An Organic Wave: Is organic the new kosher?

I’m still amazed at how many people in the food industry truly believe
that organic foods are a fad destined to fade into obscurity like the
low-fat or low-carb trends.

I’m still amazed at how many people in the food industry truly believe that organic foods are a fad destined to fade into obscurity like the low-fat or low-carb trends. For the record, the modern organic movement started at the turn of the 20th century, is currently estimated at $25 billion in North America, and, according to the Organic Trade Association’s 2007 Manufacturer Survey, is expected to grow at about 20 per cent a year over the next few years. It is difficult by these metrics to accept the argument that organic is a fad. But exactly where is organic headed? Perhaps some insight might be gained by examining another relatively recent trend in the food industry.

Kosher-certified food is another industry segment that has achieved tremendous growth in recent years. Some estimates place kosher food sales in North America in excess of $165 billion. The research group Mintel reports that over 14,300 new kosher retail products have been launched in the past five years in North America. I’d be hard pressed to produce examples of non-kosher ingredients that I have handled in my 13 years as an ingredient supplier (all of the organic ingredients we currently handle are also kosher). Clearly, the demand from strict observers of kosher laws and tradition alone cannot explain the size and rapid growth of the market, so there must be other compelling reasons for producers to produce, and consumers to consume, kosher products.

One of those reasons, from a producer’s perspective, is to ensure access to important markets, as many retailers and distribution channels require kosher certification. Consumers perceive kosher supervision as an additional layer of quality control. A kosher symbol has been likened to the modern equivalent of the Good Housekeeping Seal of Approval. Others, like vegetarians or consumers with allergens, use the kosher symbol as a security measure to avoid foods containing meat and dairy products. Regardless of the reasons, kosher certification has become an almost ubiquitous component of ingredient supply and certainly a significant reality for most finished product manufacturers.

In the same way, there are also different classifications of consumers who buy organic foods. There are, of course, the stereotypical Birkenstock-wearing hippie types who are exclusive organic consumers. The largest group, however, and the group that is driving organic from niche to mass market, can be referred to as the mixed-cart consumer. These consumers buy organic for perceived advantages in quality and nutrition.

Like kosher, organic certification represents an additional layer of inspection and supervision conducted by third-party organizations. And in most countries, organic claims are now specifically
regulated (Canada is one of the last first-world countries to have federal organic regulations – passed in December 2006 and scheduled to come into full effect in December 2008). Now, in addition to the certifying body’s logo, which is generally proudly displayed on packaging, manufacturers selling into many jurisdictions can also include a universal government logo that will be widely recognized and serve as a kind of seal of authenticity.

The health and nutrition aspect of organic foods is a more delicate topic. It is unlikely that anyone in the organic movement would engage someone in the argument that an organic apple is “healthier” than a conventional one. That being said, for most consumers the thought of ingesting fewer chemical pesticides and synthetic additives is undoubtedly an intuitively appealing concept. One would hardly be required to show decades of medical research to convince consumers of this point. Moreover, in the last few years there has been some very interesting research showing significantly higher nutrients contained in organic foods compared to their conventionally produced counterparts. This supports the longstanding organic principle that a healthier environment equals healthier foods. Regardless of the perceived health benefits, consumers of certified organic foods can be sure that they are buying foods made with identity-preserved non-gmo materials, no hydrogenated fats, fewer refined carbohydrates, more whole grains and fewer synthetic additives.

Safety has also been a demonstrable driver of organic consumption. The best and most recent example of this was the Menu Foods recall last year. Shortly after the issue came to light, The New York Times reported on the spike in demand for organic pet food. Organic pet food manufacturers and retailers reported up to a 50 per cent increase in sales of their products. The following comment, which was posted on a pet-related blog, can sum up consumer sentiment: “Here we trusted good names and ‘high quality foods’ and we purchased and fed our animals poison! Makes me so sad and angry. I don’t trust it; I feed Jack organic food now.” (L.A. Glass). Other foods scares have also prompted spikes in consumption of organic products, like reported outbreaks of salmonella and E. coli, and the BSE scare of 2003.

Browse through the menu at any fine restaurant and you’re likely to see the word organic peppered throughout. Or visually compare the produce section at your grocery store with the organic section at Whole Foods; it’s easy to comprehend why organic and quality have gained synonymy. Organic conjures up images of small farmers and artisan producers lovingly cultivating crops and creating fine artisan foods. The organic movement has also been strongly tied with the principles of fair trade and social responsibility.

Wandering the halls of BioFach 2008, the world’s largest organic trade fair, you can notice a subtle difference in the branding of organic. In Europe, the organic seal is a subheading, representing an assurance. In other words, organic apple juice is apple juice first, organic second. The market has matured to the point that “organic” alone is not enough of a differentiator.

For consumers, then, “organic” represents food products that carry an assurance of some combination of the following characteristics: quality, safe, natural, healthy, environmentally and socially responsible. Assuming that consumers continue to demand these qualities in their food products, and judging by the more than 70 per cent of North Americans who have purchased organic products (according to The Hartman Group), the organic seal has the potential to swing from a product differentiator to a consumer-driven expectation.

Bob Crane is president of N2 Ingredients, Canada’s premier full-service distributor of natural and certified organic ingredients. Based in Oakville, Ont., N2 has strategically located distribution points across Canada. In October 2007, N2 ranked 23rd on the prestigious PROFIT HOT 50 list. Find out more at www.n2ingredients.com .