According to research and consultancy firm Organic Monitor, organic meat sales in the US have expanded by over 150 percent since 2002, with high growth rates expected to continue as retail distribution increases.
Figures published by the company reveal a 51 percent market growth in 2005, just short of the 55 percent recorded by the Organic Trade Association (OTA), which also released its most recent figures this month.
According to Organic Monitor, beef is the fastest growing sector in terms of sales, making up over half of the total organic meat market.
This is partly a result of consumer reaction to BSE, after incidences of the disease were first detected in American and Canadian herds in 2003.
"Although the BSE incidents have not eroded consumer confidence in beef products, they have elevated consumer awareness of organic meat production methods. Organic beef sales in the US have doubled each year since 2003 partly because of this new consumer awareness of organic meats," said the report.
But the relative high price of organic beef is what is keeping it in top slot. In terms of volume, beef only makes up around 25 percent of the total organic meat market together with pork and lamb. The remaining 75 percent of the market is held by organic poultry.
Around 26,000 tons of organic poultry were sold in 2005, with chicken comprising the bulk.
According to the new report, chicken dominates the market because of its short production cycle, which enables producers to adapt relatively quickly to demand fluctuations. It continues to be the most widely available organic meat in North America, with a growing number of retailers selling it under their private labels.
Organic Monitor estimates the nation's organic meat market will increase a further 42 percent this year, but a larger overall market means that growth momentum is expected to slow in coming years. Current estimates reveal an average growth rate of around 17 percent per year up to 2012.
But undersupply continues to inhibit market growth rates.
According to the report, producers cannot find enough organic meat supply to meet demand, resulting in many companies resorting to imports. For example, over 60 percent of the organic pork sold in the US is currently imported because of low domestic production levels.
The "import dependent" organic meat market in the US currently relies on Latin America, Australasia and Canada to supplement its supply needs.
At the same time, domestic natural and conventional meat companies are taking up high market share as they use their distribution networks to launch organic meats, said the report.
But, it added, "many dedicated organic meat companies are finding it difficult building supply chains from farmers to retailers because of supply problems. Indeed, the lack of distribution infrastructure makes direct marketing an important channel for many producers."
The consultancy firm, which provides recommendations to companies looking to enter the fast growing organics market, said that "organic meat companies are advised to look at strategic collaborations to strengthen supply chains and build bargaining power."
"Product differentiation is expected to become important as organic meat suppliers increasingly compete on price," it added.
"Small-scale production and undersupply have made organic meats in US and Canada some of the most expensive in the world; organic beef and pork products are priced up to three times as much as conventional meat products. Retail prices are expected to go down as more supply becomes available, enabling companies to achieve economies of scale in production and marketing."
Organic Monitor is due to release a report on the US organic dairy market next month, with a report on the Organic fruit and vegetable market set to follow by the end of the year.