For many of us, the cancellation of Natural Products Expo West in Anaheim was a wakeup call on the seriousness of the COVID-19 pandemic and its impact on our day-to-day, though the virus was in its earlier stages back in March. 2020 looked very different on Sunday, March 1st when eight OTA-sponsored international buyers boarded flights to Anaheim to meet with U.S. exporters and walk the trade show. Just 24 hours later, these jet-lagged buyers arrived to California only to discover that the show had been cancelled while they had been on board their flights. These buyers were part of the OTA-Food Export Midwest sponsored buyers mission at Expo West, where international companies and U.S. suppliers are connected for 1 on 1 meetings alongside the trade show.
As we rebooked their flights to return home on Wednesday, we had the opportunity to make the most of their one full day in Anaheim. Tuesday morning was filled with store visits to Whole Foods, Target, and Sprouts, before an afternoon of quickly thrown together meetings with the few suppliers that were local or had also already arrived in California. In the small conference room of our hotel, about 30 one-on-one meetings took place between a handful of U.S. companies and the international buyers that had flown in the day before. It was far from the 500+ meetings we had planned over the course of the week, but lasting contacts were made and have already resulted in new export sales.
Royal Ridge Fruits, an OTA member who was able to drive in for meetings, had two strong export successes as a result of the trade mission: “Royal Ridge Fruits is grateful that we can offer Organic healthy foods to the world as we enter into this new phase of our lives. These last few months RRF’s has seen an uptick of interest in our organic dried fruits and tart cherry juice concentrate. It appears the pandemic has created a renewed interest in health and personal awareness of our ability to fight this virus.” As a result of the meetings in Anaheim, RRF has new export sales to Vietnam and France for several dried fruit varieties and a tart cherry juice concentrate. Though the meetings that took place in Anaheim were far from what we had envisioned, the resilience of the suppliers who were able to change their plans last minute to meet with foreign companies was a testament their commitment to their business and expanding the market for organic around the world.
New global organic data now available
Global organic market data through 2019 is now available on globalorganictradeguide.com, a resource designed for companies that contains extensive information on the global market for organic products and export market possibilities. The site compiles data from Euromonitor, USDA, and other industry experts to serve as your go-to-guide for understanding organic market potential around the world.
The site synthesizes data on individual market sizes, forecasted growth, leading retail companies, market trends, export prospects and more! Additionally, the trade guide features policy information on the authority body regulating the organic market, local regulations and standards, import product requirements and other regulatory information. Visitors can also search for data on trade shows by country or region, USDA market reports, and other organic related news.
Trends from the new data show that the global market for organic products continues to expand. A recent consumer survey conducted by Euromonitor found that the organic label was the second highest sought after label globally, behind non-GMO. Of the top five U.S. export markets for organic products, Canada, Mexico, Japan, South Korea, and Taiwan, all but Taiwan demonstrated a strong growth rate from the period 2016-2019. The data gathered also found that the global retail sales for organic packaged food and beverages totaled over $47 billion USD, with about 87% of the sales going to packaged food. Though the majority of retail value sales occur in North America and Western Europe, both the Asia Pacific and Middle East regions demonstrated the highest value growth.
With a forecasted growth rate of 11.6% from 2017-2022, the United Arab Emirates (U.A.E.) continues to demonstrate strong prospects for U.S. organic exports. Though the market for organic beverages is limited in the U.A.E., the retail prospects for packaged food and some fresh products, particularly organic dairy, are projected to be strong in the coming years. As USDA reports, 80% of food consumed in the region is imported, highlighting the market potential for U.S. exporters. Though the U.A.E. recently released its own domestic standard, it has not impacted the import regulations for U.S. products since the USDA standard is recognized as compatible with the domestic organic regulations.
Another area experiencing strong domestic demand for organic is Hong Kong, whose forecasted growth rate is ranked second highest in our data at 13.4% over the period 2019-2024. Though organic products in Hong Kong represent roughly 0.5% of global demand and approximately 5.5% of the market in the Asia Pacific region, demand for organic products is expected to grow in emerging categories due to an increasingly health-conscious population. By 2024, the market is expected to be valued at over $485 million USD. Similar to other foreign markets and led by a desire to provide the safest food possible for their families, consumer demand for organic packaged baby food is driving market growth, with a value growth of 85% in 2019. Related to this, consumers in Hong Kong are increasingly concerned about the origin and ingredients of food products, which has led to an increase in the popularity for organic products such as brown rice and fruits and vegetables, which are staples in Hong Kong.
These two market snapshots are a just sample of the organic data that is available for the 35 countries detailed in the trade guide. In addition to the comprehensive statistics and analysis in the trade guide, full country reports are available for download on the website. The Organic Trade Association encourages exporters to use this database to research market potential and new opportunities for their products around the world.
Organic Equivalence Enhances Market Access in Taiwan, Japan
The United States and Taiwan signed a bilateral equivalence arrangement for organic products on May 30th, 2020. The new bilateral equivalency arrangement removes previous barriers for exporters, providing an opportunity for U.S. organic products to gain a greater share in the Taiwanese marketplace. Taiwan’s imports of U.S. organic products have increased sharply in the past few years, with imports totaling over an estimated $90 million in 2019, and are forecast to grow by almost 50 percent over the next five years. According to USDA data, Taiwan is the fifth largest market for U.S. organic exporters. This bilateral equivalence also enables the U.S. to compete with other regional trading partners for organic, Japan and Australia, which also signed equivalence agreements with Taiwan earlier this year. OTA is tentatively planning a trade mission to Taiwan for the summer of 2021 for U.S. companies interested in the market.
Additionally, the U.S. and Japan announced the addition of livestock products to the existing U.S.-Japan organic equivalence arrangement, effective July 16th. Japan is the third largest export market for U.S. organic products, and until this point only plant-based products had been allowed under the equivalence arrangement, originally signed in 2014. OTA conducts frequent marketing activities in Japan, and is undertaking a new social media and retail promotion activities in Tokyo this fall. OTA is also planning to exhibit at FoodEx Japan in March of 2021. //