Organic produce returns to 2021 volume after year-over-year decreases

Organic fresh produce grew for a third consecutive quarter in 2024, reversing a stubborn two-year trend of volume decreases. While organics are now back to 2021 volume, growth is occurring at a slightly slower pace and the steady narrowing of the gap between organic and conventional produce prices paused this quarter.

Organic produce grew overall in dollars by 4.2% and volume by 4.6%, according to the 2024 Q3 Organic Produce Performance report developed by Category Partners, a strategic insights company focusing exclusively on fresh industries in the retail grocery channel.

After two consecutive quarters of dollar and volume growth in 2024, both are slightly down compared to the previous quarter. From April through June of this year, organic produce grew by 4.8% and 5.8% in dollars and volume, respectively.

Conventional produce also reported growth in Q2, with increases amounting to less than half of its organic counterparts. Conventional produce grew 2.0% in total dollars and 2.6% in volume.

While the prices of conventional and organic pricing continue to steadily converge, there was a pause on this trend for the third quarter. Compared to last quarter’s gap of $1.33 per pound, this quarter’s difference of $1.49 per pound is nearly identical to last year’s pricing ($1.50/lb). For the first time in five years, the average price decreased for both organic and conventional produce ($0.01 decrease).

Related:Sales growth in organic produce continues in Q2, report shows

Commodity growth strong overall

Source: Category Partners

Of the top 20 organic commodities, 15 experienced revenue growth for the third quarter. Fruit had an especially strong quarter, with bananas (15.8%), grapes (15.3%) and apples (11%) leading the top 20. Potatoes and cucumbers both hovered around 10%.

While berries grew by less than 3%, the commodity led in total dollars for the quarter, generating $473 million. Prepackaged salads continued to tumble for the third straight quarter, losing 5.2% compared to last year. However, salads ranked second again in terms of overall revenue at $351 million for the quarter.

For unit volume, 12 of the top 20 commodities grew for the third quarter. Organic apples grew by 27.6% to achieve the highest volume growth for the quarter. Bananas and grapes rounded out the top three with 13% growth—mirroring the top commodities for revenue growth. Bananas dominated organic volume, with 155 million units.

Avocados were the only commodity with double-digit unit volume loss—down by 10.6%. Citrus and berries were close behind, with 8.2% and 6.7% decreases for the quarter.

Related:Organic Produce Q1 report shows 'promising upward trend' for 2024

Regional performance varies

Source: Category Partners

Regional performance shows a split between the coasts and middle of the country. Growth continues in the South and Midwest regions, as the Midwest leads with 7.4% organic volume growth and the South achieved dollar growth of 5.7%. Both regions are also showing a deflationary trend for Q3—compared to the inflation experienced in the West and Northeast regions.

The West Coast again experienced the slowest dollar and volume growth for the quarter, while also seeing the highest price-per-pound increase compared to last year. The Northeast holds the highest average price per pound at $3.59/lb.

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