The U.S. organic sector stayed on its upward trajectory in 2016, gaining new market share and shattering records, as consumers across the United States ate and used more organic products than ever before, according to the Organic Trade Association’s (OTA’s) 2017 Organic Industry Survey.
Organic sales in the U.S. totaled approximately $47 billion in 2016, reflecting new sales of almost $3.7 billion from the previous year.
The $43 billion in organic food sales marked the first time the American organic food market has broken though the $40-billion mark. Organic food now accounts for more than five percent—5.3 percent to be exact—of total food sales in the U.S., another significant first.
Organic food sales increased by 8.4 percent, or $3.3 billion, from the previous year, blowing past the stagnant 0.6 percent growth rate in the overall food market. Sales of organic non-food products were up 8.8% in 2016, also handily surpassing the overall non-food growth rate of 0.8 percent.
The survey also showed that organic is creating jobs. More than 60 percent of all organic businesses with more than five employees reported an increase of full-time employment during 2016, and said they planned to continue boosting their full-time work staff in 2017.
The $15.6-billion organic fruits and vegetables sector held onto its position as the largest of the organic food categories, accounting for almost 40 percent of all organic food sales. Posting an 8.4 percent growth rate, almost triple the 3.3 percent growth pace of total fruit and vegetable sales, organic fruits and vegetables now make up almost 15 percent of the produce that Americans eat.
Produce has traditionally been the entry category for consumers new to organic, in large part because in the produce aisle the benefits of organic are probably the easiest to understand. Across all organic food categories, shoppers are placing high value on freshness and convenience. In produce, grab-and-go salads and ready-to-eat veggies (fresh or frozen), were top sellers.
Consumers in recent years have sought clean products abundant in protein, and sales of organic protein-rich meat and poultry shot up by more than 17 percent in 2016 to $991 million, for the category’s biggest-ever yearly gain. Continued strong growth in that category should push sales across the $1-billion mark for the first time in 2017. Growing awareness of organic’s more encompassing benefits over natural, grass-fed or hormone-free meats and poultry is also spurring consumer interest in organic meat and poultry aisles.
Although not a major organic food category, organic condiments still see increasing sales. Organic dips, for one, posted stellar growth in 2016 of a whopping 41 percent, with $57 million in sales, while sales of organic spices swelled by 35 percent to $193 million.
Survey results also showed that today’s consumers aren’t just eating more organic, they’re also using more organic products in their wardrobes, their bedrooms and bathrooms and throughout their homes. Sales of non-food organic products increased by almost 9 percent to $3.9 billion. Organic fiber, supplements and personal care products accounted for the bulk of those sales. Adequate supplies of organic textiles are a continuing challenge in the organic fiber market. However, U.S. organic cotton farmers produced a record 17,000-plus bales in 2016, which should help alleviate some supply concerns.
Increasing consumer awareness that what we put on our body is as important as what we put in our body is driving the growth in organic fiber sales, while a growing desire for transparency, clean ingredients and plant-based products is spurring sales of organic supplements and personal care products.
More than 200 companies responded to the survey conducted this year from February 2 to March 31. The full report can be purchased from the Organic Trade Association. //