BALTIMORE — Even as the growth rate in organic slows, the industry remains optimistic that the multi-billion segment has several ways to increase its reach with consumers.
"Organic is still a core driver of our industry. We see organic delivering growth across a broad range of categories," Andrew Henkel, senior vice president of brand growth solutions at SPINS, told a crowd at the Natural Products Expo East conference in Baltimore. "Organic is alive and well and anyone who tells you anything different is wrong."
Sales of organic food in the U.S. last year totaled a record $47.9 billion — 5.9% higher than 2017, according to Organic Trade Association figures released earlier this year. While that's slower than the 6.4% in 2017, sales continued to outpace the overall food market's 2.3% growth rate for 2018.

Organic food sales remain on the upswing, but OTA's figures show that after peaking at a growth rate of 12.2% in 2013 the annual increase has been trending downward. The organic food sector is still growing faster than conventional foods, but certain products have faced hurdles. Sales of organic dairy products slowed for a second straight year in 2018, which the group blamed on shifting dietary trends.
A series of factors are squeezing prices for organic producers. Large-scale grocers are consolidating their purchasing power, enabling them to get better pricing and pass it on to consumers. In addition, the OTA said that as retailers carry more organic that they sell at a competitive price to attract shoppers, the result is a smaller differential between prices for organic and non-organic crops. And finally, as organic production climbs, the premium farmers and shippers get paid for the crop declines.
These factors provided an impetus for the organic industry to assess where it is heading.
Lauren Batcha, CEO and executive director of OTA, told the Expo East audience that the trade group is testing out new programs to "address some of these long-term issues." OTA, she said, is studying ways to provide assistance for farmers to transition from conventional agriculture to organic. It also has talked with thousands of consumers to ensure the trade group is in tune with changing consumer demographics where shoppers have different values and needs when it comes to organic — as well as making sure the food is affordable while at the same time offering growers a fair price.
"Organic is alive and well and anyone who tells you anything different is wrong."

Andrew Henkel
Senior vice president of brand growth solutions, SPINS
"The organic industry may not be as attuned and as used to listening to diverse voices for potential consumers, and we wanted to really dig into that," Batcha, who started out in organic as a farmer in the 1980s, said. "If we don't understand that and intentionally try to listen, we're never going to hear what's happening around us."
Seth Goldman, co-founder of Honest Tea who is also the executive chairman of the Beyond Meat board, told Food Dive that in organic's earlier days it wasn't able to benefit from issues like the environment that are more top-of-mind with consumers today — a factor that is a major contributor to red-hot growth impacting plant-based meat makers like Beyond Meat. And organic products as a whole, including offerings from Honest, taste significantly better today than they did two decades ago, he said.
"If we started organic today it might grow more quickly," Goldman said. Organic's "growing but it's not the explosive growth that we're seeing in plant based."
Goldman said Honest Tea, which is now owned by beverage giant Coca-Cola, recently redesigned the labels on some of its bottles with changes that included making the word organic easier to read. Organic, which is at the core of his company's business, wasn't a major topic for consumers when he started the business, and even had the potential to drive away some shoppers.
"Earlier on, we were like we don't want to make organic too bold because we were afraid that might scare people off," Goldman said. "People used to think organic was expensive and didn't taste good. Now, we're over that."