Significant, sustained growth in America's natural and organic foods categories is to be expected over the coming years, according to a report by US investment bank New Adams Harkness & Hill. The report claims that the "mainstreaming" of natural and organic foods, a sector currently worth $15 billion (€16.84bn), will drive double-digit annual growth over the next several years, and prove to be an attractive investment opportunity.
"Over the last decade, we've seen the beginnings of the industrialisation and mainstreaming of natural and organic foods, but the category is still young and growing - which implies further expansion ahead," said Scott Van Winkle, the report author.
He added: "It's worth noting that recent negative trends in the overall economy have had little effect on the growth of the natural and organic category. One of the attractive aspects of the food industry for investors is that trends are generally long and visible, providing both individual and institutional investors with ever-important time to identify trends.''
The Better Food & Nutrition Industry Report provides an overview of the size and growth of the natural and organic industry, as well as identifying the industry's driving factors and overall structure.
The $15 billion natural and organic food category is part of a $32 billion natural products industry. AH&H estimates natural food segment growth at 8 to 10 per cent for the next several years and organic food segment growth at a more robust 20 to 25 per cent rate.
The report attributes the growth of the sector to demographic factors such as the ageing of baby boomers, the rise in self-care, better understanding of the correlation between diet and health, favourable regulation and increased consumer understanding of the negative effects of pesticides, food additives and genetically engineered ingredients.