Despite the pandemic, and in some way because of the pandemic, [2020 was an] amazing year for us … with total industry sales growing 12.7% to $ 256 billion ”,Carlotta Mast, Senior Vice President and Market Leader for New Hope, said yesterday at the Natural Products Expo East in Philadelphia.
He explained to in-person and virtual event attendees that much of that increase was due to pantry load and brand exploration from last year due to the limited supply of more familiar products and a desire to bring something new to. their homes.
But, he added, as the threat of the pandemic eases demand for natural and organic products it remains strong even as sales growth slows.
The pandemic “It continues to have a positive impact on the industry today. People tried those new brands and in many cases they stuck with them, especially in the food and beverage categories.”She said. “Additionally, health and wellness by supporting our immune health became top priorities for us during the pandemic, and this also persists and helps our industry grow in 2021.”
Industry sales in 2021 are projected to grow 6.6% to $ 271 billion, which is slower than 2020, but still has the segment on track to surpass $ 300 billion in sales by 2023, suggesting that Estimated sales growth of $ 9 billion attributable to last year’s pandemic was just the beginning, and it will continue to increase industry sales for the next three years and beyond, Mast said.
TO “main contributor”The natural and organic industry growth was the food and beverage industry, which drove more than 70% of total industry sales in 2020 and remains a strong driver in 2021, said Kathryn Peters, executive vice president of SPINS, at the conference.
He explained that natural, organic and functional foods and beverages are on track to reach $ 200 billion by 2022, topping “Quite significantly, total US food and beverage sales.”
He added that sales of natural and organic food and beverages are growing by around 7% in 2021, less than the 9% growth last year, but still notably higher than the 5% growth in 2019 before the pandemic.
“We don’t expect that to diminish anytime soon,”Peters said.
Beyond immunity
Despite optimism from industry leaders for the natural and organic industry going forward, Mast cautioned stakeholders not to take consumer interest in their segment for granted but instead, he said, should continue to innovate and deliver products that meet changing consumer demand.
For example, while immunity-boosting claims may have attracted many consumers to the segment in the past 18 months, what will keep them engaged are products that support children’s sleep, stress, and health – all which remain pain points despite adult vaccination options.
Peters noted that the industry is already innovating to meet these needs. In the beverage segment, SPINS is seeing a 51% increase in immunity-boosting claims with elderberry, echinacea, and camu camu leading the way. Likewise, he said, rest and stress relief claims increased 36% with ingredients like CBD, melatonin, theanine, and valerian. Finally, the use of adaptogens, including chaga and rishi mushrooms, ashwaganda, maca and holy basil, increased 32%, he said.
Peters also noted that as consumers increasingly embrace the idea of food as medicine, they are turning to mainstream products in search of the benefits they previously sought in the dietary supplement aisle.
For example, sales of ashwaganda in food increased 129.5% to $ 8.4 million in the year ending August 8, 2021. In the same period, SPINS found that sales of super mushrooms increased 16, 1% to $ 420 million, moringa increased 14.7% to $ 2.5 million. , elderberry was up 96.5% to $ 16.3 million and MCT was up 50.7% to $ 146 million.
Herbal continues to grow
Along with an increased demand for functional ingredients, there is a seemingly insatiable desire for plant-based options, according to data from SPINS.
“I hear people say sometimes, I don’t want to hear any more about the plants, but it’s still on fire.”Peters said, noting that sales of plant-based products in the 52 weeks ending Aug. 8 increased 12.8% to $ 6.4 billion. This is outpacing the 4.2% year-on-year increase for food and beverages in general.
Peters attributed the continued strength of the plant-based trend to consumers’ belief that products are better for their bodies and the planet.
“Certainly there are some industry favorites right now with oats and stuff, and it’s great to see the continuous ingredients bring new innovations to plants.”She added.
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