Inflation: sales of organic products plummet

La grande distribution restreint ses références et commande moins de bio.

For organic, 2022 is a lean year. “There is a drop in the volume of consumption, probably around 7 to 10% during the year 2022. And from 10 to 12% in specialized brands”observes Pierrick de Ronne, president of Biocoop and the Maison de la Bio, which brings together professionals from the sector.

However, the sector had tripled its sales volume over the last decade, from 4 to 12 billion euros. If 2020 had been marked by a 12% increase in the organic market, in a context in which confined households were willing to invest more in food due, in particular, to the increase in savings, the year 2021 nevertheless ended with a fall of 1.3%, which is accelerating. strongly this year.

Consumer Tips to Fight Food Price Inflation

Inflation eats away at budgets

Producers, distributors and economists unanimously point to the effect of food inflation, which could reach a maximum of 15% at the end of the year, well above general inflation. The rise in prices gnaws at the budget of the French, who first reduce their spending on food by around 4%. Manageable, they can be reduced more easily than fixed charges like rent or a subscription. Result: Organic is among the first purchases to cross off the grocery list, along with fresh produce.

“Customers make concessions against organic. They downgrade the market, they switch from an organic product to a conventional product, they opt for a cheaper organic product.”notes Pierrick de Ronne of Biocoop. “However, the inflation of conventional products is twice that of organic products, which do not require fertilizers or pesticides and consume less energy,” he continues. However, insufficient to close the gap between the prices of organic and conventional, around 20 to 50% according to Pierrick de Ronne.

Low-income households aren’t the only ones counting their pennies. The rise in the cost of living is spreading and is affecting more and more homes. “In 2019, half of the French said they had difficulty eating what they wanted. Today they are 63% and the middle and upper middle classes are increasingly affected”warns Pascale Hébel, associate director of the firm C-WAYS.

“Loss of confidence in organic”

Beyond budgetary considerations, the representative of the Maison du Bio feels “a loss of confidence” in organic. Organic products are becoming common as they become more popular in supermarkets. More and more customers are scanning purchases on their smartphones and are surprised by the ” inconsistencies » apparent organic products. Especially when they are imported from far away countries.

Above all, the consumer struggles to digest all the mandates to consume more green than green: local, seasonal, respectful of animal welfare, guarantor of fair trade, no plastic packaging… So many labels that share a part of the cake of products sold as “ethical” or “sustainable”, long monopolized by organics.

“Today, the only criteria of organic is no longer enough to convince. Consumer habits have changed very rapidly since the pandemic. Under the influence of more educated consumers, one new consumption criterion systematically displaces another. People were disappointed to see that organic doesn’t necessarily rhyme with local.”, analyzes Pascale Hébel. This consumer specialist insists on the enthusiasm for his local products and the success of the local stores that sell them, especially at the producer’s house.

Competitor Greenwash

The head of the National Federation of Organic Agriculture (FNAB) sees “a trend towards greenwashing with many products claiming to be eco-friendly”. Among them, the organic one faces three competitors on the shelves “Local, which is not to say that it is a reliable product, although local organic is obviously the ideal. Then the certificate of “high environmental value” promoted by the Ministry of Agriculture and the “zero residue of pesticides” which in fact provide few environmental guarantees compared to organic “regrets the president of the FNAB Philippe Clamadieu.

To recover the ground ceded to their competitors, organic producers and distributors boast of their specifications that impose an agriculture without pesticides, without transgenics and without chemical fertilizers. Since May 30, a communication campaign in this regard called “Bioréflexe” has been a reminder of the commitments of the sector.

Do not fall below 5% market share

In the coming months, the leaders of the FNAB and the Maison du Bio expect players, particularly those who had invested betting on the growth of the sector, to find themselves in difficulties or even, for some, in closure. In fact, large retailers, which account for more than 60% of organic sales, restrict the references marketed. Taking note of the drop in organic purchases on its shelves, it is reducing orders. The phenomenon has already begun. In a district in the west of Paris, an ecological brand, which had established itself after the lockdown to replace a discount brand, closed its doors in 2021 after a few months, leaving the walls to… the same low-cost store that had substituted .

On the other hand, those responsible for the FNAB and the Maison du Bio salute the resilience of sales channels that do not depend on large distributors to set their prices. Therefore, they do not anticipate a massive return from organic to conventional agriculture. According to Pierrick de Ronne of Biocoop and the Maison du Bio, the challenge will be not to fall below 5% in organic food consumption. That would condemn him to be again “a niche market”.

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