?
Batcha: We are witnessing strong growth in this demographic, which is expected given the changing consumer landscape. Organic products are becoming more accessible and available, expanding beyond the traditional niche of older, affluent consumers. We see participation from a diverse array of demographics, which is promising for the future of organic.
Food Dive: Are you targeting specific audiences beyond the typical organic consumer?
Batcha: As a trade association, we conduct research to gain insights into consumer behavior. This year, we are focusing on understanding motivations among a more diverse group of consumers. Additionally, we are working on the Organic Check-off initiative to foster large-scale consumer education.
Food Dive: What is your top priority for 2018?
Batcha: Ensuring the integrity and oversight of the organic seal is paramount. Recent reports of fraudulent livestock feed entering the country have highlighted the necessity for continuous improvement in compliance. We are advocating for legislation to close loopholes and enhance oversight globally. Alongside that, improving the standards through research and best practices also remains a top priority.
Food Dive: Is fraud still an issue for organic? Are you concerned it might dissuade consumers in the long run?
Batcha: The integrity of the organic seal is crucial. Any level of fraud is a concern that we must address. We are seeing improvements in the oversight program, and the USDA is collaborating with certifying agencies to enhance product verification. We are optimistic about upcoming legislative support in this area. Vigilance regarding fraud is increasing across the board, and it is essential to maintain trust within the industry.
Food Dive: Are there other challenges or concerns? A few years ago, there were issues with securing enough organic supply domestically.
Batcha: The primary challenge lies in row crops, especially feed grains for domestic production. While there has been an increase in fresh fruits and vegetables, we still struggle with feed grain production. This gap can lead to import risks, which we are addressing through advocacy in the farm bill.
Food Dive: Are there sufficient incentives to encourage farmers to undergo the three-year transition to organic?
Batcha: Currently, marketplace incentives predominantly drive the transition to organic. This has proven effective, as market dynamics shape planting decisions rather than policies. However, there are still areas where existing policies could better support organic farmers, particularly in conservation and risk management programs.
Food Dive: What issue keeps you awake at night?
Batcha: Our main focus is on advancing oversight and ensuring significant, lasting changes in this area. It’s essential to transition from outdated methods to a technology-enabled approach, given the global nature of the organic market. Additionally, we aim to consolidate our voice to help the public understand the benefits of organic production, including reduced pesticide exposure and sustainability.
Food Dive: Do enough people understand what “organic” means, and is that a concern?
Batcha: This will always be a challenge, as a significant portion of shoppers are newcomers to organic. Ongoing education is necessary, as there will never be a point where we can say we have fully educated the public. While awareness of the USDA seal is high, thorough understanding of its attributes remains limited. We must continue to clarify what organic means for consumers.
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