CHICAGO – 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. 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.
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