With fruits and vegetables setting the pace for an increase in sales of organic foods in 2009, marketers have been positioning their products to keep the category’s momentum going.
“It’s fantastic,” said Roger Pepperl, marketing director for Wenatchee, Wash.-based Stemilt Growers, which has been building its organic program in recent years.
Two years of a down economy haven’t dampened Pepperl’s enthusiasm for the profit potential of organic fruit, he said.
‘”Last year, when the economy was down and you couldn’t sell a used car, they said anything that cost a nickel and up wasn’t selling, but we did tremendous on organic fruit,” Pepperl said. “We sold organic fruit like mad. We double-digit increased with our customers. Our customers double-digit increased with their scan data.”
Some growers likely “backed out” of organics out of apprehension about the economy, but Stemilt and others who pressed on reaped rewards for doing so, Pepperl said.
“People who kept their foot on the gas totally smoked it,” he said. “So overall, it was a better year last year. It might have been even better if some people didn’t make decisions for the consumer. You know, we’re the gatekeeper for the consumer at retail.”
Trends were pointing upward again for the 2010-11 season, as well, Pepperl said.
“We have more program business every week,” he said.
There are a couple of reasons, he said.
“One, organics is a lifestyle change,” he said. “I’m not saying they’re safer, but it’s a lifestyle choice, and that lifestyle is doing nothing but getting larger, as our younger generation comes in.”
Stemilt began to transition conventional orchards to organic several years ago, and those acres are now in production, Pepperl said.
“The other thing, we filled a demand that was met before but it was met with really sparse supplies,” he said. “The organic grower is still making a premium because they farm awful hard to grow organics. But the premium has narrowed to the point that the retailers can sell organic products sometimes for as low as 10% above the conventional and sometimes 20%.”
Suzanne Wolter, marketing director for Rainier Fruit Co., Selah, Wash., said her company sold 16% more organic apples in 2009-10 than in the previous year.
“And our 2010 season-to-date sales are 25% above last year’s,” she said.
The organic category is embracing specialty varieties, such as the Pink Lady, as well, according to Alan Taylor, marketing manager of Yakima, Wash.-based Pink Lady America LLC.
“That’s one of the areas that has been increasing dramatically,” he said. “It has become a significant organic apple in the state and became significant very rapidly. About three years ago, it was at about 250,000 boxes. Last year, it jumped to over 400,000, and this year is projected to be about 600,000 boxes. That was the projection.”