Spending on organic products is set to soar by 50 per cent over the next five years as health and ethical concerns become increasingly important to consumers.
International food and grocery expert IGD pegs sales to reach £3 billion by 2012 in its forthcoming report, UK Grocery Outlook, to be published at the end of September 2007.
And according to a Soil Association report, annual sales of organic food and drink in the UK have already hit £2 billion. Spending on organic products grew by 22 per cent between 2005 and 2006, making the UK the third-largest market in Europe behind Germany and Italy.
UK supermarkets saw their organic retail sales rise by 21 per cent, with consumers in London, the South East, the South West and Wales the biggest spenders on organics.
Vegetable box schemes, local supply schemes and mail order projects grew their sales by 53 per cent to £146 million, according to the Soil Association.
“Encouraged by the consumer trends of ethical shopping, health and well-being, leading supermarkets and independent retailers are rapidly expanding their organic product ranges,” said Gerardine Padbury, IGD senior business analyst.
“Factors such as the opening of Whole Foods Market, government health campaigns and food scares all play their part in driving demand. We are seeing the emergence of the ‘foodie’ consumer; the growing group of people who look for value in their food over and above simple nourishment. They live to eat rather than eat to live.”
Padbury added: “Organic shoppers tend to be younger and wealthier than average, providing a lucrative opportunity for suppliers and retailers. However, organic status is not enough on its own; there can be no compromise on taste, quality and availability. Companies selling organics must communicate the story behind the product, including the point of origin, to capture and retain the hearts of consumers.”
However, the Soil Association says that demand for home-grown organic food is outstripping supply.
“It is important to note that the rate of growth in the organic retail market is unlikely to be sustained in 2007 due to a severe shortage in the supply of UK organic products,” said the report, which stated that organic fruit and veg is undersupplied.
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