In The United States - · PDF fileYear round programs on highest demand products: ... Pears,...

Ricardo M Sardáns, Latin American Relations – ricardo@purityorganic.com

November, 2008

The Organic Food Consumer In The United States

Overview...

Introduction to POP

The Economy

Organic Consumption Trends

The Future

Creating a chain of support that linksgrowers, buyers, and

consumers in the enjoyment of high quality organic Produce,

Juices and More…

About...

Pacific Organic Produce (POP) was established in 1993 with anapple orchard in Hood River, Oregon.

15 years later, POP is the largest, most established and mostdiverse organic tree fruit marketer in North America.

We market fruit for thousands of differentgrowers, dozens of packing houses andshippers from Latin America and USA.

In 2004, we created five Purity.Organic Juices to increase the binreturn to the grower and add value & recognition to the Purity.Organic

label.

In 2007, we developed four Purity.Organic Functional Fruit Waters tocapture the low sugar/functional water market and to give produce

managers the ability to access the high volumeof a water product in their department.

About (cont)...

Strengths…

POP’s sales team has a combined 60 years of experience inORGANIC produce retail, marketing and sales.

Constant communication w/key partners & customers inCanada, Europe, Latin America, and all over the US keep usinformed and in front of emerging global and domestic trends.

“1 Stop-shopping” for all customers thanks to a great diversityof commodities (23) and varieties (115). Never out of season orout of touch!

Year round programs on highest demand products: Apples,Pears, Lemons, Oranges, Avocados, Mangoes, etc.

Strong, established relationships with our growers provideconsistent supply and the ability to plan strategically with ourcustomers.

Consolidation & Distribution…

10+ cold storage & repackaging facilities located on the Westand East Coasts, Southwest and Pacific Northwest help

guarantee the strength of the marketing chain and providecustomers with choices and flexibility.

POP has very strong business and commercial relationships not onlywith the largest organic retailers and distributors but also with massmarket and specialty stores located in the United States, Canada,Europe and Asia.

Pacific Organic Produce satisfies the needs of:

Supermarkets

Specialty Grocery & Cooperatives

Distributors

Food Service & Institutional

Clients & Markets…

USA: Apple, Pear, Cherry, Peach, Plum, Pluot, Aprium, Apricot, Nectarine,Orange, Lemon, Grapefruit, Pumello, Tangerine, Tangelo, Avocado, Berry,Grape, Mango, Pomegranate,Persimmon, and FingerlingPotato.Argentina: Apple, Pear,Cherry, Peach & Plum.Chile: Apple, Cherry,Avocado, Melon, Plum& Berry.Mexico: Avocado, Orange,Blackberry & Mango.Ecuador: Mango &PineappleBrazil: Mango & MelonPeru: Mango

Growers and Products...

The Economy…The economy is creating a food crisis

Today, average family of four spends $904 per month, up $80(2006)*

Food Costs are creating major concern about being able to putfood on the table

- Over the years, US consumers spend average of less than 10% of income on food. Today it is somewhere between 15% 25%

Food prices climbed 4% in 2007, the biggest annual increasesince 1990, and prices are projected to rise 4.5% to 5.5% in 2008USDA

*Sources: USDA/Iconoculture

5% 4%

19% 21%

51%

Not at all

Serious

2 3 4 Extremely

Serious

MARKET FACT

More than half of USHouseholds rate theseriousness of rising food prices

in terms of impact on the foodthey buy for their family asExtremely Serious. This is the

highest among women andpeople under 25.

Source: Produce Marketing Association,

Rising Food Prices – July 2008

The Economy (cont)...

Retailers are feeling the effects

Value-based grocery is doing well at the expense of supermarkets

ShoppedSupermarket in the last 30

days 86%down from

95% in 2005

ShoppedSupercenterlast 30 days

45% up from35% in 2005

73% Sayprice is “veryimportant” upfrom 62% in

2005

Source: Food Marketing Institute

The Economy (cont)...

Restaurants are feeling the effects

Eating habits

71% are cooking more and eating out less

58% are eating more leftovers

48% are eating less expensive restaurants

46% of those eating out less often are doing so becauserestaurant prices have gotten too high

Source: Business Week & Technomic

The Economy (cont)...

The Organic Marketplace

Organic Consumption

Nearly a quarter of American shoppers now buy organicproducts once a week up from 17% in 2000 Time Magazine

The Organic Consumption Trends…

Organic Food

Sales of Organic Foods will reach $18 billion in 2008 – up from$10 billion in 2003 USDA

Branded packaged goods account for 49.2%

All perishable goods account for 40%

Fresh vegetables/fruit = $2.5 billion Natural Marketing Institute

The Organic Consumption Trends (cont)…

Source: IRI/FreshLook

Organic Retail Performance

Total US Organic retail trends (04v07)

Organic Produce Dollar trend (+121%)

Organic Fruit, +253%Organic Vegetables, +69%

Organic Produce Volume trend (+104%)

Organic Fruit, +192%Organic Vegetables, +63%

Trading up to Healthy - 2009

In 2009: Avocados, Raw Almonds, Blueberries, andPomegranates take center stage as Super Foods

TODAY’S NEW CONSUMER CURRENCY: The new face ofaffluence. No longer limited to income, assets or material goods…increasingly consumer “wealth” is being assessed by HEALTH &WELLNESS

MARKET FACT

Health has become the new status

symbol for Americans across all age

groups, income brackets and

ethnicities…today we place even more

value on striving for good health than

we do on achieving financial and

professional success in our lives.

Anita Bose, senior vice president Business Wire

– 1.28.08

The Organic Consumption Trends (cont)…

1 (lowest pesticide load)Onions45 (best)1Avocado442Sweet Corn-Frozen437Pineapples429Mango4111Sweet Peas-Frozen4011Asparagus3914Kiwi3816Bananas3717Cabbage3618Broccoli3519Eggplant3421Papaya3324Blueberries3225Watermelon3130Sweet Potatoes3030Tomatoes2931Winter Squash2831Grapefruit2731Honeydew Melon2631Lemon2534Cantaloupe2437Mushrooms2338Tangerine2239Cauliflower2146Grapes-Domestic2046Oranges1946Plums1847Raspberries1752Cucumbers1653Hot Peppers1555Green Beans1457Carrots1358Potatoes1260Spinach1165Pears1068Grapes - Imported969Lettuce875Cherries783Strawberries684Nectarines585Celery486Sweet Bell Peppers396Apples2100 (highest pesticide load)Peaches1 (worst)SCOREFRUIT OR VEGGIERANK

The Organic Consumption Trends (cont)…Pesticides in Produce

The Future: Integrated Branding Approach...

Thank You !