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Organic market report

A surge in demand from locked-down shoppers helped sales of organic produce in the UK rise by 12.6% to £2.79 billion in 2020 – the category’s highest growth level in 15 years.

After a tenth consecutive year of sales growth, the market surpassed original estimates it would grow to £2.5 billion in 2020, and was now was on track to reach a value of £2.9 billion by the end of the year, said Soil Association Certification’s Organic Market Report for 2021, published today.

Sales also significantly outperformed those of similar, non-organic food and drink, the body said, citing Nielsen data [24 w/e 3 October] that showed total food and drink growth stood at 8%.

Foodservice sales fell by 23.2% to £75.7m as a result of the pandemic’s impact on the sector, while independent retailers experienced a “mixed year”, with success depending on location and sales rising by just 0.9% to £409.8m.

However, the gains seen in supermarkets and through online and home delivery outstripped these losses by far, with revenues climbing by 12.5% and 36.2% respectively to £1.81 billion and £494.3m.

The report added that 18% of all organic supermarket sales were now online. And with shopper habits changing “dramatically”, the channel was now also worth more than the independent channel and represented almost a quarter of all organic sales, it said.

Organic market report 2021

“The pandemic has led to a greater appreciation of food, which has helped increase sales of organic,” the report suggested.

Confidence in organic produce also continued to grow last year, SAC added, with 41% of people agreeing that buying organically produced foods was good for sustainability at the start of 2020 – a figure that increased to 50% by July [Nielsen Homescan Consumer Panel July 2020].

It comes as research published this week by SAC’s sister organisation the Soil Association also revealed growing concern over industrial farming practices and little appetite for lower food standards, with almost 50% of the 1,002 consumers polled feeling worried that US-style industrial farming is increasing in the UK.

Among SAC’s top four organic categories over the past year, market leader dairy enjoyed a 7.7% increase in sales; fresh produce jumped 15.5%; canned and packaged foods rose by 19.8% while meat, fish and poultry sales grew by 16.8%.

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Beers wines and spirits also benefited from the pandemic bounce in sales to post a 32.9% increase, while frozen rose by 22.2%, albeit from much smaller bases.

“The unprecedented crisis of 2020 has brought immense challenges across the entire food supply chain – not least for organic businesses,” said Soil Association Certification trade consultant Finn Cottle.

“It’s significant that in times of crisis, people are turning to organic products for the assurance of transparency, integrity and quality they provide. Organic is now rightfully recognised as the cornerstone of a resilient food and farming system and a vital part of the solution to the climate, nature and health crises.”

And with shopping increasingly undertaken online, there was also a “huge opportunity for organic businesses to innovate and continue growing the market”, Cottle added.

While shopping trips became more planned and less frequent, consumers increased interest in good quality and healthy food helped to drive sales of organic, she pointed out.

The report’s results echoed the experience of Ocado during 2020, said Laura Henderson, the retailer’s head of buying for fresh & frozen.

“We saw a marked increase in the sale of our organic food and drink products,” she said. “Our new partnership with Marks and Spencer increased the number of organic products available, taking our total to more than 4,000. This is considerably more than other grocery retailers and we’re delighted to offer our customers such variety of choice – all with the effortless convenience of shopping online.”

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