Global appetite for organic drives organic market

Organic products mean enjoyment and quality of life. They stand for the combination of top quality and carefree consumption. Approx 2,600 exhibitors present their products to the some 45,000 expected visitors at BioFach 2008, the World Organic Trade Fair and the organic world’s most important get-together. BioFach, which takes place in Nürnberg from 21-24 February, has another highlight lined up for 2008 – the new Wine Hall 4A. This puts organic wine in the limelight and the culinary event worlds in the Wine Hall have some real organic treats in store for visitors. 

Picture: Biofach 2007

Vivaness, the Trade Fair for Natural Personal Care and Wellness in hall 7A and part of hall 7, celebrates its first birthday in 2008. BioFach’s lovely daughter became fully fledged in 2007 and is thriving and growing splendidly. It listed 161 exhibitors from the start in 2007, a growth of 70 % over the previous year. The growth trend shown by the two exhibitions BioFach and Vivaness also persists on the international organic market.

The organic industry is booming and more and more companies are entering the market. The marketing structures are well developed in countries like the USA, Germany, Denmark, Switzerland, Austria and Great Britain. Buyers in these countries can choose from a large range of organic products in supermarkets, organic food shops, at weekly markets, from box schemes or in selected restaurants and hotels. (Picture: BioFach 2007)

The strongly growing demand in heavily populated countries like Germany and the USA is causing an undercurrent on the international markets. This is increasingly affecting the producer countries, where it encourages conversion to organic agriculture. More than 31 million ha of agricultural land are currently certified organic and another 62 million ha are recognized for the collection of products from the wild. Australia with 11.8 million ha leads the international statistics, followed by Argentina and China with 3.1 million ha of organic farming land each. In Europe, some 7.3 million ha are currently farmed using organic methods, of which 6.6 million ha – corresponding to more than 4 % of agricultural land – are in the EU. (Helga Willer, Research Institute of Organic Agriculture (FiBL), Switzerland)

Worldwide spending on organic food in 2007 will top the 40 billion US dollar mark for the first time, says Amarjit Sahota of the London corporate consultant Organic Monitor. Although most of the world’s regions report high growth rates, the largest growth in terms of turnover can be observed in North America and Europe. Organic Monitor assumes that the 60 billion US dollar limit will be reached for worldwide sales in 2010.

Organic boom affects all marketing channels in Germany

Organic food shops and direct-marketing organic farmers rank as the industry’s trailblazers on the German market. The conventional retail food trade, discounters and organic supermarkets currently are achieving the largest market growth. (Picture: Bio Wertkost)

Organic farming in Germany grew from 18,133 to 825,539 ha in 2006, according to a report by the Federal Ministry of Agriculture. The number of organic farms rose by 537 to 17,557. This means 4.6 % of the farms in Germany work 4.9 % of the agricultural land according to organic farming guidelines.

The total number of companies working in the organic sector in Germany, i.e. producers, processors, importers and traders, rose by 8.8 % to 23,978 in 2006. The processing and import sectors are still growing faster in numerical terms than the production side.

The organic boom in Germany now continues for the third year in succession – with hardly any changes in the real income of consumers. The sale of organic products in 2006 amounted to 4.6 billion EUR, which equates to 18 % growth over the previous year. The conventional retail food trade – including discounters and fruit and vegetable shops – with 49 % and the organic food retailers with 23 % account for the largest shares of these sales. (Picture: basic). They are followed by direct marketing with a share of 11 %, miscellaneous such as drugstores, mail-order trade, etc. with 7 %, and butcheries/bakeries and health food stores with 5 % each. (Prof. Dr. Ulrich Hamm, University of Kassel, Germany)

The industry can be expected to grow another 10 to 20 % in 2007. The German association, Bundesverband Naturkost, Naturwaren, Herstellung und Handel (BNN), reports a rise of 12 % in the number of its member companies in the first half of 2007. With an estimated growth of 15 % for the organic industry, turnover at the end of 2007 would be 5.3 billion EUR, so it could top the 5 billion EUR mark for the first time.

Plenty of movement in the East European organic market

Poland, Hungary, the Czech Republic and the Slovak Republic are among the aspiring organic markets in Eastern Europe. Poland’s organic production grew strongly in 2006 and the number of organic farms rose by 28 % to 9,188. The number of processors doubled to 156, according to the Zentrale Markt- und Preisberichtstelle (ZMP) in Bonn, Germany. Hungary exported some 90 % of its agricultural products, but the domestic market for organic products is also growing all the time. Like Hungary, the Slovak Republic exported 90 % of its organic production due to the lack of domestic spending power. These products went mainly to Austria, Germany, Italy, Switzerland, France and the Netherlands. The Slovak Ministry of Agriculture is aiming for an organic area of 120,000 ha or 5 % of agricultural land by 2009. The 912 organic farms in the Czech Republic work 6.45 % of the agricultural land. Despite large organic shares, the demand cannot be covered by local organic products. The number of manufacturers and processors is still too small. (Picture: Poland)

Organic growth continues around the Mediterranean

The organic area in France increased by 31 % to 500,000 ha between 2001 and 2006. It accounts for 2 % of the total agricultural land. Organic sales are estimated at 2 billion EUR by the French corporate consultant Ecozept in Montpellier. (Picture: French organic products). The organic area in Spain was extended by 15 % to 926,360 ha in 2006. Other major organic growing regions besides Andalusia, the main driving force behind organic growth in Spain, are Aragon, Extremadura and Catalonia. Of the some 19,200 Spanish organic companies, 17,200 are producers. Almost 2,000 companies are involved in processing and trading organic products. The number of organic companies rose by almost 10 % over the previous year. The number of organic farmers, manufacturers and traders in Italy distinctly increased from the previous 40,965 to 44,733 in 2006, according to the Italian economic institute Nomisma. Sales amounted to 2.6 billion EUR.

A look over the Alps is also worthwhile: The organic market in Austria grew by 35 % last year and reached some 200 million EUR at the end of 2006. This corresponds to 5 % of turnover in the conventional retail food trade according to information from the Austrian marketing organization RollAMA. Milk is one of the most popular organic products among the Austrians. Every seventh litre comes from an organic farm. The discounters’ share of the organic market is also continuously increasing in Austria and is currently 27 %.

40 % more organic conversion area in Great Britain

Sales of organic products in Great Britain in 2006 amounted to some 2.9 billion EUR, which equates to 22 % growth over the previous year. (Picture: Natural Kitchen). The average growth rate over the past ten years was 27 %. In January 2007, 613,470 ha were farmed organically, which is 3.5 % of the agricultural land. The conversion area grew by 40 % in 2006. (Organic Market Report 2007, Soil Association, Great Britain)

USA: 21 % growth of world’s biggest organic market

More and more conventional supermarkets are entering the American organic market and offer their customers a limited organic range. Examples of newcomers are Bigg’s in Cincinnati with 12 supermarkets and Hannaford in the northeast of the USA with 159 supermarkets. (Picture: Everybody's, USA)

Organic products worth around 17 billion US dollars were sold in the USA in 2006. This equates to a share of 3 % of the total food market. According to the US Organic Trade Association (OTA), the organic market in the USA grew by 21 % in 2006.

Lifestyle of Health and Sustainability supports desire for more organic

Health and sustainability are cornerstones of the lifestyle trends of the same name. Futurologists are agreed that healthy enjoyment is booming in the long term. Hardly any other topic is more closely associated with enjoyment and value renaissance than food. Organic is also closely connected with current questions of social, economic and ecological sustainability. The peak of the organic food hype has not yet been reached and the organic market still has plenty of international growth potential. (Picture: BioFach 2007)