Organic Packaged Food in Australia

PROSPECTS

Moderate growth expected in organic packaged food due to supply issues

Over the forecast period, organic packaged food is expected to register moderate annual increases in value sales, with growth set to be considerably lower than over the review period. One reason for the anticipated slowdown in growth is that demand for organic packaged food is likely to continue outstripping the supply of these products, which means that some products are expected to be available only intermittently.

Greater accessibility thanks to widening distribution

The distribution of organic packaged food is set become wider over the forecast period, meaning that consumers will have better access to these products. One main reason for this is the ongoing expansion of the private label organic packaged food ranges of major retailers such as Woolworths and Aldi.

High unit prices mean that demand for organic food is limited to affluent minority

Despite the anticipated improvements in the accessibility and affordability of organic packaged food, the prices of these products remain very high in comparison with the standard equivalent products. Demand for organic packaged food products is therefore set to remain largely confined to higher-income consumers for the foreseeable future.

COMPETITIVE LANDSCAPE

Woolworths leads sales of organic packaged food

Grocery retailer Woolworths remained the overall leader in organic packaged food in 2017 due to the popularity of its three private label lines Woolworths, Macro and Macro Organic. Recent years have seen Woolworths pursue a strategy of strengthening the presence of its private label products in organic packaged food and forms part of the retailer’s wider strategy of expanding the range of value-added products on offer within its private label portfolio.

Bellamy’s Australia is the leading branded player in organic packaged food

Bellamy’s Australia ranked second overall in organic packaged food in 2017 thanks to its near-monopoly in organic milk formula. In addition to organic infant formula, Bellamy’s is also present in organic dried baby food.

Dairy producers Parmalat and Five AM Life remain strong, ahead of Only Organic

Parmalat Australia Pty Ltd was third in organic packaged food in 2017, thanks to its strength in organic milk. The company’s Pure Organic is the leading brand in both organic reduced fat milk and organic standard milk.

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