The wave of organic packaged foods may have crested at mainstream retailers.
Organic foods and beverages are pulling back from startling growth levels in
recent years and settling into a small niche space at mainstream retailers, food
industry executives and analysts said this week.
The recession put a halt to the double-digit sales growth organic foods saw
earlier last decade. But even when the economy improves, organics are not likely
to rebound to such lofty heights as consumers and retailers now have other
priorities for spending and shelf space.
“It’s hard if you are a big company to do things that move the needle in that
space,” said Greg Pearlman, managing director and head of the U.S. food and
consumer group for BMO Capital Markets (BMO.TO). While Pearlman expects 2010 to
be an active year for deals in the food industry, he did not see a big play for
manufacturers in the organic space.
Health and wellness is still expected to be a big trend in the food industry,
analysts and executives said at the Reuters Food and Agriculture Summit in
Chicago. But that interest will be spread across items like those with lower
sodium, reduced calories and even a focus on removing allergens from food.
To read the rest of this story please go to:
Reuters