Organic Food Market in Australia Grows to $300M

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By Vittorio Hernandez | October 30, 2012 8:35 AM EST

Australia's organic market is growing, a report from the Biological Farmers of Australia said. The 2012 Australian Organic Market estimated the industry's value at $300 million a year.

The growth was caused by more Aussies buying organic produce and products. More than 1 million Australian regularly purchase organically grown products, with three out of four purchases done at large supermarket chains.

As of May, 65 per cent of adult Australian bought at least one organic product, up from 40 per cent in 2008.

However, as a percentage of total retail market value, the organic market is only a miniscule 1 per cent, although it has moved from a fringe cottage industry into the mainstream.

The large volume of sales has resulted in farmgate value of organic produce rising 34.7 per cent over the past two years. The report said that as Australia's organic industry continues to move towards maturity the average size of organic farms is also expanding.

Among organic produce, vegetable sales declined compared to two years ago, but beef farmgate sales jumped 111 per cent and lamb 64 per cent. Organic milk also registered strong sales growth even if its price tag is twice or thrice that of ordinary milk.

As a result, industry produce of organic milk has gone up to almost $30 million from $17 million in 2010.

Andre Leu, chairman of the Organic Federation of Australia, said buyers of organic items were not mainly rich people contrary to popular belief, but ordinary families.

"We find people become organic consumers when they become parents and they suddenly become very concerned about what goes into their children. In places like Germany it's almost impossible to buy non-organic baby food," The Sydney Morning Herald quoted Mr Leu.

Woolworths, Australia's largest supermarket, has 400 organic items on its shelves in all its stores across the country, unlike before when these goods were available only in outlets in inner-city areas characterized by higher income of residents.

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