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Natural Foods Merchandiser

Organics sales reach double-digit growth in 2008

Nonfood items such as supplements, personal care products, linens and clothing propelled an increase in U.S. sales of organic products in 2008, according to a new survey by the Organic Trade Association.

Sales of organic products, both food and nonfood, totaled $24.6 billion in 2008, a 17.1 percent increase over 2007, according to OTA's 2009 Organic Industry Survey.

The survey, conducted by the Lieberman Research Group, showed that organic food sales grew 15.8 percent to $22.9 billion. Organic food now accounts for 3.5 percent of all food product sales in the U.S., the OTA said. Total U.S. food sales grew 4.9 percent in 2008.

Meanwhile, organic nonfood sales reached nearly $1.65 billion, a whopping 39.4 percent increase over 2007 sales.

"Organic products represent value to consumers, who have shown continued resilience in seeking out these products," said Christine Bushway, OTA's executive director.

In organic nonfood categories:

  • Supplements sales grew 38 percent to $566 million
  • Fiber, including linen and clothing, grew 65 percent to $472 million
  • Personal care products grew 19 percent to $443 million
  • Pet food grew 48 percent to $76 million
  • Household products grew 42 percent to $50 million
  • Flowers grew 54 percent to $42 million

"It is not surprising to see higher rates of growth in the organic nonfoods categories than the organic foods categories, as this sector is less mature than organic foods in general," the OTA said in its executive summary of the report.

Consultant Debbie Swoboda, of Stuart, Fla.-based Debbie Swoboda Marketing Solutions, isn't surprised at the results either. "People are becoming more aware," she said. "And in many cases, prices have come down."

Organic baby clothes, for example, are gaining in popularity, Swoboda said.

In the organic food categories, fruits and vegetables accounted for the lion's share of sales – 37 percent, followed by beverage and dairy, with 14 percent each.

Organic breads and grains and beverages showed the strongest growth. Breads and grains were up 35 percent over 2007. Beverages were up 40 percent.

Swoboda wondered what effects the lingering bad economy will have on organic sales in 2009. "People are concerned. But our industry is still up."

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