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US consumers shifting to cheaper organic substitutes

Thu 18/08/2022 by Richard Wilkinson
Westhampton Beach Farmers Market, New York, November 6, 2021. Copyright USDA (FPAC photo by Preston Keres)
Blueberries posted the largest decline in dollars, with bell peppers and squash also showing noticeable declines.

The value of organic fresh produce sales in the US during the second quarter of 2022 were 3.7% higher than a year previously, thanks to higher retail prices. However, volumes were down by 2.8%, according to the Q2 2022 Organic Produce Performance Report.

Overall, organic fresh produce pricing increased by 6.7% for Q2/2022 compared to the same period in 2021, with sales for the quarter topping US$2.4 billion. Meanwhile, the price of conventional produce rose by over 9% on average, with total sales of $18.1 billion. 

Tom Barnes, CEO of Category Partners, said: 

“Seeing a decline in organic volume for Q2 suggests food budgets are under stress in many US households. It’s common to see budget-centric consumers trade down, substituting for lower-priced conventional items or shifting from a high-priced organic item to a cheaper organic alternative from another category.”

Barnes believes organic substitution explains why organic bananas had a particularly strong quarter in Q2. 

“Bananas are one of the lowest-priced organic fruits and have the smallest price spread between conventional and organic. While nearly every other organic fruit declined in volume, bananas increased in both dollars and volume.”

After bananas, the organic berry category also had a good quarter, with sales exceeding $430 million. Organic blackberries generated the largest percentage increase in dollars, gaining 27.6%, followed by tomatoes, onions, and raspberries.

Conversely, blueberries posted the largest decline in dollars, with bell peppers and squash also showing noticeable declines. Berries and salads continue to be the top organic produce categories by total sales, responsible for nearly 40% of all organic produce dollars.

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