Farming News - Rapid worldwide growth for organic market in 2012
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Rapid worldwide growth for organic market in 2012
Figures released last month by the Transparency Market Research group show that, worldwide, organic food and drink enjoyed a massive boost in sales in 2012. Analysts at TMR predicted that growth in the sector will continue at an increased rate up until the end of the decade.
In 2012, the global organic food & beverages market was valued at USD 70.70 billion (by revenue), a ten percent increase on 2011. In 2011, the sector brought in $63 bn, a nine percent increase on the previous year ($57.2 bn). Over the past decade organic sales have increased by over 170 percent.
Europe and North America are still the most significant producers and consumers of organic goods, having consumed 45.6 and 48 percent of organic produce respectively last year, though the market is increasing around the world. Manufacturers' attention has been drawn to increasing demand for organic produce in Brazil, Mexico, China, India, and Argentina in particular in recent years.
Even so, less than 1 percent of agricultural land worldwide is used to cultivate organic food, in spite of the organic sector's rapid and consistent growth.
The organic food market has traditionally been dominated by fresh fruits and vegetables, which accounted for 38.9 percent of the market in 2012. Fresh produce is expected to remain the dominant area of organic sales over coming years. However, processed foods increased their market share last year (TMR suggested sales may well drop off by 2019, as organic dairy products – despite currently suffering from infrastructure and logistical problems – grow in prominence, in response to already elevated demand).
Organic coffee and tea remained dominant in the beverages market in 2012, accounting for 35 percent of this market alone. Along with 'non-dairy beverages', tea and coffee accounted for over 75 percent of the organic beverages market last year. Market researchers suggested that the organic coffee and tea market has reached Saturation point, and that beers and wines would experience growth towards the end of the decade.
The market research group suggested that the organic market would grow at an average annual rate of 13.5 percent between 2013 and 2019. The Asia Pacific market is expected to lead growth towards 2019, with economies such as India, Japan, Australia and China being the chief contributors.
The Transparency Market Research report suggested that "The growth in the [organic] market is driven due to rising green consciousness and growing awareness and affinity for organic ingredients." Growing awareness of food safety and transparency issues, as well as attention to the harmful effects of pesticide use, also contributed to shifting attitudes towards organic products.
The market is still "highly fragmented" and diverse, according to the analysts, though some larger companies are still considered major players, owning portfolios of organic brands.
In the UK, sales of organic products have only just begun to rebound this year, following a slump which coincided with the onset of the financial crisis in 2008. The perception of organic foods as expensive and the sector as elitist, and the reaction of major supermarkets to the economic downturn have been blamed for the drop in sales, which stood in contrast to the sector's health throughout the rest of Europe.