UK organic market tops £2 billion

The Soil Association’s 2017 Organic Market Report launched today, 21 February, reveals the UK organic market continues its fifth year of growth and is now worth £2.09 billion. Total sales of organic products increased by 7.1% in 2016 while non-organic sales continued to decline.
Organic represents around 1.5% of the total UK food and drink market.

Key trends highlighted in the report include:
Supermarket sales of organic have grown by 6.1%
Independent retailers have increased sales of organic by 6.3%
Sales of organic home delivery have grown by 10.5%
The organic foodservice market has grown by 19.1%

Organic farming in the UK remains buoyant and there are new opportunities for farmers. At a meeting between the English Organic Forum and George Eustice, the minister was able to confirm funding for organic farmers will continue for two more years’ post-Brexit. The window to apply for support in Scotland is currently open and Northern Ireland is also due to open shortly.

The area of farmland in conversion to organic is now slowly beginning to increase after remaining flat or in decline for several years; in 2016 Defra reported the first increase (4.9%) since 2007. Soil Association Certification also reports an increase of 13.5% in the number of farmers applying to become certified.  However the overall amount of organic farmland in the UK continues to decline despite the growing market demand.

Liz Bowles, head of farming at the Soil Association said; “It has been a difficult time for all British farmers but the future looks positive for organic. We are relieved that organic support is set to continue for new applications until at least 2020 and we are constantly working to ensure organic farming is part of all the post-Brexit agriculture discussion.

“There are good opportunities for organic farmers if you find the right market. Dairy, beef, poultry and eggs have all seen sales growth this year. British farmers can take confidence in the fact that UK-produced organic products are highly regarded around the world so export is and will continue to play a big part in UK organic. In addition people are more aware than ever about buying British, and more aware about how their food is produced, which will help increase organic sales in the future.”

Increased consumer demand for organic is coming both in retail and eating out. Here growth is being driven by high street chains like McDonalds and Pret, which are including more organic products on their menus. Plus the foodservice sector is in strong growth (19.1%) with more schools, hospitals and workplaces serving organic food. Demand has been influenced by the Soil Association Food for Life Catering Mark with £15 million spent on organic food – an increase of 66%.

Much of this has been supported by the Catering Mark Supplier Scheme and there has been a significant increase in the number of wholesalers now licenced to supply organic.

UK organic sales are catching up with market growth rates around the world. The global organic food market is valued at $81billion and the UK represents around 4% of global sales.  In many countries, British organic is seen as the best that you can possibly buy – particularly in the Far East, US and Europe. Overall, nearly half (49%) of Soil Association Certification licensees are exporting products with an estimated value of exports at £250m.

Simon Crichton, Food, Farming and Trade Team Manager at Triodos Bank said; “We’ve helped farmers to finance 1,185 hectares of additional organic land in 2016, a threefold increase on last year. We’ve seen dairy doing well as are those who have direct relationships with consumers, whose confidence in organic has increased. There are a number of opportunities for organic farmers at the moment – but those looking to convert, need to have a solid market for their product. Clearly, having certainty around support payments would be of great assistance but agriculture has always had to take a long term view and organic methods are well placed for both environmental and financial sustainability.”

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