Organic Food Boom: UK Sales Rise Despite Cost of Living Crisis
- The organic food market is experiencing a resurgence, defying expectations given the persistent cost of living crisis.
- Riverford, the well-known organic vegetable box delivery company, reported a 6% increase in annual sales, signaling a broader trend.
- Clare Hadway-Ball, senior commercial manager at the Soil Association, attributes this growth to a shifting consumer focus.
The organic food market is experiencing a resurgence, defying expectations given the persistent cost of living crisis. While household finances have been under pressure since the credit crunch – a period when veg box deliveries were among the first casualties of budget cuts – demand for organic produce and products is now at its highest level in two decades.
Riverford, the well-known organic vegetable box delivery company, reported a increase in annual sales, signaling a broader trend. This isn’t limited to fruits and vegetables; sales of organic meat are also seeing “massive” increases. Organic chicken, despite costing three times as much as conventionally raised birds, saw a year-on-year increase in sales. Similarly, organic salmon sales are up by value and by volume.
Clare Hadway-Ball, senior commercial manager at the Soil Association, attributes this growth to a shifting consumer focus. “People are still concerned about the cost of living but health is also really important, and for the last two years organic has been outperforming non-organic,” she said. This suggests consumers are increasingly willing to prioritize health and quality, even when facing financial constraints.
The UK organic food and drink market grew by nearly in the year to , according to Soil Association figures. Importantly, this growth isn’t solely driven by price increases; sales volume increased by , five times the rate of the overall market. This indicates genuine demand, not simply consumers paying more for the same amount of product.
The demographic driving this trend is also evolving. While retired individuals and empty nesters remain key spenders, middle-income families are now the most frequent purchasers of organic goods. These families are focusing on essential items – fruits, vegetables, tinned goods, staples like pasta and rice – suggesting a pragmatic approach to incorporating organic options into their budgets.
Rob Haward, Riverford’s chief executive, noted the strength of the current market, stating he had “not seen the market grow as much as this for .” This growth, which accelerated in , is linked to increased awareness of healthy diets and a desire for trustworthy food sources.
The resurgence of the organic market represents a significant shift from the recession, when organic sales dropped by as retailers lost confidence and delisted organic products. Today, supermarket support is crucial, with two-thirds of organic food and drink sold through major grocery chains. This backing appears secure, with Tesco recently revamping its organic own-label range to include over products. John Constantinou of Tesco emphasized that customers value “quality, great-tasting organic food.”
Waitrose has also invested heavily in its Duchy organic brand, expanding the range to products. Hannah McDonald, Waitrose’s own-brand manager, reported increased sales volume in for organic berries and bananas ( increase) and eggs ( increase).
The price premium associated with organic food remains a barrier for some consumers. Hadway-Ball acknowledges that organic production costs are generally higher, leading to higher retail prices. However, the inclusion of organic products in loyalty schemes like Clubcard and Nectar is occasionally allowing consumers to purchase everyday organic items at comparable prices to conventional alternatives.
A key driver of this growth appears to be generational. A recent poll found that of purchase organic products at least once a month, making them more likely to buy organic fruit and vegetables than millennials. This suggests a strong and growing preference for organic options among younger consumers.
Tor Crockatt, head of marketing at yoghurt-maker Yeo Valley, points to growing consumer concern over ultra-processed foods. “One in three households are concerned about ultra-processed foods and moving to cleaner products,” she said. Yeo Valley has benefited from a increase in demand for natural and Greek yoghurts over the last three years, as consumers return to more basic food choices to avoid processed ingredients.
Crockatt believes that Gen Z’s upbringing – in an era of heightened awareness regarding health and environmental impact – is a significant factor. “They have been brought up in an era where they have heard a lot about the health of people and the planet, and the impact we are having. There’s a lot of scepticism from consumers [about the food industry] so it feels like now is the time for organic to shine.”