Food Business News - April 19, 2016 - (Page 9)

Editorial EDITORIAL STAFF Editor-in-chief Morton I. Sosland Executive editor, markets Neil N. Sosland Editor L. Joshua Sosland Executive editor Keith Nunes Senior editor, markets Jay S. Sjerven Managing editor Eric J. Schroeder Senior editor, markets Ron Sterk Associate editor Jeff Gelski Assistant editor, markets Laura Lloyd Senior editor, digital content Monica Watrous Internet editor Rebekah Schouten Contributing editor Donna Berry Graphic designer, market graphics, data Christina Sullivan PUBLISHING STAFF Chairman and C.E.O. Charles S. Sosland President L. Joshua Sosland President emeritus Mark Sabo Director of Publishing G. Michael Gude Associate publishers David DePaul Bruce Webster North American sales Matt O'Shea Vice-president, chief financial officer Melanie Hepperly Audience development director Don Keating Advertising manager Nora Wages Design services manager Sadowna Conarroe Associate design services manager Ryan Alcantara Circulation manager Whitney Hartman Digital systems analyst Marj Potts Manager of advertising design Becky White Director of e-Business Jon Hall Director of on-line advertising and promotions Carrie Fluegge Promotions marketing manager Jim White WE'RE EAGER TO RECEIVE YOUR FEEDBACK: E-mail editor@sosland.com or write to us at Food Business News, 4801 Main Street, Suite 650, Kansas City, Mo, 64112 April 19, 2016 KEITH NUNES Growth of organic category suggests still greater attention ahead knunes@sosland.com ales of organic food and beverage prod- acres by 2008 and increased another 17 per ucts are on the rise and, in response, cent to 3,084,989 acres by 2011, which is the the market is gaining scale as additional most recent year the U.S.D.A. has numbers for acreage and resources are devoted to certified total organic crop area based on data from orproduction. While the market, which did not ganic certifiers. To put the numbers in perspecreceive an official definition under the auspic- tive, organic acres comprised only 0.83 per cent es of the U.S. Department of Agriculture until of total crop area of 370.7 million acres in 2011. 2002, is still in a nascent phase, emerging critiIt does not take much effort to see how orcal mass has the potential to accelerate growth ganic production may grow more rapidly in rates and further broaden the category. The the years ahead. The U.S.D.A. is putting progrowth will also further intensify the debate grams in place to support the market and ease regarding the exact benefits of organic products in comparison Food and beverage companies have proven they to their conventionally produced counterparts. are willing to pay high multiples to acquire leading In absolute terms, the expansion of the market for organic organic businesses in order to gain greater access to products in the United States has been slow. The total retail marthe organic consumer. ket is now valued at more than $39 billion in the United States, and the number of domestic certified organic operations increased by almost the financial burden many producers face in 12 per cent between 2014 and 2015, represent- making the transition to organic certification, ing the highest growth rate since 2008 and an which may take up to three years. There is also a defined market with what apincrease of nearly 300 per cent since the count pears to be a large and growing base of conbegan in 2002. The figures will continue to rise as larger sumers demanding such products. Food and food and beverage companies and ingredient beverage companies have proven they are willsuppliers commit resources to growing the ing to pay high multiples to acquire the likes portfolio of organic food and beverage prod- of such leading organic businesses as Annie's, ucts they manufacture. In December, for exam- Applegate Farms and others in order to gain ple, ingredient supplier Ardent Mills introduced greater access to this consumer, who is willing an organic wheat initiative focused on doubling to pay a premium for such products. Yet with all of the investment and attention the number of organic wheat acres in the Unitbeing paid to the category, what, exactly, coned States by 2019. This past March, General Mills, Inc. an- sumers are getting in return for the purchase nounced plans to double the amount of acreage of organic products remains unclear. The it is devoting to organic production to 250,000 questions will only intensify as more compaacres by 2019. The effort is in line with the com- nies introduce organic versions of conventionpany's goal of achieving $1 billion in the sale of ally manufactured, processed products that natural and organic products by that same year. feature certified ingredients but the same nuThe company says it is the second largest buyer trition profiles. In February, the Centers for Disease Control of organic fruits and vegetables in the United States and within the top five purchasers of or- and Prevention published data showing the ganic ingredients in the North American pack- rate of obesity among adults over the age of 20 in the United States continues to rise. The aged food segment. Despite the news, the production of organic agency estimates the costs associated with field crops remains small when compared to obesity and the chronic conditions it causes to the production of conventionally grown crops. be greater than $147 billion per year. It remains Total certified organic crop acreage nearly to be seen what, if any, impact more consumers doubled from 638,500 acres in 1995 to 1,218,905 eating products certified as organic will have acres in 2000, more than doubled to 2,643,221 on these numbers. FBN S FOODBUSINESS NEWS ® 9

Table of Contents for the Digital Edition of Food Business News - April 19, 2016

Food Business News - April 19, 2016
Fresh, authentic a focus for Unilever
Clash over child nutrition programs may lie ahead
Dairy Business News - Dairy flavors grow ever more creative
Table of Contents
Web Contents
Editorial - Growth of organic category suggests still greater attention ahead
Monogram Foods acquires appetizer company
‘Premiumization’ opportunities abound
Preferred Popcorn picks up organic popcorn maker
Wal-Mart to transition to cage-free eggs by 2025
AdvancePierre Foods files for i.p.o.
Dr Pepper Snapple increases sports nutrition stake
Hormel Foods launches clean label effort
Identifying the X-factor in food startups
Food service operators betting big on buns
ConAgra Foods earnings reflect focus on execution
Mondelez to partner with e-commerce firm Alibaba
Modern Table planting the seeds of a trend
Market Insight - Dairy still under pressure
Company Profile - Flowers focused on improved margins
Flavor Trends - The next level for dressings, sauces and marinades
Ingredient Innovations - Fiber's global reach
Ingredient suppliers emphasize specialized fibers
Algae venture to invest in or buy food companies
New Food Products
Ingredient Market Trends - Large supplies will weigh on grain and oilseeds prices into next year
Ingredient Markets
Supplier Innovations and News
Classifieds
Marketplace
Ad Index
Food Business in the News

Food Business News - April 19, 2016

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