Increased health awareness drives organic food and beverage market

According to a new report by Global Industry Analysts, Organic Foods & Beverages: A global business report published this month, health and well-being is becoming increasingly prevalent on consumer priority lists, helping to spur a double-digit annual growth rate in the global organic food and beverage market.

" Recent outbreaks of food scares and heightened awareness of the health benefits of organically produced ingredients are thought to be behind the dramatic turn from unhealthy ingredients such as carbohydrates, fat, calories and hydrogenated oils, and the use of genetically modified organisms (GMOs) in food products, among others," states the report.

The major push towards healthy living has been felt most dramatically in Europe and the US, with both countries holding 80 per cent of the overall world market.

In the US, sales in the category are predicted to reach over $43bn (€31bn) by 2010.

However, it is the Asia-Pacific region that is the fastest growing region, posting a 28 per cent CAGR growth rate.

The growing trend is of such significance that regulatory bodies across the world have come together to negotiate equivalencies of the organic programs wherein each country recognizes, and acknowledges the national organic program of other countries as an equivalent to the prevailing domestic standards, said the report.

In an attempt to allow for easier trade across different countries and regions, the authorities are now co-operating together to better understand the regulatory procedures of each individual market.

Despite the growth in consumer demand for organic products, the market is still fairly new to such regulation.

However, this is set to change as most countries attempt to discipline their organics industry on regulations issues such as product certification and labelling.

The report suggests that this is an attempt to increase consumer confidence in the authenticity of organics, while protecting them, and organic farmers, from fraudulent practices.

Likewise, the report claims that intervention from governmental legislation is welcomed by the organic industry, as this is considered to add authenticity to the food category.

With the added governmental support, and the heightened awareness and authenticity this brings, the organic food market is now expanding away from its previously held position as a 'health niche', and is going main stream in products such as chocolate, cheese and condiments.

The market is apparently attempting to shed its 'uninteresting' image, with many manufacturers leveraging organics as a way to promote improved taste in their products, according to the report.

Another key driver of the market is also put down to increased environmental awareness, a motive that has helped the organic produce market become the largest segment in the organic foods & beverages market, which is projected to reach sales of $33bn (€23bn) by 2010.

Likewise, the non-diary beverage market is posting the fastest grow rate and will allegedly post a growth rate of more than 18.5 per cent in the ten-year analysis period.