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U.S. Organic Food Sales up 22%, Hit $17 billion in 2006

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U.S. organic food sales totaled nearly $17 billion in 2006, up 22 percent over previous year, according to preliminary findings from the Organic Trade Association's 2007 Manufacturers Survey.

Organic foods' share of total retail sales of food and beverages was about 3 percent, up from 1.9 percent in 2003 and approximately 2.5 percent in 2005. Sales in 2005 were $13.8 billion.

About 31 percent of overall organic sales in 2006 were through mainstream supermarkets/grocery stores, and 24 percent were through the leading natural food supermarket chains such as Whole Foods, Wild Oats, and Trader Joe's.

Another 22 percent of all organic sales were through independent, small chain natural grocery stores. Foodservice sales still represent a small fraction of total organic sales at 3 percent of overall organic product sales, OTA said.

Sales of fresh fruit and vegetables grew about 7 percent in 2006, while dairy products (including yogurt) showed gains of 27 percent.

Organic beef sales grew about 13.5 percent from a very small base, which is impressive given that overall beef sales are fairy flat growing at around 3 percent.

Sales of organic baby food posted a 21.5 percent gain in 2006. Although still a small part of total organic food sales, sales of dried fruits and vegetables outpaced the growth rates for many other organic food types.

Last year, about 9.5 percent of domestically produced organic products were exported: four percent to Canada, 3 percent to Europe, 2 percent to Asia. Combined sales to Latin America, Africa, and Middle East accounted for 0.5 percent.

"These preliminary findings verify organic product sales to be a shining star in the marketplace, and we expect strong growth in 2007 as well," said Caren Wilcox, OTA's executive director.

OTA contracted with Packaged Facts to conduct the survey in March and April.

The final report of the survey is expected to be available in June.