click image to zoomUSDA Organic dairy product sales rose 8% in 2013, but a shortage of organic feed and drought issues continued to put supply pressure on the market, according to an annual summary from the Organic Trade Association (OTA).
OTA’s Organic Industry Survey was conducted and produced by Nutrition Business Journal. More than 200 companies responded to the survey, conducted from Jan. 27 through April 4. Companies gave data on revenues reported, sales growth, revenue by product and sales channel breakdowns.
The $4.9 billion organic dairy category is the second largest organic food sector. The 8% increase in 2013 follows a 7% increase in 2012.
Based on USDA monthly summaries, organic dairy represents about 4.5% of total packaged fluid dairy sales.
Despite ongoing growth, dairy joined organic beverages as the only two organic sectors that did not post double-digit growth last year, OTA reported.
Organic beverages recorded the slowest growth in 2013, with a rate of 5%, a drop from the 7% growth in 2012. This was in large part due to the continued slide of soymilk sales, the largest segment of the organic beverage category.
Similar supply issues have constrained the growth of the organic meat, fish and poultry category, which rose 11% in 2013, with price increases a major factor in category growth.
The $4.8 billion organic packaged and prepared foods category remains the third largest after produce and dairy. If its growth continues to outpace dairy, it is likely to move into the second spot in 2015.
Overall, U.S. sales of organic products jumped to $35.1 billion in 2013, up 11.5% from the previous year’s $31.5 billion, and the fastest growth rate in five years, according to OTA’s latest survey of the organic industry. Survey respondents expect a similar to slightly higher growth rate over the next two years.
Organic food sales in 2013, at $32.3 billion, accounted for roughly 92% of the total organic sales. Organic foods account for roughly 4% of total food sales.
Non-food organic products – including flowers, fiber, household products and pet food – are currently a very small part of the total organic market, but are making quick in-roads. Sales of non-food organic products, at almost $2.8 billion, have jumped nearly eight-fold since 2002, and have almost doubled in market share.
A niche industry in the huge food sector just a decade ago, consumer purchases of organic food first broke through the $30 billion mark in 2012 and now account for more than 4% of the $760 billion annual food sales in the United States. More telling, the growth rate of organic food sales, which has averaged almost 10% every year since 2010, has dwarfed the average annual growth of just over 3% in total food sales during that same period.