General Mills has announced that it expects to meet its organic sourcing and growth goals by 2019, thanks to its portfolio of organic brands including Annie’s Homegrown, Cascadian Farm, and Muir Glen. These goals, which include expanding its organic acreage to 250,000 and growing its natural and organic portfolio to $1 billion, were first announced last year.
To continue to grow its organic sector, the company is paying for transition costs for would-be organic farmers. The company strives to send “clear market signals” with regard to the growth of the organic market to farmers considering organic transition, according to Food Navigator.
“Contrary to mythology, it’s not just millennials who are buying organic… all generations are participating,” notes Katrina Heinze, a General Mills executive.
General Mills is also investing in much-needed organic industry research, including specialized crops and organic oat variety trials.
Natural and organic products have been General Mills’ strongest growth sector over the last few years, with a ten percent average annual increase since 2005. Annie’s Homegrown, acquired by General Mills for $820 million in 2014, has grown 40 percent over the past year, thanks to the introduction of new products including an organic popcorn line.
The continued development of organic products is essential to the thriving organic marketplace. An October report showed that current organic production was not meeting consumer demands for products; despite projections by Allied Market Research that the global organic food and beverages market is expected to triple the 2015 market by 2022, organic supply is still not able to meet increasing consumer demand.
The organic and natural sector is one of four investment opportunities upon which General Mills is currently focusing, along with Häagen-Dazs ice creams, snack bars, and Old El Paso Mexican foods, according to a February announcement by General Mills President and CEO Jeffrey L. Harmening.
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