“Growing Demand for Organic Foods: Trends and Insights from the U.S. Market”
Earlier this year, Nielsen data published by the Organic Trade Association revealed that organic foods are present in 82.3% of the 117 million households in the United States. This widespread adoption likely contributed to an impressive 8.4% increase in organic food sales, reaching a record high of $43 billion last year, as consumers filled their kitchens with organic products like crackers, strawberries, lettuce, and fruit snacks. Millennial parents, who are already the largest demographic purchasing organic items, are increasingly leaning towards healthier, more natural food options while avoiding processed goods that have traditionally dominated American grocery shopping. Their desire to be more selective about what they feed their children is evident. “There is a doubling-down on interest in organic when children come into the home,” Batcha stated at the Natural Products Expo East in Baltimore. When millennials become parents, there is an immediate shift in their commitment to organic products.
Both grocers and food producers are acknowledging this trend. Supermarkets are expanding their produce sections to feature more organic selections, with retailers like Wegmans showcasing these fruits and vegetables prominently at the entrance of their stores. Lidl, which made its U.S. debut in June, also prioritizes organic products while highlighting clean labels, locally sourced items, and free-from options. Amazon, which recently completed its acquisition of Whole Foods, is expected to enhance the visibility of organic offerings on its e-commerce platform and through its meal delivery services. “We’re determined to make healthy and organic food affordable for everyone,” stated Jeff Wilke, CEO of Amazon Worldwide Consumer, in a press release last month.
In response to consumer demand, major food manufacturers have bolstered their organic product lines, primarily through acquisitions. For instance, Campbell Soup invested $700 million in July to acquire Pacific Foods, a natural and organic brand based in Oregon, and previously purchased Plum Organics, a producer of baby foods, formulas, and snacks. General Mills acquired Annie’s, a maker of natural and organic products, in 2014 for $820 million, while Hormel acquired Applegate Farms, an organic meats brand, for $775 million the following year. Recently, John Foraker, founder of Annie’s, announced he would lead Once Upon a Farm, a California-based organic baby food startup.
As consumer demand for organic products continues to rise and manufacturers increase their offerings, the Organic Trade Association remains optimistic about the future of organic foods. While some questions linger regarding the value of organic products and the significance of their health benefits—such as the importance of calcium and calcium citrate—these concerns have not significantly dampened enthusiasm for the organic food sector. The momentum behind organic foods appears poised to continue unabated in the foreseeable future.
