Asia Leads Growth For Organic Food Market

Friday, January 4th, 2019

Various research studies show that organic foods have a higher nutrient density than conventional foods. And according to Ecovia Intelligence, the global organic food and drink market is growing by about eight to ten percent per annum. In particular, growth in the Asian market is occurring at a slightly faster rate, at about 15 percent per annum and the largest market in Asia is in China, which has been showing a spike in demand for organic products for the last 10-15 years. While other important markets for organic products are in Japan, South Korea, India and Taiwan.

A major driver of growth in Asia can be attributed to consumers’ fears for food safety and China in particular, has experienced a large number of food scandals which include melamine (industrial chemical) in dairy products and infant formula, rotten meats, sewage oil in food products, adulteration and counterfeiting etc.

Additionally, factors such as increasing retail distribution, rising consumer awareness of organic production methods, large companies entering the organic sector and government support have also contributed to market growth.

In the case of increasing retail distribution, this trend has resulted in organic food becoming widely available to Asian consumers and it is common now for organic food to be actively marketed by many supermarkets and hypermarkets in Asian countries, including South Korea, Singapore and Hong Kong. Thus, this added factor of convenience has boosted the popularity of organic food in Asia.

Meanwhile in the case of the rising consumer awareness of the health benefits of organic food, Asian consumers are becoming more aware of organic production methods and how they differ from conventional products. Concerns about agro-chemicals in food products are also generating demand for organic products and the media is playing an important role in accelerating this trend by through reports on green issues and food production methods.

To add to the above, large food companies are also entering the organic food industry and this has caused the distribution of organic products to increase in conventional grocery channels. In China, India and South Korea, leading food and beverage companies have launched organic products. And this is strongly supported by government incentives. This is because, a growing number of Asian governments are recognising the environmental and economic benefits of organic farming and thus, they are encouraging the conversion towards organic agriculture and organic food production. Most Asian countries have also introduced national standards for organic foods, with labelling and certification schemes.

Therefore, as the global organic food market continues to expand, Ecovia Intelligence expects the number of national and private standards for organic food to grow. This is because standards remain an impediment to global trade of organic products. Similarly, while organic crops are grown in 178 countries, only 87 countries have national standards for organic production and a key concern is the lack of harmonisation between these national standards, as well as growing number of private standards.