U.S. Farm Report Mailbag
U.S. Farm Report
Comments, questions, opinions...this is your chance to speak out regarding anything and everything reported on U.S. Farm Report. Viewer feedback updated regularly.
Feb 28, 2011
I just saw your "comments" on organic foods & what a crock of crap. Trust me Walmart wouldn't sell organic milk if there wasn't a demand.. people vote with thier money. All it takes for someone else to start purchasing organic is for another recall or ecoli etc...just keep telling yourself that line. Robbie Orr
***Editor's Note: Below is John's response to this viewer followed by a transcript of his comments on U.S. Farm Report regarding the demand for organic produce...
Thanks for your response. We obviously disagree, so you can bet on anecdotal observations, and I'll work with real numbers. Like here, here and here. I'm not saying organic isn't growing, but it's barely keeping up with market growth. 3% is 3% despite what appearances are. I'll revisit this issue from time to time to see who is closer to reality. John
Farm Report Mailbag (February 26-27, 2011):
TIME NOW FOR OUR WEEKLY LOOK INSIDE THE FARM REPORT MAILBAG...A VIEWER IN MARYLAND IS CONCERNED ABOUT THE GROWTH OF ORGANIC PRODUCTS:
"THERE'S NOT A GROCERY STORE OUT HERE THAT'S NOT SELLING ALL NATURAL ORGANIC FOODS AND IS SELLING PRODUCE LIKE IT'S GOING OUT OF STYLE... IT'S ONLY A MATTER OF TIME TILL THE CHINESE, RUSSIANS AND THE EUROPEAN MARKETS WILL BE WANTING THE CHANGE TO ORGANICS. THEN WHERE WILL YOU BE?"
WELL, ORGANIC SALES AREN'T QUITE THAT HOT. IT IS A CLASSIC CASE OF MARKETING SPIN AND POOR PUBLIC MATH SKILLS. LET ME ILLUSTRATE: ORGANIC FOOD AND BEVERAGE SALES WERE ABOUT 27 BILLION DOLLARS IN 2009. THIS IS A BIG NUMBER UNTIL YOU COMPARE IT TO TOTAL FOOD SALES OF JUST OVER 1 TRILLION DOLLARS. ORGANIC SALES ARE ABOUT 3 PERCENT.
ORGANIC SALES GROWTH WAS ABOUT 5 PERCENT IN 2009. BUT THE TOTAL FOOD MARKET GREW AT ABOUT 3% SO ORGANIC ONLY GAINED A SHARE GROWTH OF 2 PERCENT. THIS IS LESS THAN A TENTH OF PERCENT OF MARKET SHARE. AT THIS RATE IT WILL TAKE DECADES TO GET TO EVEN 10% OF MARKET SHARE.
SECOND, MOST OF THE LOW-HANGING ORGANIC FRUIT HAS BEEN PICKED. CARROTS ARE ABOUT 25 PERCENT ORGANIC, FOR EXAMPLE. ORGANIC MILK AND ESPECIALLY MEAT ARE GROWING MUCH SLOWER. JUDGING THE MARKET BY SHELF SPACE CAN BE DECEPTIVE. ALSO, THE EUROPEAN ORGANIC MARKET IS ABOUT 15 YEARS AHEAD OF US, AND IT FLATTED OUT.
FINALLY, I DON'T HAVE PROBLEMS WITH CONSUMERS CHOOSING MORE EXPENSIVE FOOD.BUT ALL ORGANIC WOULD REQUIRE A VERY EXPENSIVE MARKET INCENTIVE. I THINK THAT OUTCOME IS VERY, VERY UNLIKELY.