A fall in consumer demand brought on by the worst trading conditions in 20 years has led to a slump in sales of organic food, drink and other products, new figures released today by the Soil Association reveal.
Sales of organic products fell by 12.9 per cent in 2009 to £1.84 billion, according to the Soil Association’s Organic Market Report, the most comprehensive annual study of UK organic trade. Bread, meat and chilled foods were hit hardest, but organic milk and baby foods bucked the trend.
The fall was the first recorded since the Soil Association began reporting organic products sales in 1993. Even in 2008, organic products saw a modest growth of 1.7 per cent to £2.113 billion.
The Soil Association was today putting a positive spin on the figures, saying 2010 was already showing signs of modest growth and that the need to tackle
food security and climate change meant sustainable production systems would continue to grow.
Organically managed land area in the UK increased to 743,516 hectares in January 2009 – up nine per cent on the previous year. It now represents 4.3 per cent of UK
farmland.
The three biggest categories of organic food in terms of retail value – dairy, fruit and vegetables, and fresh meat – were all hit by the slump in demand in 2009. They saw supermarket sales fall by 6.5 per cent, 14.8 per cent and 22.7 per cent respectively.
Organic bread and bakery hit worst
One of the worst hit, though, was organic bread and bakery items, which saw sales dive 39.8 per cent. Meanwhile, sales of chilled foods fell by 21.4 per cent.
In contrast, organic milk saw its best year ever last year, growing by on per cent, while organic baby food sales grew by 20.8 per cent.
In terms of retail sectors, the independent sector saw the biggest drop, with sales falling 17.7 per cent, while supermarkets, which have cut back on organic shelf space and product ranges, saw sales drop by 12.2 per cent. Organic box schemes were also less in demand, seeing sales fall by 9.8 per cent.
Soil Association predicts modest growth in organic sales in 2010
On a positive note, the Soil Association said the first few months of 2010 showed clear signs of increasing confidence amongst consumers for organic products. It predicts a modest expansion of the market of between two per cent to five per cent in 2010.
Over 60 per cent of the UK’s biggest organic brands are planning for growth in the coming year, it said, while Tesco organic fresh produce sales are already growing.
"It has been a tough year for the organic market, but we have seen businesses that are most committed to communicating the many, real benefits of organic food and farming to the public perform best," said Peter Melchett, policy director of the Soil Association.
"Confidence is now returning, and with the growing recognition of the need for environmentally sustainable
production systems that are less reliant on fossil fuels, we are confident that the organic market, having weathered the recession, will return to growth."