The Organic Research Centre

TheUKMarketfororganicfoodin2010/11

SusannePadel
Socioeconomicprogrammeleader,ORC

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Outline
Production Marketdevelopment Examplesofsuccess Conclusions

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UKSectordevelopmentsince2002
800 700 600 500 400 300 200 100 0 1'000 0 4'000 3'000 2'000 6'000 5'000 Land area [1'000ha] No of producers

Source: DEFRA and Soil Association Market Reports The Organic Research Centre

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Differenttrendsinthedifferentparts [1000ha]
800 700 600 500 400 300 200 100 0 Northern Ireland Scotland Wales England

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Developmentofinconversion area[1000 ha]

250 200 150 100 50 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 England
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Wales

N Ireland

Scotland

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Landuse(organic&inconversion)
[1000ha]

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The Facts
Total market value is approx 1.6B Less than 2% of the total grocery market An industry that crosses the broad spectrum of all products and through all channels 21m UK households purchased in last year 83.6%
Total Organic Grocery Products including Baby - 4 weekly m
100

80

60

40

20

0 1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

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Themostimportantsectors [%value]andchange
2009 to 2010 -2.7 % -6.3 % +10.3% -8.3% -9.4%

Sector

Dairy Fruit & vegetables Baby food Confectionary Eggs

Source: Soil Association 2011 Market Report The Organic Research Centre

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TheUKmarketcomparedwithother countries[M]

Source: FIBL, AMI ORC The Organic Research Centre

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Developmentofsaleschannels

Source: Soil Association Market Reports The Organic Research Centre

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Developmentofsaleschannels [Change0910%]

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Source: Soil Association Market Reports

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Changeinsalesoverthe12monthto August2011 (indexsalespercustomer)

Source: Kantar World Panel 2011 The Organic Research Centre

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Organicfoodconsumption[/head]

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There is innovation.. And brands are outperforming the market

 Ocado have approx 1400 lines of organic Added approx 70 items from Daylesford added to range in Sept 2011 Sales performance is +5.5% v market decline Ocado overtrade significantly they have 0.5% of share of grocery market and approx 5% of the organic grocery market 79% of customers buy at least 1 organic item

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Forexample

Started in 1995 first organic and natural supermarket in the UK Strong relationship with consumers, suppliers and the team Sales up 12% on last year in Oct 2011 Now 5 stores and planning to open more
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ForexampleDaylesfordorganics
FarmshopinGloustershire 3storeswithcafesinLondon AlsoinMunichandJapan Planningtoopennewstores

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Conclusions
DeclineinorganiclandareamainlyinScotland Stagnationinlandaregoingintoconversion,duetopolicyand marketuncertainty ScotlandhaslaunchedanewActionPlan

Supportingorganicproduction, Sustainableeconomicgrowthofthefoodanddrinkssector Understandingorganics

Nouptodatedataonimport/export

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Conclusions continued
Negativemarketdevelopmentparticularlyinsomeofthe multipleretailers

Reducedwillingnesstostockorganiclines Consumerconfusionwithregardstowhatorganicdelivers(e.g. Animalwelfare)

Positivetrendsinsomesectors Consumerloyaltyandgrowthexpectations

Specificbrandsandstores Specialistorganicshopsand

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