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Published by: Key Note Publications Ltd
Published: Feb. 1, 2006
Table of Contents
- Executive Summary
- 1. Introduction
- REASONS FOR UPDATING THE REPORT
- KEY SOURCES
- DEFINITION
- 2. Strategic Overview
- BACKGROUND AND HISTORY
- The History and Role of the Soil Association
- Definition of Organic Farming
- Genetically Engineered (Modified) Crops and Foods
- Organic Product Inspection: Certifying Bodies
- Table 1: Certifying Bodies and their Coverage of Land and Enterprises (%, thousand hectares and number), January 2005
- Organically Managed Land
- Table 2: Organically Managed Land in the UK (thousand hectares and %), Years Ending April 1997-2005
- Table 3: Organically Managed Land Areas in the UK by Nation (thousand hectares and %), Years Ending April 2003-2005
- Table 4: Organically Managed Land in England by Standard Region (thousand hectares and %), Year Ending April 2005
- Use of Fully Organic Land
- Table 5: Fully Organic Land in the UK by Land Use (thousand hectares and %), Years Ending April 2003-2005
- Table 6: Fully Organic Land in the UK — Arable Production by Land Use (thousand hectares and %), Years Ending April 2003-2005
- Table 7: Fully Organic Land in the UK — Horticultural Production by Land Use (thousand hectares and %), Years Ending April 2003-2005
- Numbers of Producers and Processors/Importers
- Table 8: Organic Food and Drink Producers, Processors and Importers in the UK (number), Years Ending April 1995-2005
- Table 9: Producers and Processors/Importers of Organic Foods and Drinks in the UK by Nation (number and %), Years Ending April 2003-2005
- Table 10: Producers and Processors/Importers of Organic Foods and Drinks in England by Standard Region (number and %), Year Ending April 2005
- MARKET DYNAMICS AND SEGMENTATION
- Factors Affecting the Market
- Challenges to Organic Farmers and Growers
- Government Policy and Assistance in Organic Farming and Growing
- Health Benefits of Organic Foods and Drinks
- Environmental and Animal Welfare Benefits
- The Move From Niche To Mainstream: Higher Selling Prices
- The Level of Imports
- Table 11: Import Levels in Primary Organic Foods — Major Multiples (% by value imported), 2003 and 2004
- Table 12: UK Sourcing of Organic Meat, Vegetables and Fruit at Major Supermarkets (% UK sourced), 2003 and 2004
- Market Size
- The Total Market
- Retail Sales by Sector
- Import Levels
- DISTRIBUTION
- COMPETITIVE STRUCTURE
- ADVERTISING
- THE CONSUMER
- MARKET FORECASTS
- Table 13: The Forecast UK Market for Organic Foods and Drinks by Retail Value at Current Prices (£m at rsp), 2006-2009
- 3. Market Size
- The Total Retail Market
- Table 14: The Total UK Market for Organic Foods and Drinks by Retail Value at Current Prices (£m at rsp), Years Ending April 1994-2004 and Years Ending December 2003-2005
- THE RETAIL MARKET BY SECTOR
- Table 15: The UK Market for Organic Foods and Drinks by Sector by Retail Value at Current Prices (£m at rsp and %), Years Ending April 2001-2004 and Years Ending December 2004 and 2005
- Figure 1: The Estimated UK Market for Organic Foods and Drinks by Sector by Retail Value (%), Year Ending December 2005
- Vegetables and Fruit
- Dairy Products
- Cereal and Baked Products
- Meat, Meat Products and Fish
- Wines and Fruit Juices/Fruit Drinks
- Baby Foods
- Coffees, Teas and Hot Drinks
- Multi-Ingredient Products/Other Items
- ORGANIC `PRODUCER' FOODS AT FARM GATE PRICES
- Table 16: Farm Gate Values of Main Organic Foods (£m), Years Ending April 2003 and 2005
- Table 17: Farm Gate Values of Main Organic Foods by Produce Category (£m), Years Ending April 2003-2005
- 4. Advertising and Promotion
- MAIN MEDIA ADVERTISING EXPENDITURE
- Table 18: Main Media Advertising Expenditure on Organic Foods and Drinks by Brand/Product (£000), Years Ending December 2002-2004 and Year Ending September 2005
- EVENTS
- 5. Distribution
- RETAIL SALES BY DISTRIBUTION CHANNEL
- Table 19: Retail Sales of Organic Foods and Drinks by Distribution Channel (£m at rsp and %), Years Ending April 2003 and 2004 and Years Ending December 2003 and 2004
- 6. An International Perspective
- THE GLOBAL MARKET
- Table 20: Location of the World's Organic Farms and Farmland (%), 2003
- THE EUROPEAN MARKET
- Table 21: Organically Managed Land in European Countries (thousand hectares, % and 000 holdings), 2004
- 7. PEST Analysis
- POLITICAL FACTORS
- ECONOMIC FACTORS
- SOCIAL AND ENVIRONMENTAL FACTORS
- TECHNOLOGICAL FACTORS
- 8. Consumer Dynamics
- OVERVIEW
- Table 22: Summary of Levels of Agreement with Survey Statements (% of respondents), December 2005
- REGULAR PURCHASERS OF ORGANIC FOODS OR DRINKS
- Table 23: Regular Purchasers of Organic Foods or Drinks (% of respondents), December 2005
- OCCASIONAL PURCHASERS OF ORGANIC FOODS OR DRINKS
- Table 24: Occasional Purchasers of Organic Foods or Drinks (% of respondents), December 2005
- REGULAR PURCHASERS OF ORGANIC FRUIT OR VEGETABLES
- Table 25: Regular Purchasers of Organic Fruit or Vegetables (% of respondents), December 2005
- REGULAR PURCHASERS OF ORGANIC DAIRY PRODUCTS
- Table 26: Regular Purchasers of Organic Dairy Products (% of respondents), December 2005
- REGULAR PURCHASERS OF MEAT OR MEAT PRODUCTS
- Table 27: Regular Purchasers of Organic Meat or Meat Products (% of respondents), December 2005
- REGULAR PURCHASERS OF ORGANIC BREAKFAST CEREALS
- Table 28: Regular Purchasers of Organic Breakfast Cereals, Biscuits or Cakes (% of respondents), December 2005
- REGULAR PURCHASERS OF ORGANIC BABY FOODS
- Table 29: Regular Purchasers of Organic Baby Foods (% of respondents), December 2005
- REGULAR PURCHASERS OF ORGANIC FOODS THROUGH BOX SCHEMES, FARM SHOPS AND FARMERS' MARKETS
- Table 30: Regular Purchasers of Organic Foods through Box Schemes, Farm Shops and Farmers' Markets (% of respondents), December 2005
- PERCEPTION THAT ORGANIC FOODS OR DRINKS ARE TOO EXPENSIVE
- Table 31: Agreement that Organic Foods or Drinks are Too Expensive (% of respondents), December 2005
- PERCEPTION THAT ORGANIC FOODS OR DRINKS ARE HEALTHIER
- Table 32: Agreement that Organic Foods or Drinks are Healthier for You (% of respondents), December 2005
- OPINION THAT THE GOVERNMENT SHOULD OFFER MORE ASSISTANCE FOR ORGANIC FARMERS AND GROWERS
- Table 33: Agreement that the Government Should do More to Assist Organic Farmers and Growers (% of respondents), December 2005
- CONCERN THAT FOODS DESCRIBED AS ORGANIC MAY NOT BE
- Table 34: Concern that Foods Described as Organic May Not Be (% of respondents), December 2005
- CONCERN ABOUT THE USE OF FERTILISERS OR PESTICIDES
- Table 35: Concern About the Use of Fertilisers or Pesticides (% of respondents), December 2005
- CONCERN ABOUT THE TREATMENT OF ANIMALS IN FARMING
- Table 36: Concern About the Treatment of Animals in Farming (% of respondents), December 2005
- 9. Company Profiles
- INTRODUCTION
- Producers, Processors, Manufacturers and Suppliers
- Alara Wholefoods Ltd
- Alpro (UK) Ltd
- Alvis Brothers Ltd
- Arla Foods UK PLC
- Ashbourne Biscuits Ltd
- Aspall Cyder Ltd
- Baxters Food Group (WA Baxter & Sons Ltd)
- Belvoir Fruit Farms Ltd
- Bennett Opie Ltd
- Cafédirect PLC
- Cambrian Organics Ltd
- Cauldron Foods Ltd
- Clipper Teas Ltd
- Coombe Farm
- Crazy Jack
- Cumbria Organics Ltd
- Deans Foods Ltd
- Doves Farm Foods Ltd
- Duchy Originals Ltd
- Dumfries & Galloway Organic Network
- Eastbrook Farm Organic Meats Ltd
- Fieldfare Organic and Natural Ltd
- Food Brands Group Ltd
- Gerber Foods Soft Drinks Ltd
- Goodlife Foods Ltd
- Graig Farm Organics
- granoVita UK Ltd
- Green & Black's Ltd
- Go Organic
- Haldane Foods Ltd
- HJ Heinz Company Ltd
- Higher Hacknell Farm Ltd
- High Weald Dairy
- Hipp Organic
- W Jordan (Cereals) Ltd
- Kallo Foods Ltd
- Kettle Foods Ltd
- Langmead Farms Ltd
- Lyme Regis Fine Foods Ltd
- Mackie's Ltd
- Manor Farm Organic Milk Ltd
- Martlet Natural Foods (Martlet Natural Food & Drink Ltd)
- Meridian Foods
- Northumbria Organic Producers
- Nutricia Ltd
- OMSCo
- Organic Farm Foods Ltd
- Organic Livestock Farmers of Cornwall & Devon
- Organic Roots
- Organix Brands Ltd
- The Pertwood Organic Cereals Company Ltd
- Pim Hill Organic Farm
- Purely Organic
- Rachel's Organic Dairy (Rachel's Dairy Ltd)
- Riverford Organic Vegetables Ltd
- Rowse Honey Ltd
- Sedlescombe Organic Vineyard
- Seeds of Change
- September Organic Dairy Ltd
- Sheepdrove Organic Farm
- Shepherdboy Ltd
- Simmers-Nairn (Simmers of Edinburgh Ltd)
- Simply Organic Ltd
- Somerset Organics
- Swaddles Green Farm
- Tetley GB Ltd
- The Tracklement Company Ltd
- R Twining and Company Ltd/Jacksons of Piccadilly
- The Village Bakery (The Village Bakery (Melmerby) Ltd)
- The Welsh Hook Meat Centre Ltd
- H Weston & Sons Ltd
- James White Drinks Ltd
- Whitworths Sugars
- Wilkin & Sons Ltd
- The Yeo Valley Organic Company Ltd
- 10. The Future
- Market Forecasts
- Table 37: The Forecast UK Market for Organic Foods and Drinks by Sector by Retail Value at Current Prices (£m at rsp and %), 2006-2009
- Figure 2: The Forecast Total UK Market for Organic Foods and Drinks by Retail Value at Current Prices (£m at rsp), 2006-2009
- 11. Consumer Confidence
- METHODOLOGY
- THE WILLINGNESS TO BORROW
- Table A: The Average Amount Consumers Are Willing to Borrow in Order to Purchase Expensive Items at Current and Constant November 2004 Prices (£ and £bn), November 2004, February 2005, May 2005, August 2005 and November 2005
- The Desire to Borrow Stays Strong
- Table B: The Number of Adults Willing to Borrow in Order to Purchase Expensive Items (000 and %), November 2004, February 2005, May 2005, August 2005 and November 2005
- THE WILLINGNESS TO SPEND FROM SAVINGS
- Table C: The Average Amount Consumers Are Willing to Spend from Savings in Order to Purchase Expensive Items at Current and Constant November 2004 Prices (£ and £bn), November 2004, February 2005, May 2005, August 2005 and November 2005
- Consumers Increasingly Cautious
- Table D: The Average Amounts Adults are Confident Spending to Purchase Expensive Items (£ and %), November 2004, February 2005, May 2005, August 2005 and November 2005
- 12. Further Sources
- rade Associations
- Government Sources and Certifying Bodies
- Producers, Processors, Manufacturers and Suppliers
- Trade Journals
- General Sources
- Bonnier Information Sources
AbstractThe total organic food and drink market increased in value at retail level by 10.1% in 2005. Within this, vegetables and fruit increased their share, while dairy and bakery products retained steady shares. The proportion held by meat (and, to a much smaller extent, fish) has grown, as has that accounted for by wines, fruit juices and hot beverages. However, baby foods and the range of other multi-ingredient items have lost share, although baby food sales have still increased. The overall market is now growing at a stable rate of around 10% per year, after much more substantial annual growth between 1996/1997 and 2000/2001.
The introduction of new `decoupled' government payments in 2005 to organic farmers and growers, no longer related to organic production, have created new interest in the market, with a doubling of requests for information received by the Organic Conversion Information Service (OCIS). Meanwhile, the Soil Association continues to promote the range of claimed health, environmental and animal welfare benefits of organic foods and drinks.
The total area of organically managed land in the UK peaked in 2001/2002 and 2002/2003, and steadied at a marginally lower level in 2003/2004 and 2004/2005, as the proportion `in conversion' had fallen to a low percentage. More than 50% of organic land is in Scotland, with less than 40% in England and the remainder in Wales and Northern Ireland. Overall, nearly 90% is grassland, with less than 10% being arable or used for horticulture. The number of organic primary food producers peaked in 2002/2003, whereas the number of processors and importers steadied to a small yearly increase (albeit following a decline in 2002/2003).
The organic food and drink market is characterised by large numbers of small producers, although there is now evidence of increases in size to challenge the remaining smaller companies. There is growing activity in primary producers operating as co-operatives, and the share of organic food sales through direct outlets, notably box schemes, has increased significantly. This has affected sales of organic produce through the dominant grocery multiples of Tesco, Sainsbury's and Waitrose. The higher prices charged for organic products are under pressure from grocery multiples' demands, from increasing economies of scale at producers and from any overcapacity situations resulting from supply temporarily exceeding demand.
A significant proportion of organic meat, vegetables and fruit is still imported, as are many bakery items, fruit juices, hot beverages, baby foods and some multi-ingredient products. The Soil Association continues to campaign against this on behalf of UK farmers and growers, citing the Government's target of only 30% of total organic produce imported by 2010.
The organic food and drink market is forecast to grow at a slowing rate in the future, although still at an annual growth rate exceeding that for non-organic foods for most of the period to 2009. However, Key Note does not predict any substantial increase in the numbers of heavy consumers of organic produce — the majority still buy only relatively small proportions of organic foods and drinks within their total grocery purchases.
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