Organic food makers take heart from Danish demand

By Lindsey Partos

- Last updated on GMT

Related tags: Organic food sales, Scandinavia, Denmark

There are encouraging signs for food makers making moves into organics with signs that Scandinavian countries are bucking the 'flatlining' trend witnessed in the rest of Europe.

Organic food sales from supermarkets and department stories in Denmark rose to €671m in 2008, marking a 29 per cent vertical rise on the year before, show figures from Danish business daily Borsen​.

The booming demand in Denmark stands in stark contrast to the 2 per cent growth witnessed in the UK last year, and slipping organic sales across the rest of Europe.

Probing the reasons behind the strident organic growth in Scandinavia, Organic Monitor analyst Amarjit Sahota cites consolidation, culture and the economic backdrop as all contributing to the sustained rise in organic sales.

"Their economies have not been as affected by the financial downturn as the UK, Germany, Spain and other European countries,"​ Sahota explained to FoodNavigator.com.

In addition, Scandinavians – and the Nordic culture – in general appear to be more conscious about environmental issues, he continued.

An awareness that, it would appear, translates directly to sales. According to Organic Monitor, organic food sales claim about 5 per cent market share of total food sales. In the rest of Europe, organics hold a 2 per cent slice of food sales.

"Despite the very high cost of living, they don't seem to mind paying more for good quality products,"​ says Sahota of the Scandinavian consumers. This culture contrasts with the 'discounting phenomena' in Germany and the UK in particular.

A further key factor for the growing organic sales in Scandinavia is consolidation, suggests the Organic Monitor analyst.

Between 2006 and 2007 the industry saw consolidation in the organics sector, with product ranges re-vamped. Supermarkets, for example, reduced their lines and manufacturers had to focus and re-think their product range.

"After a period of slow growth and consolidation, growth kicks in and investment follows,"​ explained Sahota, suggesting that Scandinavia is currently at the top of the cycle, an 'upturn' that contributed to the high double-digit growth witnessed in 2008.

Related topics: Market Trends

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