U.S. Organic Food Sales Up 72%, USDA Report Finds

U.S. Organic Food Sales Up 72%, USDA Report Finds

A new U.S. Department of Agriculture (USDA) report shows that organic food sales have seen a sharp increase, with sales from organic farms topping $5.5 billion. AgWeb reports that sales are up 72 percent since 2008.

According to AgWeb:

The growth comes primarily from several pockets in the U.S., including the West Coast, Texas and Colorado, the upper central Midwest and parts of the Northeast. The following 10 states account for 78% of all organic sales in the U.S.

California, Washington, Pennsylvania, Oregon, Wisconsin, Texas, New York, Colorado, Michigan, and Iowa account for the majority of growth, with $2.2 billion of organic food sales coming from California.

In all, there are now 14,000 certified organic farms, with the top five organic commodities being milk, eggs, broiler chickens, lettuce, and apples. In fact, sales of organic milk alone was nearly $1.1 billion.

AgWeb also reported that sales were increasingly coming from goods produced closer to home:

According to the report, 46% of organic agricultural products were sold within 100 miles of where these goods were produced. Another 34% were sold within 500 miles and 18% were sold more than 500 miles from where they were produced.

Much of the organic food sales came from natural and organic retailers, who saw a 9 percent increase in sales, while grocery chains saw a 1.3 percent increase.

Big food companies are feeling increased pressure to get in the organic game. Hormel Foods, for example, recently bought Applegate Farms for a reported $775 million. Hormel Foods owns brands like Spam, Dinty Moore, Jennie-O, and Skippy, making Applegate Farms the company’s only exclusively organic and natural brand.

Additionally, General Mills bought Annie’s Homegrown earlier this year for a reported $820 million. Over the company’s 25 year history, Annie’s Homegrown has been a staple in the natural foods industry, growing at 20 percent last fiscal year. General Mills already owns a number of organic and natural food companies including Muir Glen, Food Should Taste Good, Good Earth, and Cascadian Farms. Big food companies are acquiring organic niche brands to get into the market and increase sales.

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