The U.S.

Organic Agricultural Industry

Consumer Perceptions And Behaviors
June 2017
OVERVIEW

Executive Summary

The U.S. organic food industry has grown significantly since the
1990s. Consumption of organic food has increased more than 200
percent in the past decade, a growth rate over six times that of total U.S.
retail and food service sales. Organics now account for more than four
percent of total U.S. food sales.

However, consumers still don't fully understand the meaning of

organic. A survey of American consumers conducted last month by
Morning Consult on behalf of HPS found both frequent and infrequent
consumers of organic products remain largely unaware of some of the
basics of organic production.

Consumers consider manufacturers most responsible for them

being informed on the meaning of organic. Consumers place more
responsibility on manufacturers than they place on the government, the
media, or themselves.
Source: USDA 1
OVERVIEW

The "Organic" Label Certifies Agricultural Products

Are Produced Through A Highly Regulated Process
Requirements Certification Process

Organic certifications designate A farm or business adopts organic

products produced through
methods approved by the U.S.
Department of Agriculture (USDA).
Only certified products can carry
the USDA organic seal.
An organic seal indicates a
product's content is at least 95
percent organic.
The USDA's National Organic
Program (NOP) regulates all
certified organic products.
Source: USDA
practices and submits an application
and fees to a certifying agent.
An inspector conducts an on-site
inspection.
The certifying agent reviews the
application and inspector's report to
determine compliance.
The certifying agent issues an
organic certification.
Every year, the certified farm or
business goes through the annual
review and inspection process to
maintain its certification.
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SUPPLY & DEMAND

The Number Of Certified Organic Operations In The

U.S. Has Increased By Over 200 Percent Since 2002
USDA-Certified Organic Operations In The U.S.*
+237%
25,000
Number Of Certified Organic Operations

Between 2011 and 2015

alone, the number of
20,000 acres devoted to growing
certified organic food
grew by 20 percent.
15,000
Total organic land in the
U.S. now exceeds 4.36
million acres, or over
10,000
6,800 square miles.

This acreage is more

5,000 than double the size of
the state of Delaware.

0
2002 2016
Sources: USDA Count Of Operations, 2016; U.S. Census Bureau Agriculture Statistical Abstract; 2011 Certified Organic Production Survey
* 2002 is the earliest available data. 3
SUPPLY & DEMAND

Alongside Production Increases, Organic Food Sales

Grew Significantly Over The Last Decade
Organic Food Sales In The U.S. (Billions), 2005-2015*
+200% Organic food sales are
40 growing at a much
higher rate than total
35 food sales in the U.S.
Over the last
30 decade, total U.S.
Sales In Billions ($)

food sales have

25 grown by nearly 31
percent, while
20 organic food sales
have jumped by 200
15 percent.
If the organic food
10 industry were a
company, it would
5 now earn a spot on
the Fortune 100.
0
2011

2015
2005

2006

2007

2008

2009

2010

2012

2013

2014

Sources: Organic Trade Association; U.S. Census Annual Retail Trade Survey; Fortune
* 2005 is the earliest available data. 4
COMMON MISCONCEPTIONS

Despite Increased Demand For Organics, There Are

Still Common Misconceptions About Its Meaning
Myth Fact
Organic products must use 100 percent Only products labeled "100% Organic" must be
organic products and processes. 100 percent organic.

No guidelines regulate the organics Since 2002, all organic food products sold in
industry. the U.S. are required to meet strict federal
standards regulated through the USDA.

Soil and plants used to produce organic While synthetic chemicals are prohibited, the
foods cannot be treated with pesticides. USDA allows naturally occurring pesticides in
the production of organic food.

Imported organics are held to a different All USDA-certified organics, including

standard than are domestic organic imported products, must meet the same
products. standards.

Sources: USDA; CFR, Title 7, Subtitle B, Ch. 1, Subch. M, Pt. 205, Subp. G, 205.601; NSF International 5
KEY SURVEY TAKEAWAYS

Few People Understand The Organic Label, Even

Among Those Who Frequently Buy Organic Food
Key Takeaways From A Recent Survey Of U.S. Consumers

1
While the organic food industry is growing rapidly, frequent buyers of
organic foods are highly concentrated in a few regions.

2
Despite the industry's growth, few people understand the meaning of the
organic label. For example, frequent organic purchasers answered only 41
percent of survey questions about organics correctly.

3
Many consumers believe product manufacturers are fully responsible for
making them informed about the meaning of organic.

Source: Morning Consult Polling, 5/16/17-5/18/17, among a national sample of 2,382 adults. Margin of error is +/- 2 percentage points. 6
GEOGRAPHY OF ORGANICS

Frequent Purchasers Of Organics Are Concentrated In

The Highest Organic-Producing Regions
Share Of Consumers That Frequently Purchase Organic Food By Region

Frequently Infrequently

The USDA's National

Agricultural Statistics Service
(NASS) found 10 states are
50%
responsible for 78 percent of
organic sales: WA, OR, CA, AZ,
TX, CO, WI, MI, PA, and NY.
52% The majority of organic food is
sold close to the farm where it
is produced.
In 2014, less than 20
percent of organic products
61% were sold more than 500
miles from the farm.
58%
Nearly half of all organic
products were sold within
100 miles of the farm.

Sources: Census of Agriculture; USDA National Agricultural Statistics Service;

Morning Consult Polling, 5/16/17-5/18/17, among a national sample of 2,382 adults. Margin of error is +/- 2 percentage points. 7
PUBLIC OPINION

Frequent Organic Consumers Think Organic Standards

Are More Stringent Than Do Infrequent Consumers
Question: To the best of your knowledge, are each of the following statements accurate, or not accurate, about organic foods?

Buy organic frequently or more* Buy organics rarely or less*

Don't Know/
Yes No No Opinion
Accurate

Organic meats are raised with 67% 16% 17%

no hormones or antibiotics
and are fed organic feed 44% 16% 41%
Inaccurate

Soil and plants used to 62% 20% 18%

produce organic foods cannot
be treated with pesticides 45% 18% 37%
Inconclusive

Foods produced organically 55% 25% 20%

are better for the environment
than are conventional foods 34% 21% 45%
Accurate

No synthetic fertilizers can be 61% 20% 20%

used to grow organic foods
31% 24% 45%
Accurate

Foods produced organically 55% 21% 24%

do not contain genetically
modified ingredients 38% 17% 46%

Source: Morning Consult Polling, 5/16/17-5/18/17, among a national sample of 2,382 adults. Margin of error is +/- 2 percentage points.
* Proportions may total to more than 100 percent due to rounding. 8
PUBLIC OPINION

The Most Common Answer Given By Infrequent

Consumers Of Organics Was "Don't Know/No Opinion"
Question: To the best of your knowledge, are each of the following statements accurate, or not accurate, about organic foods?

Buy organic frequently or more* Buy organics rarely or less*

Don't Know/
Yes No No Opinion
Inaccurate

Natural toxic substances, such 30% 38% 31%

as arsenic, can be used in the
production of organic foods 16% 29% 54%
Inaccurate

There are no guidelines on what 35% 45% 20%

is and is not organic
22% 32% 46%
Inaccurate Inaccurate** Inaccurate

Organic products are 100 38% 43% 19%

percent organic
20% 39% 41%

Foods produced organically have 54% 26% 20%

been proven to be healthier than
conventional foods 25% 31% 44%

Organic food grown in other

countries but sold in the U.S. is 55% 21% 24%
held to a different standard than
those grown and sold in the U.S. 38% 17% 46%

Source: Morning Consult Polling, 5/16/17-5/18/17, among a national sample of 2,382 adults. Margin of error is +/- 2 percentage points.
* Proportions may total to more than 100 percent due to rounding.
9
**Foods produced organically may have health benefits, but the science has not yet been proven.
PUBLIC OPINION

Surveyed Consumers Say Manufacturers Are Most

Responsible For Explaining The Meaning Of "Organic"
The Percent Of Surveyed Adults Who Believe The Following Groups Are "Fully
Responsible" For Them Being Informed About What "Organic" Means

40 38%
34%

30 29%
Percent (%)

20
16%

10

0
The Media The Consumer The Government The Product
(USDA/FDA) Manufacturer

Source: Morning Consult Polling, 5/16/17-5/18/17, among a national sample of 2,382 adults. Margin of error is +/- 2 percentage points. 10
HPS FOOD GROUP

This Analysis Was Developed By The Following

Members Of The HPS Food Group:

Tucker Warren, Partner

Rob Terra, Managing Director

Andrea Christianson, Senior Director

Elizabeth Kelley, Senior Director

Jesse Steinmetz, Senior Associate

Jessica Pavel, Senior Associate

Ali Rohde, Analyst

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