Baking & Snack - March 2005 - 78

March 2005

Orchestrating Organics
BY STEVE BERNE

ealth-conscious consumers continue opting for organic
baked foods in ever-increasing numbers. The US organic
market is projected to reach a value of $30.7 billion by 2007
from its current level of nearly $11 billion, according to Datamonitor analysis. Its recorded a 5-year CAGR of 21.4% between 2002
and 2007, compared with a 21.2% rate between 1997 and 2002.
This performance narrows the gap with "natural" foods, which
maintained a small lead with sales of $11.3 billion. However,
"natural" grew just 4% during the period.
Compare these with figures from three years ago when the
"naturals" category achieved sales of $9.6 billion, while organics only saw sales of $7.6 billion. Increased consumer awareness
of health and wellness, credibility of sales figures and the fact
that several major food manufacturers
have joined the growing orchestra
of players in the organic segment
all suggest this category is no
longer a fad but a mainstream
market segment.
With this said, how are
bakers and suppliers alike
dealing with the challenges
of ingredient procurement
and segregation, supply and
demand, formulation and
processing changes, regulatory
labeling and other issues now
affecting organics?

The trends of high-fiber, protein, health and good-for-you foods
all got a jolt of respect as a result of Atkins that helped push the
organic industry forward. "It is an overall drive toward 'betterfor-you foods' by consumers, and bakers large and small are
jumping on the wagon," said Linda Wilson, commercial director, Nutriant, Cedar Falls, IA, a division of Kerry Ingredients.
"However, one of the issues the industry must contend with is
that most consumers still do not really understand 'organic.'
They only know it is better for you. Younger generations, with
more disposable cash and a demand for immediate satisfaction,
have more personal awareness of organics, but still more than
90% of consumers leave it to manufacturers to educate them to
its benefits."
For years, organic foods have been a niche item found in health
food stores and specialty markets, noted Jeff Dillion, manager of
sales and business development for Didion Milling, Johnson
Creek, WI. "However, with the influx of major players such
as General Mills, Kraft and Frito Lay, demand took a giant
leap forward, and suppliers are scurrying to keep up,"
he said.
"While there could be supply issues with some obscure
ingredients, more and more ingredients are becoming

The market for
organic baked foods
crescendos into the
mainstream with a
symphony of new
products.

SUPPLY SIDE
A decade ago, the organic industry saw slow but steady growth.
But with increased consumer
respect and a loyal following,
what used to be viewed as food
for those on the fringe of society
now has a reputation for quality and a perception of health. Its
most recent surge can be attributed in large part to the fleeting,
yet astounding, popularity of the
Atkins diet.

ᮣ Organic oats are in plentiful
supply and add fiber and protein
to bread, cookies and other organic baked foods.
Grain Millers, Inc.

March 2005 / BAKING & SNACK / 81

Baking & Snack - March 2005

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