Environmentally friendly PRODUCE is becoming mainstream. According to the Mintel International Group, a global distributor of consumer media and market research, organic food sales in the US have grown by 132%, while organic beverage sales nearly doubled since 2002. The organic food and beverage market is worth nearly US billion a year.
Over half the Americans who took part in the survey indicated that they purchase organic foods, while nearly a third reported purchasing organic products “as often as possible”.
Mintel senior analyst Colleen Ryan said over 50% of 18- to 24-year-olds in the US survey claimed to buy “green” products regularly. “This suggests a bright future for green products, as young adults will carry their habits and beliefs with them as they age,” she said. Only 31% to 36% of older adults said they regularly buy green products.
In Britain, organic food sales are worth over £1,5 billion and 71% of consumers have bought organic produce over the past year. Around 16% are going even further by taking into account a company’s environmental and ethical credentials when choosing where to bank.
SA Organics is currently conducting a market survey to quantify the growth in South Africa. General manager Ernst Klokow confirmed the local market is following international trends.
Senior researcher at Marcia Mogelonsky expects organic food and beverages sales in the US to increase 59% and 65% respectively by 2012. She attributed the growth to increased concerns over climate change, energy costs and product safety. In Britain, organics are predicted to increase 54% by 2012, with the market set to break the £2 billion barrier by 2011.
Organic meat, which guarantees higher animal welfare standards, is expected to experience the fastest growth of any sector, at 71%, in the next five years.
Consumer focus has increasingly shifted towards locally sourced organic produce. As a result, imports have dropped 70% since 2002 and account for only 30% of the market today.
The switch from imported to locally produced organic food has hampered sales growth as British producers are struggling to satisfy the growing demand for home-grown organics. Klokow said Britain has become less idealistic and more practical in their organic purchases and he predicts that organic imports will start to grow again.
Manufacturers have been quick to respond and new organic foods and beverages launched in the US have almost doubled since 2002. Klokow said the same trend can be seen in South Africa, where Pick ‘n Pay and Woolworths are two of the main players. He pointed out the low supply of locally produced organic products is currently the main restriction on market growth.
Mogelonsky said that private label brands might offer cheaper prices than traditional brands, so while their rapid expansion into organics may encourage more people to buy more organic products, they could also hurt market growth.
Additionally, higher prices for organic food and drink still turn many consumers away. Mintel’s survey revealed that two-thirds of Americans said they would buy more organic products if they cost less. Most indicated they are unwilling to pay more than 10% extra for green products. – Glenneis Erasmus
Maize stock levels lowest in 11 years
Poor production due to drought, and fewer imports due to high international prices, have resulted in the lowest summer grain stock levels in 11 years. This is according to Neels Ferreira, chairperson of Grain SA. limited availability of yellow maize also resulted in more white maize being taken up by the animal feed market.
By the end of the current marketing season, ending on 30 April this year, maize levels are expected to drop to the third-lowest levels since deregulation at only 1,06 million tons.
This represents 11,4% of the total annual commercial demand or only 40 days’ consumption. Ferreira added that the stock levels of other summer crops such as sorghum, sunflower seeds and soya beans would hardly be sufficient to maintain the pipeline stock.
A second crop estimate by the Crop Estimate Committee indicates the summer grain harvest could be higher than last year. Maize production is estimated to increase by almost 51% to about 10,8 million tons, sunflower seeds by 156% to 769 080t, and soya beans and sorghum by 45% to 297 250t and 255 955t respectively.
Given the present stock levels, the carry-over maize stock will still be relatively low at the end of the next marketing season in 2009, in spite of
larger harvest, according to Ferreira. The US is also expecting a drop in maize stock levels. The US Department Agriculture indicated their producers
decrease their plantings of maize by in favour of soya beans. Ferreira explains that soya bean production has lower risks, lower input costs and is associated with higher profit margins than maize.A report of a reduction in US maize plantings, and an increase in their local consumption, will reduce stock levels there by half in the coming season. – Glenneis Erasmus
