OTA: Organic food sales soar during pandemic
25 May 2021
U.S. organic sales soared to new highs in 2020, jumping by a record 12.4% to $61.9 billion as more consumers cooked at home, according to the 2021 Organic Industry Survey released on May 25, by the Organic Trade Association.
It marked the first time that total sales of organic food and non-food products have surpassed the $60 billion mark, and reflected a growth rate more than twice the 2019 pace of 5%, OTA said. In 2020, almost 6% of the food sold in the United States was certified organic.
Laura Batcha, CEO and executive director of the group, announced the new data at Organic Day at Natural Products Expo West.
“The pandemic caused abrupt changes in all of our lives,” Batcha said in a news release.
“We’ve been eating at home with our families, and often cooking three meals a day. Good, healthy food has never been more important, and consumers have increasingly sought out the organic label. Organic purchases have skyrocketed as shoppers choose high-quality organic to feed and nourish their families.”
Fresh organic produce sales rose by nearly 11% in 2020 to sales of $18.2 million. Frozen and canned fruits and vegetables also jumped with frozen sales alone rising by more than 28%. Including frozen, canned and dried products, total sales of organic fruit and vegetables in 2020 were $20.4 billion
More than 15% of the fruits and vegetables sold in this country now are organic, OTA said.
Pantry stocking was overwhelmingly the main growth driver in 2020, OTA added. As bread making and cookie baking took kitchens across the country by storm, sales of organic flours and baked goods grew by 30%.
Consumers also turned to “meal support” products to help them in the kitchen. Sales of sauces and spices pushed the $2.4 billion condiments category to a growth rate of 31%, and organic spice sales jumped by 51%, more than triple the growth rate of 15% in 2019.
Meat, poultry and fish, the smallest of the organic categories at $1.7 billion, had the second highest growth rate of nearly 25%.
“The only thing that constrained growth in the organic food sector was supply,” said Angela Jagiello, OTA’s director of education and insights. “Across all the organic categories, growth was limited by supply, causing producers, distributors, retailers and brands to wonder where numbers would have peaked if supply could have been met!”
Jagiello, who spearheads the coordination of the survey for the association, also noted that because of the pandemic, not only ingredients were taxed, but packaging — bottle lids, pouches, corrugated cardboard, bottles for dietary supplements — was in short supply as were workers and drivers to transport product, making it hard for producers to ramp up processing to meet consumer demand.
The organic non-food category did not see the same exceptional growth in 2020 as organic food, but its growth held steady with prior years. Sales of organic non-food products reached $5.4 billion, up 8.5% and only slightly below the 9.2% reported in 2019.
Reflecting the pandemic and as in the conventional market, organic sales were driven by personal hygiene, hand sanitizers and cleaning products. Sales of organic household products saw record growth of 20%.
Textiles and fibers, the biggest category of the organic non-food sector, saw sales slow as stores closed, and clothes buying dipped. That said, the category fared better than the industry expected given its ties to brick-and-mortar retail and the shutdown of that sales channel for a significant period of time. For the year, U.S. organic fiber (linens, clothing and other textiles) sales grew at a rate of 5%, compared to 12% in 2019, reaching sales of $2.1 billion.
While the growth in organic food sales is not expected to continue at 2020’s fast rate, organic food sales are expected to stay on a strong growth path in 2021. It’s anticipated that the grocery industry at large will get a lasting lift from the pandemic for the foreseeable future as many consumers continue to cook more at home.
This year’s survey was conducted from January through March 2021 and was produced on behalf of the Organic Trade Association by Nutrition Business Journal. Nearly 200 companies completed a significant portion of the in-depth survey.