1. The Economy: Wall Street may be recording record profits,
but the job market is lagging. As such, hard-pressed consumers
will continue to look for value. Core healthy lifestyles
shoppers will be more discerning in their budgets for organic,
and low-income families are particularly strained in finding
healthful food alternatives. With people looking to save money,
coupon redemption is up 25% this past year, and coupon use in
the natural sector reflects a similar growth trend. Also,
redemption rates for Internet coupons, while still small,
account for the fastest growing segment in the business. Private
label product sales also increased from 15% of total food sales
before the recession to 18% this past year, according to
research firm Booz & Company, which also reports that the new
frugality may be here to stay, as consumers continue to feel
they are on shaky ground. The natural and organic companies that
can communicate value as well as benefits will continue to grow
in a tough market.
2. Social Networking: Word of mouth travels fast in the social
network, good or bad. Take an active role in making it good.
Stay engaged on Facebook and Twitter and build your brand among
friends and followers. Sustainable consumers tend to be early
adopters on the web and build strong online communities.
"Friend" and "follow" other like-minded Facebookers and
Twitterers they'll help you spread the word and stay
connected professionally on networks such as Linked In. See what
other companies are doing on their Facebook pages. Learn
WordPress, a relatively easy, open source blog publishing
program, or get someone on your team who knows how, and
contribute regularly to your blog. Tie it all in with your
website and traditional public relations and marketing
campaigns. All these efforts can go far in getting your brand to
show up higher in the Google searches. Try to keep up!
3. Chemicals in the Environment: The cumulative effects of
chemicals in our environment, food and packaging are impacting
our public health. The average school age child is walking
around with an estimated 10-13 pesticide residues in their
bodies every day. However, when they switch to an all-organic
diet, the residues literally disappear from their bodies,
according to studies by Emory University and Harvard School of
Public Health. Additionally, the President's Cancer Panel in
2010 reported on "pre-polluted babies" born with as many as 300
man-made chemicals in their umbilical cords. Families are
reacting: 41% of parents report they are buying more organic
foods today than a year ago, up significantly from 31% reporting
organic purchases in 2009, according to a joint survey released
this month by the Organic Trade Association and Kiwi Magazine. A
growing body of research also points to links between pesticides
and alarming rises in the rates of childhood autism, ADHD,
diabetes and obesity. Additionally, synthetic nitrogen
fertilizer runoff is primarily responsible for the Dead Zone in
the Gulf of Mexico and elsewhere. GMO contamination threatens
native plant species and promotes the emergence of superweeds.
As a result, demand for sustainable food production that
protects health and the environment will continue to grow, and
consumers are willing to pay a premium for organic products, but
only up to a point (see #1).
4. Sustainable Packaging: Did you hear the latest research
about fast food and deli paper wrap and microwave popcorn bags
that leach cancer-causing chemicals into our food? These stories
will continue to emerge, and packaging is facing challenges on
two fronts: reducing package waste in landfills; and keeping
chemicals from leaching into food. Many natural and organic
products companies are leading the way toward more sustainable
packaging, including BPA-free cans, and also innovating on
reduced package content and recyclable and compostable packaging
alternatives. Concerned over squeeze pack packaging, Justin's
Nut Butter, a small Boulder-based business, recently convened a
sustainable squeeze pack summit, bringing competitors, industry
leaders and packaging specialists together to explore ways to
develop more sustainable packaging in consumer products. This is
a great opportunity for the industry to work together and serve
as a pacesetter for the food and consumer products industry at
large.
5. Organic Gardening and Urban Agriculture: As Michelle Obama
leads the way with the White House organic garden, Victory
Gardens are back, except they're organic. And it's helping
people get in touch with their food, as well as giving them
access to fresh, local produce. The organic sector of the lawn
and garden (L&G) market has experienced significant growth over
the last few years, and major garden centers are expanding the
shelf for natural and organic L&G products. Market research firm
Packaged Facts in January 2009 estimated that the organic L&G
sector reached $460 million in retail sales in 2008, a gain of
12% over 2007. Farmers Markets and CSAs (Community Supported
Agriculture) are growing fast, and small-scale urban farms are
also on the rise, thanks to the efforts of organizations like
Growing Power, linking inner city teens and communities with
working urban food gardens utilizing vacant city lots. Many
natural and organic products companies are already helping
support similar causes.
6. Organic and Climate Change: The global food system is
estimated to account for one-third of the world's total
greenhouse gas emissions, says Anna Lappe, author of Diet for a
Hot Planet. Yet, organic farming has the potential to help
reduce agriculture's impact on global warming. According to Dr.
David Pimentel, author of Food, Energy and Society, organic
agriculture has been shown to reduce energy inputs by 30%.
Organic farming also conserves more water in the soil and
reduces erosion. Healthy organic soils tie up more carbon in the
soil, helping to reduce CO2 levels in the atmosphere. An October
2010 study in California's Central Valley concluded that organic
farming significantly reduced GHGs, while conventional
agriculture increased GHGs in the atmosphere. Additionally, the
National Sustainable Agriculture Coalition reported,
"Sustainable and organic agricultural systems offer the most
resilience for agricultural production in the face of the
extreme precipitation, prolonged droughts and increasingly
uncertain regional climate regimes expected with rapid global
warming."
7. Slow Money: According to Woody Tasch, founder of Slow Money,
a nonprofit formed to catalyze the flow of investment capital to
small sustainable food companies and agriculture, the innate
value of investing in sustainable food comes not only in the
form of monetary return, but also in benefits to individuals and
communities-"more organic farms, more organic food available
locally, and a more robust local economy," he writes in the
Winter 2010 GreenMoneyJournal. In the fast-pitch world of Buy
Low and Sell High, Slow Money is developing vehicles that enable
small investors to invest in local sustainable food businesses.
In two years, Slow Money has grown to 1,200 members and six
regional chapters, and has facilitated the investment of more
than $3 million into a number of local sustainable food
businesses. In 2010, Slow Money established the Soil Trust to
pool small donations into a philanthropic investment fund
dedicated to small food companies and soil fertility, and is
working with socially responsible investing companies to further
open the playing field for everyday citizens who want to make
sustainable food investments. See
www.slowmoney.org.
8. Animal Rights: The beauty without cruelty movement has been
around for a while, helping to usher in a generation of body
care products that have not been tested on animals. Now, we
enter a new era of animal rights and consumer advocacy that is
critical of the inhumane, intensive confinement conditions in
which most animals bred for food find themselves. However,
beginning on January 1, Whole Foods Market will require that all
meat sold to it will be rated under new animal welfare
standards. The world's largest retailer of natural and organic
products created Global Animal Partnership as a nonprofit third
party certifier to establish ratings, conduct inspections and
administer the standards. Kudos to Whole Foods: This is a huge
step in increasing consumer awareness of animal rights, and also
in presenting more humane options to the public.
9. GMO Debate: This is an issue that isn't going away. In fact,
I would venture that the organic industry is pretty much at war
with the biotech and pesticide companies that seek to dominate
the market with GMO agriculture, the genetic drift from which is
a threat to organic seed stock and organic crops. While
proponents insist that GMOs are the only way to feed the world,
opponents claim that GMO farming has passed the point of
diminishing returns. While pesticide use was reduced in the
first three years after GMO crops were introduced in the mid
'90s, herbicide use has actually increased over the past 13
years by nearly 400 million pounds as a result of GMO
agriculture, according to The Organic Center. GMO yields are not
matching what was promised, and superweeds are emerging due to
the overuse of glyphosate, the herbicide mainly used in GMO
agriculture, hence the need for more herbicide. With numerous
food allergy and health concerns also emerging, many
manufacturers are turning to the Non-GMO Project to verify that
their products are GMO free. Consumers are highly confused over
this issue, due to the rhetoric from biotech companies that have
co-opted the term "sustainability." And the onslaught continues:
the FDA currently is evaluating genetically engineered
salmon-the first potential GMO animal for commercial
consumption-and also a GMO apple that doesn't turn brown when
cut open. If you are not choosing organic or if it doesn't say
non-GMO on the label, chances are your food contains GMOs, as it
is estimated that 80% of conventional grocery products now
contain GMO ingredients.
10. Sustainability: "Sustainability is not an exact science,
but it is a strategic decision," says Jeanne von Zastrow, senior
director of industry relations and sustainability at the Food
Marketing Institute (FMI). And it's more than how the food was
grown; it's also about a company's energy and water use,
transportation, equipment, supply chain management, packaging
and waste garnering efficiencies in these areas and elsewhere
promotes sustainability and cuts costs. Many natural and organic
products companies are leading the way but could do more, and
FMI also is developing sustainability resources for the food
industry. While what consumers say and do regarding
sustainability may be a dichotomy, health conscious and
environmentally aware consumers will continue to develop brand
loyalty by identifying with your green efforts.
11. Organic Acreage Grows: Compared to overall acreage
dedicated to conventional agriculture production, the amount of
land under organic production is still very small. But it is
growing. In the first wide-scale survey of organic farming,
published this past year, USDA counted 14,540 U.S. farms and
ranches that were under organic production, comprising 4.8
million acres of land in 2008. Certified U.S. organic cropland
acreage between 2002 and 2008 averaged 15% annual growth.
Globally, organic acreage grew by 9% in 2008, with more than 35
million hectares in organic production. The highest increases
came in Latin America and Europe, according to the Research
Institute of Organic Agriculture (FiBL) in Switzerland.
12. Local and Fair Trade: As my friend and colleague Joel Dee
likes to say, "We are all local." At Edward & Sons, Joel and his
team work with small-scale organic producers all over the world.
One example is the organic hearts of palm project in Peru's
Amazon basin. Working with local and indigenous people, Edward &
Sons helped create a sustainable harvesting and processing
program in Iquitos, a small city 125 miles from the source of
the Amazon, helping to protect the rainforest and bring
sustainable jobs to an impoverished region. This type of
partnership supports local economies and environments around the
world. As consumers respond to the 'local" trend, they are
understanding that local means not only supporting farmers and
producers in their own area, but also choosing organic and fair
trade products that support local economies all over the world.
This is a story the sustainable food industry was born to tell,
so if you are going to import organic products from China or
elsewhere, make sure you've got a sustainable, fair trade and
maybe even a cultural story behind it and not just because it's
cheaper (see #2).
13. The Real Cost of Cheap Food: One of the best articles I've
read on this subject was the cover story of Time's Aug. 31,
2009, edition, appropriately entitled The Real Cost of Cheap
Food. In it, author Bryan Walsh reports: "The U.S. agricultural
industry can now produce unlimited quantities of meat and grains
at remarkably cheap prices. But it does so at a high cost to the
environment, animals and humans. Those hidden prices are the
creeping erosion of our fertile farmland, cages for egg-laying
chickens so packed that the birds can't even raise their wings
and the scary rise of antibiotic-resistant bacteria among farm
animals. Add to the price tag the acceleration of global warming
- our energy-intensive food system uses 19% of U.S. fossil
fuels, more than any other sector of the economy. And perhaps
worst of all, our food is increasingly bad for us, even
dangerous," says Walsh, referring to rising obesity rates and
food safety issues in America. Plus, if you haven't seen it,
check out the 5-minute video of Birke Baehr's talk, What's Wrong
With Our Food System, at the TEDx Next Generation conference in
Asheville, NC. This 11-year-old young man, who wants to be an
organic farmer, speaks clearly about what is wrong with
conventional agriculture, factory farming and the industrialized
food system, and what people can do to change it. "Some people
say organic or local food is more expensive, but is it really?
With all these things I've been learning about the food system,
it seems to me that we can either pay the farmer, or we can pay
the hospital," says an astute Birke.
Bonus Trend
Young Organic Farmers: For years, young people have been leaving
the farm. Today, the USDA estimates the average age of the
American farmer is 57, with more than 25% over age 65. However,
while the trend is too new to quantify, USA Today reports that
there is an emerging movement in which young people, "most of
whom come from cities and suburbs," are taking up organic
farming on small-acre farms throughout the country as an
"honorable, important career choice." Three factors have made
these small organic farms possible: a rising consumer demand for
organic and local produce, a huge increase in farmers markets
nationwide, and the growing popularity of community-supported
agriculture (CSA) programs, says USA Today. The National Young
Farmers' Coalition is a new organization created by and for
young and beginning farmers in the United States, and a soon to
be released documentary, The Greenhorns, explores the lives of
America's young sustainable farming community. Also, an
international volunteer organization, Worldwide Opportunities on
Organic Farms, since 1971 has been connecting young workers with
organic farms all over the world, where they gain hands on
experience in sustainable farming. The invested energy of youth
is a promising bonus trend indeed for the future of sustainable
food.
About Compass Natural - Your Guide to the Natural, Organic &
LOHAS Market Compass Natural LLC, established in 2002 and based
in Boulder, CO, brings 30 years' experience in natural and
organic products sales, marketing, public relations,
communications, research, event planning, and strategic industry
guidance to businesses with interests in the $290 billion market
for natural, organic, sustainable, and socially responsible
products and services. Visit
www.compassnatural.com or call 303.807.1042.
© 2010 Compass Natural LLC.