Dive Transient:
- Natural meals gross sales rose about 2% in 2021 to achieve $57.5 billion, consistent with the Natural Industry Affiliation’s annual trade survey. This compares to a 12.8% enlargement price in 2020, and a 4.6% building up in 2019.
- Amongst explicit natural classes, child meals noticed the best greenback gross sales enlargement in 2021 at 11%, adopted by way of drinks at 8%. Dairy and egg gross sales had been flat, even though nonetheless just about 11% upper than in 2019, consistent with the OTA. Snacks, the one class to look a lower in gross sales in 2020, posted 6% enlargement in 2021 pushed by way of diet bars.
- Whilst the OTA situated remaining 12 months’s slower gross sales enlargement as “transferring again to ancient tendencies,” the record-high building up in meals costs this 12 months will take a look at shoppers’ dedication to paying extra to devour natural.
Dive Perception:
Taken independently, nearly each and every natural meals class held its personal in 2021, despite the fact that enlargement charges fell again to modest ranges.
Gross sales of natural fruit and veggies rose about 4.5% in 2021 to achieve greater than $21 billion, making up a fifteen% proportion of the overall phase. Whilst frozen fruit and veggies had been a large motive force of enlargement in 2020 as shoppers stocked up all through the pandemic, gross sales of frozen and canned pieces fell quite remaining 12 months. In 2021, the recent produce and dried beans, fruit and veggies segments drove enlargement, with gross sales up 6% and six.5%, respectively.
Natural meat gross sales — together with poultry, cattle and seafood — grew 2.5% in 2021 to achieve just about $2 billion, in comparison to a greater than 25% bounce in 2020. Poultry noticed the best enlargement price within the meat phase at 4.7% to hit greater than $1 billion in gross sales.
With the decline in pantry loading, natural classes that noticed explosive enlargement in 2020 together with canned soup, nut butters and pasta sauce suffered the largest declines in 2021, consistent with the OTA.
Natural bread and grains additionally had a post-pandemic fall-off, as gross sales “tapered off quite” in 2021 after a 30% building up in 2020, consistent with the crowd. Baking components, pastas, rice and different dry grains all noticed declines.
In a press unlock, the OTA famous that the class “might proceed to battle” because the Ukraine warfare and different tendencies force provide chains. Blended, Ukraine and Russia are the supply of 30% of the arena’s wheat, and costs for the staple grain have approached checklist highs as international provides shrink. This previous week, the Meals and Agriculture Group of the United International locations reported that world wheat costs averaged greater than 56% upper in Would possibly than the 12 months prior. Those upper costs had been for all wheat merchandise, no longer simply the ones which can be qualified natural, which have a tendency to hold a worth top rate.
Not obligatory Caption
For makers of natural meals and drinks, the problem is two-fold.
“To stay natural robust, the trade will want to proceed growing cutting edge answers to offer chain weaknesses and prioritizing efforts to have interaction and teach natural consumers and companies,” OTA CEO and Government Director Tom Chapman mentioned in a commentary.
Proving the class’s price to shoppers at a time when meals costs are hitting a four-decade excessive could also be natural’s heavier raise. Customers are already buying and selling down and switching to more cost effective manufacturers underneath the force.
And shoppers’ hobby in buying natural will also be feeling the stress. Consistent with a up to date research of client survey knowledge and social media key phrases by way of Brightfield Workforce’s Evergi platform, cash has grown as a stressor up to now six months, outpacing paintings, the pandemic, the inside track and loss of sleep. In the meantime, shoppers’ willingness or want to pay extra for various attributes has declined. Handiest 17% had been keen to shop for natural merchandise within the fourth quarter of 2021 consistent with a survey the crowd printed, down 3 issues from the former quarter.
