Organic Market 2018 - Smylies
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Organic Market 2018 Published with support from
What’s in this report Introduction from Chief Executive Executive summary UK organic market Supermarkets Independent retail Home delivery Foodservice and eating out Organic across the UK Beauty and wellbeing Textiles Today’s organic consumer Organic farming Organic across the globe The year ahead About us
Organic Market 2018
Introduction
Sales of organic food have had another year of
strong growth in the UK and, at £2.2 billion, are
now higher than they have ever been.
A sixth year of consecutive animal welfare. Processors Organic offers opportunities
increase confirms our and retailers have a strong role in uncertain times
consumer insights which show to play, working with farmers
Like all farming sectors, we
that there is a generation who to make sure they have the
are very concerned about
really appreciate the values confidence to invest in the
labour and trade arrangements
that organic farmers put into production we will need if
post-Brexit. It’s why we
practice, day after day, rain market growth can continue.
have joined forces with the
or shine.
We need to support the National Farmers Union and
Farming organically is not an benefits of organic the wider industry to call for
easy choice. So it is heartening future policies that allow our
As ever, the biggest shortfall
that, after years of decline, it businesses to thrive. There
is in arable and protein crops,
seems that, finally, the tide is is a great deal at stake in the
especially for animal feed.
turning with a 22% increase coming months, and our team
These can be technically
in farmers in conversion to is stretched to the limit as we
challenging crops, though
organic. After years of reporting try to mitigate the threats and
some farmers are growing them
great innovation and growth grasp the opportunities.
superbly well. Advances in
from our UK organic brands
weed control are helping some At a time of such uncertainty,
and businesses, I’m thrilled
of us (speaking personally here!) differentiated, high value
we’re now able to tell a more
who struggle at times with markets offer a better chance
positive story on the consumer
our ‘plants in the wrong place’. of stability and success. With so
demand side too. These green
(Charlock is my particular many strong brands, and some
shoots need to be nurtured
bête noire.) At the same time, innovative, well-supported
if we are to meet the public’s
all farmers need to be less producer organisations, organic
expectations that the products
paranoid about weeds. They are provides a significant chance
they buy are grown in the UK,
not a slur on our character, and to stay ahead of the game,
where possible, rather than
the diversity in our crops is one especially when the rules of the
being imported.
of the key reasons we support game are not yet clear.
We welcome the UK so much more wildlife on our
government’s increasing organic farms.
enthusiasm for organic Helen Browning
We will be urging the UK
farming, and for many of the Chief Executive,
government to put strong
environmental and animal Soil Association
support behind a future
welfare goals that the Soil
organic scheme that reflects
Association has long espoused.
the benefits of organic. And to
But we now need to work
invest in farmer-led research
together to make sure these
and development which
warm words translate into post-
we have shown to be a cost
CAP policies that recognise the
effective way of improving
contribution organic farming
on-farm knowledge and
makes to restoring soils and
performance.
biodiversity, and protecting
1
Organic Market 2018
Executive
summary
The pace of growth of the organic market in the
UK continues to be solid, at 6%, despite economic
pressures and Brexit uncertainty.
• A
t £2.2 billion in 2017, the UK organic market is
worth more than it ever has been.
• W
e’ve seen six years of solid growth in the organic
market in the UK.
• A
lmost 30% of all sales of organic are through
independent retailers and home delivery, and
growing faster than supermarket sales.
• P
eople are buying more organic items in non-food
categories – sales of organic textiles increased by
25% and there was a 24% rise in organic beauty and
wellbeing products.
• T
he amount spent on organic catering through the
Food for Life Served Here scheme grew by 20% to
be worth £18 million. This is over 20% of the total
amount spent on organic in foodservice and has
doubled in the last two years.
Growth in total sales of organic in 2017 in the UK
+6 % Nearly three quarters
72 %
10 growth % of Soil Association Certification
licensees are predicting further
growth in 2018
Soil Association Certification licensees recorded a
10% growth in sales for the second year running
2
Organic Market 2018
2017 growth in sales of organic
Supermarket
sales*
+4.2%
Independent
retailer sales
+9.7%
Home delivery
sales, including
box schemes
+9.5%
Total organic sales
£2.2
billion
+10.2%
Organic sold in
foodservice +10%
+20% Licensee sales
+24% +25%
‘Food for Life Served
Here’ organic spend Beauty and Textiles sales
wellbeing sales
*Nielsen Scantrack Total Coverage Food & Drink (supermarkets and convenience stores)
52 weeks ending 30 December 2017 3
Organic Market 2018
UK organic
market
We’ve had six years of steady growth in the UK
organic market. Sales of organic products have
grown by 6% while non organic sales increased
by just over 2%.
In fact, we have the largest The 3.1% rise in inflation (as of Our November 2017 consumer
market ever for organic food November 2017, according to research (see page 20) shows
and drink, surpassing the 2008 UK government figures) has that people are choosing
peak. Around 1.5% of the total had a minor impact on organic, products which fit their healthy
UK food and drink market is with some products like butter lifestyles. In many cases, this
organic. Many businesses and and fish, seeing value increases. includes ‘free-from’, vegetarian
brands which supported organic But prices of organic products and vegan products.
through the difficult years are themselves haven’t changed as
In this period of uncertainty
now enjoying good results. much as non-organic ones.
around Brexit, there will be
Customers remain loyal The opportunity to drive health more concern about the
to organic, despite Brexit conscious consumers to organic provenance and traceability
nervousness. Shoppers choose options is greater than ever. of food, which could increase
it because they buy into the This is because organic is demand for organic. New
value of the benefits it brings, seen to be synonymous with trade deals, with the US for
not because it is being heavily health. Health is a key motivator example, may have an impact
price promoted. The higher for buying organic and, as it on the quality of the food we
shelf price is still an obstacle becomes more of a focus for import. Media stories about
but does not seem to be any family shopping, many organic food practices, like chlorinated
more of a deterrent than it categories will benefit. Already, chicken in the US, and more
was pre-Brexit. we are seeing products with genetically modified products,
health messages performing may lead consumers to choose
well, such as flavoured teas, items which have higher
cereals, nutty spreads and fresh animal welfare and that are
fruit and vegetables. certified organic.
+4.2 % increase in sales of organic through
food and drink (supermarkets
and convenience stores) in 2017
according to Nielsen
Source: Nielsen Scantrack Total Coverage Food & Drink (supermarkets and convenience stores)
52 weeks ending 30 December 2017
4
Organic Market 2018
The UK organic market is More big brands are developing Kellogg’s with a new organic
dominated by supermarkets, organic products, which cereal range and Typhoo
which increased sales of is exciting, and driving trialling their Heath & Heather
organic products by 4.2% in innovation in the UK market. brand in independent retailers.
2017. However, more people Large companies are snapping Indeed, many innovative
are shopping in smaller local up organic brands to add to organic products are starting
shops and online, which is the diversity of their product out in independent shops
driving growth of organic ranges, such as the Unilever and finding their way into
products in these channels. purchase of Pukka Herbs in larger retailers. Over 3000 new
Online continues to appeal 2017. There has been a high products were certified by Soil
to more shoppers and it is level of interest from fast- Association Certification in the
estimated that as many as 13% moving consumer goods last 6 months of 2017, a big step
of shoppers do their organic companies, including Coca- up in the speed of innovation
shopping online. Cola with their Honest T brand, and product development.
Around 1.5% of the total UK food and drink
market is organic
2003-2017 UK sales of organic products in GBP (£) millions
2218
2078 2113 2092
1954
1900 1840 1862
1741 1789
1731 1667
1600
1200
1100
+10% +9% +33% +19% +9% +1.6% -13% -6% -3.7% +4.5% +2.7% +4% +4.9% +7% +6%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Source: Soil Association Market reports 5
Organic Market 2018
2014 – 2017 trends in food and drink sales (% growth or decline in value)
7% Organic Non-organic
6%
5%
4%
3%
2%
1%
0%
-1%
-2%
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2014 2014 2014 2015 2015 2015 2015 2016 2016 2016 2016 2017 2017 2017 2017
Source: Nielsen Scantrack Total Coverage Food & Drink (supermarkets and convenience stores) ending 30 December 2017
2016-2017 Channel Growth in GBP (£) millions and percentage growth
Supermarkets Independent retailers Home delivery Foodservice
2016 2017 2016 2017 2016 2017 2016 2017
1428m 1488m 327.5m 359.3m 260.8m 285.8m 76.6m 84.4m
+4.2% +9.7% +9.5% +10.2%
Total
2016 2,093m 2017 2,218m
6
Organic Market 2018
Share of sales growth 2017 by channel
Foodservice 3.8%
Growth of 10.2%
Home delivery 12.9%
Growth of 9.5%
Independent retailers 16.3%
Growth of 9.7%
Supermarkets 67%
Growth of 4.2%
2016-2017 breakdown in product shares of UK food and
drink organic market and % change in value
Product % Share of food and drink Year on year growth
Dairy 28.7 +3.1
Fresh produce 24 +6.5
Babyfood and drink 9.6 -2.3
Meat, fish and poultry 10.2 +4.1
Confectionery/soft drinks 3.8 +1.9
Canned and packaged 16 +5.2
Beers/wines/spirits 2.3 +8.2
Chilled foods and deli 3.4 +21.3
Frozen 0.7 +6.7
Bakery 1.2 -10.3
Figures in bold if greater than total market growth in supermarkets of 4.2%
Source: *Nielsen Scantrack Total Coverage Food & Drink (supermarkets and convenience stores)
52 weeks ending 30 December 2017
7
Organic Market 2018
Supermarkets
Organic supermarket shopping is going from
strength to strength – but online opportunities
are being missed.
Sales of organic products in Buying organic is becoming Safety and food scares continue Larger FMCG brands, from
supermarkets grew by 4.2% easier, especially for everyday to unsettle shoppers. Since the Mars to Nestlé, Kellogg’s to
in 2017 to be worth approx items bought in supermarkets. 2013 ‘horsegate’ scandal, there Typhoo, are becoming more
£1.5 billion. The market Organic products are becoming has been a steady stream of food interested in having an organic
continues to be dominated by more available across a wider scares. In 2017, there were food choice within their portfolios.
Sainsbury’s, Tesco and Waitrose, network of supermarkets and hygiene issues at chicken plants, The recent acquisition of
which have almost 70% of shops, of varying sizes, and Fipronil was found in eggs, and Pukka Herbs by Unilever is
organic supermarket sales there is an increasing number supermarkets were challenged a current example. We are
between them. of everyday organic household in the media for using fake encouraged that Unilever made
brands and products. This is farm names on products. This cast iron commitments when
Data comparing today’s sales
confirmed by figures from built more mistrust among it purchased the business in
with that from four years ago
Nielsen showing products consumers. But it bodes well September 2017, to keep Pukka
confirms this growth in organic.
which represent the biggest for organic with its high ethical 100% organic. The business fit
Sales of baby food have grown
share of their category. Nearly and welfare standards and is very attractive with Pukka’s
by almost £10 million, while
two thirds (59%) of baby food independent inspections and explosive growth, with global
chocolate has increased by
sold in UK supermarkets, verification. sales of its teas and supplements
approximately £20 million and
for example, is organic. For up by around one third in
yoghurt has risen by almost Supermarket ‘free-from’
carrots, it’s 15.3%, bananas 9.3%, 2017, compared to 2016. This
£35 million. sections have helped increase
yoghurts 8.2%, eggs 6.9%, milk purchase, and other launches
sales of organic among
However, larger retailers have 5.9% and tea 6.1%. from Coca-Cola, Kellogg’s and
health conscious consumers.
still not taken advantage of the Arla, send a strong signal that
Organic is more available in Brands such as Doves Farm,
opportunity to sell more organic global FMCG businesses see
value supermarkets too. Nearly Rebel Kitchen and Plenish are
products online. Although their a positive, healthy future in
two thirds (64%) of licensees benefitting from this innovation
shops have organic options, organic food and drink.
said the most important reason as more space is allocated to
they have not extended online
why their sales increased was specialist diet choices. The
organic ranges beyond what is
because they had new listings dramatic move to less meat-
normally in their stores. This
in supermarkets. Discount based diets has also had an
has created an attractive gap for
supermarkets, like Aldi and Lidl, impact on sales of organic meat,
specialist online operators such
have been focused on getting with consumers buying better
as Ocado and Amazon.
the right range in stores at quality meat but less of it.
affordable prices.
15.3 % Highlights
• S
ales of organic products in supermarkets grew by 4.2%
in 2017 to be worth approximately £1.5 billion
of carrots sold by value in UK • E
xtensive organic choice is key to customer loyalty –
online operators are stealing the growth opportunity
food and drink retailers are • I nnovative organic products and brands are succeeding
organic in gaining shelf space
Source: Nielsen Scantrack Total Coverage Food & Drink 52 weeks ending 30 December 2017
8Organic Market 2018
Independent
retail
More organic products are purchased in high
street shops than ever before, with a 9.7% growth
in sales in 2017.
In fact, £1 in every £7 that is There’s a trend towards simple, Wholesalers are experiencing
spent on organic is through the less packaged organic products buoyant sales of organic, with Top five brands in independent
retail, according to Soil
independent sector. It includes that have a strong provenance some reporting that organic
Association Certification
delis, fine food stores, health and back story to tell. To make items now make up nearly surveys
shops, and farm shops and the most of this trend, in a third (30%) of total product
farmers’ markets. September 2017, we trialled ranges. In Soil Association
technology which tracks the Certification surveys, they
Soil Association Certification
journey of organic food from confirmed that great tasting,
research shows these outlets
field to store. Shoppers could well-priced and appealing
have different reasons for
tap their smartphones on organic products, which
stocking organic. Often it’s
packets of Eversfield Organics have the additional benefit of
to provide ethical choice but,
bacon on sale in select As certification, are increasing
more than ever, it’s to expand
Nature Intended stores and see in demand.
their health food options,
the product’s complete supply
particularly in grocery. The trend for vegetarian and
chain journey. The blockchain
vegan diets is having a big
From a consumer perspective, technology shows what Soil
impact on the range of products
our research shows that Association Certification does
sold by independent retailers.
provenance and sourcing at each step of the organic
They are devoting more space
are important reasons why certification process.
to specialist diet products. Many
independent farm shop
Prices can be higher in consumers prefer that these
customers buy organic. For
independent stores but products have an ‘organic’
fresh food-based shops,
consumers appreciate the status, alongside a ‘free-from’
customers buy organic for
added value that the personal one. This double reassurance is
quality and better taste.
touch brings and the fact there working well for organic ranges
Independent retailers’ is such a concentrated choice and should continue into 2018.
specialist knowledge appeals in one shop. Independent
to consumers’ desire to connect retailers do have to be mindful
more closely with their food. of the price ceiling, though,
This channel is becoming more so that their ranges can
popular as consumers want to compete with supermarkets,
be able to ask questions about particularly if products are
the ingredients, sourcing and stocked in both channels.
health benefits of products –
and they trust the responses
they get from independent Highlights
retailers.
• M
ore than three quarters (78%) of independent retailers
expect sales of organic to increase in 2018
• T
here has been a 9.7% growth in sales in the independent
retail sector
• S
ales through independent stores account for over 16%
of all spend on organic product
9Organic Market 2018
Home
delivery
There’s a strong market for online sales of organic
products, with this channel increasing sales by
9.5% in 2017.
Home delivery covers online Organic local delivery schemes, Online is playing its part in We work with online operators
organic retailers (except major and smaller online operators, driving innovation in organic. to introduce them to new
supermarkets whose sales are have increased sales by around organic suppliers. As a result
The recipe box market, for
included within store sales) and 17%. Several new home delivery of one of our recent ‘meet the
example, is offering organic
local and national box schemes. licensees responded to our buyer’ events, 12 new organic
meal solutions which aren’t
Key operators include Ocado, annual survey, showing that brands are to be listed with
yet widely available in retail
Riverford and Abel & Cole, new businesses in this market Ocado.
stores. It accounts for less than
which, between them, account are opening year to year
1% of the UK grocery market Amazon’s purchase of Whole
for around £225 million of sales and seeing significant early
and consists of organic options Foods Market in 2017 may
in the UK organic market. Ocado growth figures.
from Abel & Cole and Riverford, shake up the organic market
is the biggest in this sector and
There are a growing number of and meal solutions from in the UK. Amazon already has
has an almost 10% share of the
online shops and supermarkets, companies with non-organic an expansive range of organic
UK organic market, stocking
such as Big Green Smile and offerings. Sales are relatively lines in their catalogue, mainly
over 3,000 organic products.
Real Foods. Traditional retailers, small, but many recipe box grocery and non-foods items.
Our licensees told us that the such as Planet Organic and companies are seeing triple This union gives them stronger
top two reasons why their Unicorn, are seeing a larger digit sales increases. presence in the premium fresh
home delivery sales increased percentage of their sales going food market, an introduction
Online operators can expand
in 2017 was due to an increased through online. to new organic brands and
their organic choice quickly
customer base and more suppliers, and a physical
and assist new start-ups
marketing. They said rising presence in stores to test
in showcasing innovative
trends in organic, health and strategies for selling organic.
products, making them
vegetarianism have also helped
available to national customers.
increase sales.
Larger operators
79% 7.7% growth
Smaller
schemes and
online shops
21% 17% growth
Larger online operators (Ocado, Amazon, Riverford
and Abel & Cole) account for around 79% of sales
of organic through online ordering
10Organic Market 2018
Spotlight on online
shopping for organic
• £
10.4 billion is spent on online grocery shopping in
the UK
• O
rganic products account for around 3% of total online
grocery sales
• A
ccording to the IGD, two out of five UK grocery
shoppers are now using online as part of their
monthly shop
• T
he online grocery market is predicted to grow by over
50% in the next five years to 2022
• ‘Omnichannel’ shopping is becoming the norm
• W
ith more organic products available online, future
growth in the UK online organic market will be stronger
than in traditional supermarkets
Online works for organic. Potentially fresher products A 28-44 year old spends Online operators offer a
Online operators make unique are available online as they more on organic products unique springboard for
brands widely available to haven’t been sitting on the than expected for their age testing new organic brands.
consumers while offering the shelf for a few days. Customer group, one that is more likely They can be an incubator
convenience of shopping for deliveries are collated on the to shop online. They don’t for them, helping them to
routine longer life grocery and basis of orders and, in some have the same loyalty to a understand the pattern for
non-food items. cases, come directly from farms. traditional supermarket. But consumer demand before
all consumers don’t just shop they extend distribution.
Convenience is the most Retailers, farmers and
online, hence the trend towards
important reason why people producers can amplify their
omnichannel shopping which
buy organic online. The organic credentials online
offers the organic market great
breadth of the online organic through targeted marketing.
opportunities.
catalogue appeals to shoppers They can engage health
who appreciate the opportunity conscious consumers with
to find products easily, rather the ‘farm to fork’ journey of
than hunting for them on the their organic product and
shop shelf. reinforce the integrity of
organic production.
11Organic Market 2018
Foodservice and
eating out
Approximately £1.62 million is spent on organic food
and drink in the foodservice and eating out sector
per week – it’s a sector growing at significant pace.
In fact, the market has grown by • 4
0% would be prepared to pay In December 2017, Yeo Valley
10.2% to be worth £84.4 million. a bit more for organic dishes announced in The Grocer
Soil Association Food for Life on a menu that they will sell an additional
Served Here has contributed 10 million litres of organic
This interest is starting to be
immensely to this rise, with milk to the convenience
borne out by consumer choice
£18 million spent on food and catering sector.
in foodservice but it’s still early
through the scheme in hospitals,
days. “There does seem to be There was a 15% increase in
schools and other public places
an increasing customer shift organic milk supplied to the
– an increase of 20%.
towards organic as a choice,” foodservice sector in 2017. Over
Figures from foodservice says John Isherwood, from a quarter of all organic sales in
market experts MCA show Pret A Manger. “However, foodservice come from milk.
that the catering market had caution should be maintained
grown by 2.9% in 2016 to be as other factors such as price,
worth £87.2 billion. Organic routine and choosing favourites
has a less than 1% share of remain dominant in terms of
this market, meaning there’s overall market.”
lots of space for businesses to Organic Served Here
Improved technology is
take advantage of the growing
providing more opportunities Organic Served Here is a Soil Association Certification award
catering market as a whole.
for organic producers to scheme celebrating eateries that source organic food. It reassures
We can be inspired by countries
supply the foodservice sector. customers that organic food on menus is fully traceable and
such as Denmark where the
New technology companies certified. Businesses are awarded from one to five stars, depending
Organic Cuisine label is used
are starting to modernise the how much they spend on organic food. The higher the amount
in 2,000 catering outlets.
sector and make aggregated spent on organic, the more stars the business receives.
The sector is growing because ordering possible. Food Chain,
consumer demand for organic for example, is an online
on the menu has increased. In platform that connects chefs
November 2017, Soil Association and restaurants to producers of Organic spend in catering from 2013 to 2017
research found that half of 18 to meat, fish, dairy, produce and (£ms)
55 year olds who were surveyed dry goods. This is making ‘farm £80m Food for Life spend Other spend
would be more likely to choose to kitchen’ deliveries smoother,
£70m
a restaurant or cafe where they reassuring business owners 66.4
knew the menu was sustainable – and customers – of the £60m 61.5
or ethically sourced. Yet 48% provenance of the supply chain.
don’t feel there are enough £50m 55.3
The most popular products in
places with these dishes. Also: 48.8
foodservice are milk, coffee, tea, £40m
• y
ounger people (18-24 year flour, yoghurt, juices and ice
£30m
olds) are even more likely lollies. Organic juice company
to look for organic when Pip Organic now has products £20m
eating out in over 4,000 purchase points 18
£10m 15
in the UK.
• 4
3% of respondents think that 7 9
0
having organic on the menu
2013-2014 2014-2015 2015-2016 2016-2017
makes a restaurant more
appealing and they would be
more likely to eat there *’Other spend’ is money spent on organic in foodservice outside of
Soil Association Food for Life Served Here
12Organic Market 2018
Foodservice in the public, Bidvest, one of the UK’s largest Local organic suppliers offering Our ‘Give it Some Welly’
health and education sectors wholesalers, increased their seasonal options have a real events link up producers and
(the cost sector) is still growing. organic range by over 50% opportunity to supply the restaurants to help solve these
It has slowed slightly due to in 2017. foodservice sector. This is supply and demand issues
cost pressures on caterers but because many restaurants find in foodservice. Restaurant
Our Organic Served Here award
is set to increase further. This it hard to source organic food. managers and owners meet
is helping more customers
is, in part, thanks to targets to Large and small producers producers, sample food, and
recognise and choose to
double the number of Food for need to learn to adapt to the visit an organic farm.
eat organic at cafes and
Life Served Here meals from differences required to supply
restaurants. It has doubled in
silver and gold award-holders this sector, such as different
size since its launch in February
and also the support from Defra pack sizes and formats.
2017 when 67% of people
to encourage more sustainable Suppliers also need to be
told us it was difficult to tell
sourcing in the public sector. upfront about the peaks and
if a restaurant or cafe served
There are now more than troughs of supply.
organic food.
30 wholesalers supplying
organic across foodservice and
their ranges are increasing.
Out to Lunch
Since 2013, the Soil Association Out to Lunch campaign has
improved the quality and availability of healthy children’s food
outside the home. It has helped many well-known restaurants to
prioritise healthy food for children and focus on offering organic
options on their menu.
In 2017, Out to Lunch surveyed 25 UK restaurant chains, from
Highlights
McDonald’s to Jamie’s Italian. It ranked restaurants on everything
• T
he organic foodservice sector has grown by 10.2% to be
from who provided fruit and vegetables with children’s meals to
worth £84.4 million
animal welfare and organic menu options. Now, 12 of the chains
include organic ingredients in their menu, up from six in 2015. • T
he Soil Association Food for Life Served Here scheme has
This includes organic meat, milk, yoghurts and juices. helped increase growth in the sector with £18 million spent
on food through it – a rise of 20%
For more information, please visit soilassociation.org/our-
campaigns/outtolunch/ • O
rganic has a 1% share of the £87.2 billion catering market
– so there’s huge potential for organic producers and
businesses
13Organic Market 2018
Organic across
the UK
Around two thirds of UK organic sales are outside
the capital – that’s almost £1.5 billion.
This is despite the fact that Wales and the West of England sales. Northern Ireland has
London is often seen as the have a high concentration the smallest concentration of
UK heartland for organic sales. of organic processors and producers and processors,
The potential for selling organic producers. According to with 204.
across the country is not to 2016 Defra figures, Wales
Sales for Soil Association
be underestimated. Yet, the has 751 organic producers
Certification licensees are
ready availability of organic and processors (almost 12%
increasing in all three areas.
items is an issue for many of the UK total), and Kantar
According to Kantar, organic
UK consumers living in areas Worldpanel estimates that
sales in Scotland grew by 19.4%
where specialist organic shops 7.5% of what is spent on
for 12 months to February
are sparse, and larger retailers organic products in the UK
2017. During 2017 sales for our Organic sales
aren’t maintaining choice in is in Wales and the West of outside the
licensees in Wales increased
their ranges. England. Scotland, with 560 London area
by 7% and in Northern Ireland
producers and processors,
makes up around 6.5% of UK
there was a significant rise £1.5b
of 20%.
Scotland Research from Soil Association The Scottish government’s The organic market in Scotland
Certification in November Organic Action Plan, Organic will grow further if we can
Scotland-based Soil Association
2017 found that Scottish Ambitions, is improving encourage more businesses in
Certification licensees have
consumers would like to see awareness of organic and the organic supply chain to be
seen a fantastic 28% increase
greater availability, lower helping to increase sales. With certified organic and increase
in sales in 2017. Improved
pricing and wider awareness their financial support, we availability. This includes
availability and an increased
of organic. Like in England, have hosted events linking everyone from slaughterhouses
range of organic products
Scottish consumers have less up restaurateurs, cafe owners to wholesalers. The geography
in supermarkets, like Aldi,
trust in supermarkets and want and hoteliers with organic of Scotland can make this
has had an impact on this
to buy healthy and ethical food producers. challenging.
growth. One wholesaler
from a reliable and dependable
in Scotland, meanwhile, Farmers applying for the
outlet. This bodes well for the
reported approximately 10% Scottish government’s
independent organic channel
growth, selling into a strong agri-environment scheme to
in Scotland.
independent sector. Better convert to, or stay, organic
availability of organic salmon Organic is a national priority are continuing to receive
and on-trend seaweed has for the Scottish government, funding, supplying the market
helped to increase sales for and this is having a positive at home – and abroad. Amid
some of our licensees. effect on the area of land being the uncertainty arising from the
farmed organically. vote to leave the EU, it is hoped
Next year is looking positive
that the support received by
too, with 100% of Scottish One MP, Mark Ruskell, a Green
organic farming, will continue
independent retailers expecting Party member of the Scottish
into the future.
organic sales to remain the Parliament, raised awareness
same or increase during 2018. of organic in September 2017,
by calling for a mandatory
requirement for all Scottish
public sector kitchens to serve
organic food.
14Organic Market 2018
Wales
The increase in our Wales- The uncertainty of Brexit, and Dairy processing is feeling the
based sales was slightly ahead its impact on trade tariffs, may impact of over-supply as retail
of the overall UK market at affect the potential for the sales and customer demand
7%. Over a quarter of sales Welsh lamb market. Michael are not keeping up. However,
recorded from Soil Association Gove, Secretary of State for opportunities for exporting
Certification licensees based Environment, Food and Rural outside the EU are looking
in Wales are in the beauty and Affairs, attended the Royal attractive for some.
wellbeing sector, although sold Welsh Show in July 2017, and
Wales has a well-established
mainly to customers outside had a hosted tour. This kind of
supply of fresh organic
Wales. The largest number work, led by the Welsh Organic
produce. If the right messages
comes through meat and Action Plan, is helping to
are communicated, this offers
poultry licensees, which make influence government support
a great opportunity to appeal
up 30% of licensee sales. for producing and selling
to local shoppers who value
organic products in Wales.
The ongoing potential for provenance.
Welsh lamb, which is renowned
throughout the world, has been a
key concern for farmers in Wales.
Northern Ireland
Northern Ireland-based There are also only a small interest in organic farming There are a number of large
licensees increased sales of number of specialist shops since the launch of support and successful processing
organic by 20% – but greater offering organic products, for Northern Ireland-based brands based in Northern
availability of organic products mainly farm shops and stores farmers through the Rural Ireland which are increasing
and improved ranges could focused on organic health Programme for Development sales of organic nationally.
make the market much ranges. Holland & Barrett, 2014-2020. More farmers in This includes Linwoods,
bigger. At less than 1%, organic for example, have 20 shops Northern Ireland are using which make milled organic
represents a much smaller selling organic ranges in government funding to convert flaxseed, goji berries and
percentage of total food and Northern Ireland. land to organic, which should hemp; and White’s Speedicook
drink sales in Northern Ireland increase consumer demand. Oat Flakes. Their presence in
Fresh produce and meat
than it does in the rest of the UK. The Environmental Farming UK supermarkets is making
and poultry licensees have
Scheme (EFS) aims to turn organic products more
There’s a lack of credible experienced healthy increases
700 hectares of land in the available. Similarly, the rising
organic ranges in the major of 65% and 46%, respectively.
country into organic land demand for organic from the
supermarkets and none of the Demand for organic beef was
by 2020. Republic of Ireland is helping
big online organic operators slightly higher in 2017. And
to increase sales of products
deliver to Northern Ireland. there has been additional
made in Northern Ireland.
Highlights
• S
oil Association Certification licensees in Scotland have
seen a 28% increase in sales in 2017
• A
round two thirds of UK organic sales are outside London –
almost £1.5 billion
• D
efra 2016 figures show that Wales accounts for
approximately 12% of all UK producers and processors
15Organic Market 2018
Beauty and
wellbeing
The UK certified organic and natural cosmetic
market grew by 24% in 2017 to be worth
£75.9 million, making it the seventh year of
consecutive growth for the sector.
Globally, by 2019, the natural brands with the chemicals Generation-Zs (those aged 15 to
cosmetics market will be worth Sodium Lauryl Sulfate (SLS), 25) are thought to be the most
£34 billion, with the natural and parabens or microplastics. health-conscious generations
organic sector outperforming Our licensees, MuLondon and yet. Indeed, research from NPD
the synthetic one, according to Pai, along with many other Group found that Generation-
The Future Laboratory. certified brands, are proving Z’s purchasing priority in
that business can be a force beauty is for pure and natural
Increased awareness of global
for good. ingredients.
issues has driven a demand for
more transparent and ethical Soil Association Certification, Organic beauty and wellbeing
practices from conscious meanwhile, has used the trend businesses are tapping into
consumers who want ‘clean for clean beauty to inform, this demand. Bamford, for
beauty’. This is anything from educate and inspire people example, has offered personal
products without synthetic about what organic beauty is, mindfulness consultations in
ingredients or that are organic, what it means to be certified and its Haybarn Spa, while other
to a list of every ingredient why certification is important. organic brands are promoting
they contain. The trend has led the correlation between the
Organic beauty and wellbeing
to direct action from brands. origin of ingredients and our
businesses are appealing to a
In 2017, Holland & Barrett, for physical and mental health.
growing younger audience who
example, announced that they
share their values. Millennials
would no longer stock beauty
(people aged 18 to 35) and
£34b the figure reported that the natural cosmetics
market is set to reach globally by 2019
UK sales of health and beauty products in GBP (£) millions
75.9m
61.2m
54.2m
44.6m
37.2m
30.1m 31.8m
27.7m
-23% +8.7% +5.6% +17% +20% +21.6% +13% +24%
2010 2011 2012 2013 2014 2015 2016 2017
16Organic Market 2018
The sector is becoming We need a joined-up approach
better regulated. IFOAM EU to supply for organic beauty For more information about the beauty and
has agreed that only brands and wellbeing to become wellbeing market, please see the 2018 Organic
certified to a recognised mainstream. Availability of
Beauty and Wellbeing report which you can
standard should be able to use products is still a major blocker
download here
the term ‘organic’. to growth. But awareness drives
demand and demand drives
Following a change in January
retailers to get behind the
2017, new products certified by
category and push it forward,
COSMOS – the world’s leading
with functioning supply chains
certifiers in the organic and
to support growth. The supply
natural cosmetics industry –
chain should be able to supply
must meet COSMOS standards.
national retailers at scale and
Products certified before this
at a cost that encourages them
date can continue to meet
to list the products. Price is
previous standards, such as
perceived as a barrier to people
those from Soil Association
buying organic, both with
Certification or Ecocert.
food and non-food items, so
COSMOS is also the first
scale helps manage cost and
cosmetic standard to address
shelf price.
the sustainability of palm oil
ingredients. A future organic beauty and
wellbeing market in the UK
Savvy consumers are continuing
could follow that in the US,
to look for independently
which dominates on the world
certified beauty and wellbeing
stage. US consumer demand
products. It’s the only way
is so great that large players
they can be sure they meet
in the retail space have been
minimum standards, and
unable to ignore it. Organic
are free from GM and other
and natural cosmetics can be
undesirable ingredients, such
found in Costco and Walmart,
as phthalates, chemicals used
for example.
in plastics.
Highlights
• £75.9 million sales of certified organic and natural beauty products in the UK
• +
24% growth of certified organic and natural beauty products – the highest growth
this decade
• 7th year of consecutive growth for the UK certified organic and natural cosmetic market
17Organic Market 2018
Textiles
Sales from Soil Association Certification licensees
increased by a quarter to be worth £35 million,
making 2017 another buoyant year for the sector.
Indeed, organic is part of the Demand for organic textiles
growing move to sustainable is growing in pockets of the
fabrics and ethically produced industry and stabilising in
clothing in the UK. According others. The Textile Exchange
to the Ethical Consumer Organic Cotton Market Report
Markets Report 2017, the 2017 found that parts of the
value of the ethical clothing industry which experienced
market grew by 22% in 2017. growth globally include home
The average amount spent on textiles, hospitality wear,
ethically sourced clothing per feminine products, and longer
household also increased from length textiles that are used in
£41 in 2010, to £69 in 2016, a higher-end products.
trend that is set to continue.
Licensee sales growth by textile category 2017
Personal care +31% +11%
Clothing (ladies and men’s) +9.6%
+41%
Home textiles
Babywear
Sustainable cotton and textiles initiatives, and are quoted as and brands through a farm’s of the demand from Turkish
are becoming increasingly saying that they are “changing conversion period to organic mills, which are supplying
important for retailers and so that customers don’t is essential. It gives farmers the brands and retailers in Europe.
consumers. Organic is part of have to”. certainty they need and means
Challenges still exist to make
this and many more retailers they can make sure processing
Retailer commitment to organic organic cotton less niche but
are trialling organic ranges and facilities are in place along the
is driving global change in these are promising changes.
committing to organic cotton, supply chain.
textile supply chains and In fact, while under 1% of
as part of their sustainability
creating greater availability of In Africa and China, organic overall global cotton production
offer. Fat Face, for example,
organic options for consumers. cotton market supply chains is organic (according to The
launched a new organic range
For example, clothing company are still weak, but more is Textile Exchange Organic
in 2017 and H&M, which has
Superdry announced, in being done by brands and Cotton Market Report 2017),
committed to increasing
summer 2017, that they would retailers to support the sector production of ‘preferred cotton’,
demand for organic cotton,
support farmers to convert to and build capacity. In central which includes organic, Fair
recently confirmed that they
organic so that they can use Asian countries Kyrgyzstan Trade and other sustainable
want to “increase demand for
100% organic cotton in their and Tajikistan, supply networks cotton initiatives, increased
organic cotton and motivate
ranges by 2040, and have 100% are established and working from 9% to 15% between 2015
farmers for sustainable cotton
renewable electricity across well. These countries are and 2016.
cultivation”. ASOS too have
operations in the same time experiencing growth in the
declared that they are moving
period. Support from retailers organic cotton market because
forward on sustainability
18Organic Market 2018
Today’s consumer expects Sustainable Fashion at London takeback programmes. At the
retailers to provide sustainable College of Fashion. Copenhagen Fashion Summit
textile ranges. Shoppers of all in 2017, H&M, Kering, and
More fashion companies
demographics, but especially Tommy Hilfiger joined 140 other
are making sustainability
Millennials (18-35 year olds) and brands to commit to a circular
a part of all of their supply
those categorised as Generation fashion system by 2020.
chains and creating a ‘circular Global Organic Textile
Z (15-25 year olds), increasingly Standards (GOTS) is the gold
economy’ business model. Globally, certified organic
expect brands to be doing the standard for the sustainable
This is one in which they textile facilities are increasing.
right thing, including behaving processing of textiles made from
re-use materials, upcycle and The number of GOTS-certified organically grown fibres such
responsibly and sustainably.
recycle. From sourcing to facilities increased by 7% to as cotton or wool.
Figures from Mintel show
product distribution, fashion 4,642 and OCS facilities grew
that just under half (44%) of IC BLEN
companies are creatively by 21%, to 3,661, in 2016. AN
ORG
DE
younger Millennials would
D
exploring recycling concepts
like to see more eco-friendly
con
rd
to make their business more en
da
fabrics used in clothes. To meet t stan
t
eco-friendly. They are doing
this demand, ‘designers of the
everything from making Organic Content Standard
future’ learn about sustainable (OCS) certifies any non-food
fibres from recycled plastic
fashion when they are training, product containing 5-100%
bottles to introducing clothing
for example at the Centre for organic material.
Sustainable Cotton Communiqué Pledge
We worked with the International Sustainability Unit at Clarence House and Marks & Spencer to put together the
Sustainable Cotton Communiqué Pledge. This is a brand commitment to sourcing 100% of all cotton sustainably
by 2025. So far, 36 well-known brands and retailers have signed up to it, including ASOS, Nike, Tesco, Sainsbury’s,
Marks & Spencer, House of Fraser, C&A and H&M.
Sales of Soil Association Certification organic textiles in GBP (£) millions
35m
28m
21.6m
18.6m
18m
13.2m
11.68m 12m
8.83m
+61% +32% +3% +10% +36% +3.4% +16% +30% +25%
2009 2010 2011 2012 2013 2014 2015 2016 2017
19Organic Market 2018
Today’s consumer
and organic
Organic is really well-placed to make the most of our changing
food culture. That’s what Soil Association Certification research
among 25 to 55 year old consumers in England revealed.
Shoppers see it as a clear signpost to health, a key reason why
they choose one product over another, although it is competing
with a sea of labels that can bewilder consumers.
How is shopping changing? Healthy products are the Planning and shopping is a
number one consumer choice. balance. Many shoppers work to
It’s difficult for consumers to
How consumers interpret a budget and are relatively risk-
find what they want when they
‘healthy’ is personal. They are averse when it comes to making
go shopping. Huge choice
bewildered and often confused new or different choices.
and cluttered communication,
by multiple messages so may
with many messages both on Organic is one choice amongst
decide what to buy using their
packs and shelves, can make many. Shoppers have to
experience and intuition.
shopping frustrating. Our contend with many claims on
consumers kept an online diary Top up shopping is increasingly product packaging, as well as
which showed that shopping important. We know the large, the media shifting from claim
is far from a relaxing and once a week shop has changed. to counter-claim on everything
enjoyable time out. In fact, for Fresh food is bought when it’s from diet to farming practices
many, it is a regular challenge needed, especially in urban and health scares to superfoods.
and people look for shortcuts areas, and by people in smaller
and signposts to make homes, which lack storage.
shopping for food easier. Consumers are more aware of
waste and are inclined to buy
less at once.
What’s influencing food choices today?
The research identified six key beliefs, opinions and behaviours that shoppers are using to decide what they buy.
1 Healthiness. Consumers good it tastes. Taste is about 4 Pleasure. Most consumers but non-organic meat.
seek products that help them two things: finding new and allow themselves some Value is a personal ‘equation’
have a holistically healthy interesting dishes and having products that are more special, consisting of price, quality and
lifestyle. They want balance and a repertoire of firm favourites indulgent, a ‘treat’, or that convenience.
moderation and are looking which can be made without deliver more flavour. 6 Making a statement.
for natural and less processed recipes. 5 Value. For some Consumers often buy products
foods, products that give energy 3 Fits around me. consumers, price is the main because the food and/or
or sustenance, help provide
Consumers’ lives are busy and reason they bought a product. packaging look beautiful. This
weight management and meet
hectic. Shopping and making For others, it’s the inherent increases their appetite or gives
specific dietary needs (such as
food is time consuming and quality of a product. Many make them something to talk to their
gluten-free).
so consumers try to achieve a different decisions depending friends about.
2 Taste and inspiration. balance between price, quantity, on what item of food they are
Consumers see the quality of a quality, time to prepare and buying. For example, they
product as being central to how tastes everyone will love. might buy organic vegetables
20Organic Market 2018
Outside influences on what we buy
The research also revealed five growing outside influences on what food people buy.
1. British provenance. This 4. Concerns about food
is an increasingly important production. Consumers
influence on what food are particularly concerned Milk
alternatives
people buy, especially with about how animals are cared Meat
the uncertainty of Brexit. for and high-profile news reduction and Concerns
vegetarianism about food
Consumers expressed stories and documentaries production
frustration at food that can be have clearly influenced them.
grown in the UK but is shipped There continues to be ongoing
in from overseas. frustration over food and
2 3
packaging waste. British 1
2. Meat reduction and Instagram
provenance 4
vegetarianism. In our focus 5. Instagram culture. culture
5
groups, we found a marked Instagram is seen by many as
6
increase in the number of a harmless way of getting food
consumers reducing the inspiration. Some, however, feel
amount of meat they eat it portrays an overly idealistic
(predominantly red meat). view of the world of food,
Many had tried, or were something that’s impossible
converting to, a vegetarian diet to recreate. Either way, it’s an
1 Healthiness 3 Fits around me 5 Value
and everyone felt this was a important influence on what
growing trend. people eat today. 2 Taste and inspiration 4 Pleasure 6 Making a statement
3. Milk alternatives. Many
consumers had tried
What’s hot in organic?
alternatives to milk for taste
rather than dietary reasons.
Some tried them because of • Turmeric • ‘Dirty’ vegan
fears over animal welfare or • Seaweed • Mushrooms
milk production techniques. • Fermented foods • Healthy seed toppings
Many consumers are now • Fruit tea • M
ilk alternatives, including nut
using them day to day as part of • Soft fruits milk yoghurts
their choice alongside dairy. • Nutty spreads • Organic wine
Highlights
• O
ur research revealed six key beliefs, opinions and behaviours along with five broader
external factors that influence food shopping today and where organic fits into this
• T
oday’s consumer directly equates ‘organic’ with ‘healthy’, and health has become the key
reason why they make their choices
• O
rganic is one choice amongst many claims shoppers are contending with and they see
it as a positive signpost to help decision-making
• C
onsumers are taken aback when they learn about the level of assurance organic offers
– this is an underdeveloped message that needs to be communicated
21Organic Market 2018
Organic
farming
Following the EU referendum, Soil Association
is committed to securing payments for farmers
for delivering public benefits by going and
staying organic.
We’re lobbying the UK area of land farmed organically Organic premiums for milk Early signs confirm that
government to continue is in conversion, an increase of have been better. Dairy farmers fewer shoppers want red
payments for organic farmers over 22%. enjoyed higher prices for milk meat. Meanwhile, poultry
beyond 2022 and the transition during the year. However, this also continues to be the most
This is the impact of six years of
period. is cyclical and not guaranteed. popular livestock farmed
growth in the organic market.
Global demand for organic organically, increasing by over
In November 2017 and further Permanent pasture accounts
milk helped with market prices 10% in 2016.
January 2018, Defra committed for the biggest share of UK
and is opening up a lucrative
to putting soil health at the organic land (66%), followed by Farmers have an opportunity
export channel. In November
heart of its 25 year environment temporary pasture (18%) and to make the most of the
2017, Wyke Farms and OMSCO
plan. This suggests that farmers cereals (7.6%), with little change ‘buy British’ trend in the UK
launched The British Organic
will continue to be supported year on year. and abroad. Buying British
Dairy Company to maximise
for providing environmental is becoming more popular
More non-organic farmers the opportunity to sell quality
benefit. How the UK government among UK consumers. It’s
are adopting practices used organic cheese and other
delivers on organic during this their way of supporting the
by organic farmers, and are products around the world.
time of uncertainty will have local economy – but only if
finding them beneficial.
a demonstrable effect on how Consumers are buying more the price is right. According
Practices include growing
many future farmers convert red meat from independent to a mid-2017 YouGov survey,
crops to minimise soil erosion,
land to organic. retailers. Choice in supermarkets out of over 2,000 adults polled,
lengthening crop rotations and
is limited, so knowledgeable nearly three quarters would buy
We are also encouraging the UK re-introducing livestock into
consumers are turning to British as a means of supporting
government to incorporate the arable rotations. These methods
specialist butchers, box schemes local farmers, and seven out
new EU regulations for organic help to improve the health of
and online retailers, buying of 10 would do so to help UK
farming into its law. soil, increase its resilience to
from companies like Daylesford businesses. ‘British’ and ‘organic’
flood and drought, and assist
More farmers are in the process and Eversfield. The trend to are complementary labels and
with herbicide-resistant weeds.
of converting land to organic more ‘meat-free’ diets is likely reinforce the provenance
This trend is normalising
to meet increasing consumer to have a long term effect on the and sourcing credentials for
organic farming by showing
demand. According to Defra, potential for red meat sales. farming products.
that it can answer challenges
approximately 5% of the total
faced by all farmers.
22 % Land in conversion to organic in the UK has
increased by over 22%
Source: DEFRA Organic Farming Statistics 2016
Highlights
• U
K organic farming has enjoyed a positive year, thanks to the increased consumer
demand for organic and government recognition of the importance of soil health
• T
he number of organic processors increased for the third year running in 2016. It is the
highest it has been since 2008, at 2,804. The greatest number of producers are in the
South West
22Organic Market 2018
Distribution of organic land (Hectares 000s)
Organic land
2015 126.3
2016 121.6
-3.7%
Scotland
Organic farming’s transparent
production processes and high
animal welfare standards are Organic land
2015 303.7
also becoming increasingly 2016 296.5
important. Organic farming in -2.3%
the UK is governed by standards
for food and farming which Northern
Ireland
are set out in legislation – The
EU Organic Regulation. Other
farm assurance schemes are not
governed by such legislation.
Soil Association Certification
Organic land
worked on the AssureWel 2015 8.5
project with the University of 2016 8.3 England
Bristol and the RSPCA to further -2.3%
improve farm animal welfare.
The project has led to a new
Wales
approach to animal welfare
assessment being included in
Organic land
our inspections for licensees 2015 82.9
with dairy cows, laying hens 2016 81.5
and pigs. -1.7%
000s hectares 2015 2016 Year on year change
Fully organic UK land 500.7 482.7 -3.6%
Land in conversion to organic 20.6 25.2 +22%
Total UK organic land 521 508 -2.5%
2015 2016 Year on year change
Producers 3429 3398 -1%
Processors 2454 2804 +14%
Producer’ processors 173 161 -7%
Total 6056 6363 +5%
Source: DEFRA Organic farming statistics 2016
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