Sales of organic products have fallen by 5.9% in the UK over the past year as producers continued to battle against the downturn in consumer demand and challenging trading conditions, figures reveal.
Publishing its annual guide to organic trade in the UK, the Soil Association said the outlook for the next 12 months was "cautiously optimistic", but pointed to some strong areas of growth likely to lead to the sector's recovery. The Organic Market Report 2011 shows that shoppers spend more than £33m a week on organic products – with 86% of households regularly buying organic.
Overall, organic sales fell last year from £1.84bn in 2009 (down from a record high of £2.1bn in 2008) to £1.73bn. But despite the fall there was strong year-on-year growth in sales of organic beef (up 18%), organic baby food (up 10.3%) and organic textiles (up 7.8%).
The report provides the most up-to-date analysis of the organic market, examining the performance of different sectors and polling consumers as well as producers.
Although high street sales for organic products through multiple retailers fell by 7.7%, to £1.25bn, Waitrose and Marks & Spencer expect modest growth for 2011, while Tesco, Sainsbury's, Morrisons and the Co-operative predict level sales year-on-year. Home delivery box scheme and mail-order sales edged up by 1% in 2010 to £156m – which the Soil Association said was "an encouraging result" in tough trading conditions. Consumption of organic food remains low in schools, hospitals and throughout the public sector.
Production of organic vegetables and organic milk both fell in 2010 but cereal production is on the increase, buoyed up by high grain prices and strong demand for milling wheat. The Soil Association said poultry and egg production were set to fall in 2011 because of a combination of faltering consumer demand, high feed prices and the cost implications of looming changes to the EU organic regulations.
Organically managed land decreased by 0.6% to 738,709 hectares and now represents 4.2% of UK farmland, equivalent to more than the combined area of Somerset and Wiltshire. The number of UK organic producers fell by 4.2% to 7,567 in 2010, from a record high of 7,896 the previous year.
Roger Mortlock, Soil Association deputy director, said: "There is powerful evidence that consumers who care about the diverse benefits of organic will stay loyal, even during these tough economic times.Given the current uncertainties in the UK and global economy, it would be rash to make any predictions for the future organic market. But the instability caused by climate change, population growth and resource depletion mean that business as usual in food and farming is not an option. As Caroline Spelman, secretary of state at the Department for Environment, Food and Rural Affairs, remarked: 'Organic farmers are the pioneers of sustainable farming and have valuable lessons to pass on to the rest of the sector'."
