Organic Fruits and Vegetables Market size was valued at $ 18.69Bn by 2019, and is anticipated to grow at a CAGR of 7.2% during the forecast period 2020-2025. The Organic Fruits and Vegetables Market growth rate is attributed to increase in food safety concerns and farming practices that contribute to a better and sustainable environment. Organic farming, without chemical fertilizers and pesticides, can typically be identified as farming. In organic farming, living organisms are closely associated with each other. The increasing concern of individuals with pesticides, chemicals, antibiotics or other chemical residues is a major factor in the change towards the consumption of food products grown organically. Product quality, food protection and overall perceived value are some factors that directly affect the demand for organic fruits and vegetables. For consumers who are concerned about food safety and quality, organic foods are usually regarded as a supplement for conventional food. Moreover, the word "organic" is synonymous with the method of growing such types of foods. Without the application of genetically modified organisms, pesticides, hormones, or artificial chemicals to crops, organic foods are farmed or grown. It is anticipated that the global demand for organic fruits and vegetables will gain momentum among people who are health conscious.
Furthermore, more nutritional value such as high nutritive value and good natural sustainability than traditional foods is offered to organic fruits and vegetables that attract consumer’s interest. Also, organic fruits and vegetable have more beneficial nutrients, such as antioxidants. The basic methods and practices developed by the United States Department of Agriculture (USDA) are used to grow organic fruits and vegetables. There are some pollutants in the fruits and vegetables developed using traditional methods that can cause serious diseases like cancer. Hence, in a bid to be labeled as an ‘organic’, a food products needs to be free from any kind of artificial food additives. The food additives could be a preservative or monosodium glutamate (MSG) or coloring or artificial sweeteners or flavoring agents. Growing emphasis on everything ‘natural’ is poised to support growth of the global organic fruits and vegetables market in the years to come.
By Product Type - Segment Analysis
On the basis of product type, fruits segment held the major share of the market in terms of revenue and is poised to grow with a CAGR of 6.9%. The reason is being attributed to The rising awareness about the healthy and safe food coupled with augmented awareness about the health benefits that is exhibited by the consumption of organic fruit product to its large market share. Furthermore, organic fruits use less pesticide and trigger less human side effects. Organic fruits also have more nutrients, such as antioxidants, that are helpful. These factors listed above are responsible for driving this market’s growth. In addition, organic goods have good quality, high nutritional value and good natural sustainability, attracting the attention of consumers in organic fruits, which are poised to serve more opportunities in the forecast period 2020-2025.
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By Geography - Segment Analysis
North America dominated the Organic Fruits and Vegetables Market with a share of XX% in 2019. The application of Organic Fruits and Vegetables has grown rapidly over the last few years owing to the demand for organic fruits and vegetables in the United States has been continuously rising coupled with the growing health concerns and an increasing number of health-conscious consumers in the country. Consumers here are more inclined towards consumption of organic fruits and vegetables over conventional fruits and vegetables. According to the Organic Trade Association, as of 2018, of the total organic food market, fruits and vegetables were the largest category, of which fresh produce accounted for 90% of sales. Around 15% of total fruits and vegetables purchased by consumers were observed to be organic. Fresh produce has been observed to be driving the market, with millennial, affluent households, and the younger demographic being the key spenders.
Europe also represents a growing market for organic fruits and vegetables. Owing to the rise in health consciousness among individuals, Asia-Pacific, particularly China, is also a growing market for organic fruits. Organic crop production and consumption is rising tremendously in Asia, both in China and India, and is becoming a global producer of organic crops.
Organic Fruits and Vegetables Market Drivers
Rising Cultivation of Organic Fruits and Vegetables
With the rising awareness about healthy and safe food is the primary factor driving the growth of organic fruits and vegetable market worldwide. The organic production does not use pesticides and fertilizers that help to increase the production of phytochemicals such as vitamins and antioxidants into fruits and vegetables. For instance, according to a survey conducted by the Organic Trade Association (OTA) 2016, in the United States, organic farms are 35% more profitable than the average farms. The amount paid to organic farmers can range from 29-32% above the non-organic prices, owing to which there is a constant increasing demand for organic food and limited supply in relation to the demand, the area under organic farming has increased worldwide, since 2011. The global production area was reported to be 57.8 million hectares in 2016, which is an increase from 37.2 million hectares in 2011, thereby providing a lucrative support to the Organic Fruits and Vegetables market globally.
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Organic Fruits and Vegetables Market Challenges
High Production Costs and Low Yield
Organic fruits and vegetables have a comparatively higher production cost than traditional fruits and vegetables. Usually, organic foods cost 20% to 100% more than their conventionally manufactured counterparts. Due to high participation and increased growing time, organic foods are difficult to produce. In addition , the lower yields of such crops and the bad supply chain further increase the cost of production. The high fee for registration and obtaining accreditation and certification to become organic farmers is one of the major barriers to the adoption of organic farming. Increased demand for additional natural resources , such as land, water to meet the increasing demand for organic fruits and vegetables, is attributed to lower organic production yields relative to conventional yields.
Organic Fruits and Vegetables Industry Outlook
Product launches, mergers and acquisitions, joint ventures and geographical expansions are key strategies adopted by players in the Organic Fruits and Vegetables Market. In 2019, Organic Fruits and Vegetables Market share is fragmented by the top ten players present in the market. Organic Fruits and Vegetables Market top 10 companies are The WhiteWave Foods Company, Activz, General Mills, Inc., Green Organic Vegetables Inc., Z Natural Foods, LLC, H. J. Heinz Company, Organic Valley, Saipro Biotech Private Limited, CSC Brands L.P., DMH Ingredients, Inc. and others.
Acquisitions/Product Launches
In January 2014, The WhiteWave Foods Company Completes Acquisition of Earthbound Farm, as WhiteWave plans to operate Earthbound Farm as a separate business unit, based in San Juan Bautista, California. No significant operational changes are anticipated at Earthbound Farm as a result of the acquisition.
Key Takeaways
North America dominated the Organic Fruits and Vegetables Market with a share of 28% in the year 2019.
The factors such as increase in food safety concerns and farming practices are amongst the major factor projected to impel growth of Organic Fruits and Vegetables Market.
Increasing awareness about health benefits of organic products among the consumers and increasing demand for organic fruits and vegetables is primarily due to its increased production and rising global consumption are the key factors owing to the growth in the segment during forecast period 2020-2025.
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