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March 2006: U.S. Organic Food Industry VI

In this 24-page issue, NBJ looks at how organic foods posted a 16% growth and $13.8 billion in U.S. sales in 2005. NBJ also looks at the supply shortages and competition organic companies face from the natural category.

Excerpt from Overview
Healthful positioning and massmarket penetration accelerate, while demand leads to shortages of some key organic ingredients.

In 2005, the U.S. organic food industry exhibited more of the same strong growth characteristics that have shaped its decade-long rise from a counterculture niche to a major segment of the food industry. NBJ’s research concludes that organic foods grew 16% to $13.8 billion in U.S. consumer sales in 2005. Annual sales of organic foods have expanded almost four-fold from $3.6 billion in 1997 and averaged annual growth of 19.4% over the six-year period of 1998-2003. Organic foods were 61% of the $22.8-billion natural & organic foods market in 2005 and 2.5% of the $557-billion U.S. foods market (excluding food service), up from a penetration rate of 0.8% in 1997. With the addition of $740 million in 2005 organic sales in non-food segments like personal care, household goods and fiber products, the total U.S. organic industry was $14.6 billion in 2005, and overall growth was 17%.



TABLE OF CONTENTS:

U.S. Organic Industry: Organic foods post 16% growth and $13.8 billion in U.S. sales in 2005; companies face supply shortages and competition from the natural category ...... 1-9

Organic soup pushes 40% growth in mass channels; Campbell Soup targets premium market; Pacific Foods grows its own ingredients to assure supply .............................. 9-10

Candy maker Quigley Manufacturing finds a sweet spot with College Farm Organic ... 11

Cedarlane Natural Foods wins Wal-Mart account and looks to broaden brand equity with Cedarlane-Dr. Sears Zone prepared meals ...................................................................... 12

Fair Trade and Rainforest Alliance emerge as top social-environmental labeling programs, but some brands and farmers prefer self-certifying .................................... 13-15

Raw food companies Nature’s First Law, Blessing’s Alive & Radiant Foods, Lydia’s Organic and Gopal’s Healthfoods reap strong growth on raw-food trend ................ 15-17

Global Update: Biofach 2006 attendees take the pulse of a European organic market maturing and growing at the same time; Organic Monitor estimates growth ............... 18-19

Non-organic ingredients and organic dairy rules under discussion in wake of Harvey lawsuit and OFPA amendment.................................................................................... 20-21

Organic farmland expands, but more processors look offshore for commodities ...... 21-23

Organic Exchange releases global figures for the organic cotton market ....................... 22

Commodity produce prices: Organic premium ranges from -10% to 175% .................... 23




COMPANIES INCLUDED:

AC Nielsen
Aldi
Alnatura
Amy's Kitchen
Athena Marketing International
Barbara's Bakery
Basic
Beantrees
Blessing’s Alive & Radiant Foods
California Certified Organic Farmers
Campbell Soup Company
Cedarlane Natural Foods
Chiquita
Cornucopia Institute
Dean Foods
Dixon Ranch Farms
Epicurean International
Equal Exchange
Global Exchange
Golden Temple
Gopal's Healthfoods
Green Mountain Coffee Roasters
Humm Food
Int'l Federation of Organic Agriculture
Iowa State University
Lidl
Lundberg Family Farms
Lydia’s Organics
Morinaga Nutritional Foods
National Campaign for Sustainable Agriculture
Natural Marketing Institute
Nature's First Law
Newman's Own Organics
ÖkoStrategie Beratung
Organic Developments
Organic Exchange
Organic Farming Research Foundation
Organic Monitor
Organic Trade Assn
Pacific Foods
PCC Natural Markets
Private Label Manufacturers Assn
Quigley Corp
Rainforest Alliance
Sonora Mills
SPINS
Starbucks
Supervalu
The Hartman Group
The Rodale Insitute
Transfair USA
Turbana
University of California, Davis
United Natural Foods
USDA's Economic Research Service
Wal-Mart Stores
Whole Foods Market
Wholesome Sweeteners
Wild Oats
Wolfgang Puck
Zone Labs



COMPLETE LIST OF FIGURES:
  • $13.8 Billion in U.S. Organic Foods in 2005
  • U.S. Natural & Organic Foods Sales, 1997-2006 ($mil)
  • NBJ’s Universe of Organic Mftrs
  • NBJ’s Top Natural & Organic Food Manufacturers in 2005
  • Organic Sales Compared to Conventional Products


BI 03.06pad$120.00pad

 



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