George Siemon, CEO of Organic Valley of Farms, the USA’s largest cooperative of organic farmers said in weak economy, new organic customers will be more cautious. Sales growth has slowed but remains strong because of the loyalty of core organic buyers. They say new consumers are tougher to attract, given that organic can cost 10% to 50% more than non-organic rivals.
Gary Hirshberg, CEO of Stonyfield Farm, a leading organic yogurt maker says “Most of us are seeing slightly slower growth, but we are still seeing growth.” He expects 18% revenue growth this year, up from 16% last year but down from 24% plus in past years. Others also reported slower growth than Wall Street analysts anticipated, including Whole Foods Market and Lifeway Foods.
George Siemon also says existing organic buyers may cut purchases of discretionary items, such as organic ice cream, and to the basic such as organic milk and meat. Siemon earlier targeted 24% growth this year for Organic Valley. Now he is looking for 22% and the co-op had 30% growth last year. The Organic Trade Association said that sales of organic foods and beverages are expected to reach $24 billion this year, and average about 18% annual growth through 2010.
Laurie Demeritt president of market researcher of The Hartman Group says almost 70% of U.S. shoppers bought something organic over a recent three month period. She also says Hartman’s consumer survey earlier this year showed that organic use has been leveling off since 2006, and she also said organic are also seeing increased competition from “locally grown” products, whether they are organic or not.

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