UK Organic Food Needs To Be Cheaper in comparison with non-organic products to Return to Strong Growth : Trade Board

Organic food in Britain is often too expensive in comparison with non-organic products and the price gap must narrow if the struggling sector is to return to strong growth, the Organic Trade Board said.

Organic bread costs nearly a third more than non-organic, while the differential for Gala apples was 69 percent.

"More than a 60 percent premium is a big decision for any shopper," Finn Cottle, trade director for the organic sector umbrella body, told a conference on Tuesday.

After years of double-digit growth the organic sector, which also includes products like make-up and clothes, hit a barrier last year when the economic downturn kicked in.

Sales are now down about 10 percent, which coupled with tighter credit and some retailers pushing cheaper brands, has put pressure on organic producers, many of which are small, family-run firms.

"I think the price differential should be about 20 percent," Cottle said. "We (organic producers) should be looking for a consumer price that is comparable with (non-organic) premium brands. Some (price differences) are quite shocking."

In contrast with Gala apples, a bottle of organic gin costs only about 4 percent more than its non-organic counterpart while cheddar cheese sells for only 1 percent more.

Cottle said the sector must reconnect with shoppers who moved away from the organic sector to save money.

"We know many people are in favor of organic, we just have to make sure they buy our products," she said.

The trade body has a target to push organic sales to 3 billion pounds ($4.9 billion) by 2015, against the 100 million pounds it was worth in 1994.

Ed Crammer, of market analysts TNS, which looks at supermarket sales, said that while many people bought organic, a far smaller number could be properly termed "organic buyers."

"10 percent of people buying organic represent 57 percent of total spend...while 14 percent of those buying organic accounted for just 1 percent -- basically this latter group buy organic almost by mistake."

The organic sector needed to target the 90 percent of people who occasionally buy organic, he added.

Source : REUTERS