May 15, 2024Organic sales $70 billion in 2023
In the U.S., organic product sales are increasing. The segment has hit a record, according to a report.
Sales of certified organic products approached $70 billion in 2023, a record for the sector. Dollar sales for the American organic marketplace hit $69.7 billion last year, up 3.4%, according to the 2024 Organic Industry Survey released by the Organic Trade Association (OTA).
Despite stubborn price inflation seen throughout retail aisles, consumers remained clear-eyed about their priorities in the products they chose for themselves and their families, valuing health and sustainability, and seeking out the USDA Organic label, according to a news release.
The organic marketplace recalibrated its supply chain and reconciled the cost of doing business in part with increased retail pricing. The industry continued to grow, with organic food sales in 2023 totaling $63.8 billion and sales of organic non-food products totaling $5.9 billion, according to the release.
The top organic sellers
Produce held its spot as the largest organic category in 2023, continuing to be the primary entry point for consumers into the organic market. Organic produce meets the consumer’s desire for clean, healthy food, and the importance of organic’s critical benefit of no toxic synthetic pesticides is easy to grasp when buying organic berries or carrots, according to the release.
In 2023, the category grew by 2.6% to $20.5 billion. Organic produce now accounts for more than 15% of total U.S. fruit and vegetable sales. Top sellers in the organic produce section were avocadoes, berries, apples, carrots, and packaged salads, and organic bananas saw stronger growth in 2023 than non-organic bananas, according to the release.
The second biggest-selling food category in the organic aisles was the grocery category with 4.1% growth. This new category represents many of the products previously grouped under breads and grains, condiments, and packaged and prepared foods.
Beverages were the third largest category for organic in 2023, up 3.9%. Organic dairy and eggs, the fourth-largest category, was up 5.5%, according to the release.
The rate of growth in the sales of the organic non-food categories was mixed. Personal care products saw the strongest growth in 2023, up almost 7%, and sales of organic supplements were up more than 4%, according to the release.
“It is encouraging to see that organic is growing at basically the same rate as the total market. In the face of inflation and considering organic is already seen as a premium category, the current growth shows that consumers continue to choose organic amidst economic challenges and price increases. Although organic is now a maturing sector in the marketplace, we still have plenty of room to grow,” Tom Chapman, OTA’s co-CEO, said in the release.
In 2023, the increase in dollar sales in the organic market was driven more by pricing than unit sales. But, consumers boosted their purchases of many organic products. Increases in unit sales were reported for up to 40% of the products tracked in this year’s survey. The survey also showed that prices for many non-organic products climbed at a faster rate than organic products. This means the price gap between conventional and organic is closing, which should help fuel growth for organic products in 2024, according to the release.
Research is showing a consistent and growing interest in organic from Millennials and Gen Z. These generations grew up with organic and sustainability, and the health of people and planet, are all top-of-mind for these consumers. Industry experts see this as an opportunity for organic, with the sector well positioned to meet the product attributes and values sought by consumers today and for future generations. By 2030, the U.S. population will consist of a majority driven by Millennial, Gen Z and younger generations.
Read more about the report here.
