Veggies are major player in organic market growth

Veggies are major player in organic market growth

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The Australian Organic Market Report 2018 shows off industry growth.

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GROWING: Vegetables play an important role in the growth of the organic sector, according to the Australian Organic Market Report 2019.

GROWING: Vegetables play an important role in the growth of the organic sector, according to the Australian Organic Market Report 2019.

ORGANIC vegetables have been listed as the top performing organic sector within Australia for 2018.

What's more, fruit and vegetables remain key entry categories for organic purchasers, according to the research.

The statistics come from the Australian Organic Market Report 2019, released last month, which covers the 2018 calendar year.

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The organic vegetable market was valued at $845 million, made up of domestic retail ($804m) and export ($41m) values.

Processed organic vegetables were listed as being worth $594 million.

This placed organic veggies $295m above the combined domestic and export value of beef and veal.

Organic fruit was valued at a total of $225m ($167m domestic, $58m export) with processed fruit worth $164m, while organic nuts were worth $126m total ($55m domestic, $71m export) with processed nuts at $107m.

"In the fruit, vegetable and nut sector, vegetables continue to dominate with 71 per cent of the sector value, followed by fruit at 19pc and nuts at 11pc," the report said.

New South Wales leads the charge with the most organic vegetable (38pc), fruit (34pc) and nut (39pc) producers.

FIGURE: Domestic retail value - sector contributions - 2018. Source: Australian Organic Market Report 2019.

FIGURE: Domestic retail value - sector contributions - 2018. Source: Australian Organic Market Report 2019.

South Australia boasts nearly half the country's organic grapes for wine producers (49pc).

Singapore is now the largest importer of Australian-produced organic fruit and vegetables.

"The Swedes continue their love for Australian organic wines and the Japanese for organic nuts," the report said.

But in terms of organic plant products, it was that grown for livestock consumption which showed the biggest increase.

"This year's leading organic plant based sector reflects this demand with a change from the fruit sector being the predominant plant-based sector in 2017, to livestock fodder as the category with the highest number of producers in 2018 across the entire organic producer sector at 18pc, followed by vegetables (15pc); fruit (14pc); beef (13pc); grains (12pc); lamb and medicinal aromatics around 5pc each; grapes for wine (4pc); dairy and nuts 3pc each; eggs (2pc); with animal/plant fibres, pig/goat/poultry meat, honey, aquaculture and other plant/animal products accounting for the remaining 6pc," the report said.

OUTGOING: Top destinations for selected organic sectors (% of tonnage) - 2018

OUTGOING: Top destinations for selected organic sectors (% of tonnage) - 2018

"Fruit and vegetable production for most (but not all) producers continued to grow, with drought having lesser impact on this sector."

Retailer perspective

THE report highlighted the important role organic produce plays in enticing consumers to purchase organic products.

"Over six in 10 shoppers say that they have purchased organic fruit and vegetables at least once in the past 12 months," the report said.

"Fruit and vegetables remains the key entry category for organic purchasers.

"Fruit and vegetables was the highest ranked category for organic participation with 64pc claiming to have bought in the past year."

Within the report, Woolworths Supermarkets head of produce, Paul Turner, said organics are on trend with customers.

"There's no doubt more Australian customers are choosing to buy organic and are seeking fruit and vegetables that are the product of the best of what Australia's natural farming resources have to offer," Mr Turner said.

OUT NOW: The Australian Organic Market Report 2019, which was released in May.

OUT NOW: The Australian Organic Market Report 2019, which was released in May.

"In the last five years, demand has been growing at a rate of 20pc year on year in the organic produce category.

"Organics is a key strategic category for Woolworths and the $30m Organic Growth Fund is a strong testament to that."

The report contains consumer insights from 1025 Australians, who were the primary food shopper in their household compiled by market research group Mobium Group, plus industry insights conducted by the University of New England.

The reports says the overall number of households saying they have purchased at least one organic product in 2018 lifted to 65 per cent from the previous year.

Participants listed various reasons for their purchase of organic products, including being chemical-free (80pc), environmentally friendly (71pc) and additive-free (65pc).

Australian demand for certified organic products is skyrocketing with $1.93 billion dollars generated in domestic sales for 2018 across a wide range of products.

The figure is up $256 million from domestic sales of $1.67 billion for 2017 with the total Australian organic industry now worth $2.6 billion and growing year on year.

Challenges ahead

WITH such prominent growth came challenges, according to Australian Organic general manager, Niki Ford.

She said it was apparent the rapidly growing domestic market needs to be regulated, given that the Australian export market already has regulations in place.

"It's important that Australian consumers can trust that their dollars are being spent on products that have been rigorously tested to ensure they meet the industry standards and not fooled by clever marketing or simply a brand name containing the word 'organic'," Ms Ford said.

"Australian Organic has an ongoing dialogue with the industry regulator on this topic and is currently petitioning for a stronger approach to domestic regulation.

DATA: Processing value - sector contributions - 2018. Source: Australian Organic Market Report 2019.

DATA: Processing value - sector contributions - 2018. Source: Australian Organic Market Report 2019.

"In particular, the trends for ready-to-eat, packaged and alternative products are unmistakable in their presence on the retail shelf and demonstrated by the significant increase in certified processors since 2018.

"The now diverse array of certified operators encompasses a rich blend of producers, processors, input manufacturers, handlers and retailers."

In terms of market restraints, the report listed price as the key concern for shoppers.

"Numerous studies have shown the major barrier to higher organic food purchases is the price premium," the report said.

"Many consumers do not want to pay extra for organic products, in spite of the associated environmental and ethical benefits.

"Many consumers are not willing to pay this premium, due to a perceived lack of scientific evidence on the health benefits of organic products."

The story Veggies are major player in organic market growth first appeared on Good Fruit & Vegetables.

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