2019 was another excellent year for the organic market in the UK. Across the board, organic continued its steady progress of the last decade. Despite an incredibly uncertain political and economic situation here in the UK, organic has continued to thrive and establish itself as a major part of the UK population’s shopping basket.
In February, Soil Association Certification published its annual Organic Market Report. This is our yearly update on the UK’s organic market, from food and drink, to organic textiles and beauty and wellbeing.
The headline figures make happy reading for anyone involved in organic. The UK market has just entered its 9th consecutive year of growth, with sales increasing by 4.5% in 2019, ahead of a flat overall market for food and drink sales. The market is now worth around £2.45 billion, and we expect it to reach £2.5 billion by the end of the year. £200 million is now being spent each month on organic in the UK as more and more shoppers turn to organic for their sustainable shopping fix. The really great news is that this growth is being seen in all channels, not just traditional routes to market.
While the breadth and depth of organic ranges continues to grow, supermarkets remain the largest portion of the organic market, accounting for 64.6% of the market. Sales in this channel were slower than others, but still grew 2.5% in 2019, outpacing the overall market. Despite this continued dominance of the market, other channels are beginning to chip away at the supermarket share. In fact, the 64.6% market share is 1% lower than in 2018.
The channel seeing the most success in 2019 was online and home delivery, which recorded sales growth of 11.2%. There are multiple reasons for the exciting growth in this area, including convenience and choice. Savvy shoppers are turning to the internet in increasing numbers because they know this is where they can find the widest ranges with most organic options and that it is always available.
Ocado, the UK’s biggest organic online retailer, has capitalised on this trend, expanding its organic lines to over 4,500 organic items and enjoying the resulting 12% increase in sales. Searches on the Soil Association website for “organic box scheme” also increased 174% year on year to the end of 2019, showing the growing demand for fresh, locally sourced organic ingredients.
In a similar way to the online retailers, independent stores are often seen as the go-to locations for organic products. 2019’s sales results show that independents are continuing to hold their own in the organic mix, with sales increasing 6.5% in this channel. Independents, such as specialist food shops, health stores and farm shops, also offer a greater range of organic products than supermarkets and often offer new and innovative organic brands that have unique selling points not yet seen elsewhere. Independents are in a strong position to react more quickly to changing diets and other trends. They were quick to respond to the major move to plant-based products, as well as free-from, fermented and dairy alternatives.
The big winner for organic in 2019 was organic wine, which saw an unprecedented 47% growth in sales
Another channel that continues to impress is foodservice. The organic food and drink market grew by 8.3% in foodservice last year, almost a quarter of which is through the Soil Association’s Food for Life Served Here. Now, £23.2 million is spent on organic through this scheme in schools, hospitals and other public settings, up from £19.5 million in 2018.
Overall, organic foodservice saw an 8.3% rise in sales, thanks in part to more organic milk and snacks on offer at high street chains, including Pret a Manger, McDonalds and Wetherspoons. Research also indicates that around two thirds of people believe ethical considerations matter when choosing where to eat.
The big winner for organic in 2019 was organic wine, which saw an unprecedented 47% growth in sales, thanks to increased listings at major retailers responding to consumer demand for low-impact wines made without pesticides. Sales of organic wine are now nearly £50 million a year, and we see no signs of this slowing down.
Organic sales have also not been isolated from the rise in popularity of plant-based foods. The share of total organic sales accountable through deli and chilled convenience – where many vegan options are categorised – is 15 times bigger now than it was in 2015. While sales of red meat and dairy have declined slightly, with shelf space for meat and dairy products being reduced to make room for alternatives, organic is gaining traction elsewhere, as the meat-free and organic labels work so well together. Health is still a major motivator for organic shoppers alongside their desire to make planet-centric decisions and this is fuelling good growth in many of the traditional grocery categories such as cereals, flavoured teas and olive oils.
The market is more robust than it has been in recent years, and there is an air of confidence and belief in what we are doing
It’s not only organic food and drink that is growing rapidly. The certified organic and natural beauty and wellbeing industry has seen fantastic growth this year of 23% – the 9th consecutive year of double-digit growth and the third biggest percentage growth since 2010. Organic textiles also had a strong 2019. Soil Association Certification textile licensees saw sales rise 10% across the textiles sector. Homeware, up 17%, saw the greatest annual growth, while clothing, the biggest sector for organic textiles, saw growth of 14% with reported sales of £16.5m; up nearly £2.1m on 2018.
I’m confident that 2020 will be a positive year for everyone involved with the organic sector. The market is more robust than it has been in recent years, and there is an air of confidence and belief in what we are doing. Our summer 2019 research confirmed that increasing numbers of shoppers are seeing their food baskets as a way for them to reduce their impact on the environment, with organic as a ready-made solution to our personal sustainability efforts.
2020 may yet hold more surprises in store, but I feel confident as I write that organic is in a position of strength to build on the growth it has enjoyed in the last decade and secure a robust, long-lasting foothold in the UK in the coming decade.
Author: Finn Cottle, Trade Consultant Soil Association Certification | www.soilassociation.org
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