The U.K. Organic Sector: Go for It! - demand is high in the UK - Brief Article

What do you call an organics market that's relatively undeveloped but simply brimming with potential?

Answer: You call it yours... if you're quick off the mark, have ample stocks of desirable organic products and are willing to commit to a comprehensive marketing plan.

The United Kingdom is, at this moment, simply ravenous for organic foods-overall demand is increasing by 40 percent, while supply is increasing by only 25 percent.

Why do U.K. consumers buy organics? Health issues are key in this market, according to recent market research; in light of highly publicized food scares, consumer awareness of food safety has increased substantially. In this market as in others, there is a general perception that organic food is safe, natural and unsullied.

Other important public perceptions are that organic food is "environmentally friendly," "animal welfare friendly" and "free of genetic modification."

Organics Ride a Wave That's Titanic

The upsurge in demand for organic produce has led all the major retail outlets to recognize sales potential in the organic sector. Overall retail sales topped $650 million for marketing year 1998/99. Imported products account for about three out of every four pounds spent on organic sales.

Despite stepped-up production of its own organic milk, imports of organic dairy products are on the rise in the United Kingdom. Likewise, imports of organic meat, which were negligible in 1997-98, now comprise over 4 percent of total supply. Moreover, 80 percent of organic fruit and vegetables sold in the United Kingdom are imported.

In addition to fresh products, there are opportunities galore in the U.K. retail market for high-value consumer foods.

Until recently, most organic products imported from the United States were fruits, vegetables and salads. But that's changing; the shift is to shelf-stable, high-value consumer foods. Some of the most popular categories include soft drinks, alcoholic beverages, sauces, snacks, confectionery and frozen foods.

The Nectar of the Sector

Leading supermarkets account for about two-thirds of organic food sales. Most carry an ever-increasing range of products; some even feature their own-label of organic goods. Leading chains all expect to achieve very large increases in organic sales; thus they promote U.K. organic production and encourage conventional growers to convert to organics.

Large chains express a range of attitudes and approaches toward organic food; Tesco, Sainsbury's, Safeway, Asda, Waitrose and Iceland have been identified as among the most committed.

In addition to supermarkets, there are an increasing number of independent retailers selling organic products, including not only fresh food but also a wide range of dairy products, bakery goods and processed foods and drinks.

Box schemes are a popular retail venue in the United Kingdom: fresh, seasonal organic food is assembled and delivered to subscribing households, either directly to the door or to a central drop-off point. Individual growers, wholesalers and organic buyers use this method to supply food to more than 45,000 families in the United Kingdom.

The Notable Need for Organic Feed

Major U.K. grain traders have highlighted an increased need for imported cereals for animal feeds. Given the rapid growth in organic livestock and the relatively slow growth in domestic production, imports are expected to increase further.

The author is an agricultural marketing specialist at the U.S. Embassy, London.

Organics at Your (Food) Service

Organic restaurants and cafes are somewhat harder to find in the United Kingdom than in other European Union (EU) countries. You'll find a few in London, and a smaller number yet in rural areas, where the majority of produce is locally sourced. Cafes are mostly incorporated into health food shops and organic stores which cater to high-end clientele.

But all this may be on the brink of change, as market-ambitious catering firms scout out the potential for organic alternatives to conventional fare.

COPYRIGHT 2000 U.S. Department of Agriculture
COPYRIGHT 2004 Gale Group