The figures are part of a refreshed plan outlined by the government yesterday.
Launching the Action Plan - Two Years On at a farm in Devon, organic farming minister Ben Bradshaw said: "At the beginning of this year 696,000 hectares, 4 per cent of UK farmland, was under organic production, up from 30,000 hectares in 1993. The market is projected to grow by 9 per cent a year to 2007."
The UK organic market is enjoying decent growth, in particular the dairy segment. A recent report from UK market analysts Organic Monitor found that organic dairy products were reporting high growth due to product innovations and marketing campaigns of producers.
A number of innovative organic dairy products have been launched in recent years, including organic milk with functional ingredients, flavoured organic milk, and Greek-style organic yoghurts. The introduction of organic dairy products under supermarket private labels has also boosted sales growth.
Future market growth is also predicted to be driven by scientific research into the health benefits of organic milk, and by a greater penetration into the foodservice and catering sector.
Research studies have shown organic milk to have more omega acids and conjugated linoleic acid than conventional milk. Growing scientific research on the health and nutritious properties of organic milk is expected to strengthen consumer demand. There is also growing demand for organic dairy products from restaurants, cafés, schools and catering companies, reports Organic Monitor.
"The organic dairy products market is envisaged to continue to show healthy growth in spite of retail prices increasing in 2005. The leading producers are re-positioning their organic brands and this is widening consumer demand for organic dairy products," said the analysts.
Leading UK organic foods supplier Yeo Valley Organic, for example, has relaunched its organic ice creams and frozen yoghurts as part of a strategy to reposition its organic dairy products. New packaging was introduced in June and marketing campaigns are supporting the relaunch.
The new packaging design is aimed at broadening appeal to consumers who are seeking high-quality dairy products and not just organic variants. Rich vanilla ice cream and strawberry frozen yoghurts were the first to be relaunched and other flavours are in the pipeline. The brand is to be supported by a £3 million advertising campaign later in the year.
Commenting yesterday on the UK organic action plan, chairman of Defra's Sustainable Farming and Food Implementation group Sir Don Curry said: "Small and medium sized businesses have an opportunity to access new markets through the government's public procurement initiative. I applaud the progress that has been made in persuading purchasers with public procurement responsibilities in schools and hospitals to source organic food. There is still a long way to go but progress to date is very encouraging."
A key priority identified by the government for further action is UK sourcing - to take forward progress made by retailers and to extend the work to the food service and manufacturing sectors, including identifying obstacles.