Bonafide Research reports that the surge in demand for clean-label food and beverage products is expected to be a significant driver for the growth of the organic food and beverage industry. The rise in health consciousness among consumers increases the demand for sustainable food and beverages. By choosing organic products, consumers support sustainable agricultural practices that promote biodiversity, soil conservation and the preservation of ecosystems.

One such trend is the rise of "farm-to-table" and "farm-to-glass" practices, emphasizing the traceability and freshness of organic ingredients. Consumers are increasingly seeking local, organic produce and artisanal products that connect them to the origins of their food and drinks. The organic market has witnessed significant innovation and product diversification. The availability of diverse organic product offerings appeals to a broader consumer base and drives market growth. In addition to that, many governments around the world are actively supporting organic farming practices through financial incentives, grants and subsidies. These initiatives aim to promote sustainable agriculture, reduce chemical usage and support the growth of the organic sector.

Key Takeaways:

• North America is dominating with 41.89% of the market share, as consumers in the region prioritize health, sustainability, and ethical considerations when making food choices.
• Organic food is expected to lead the market with more than 90% market share by 2027, as organic fruits and vegetables are witnessing exponential demand.
• Among the organic beverages market, nearly 81% of the market share has been occupied by the non-dairy and coffee and tea segments.
• The modern retail segment is anticipated to grow at 11.56% CAGR by 2022–27.

There is room for innovation and diversification in the organic market. Developing new organic products, such as plant-based alternatives, organic snacks, functional foods and beverages is attracting consumers and driving the overall market growth. The popularity of plant-based diets and the demand for alternative protein sources continue to rise. The market has seen the introduction of a variety of plant-based meat substitutes, dairy alternatives and plant-based protein powders, catering to the growing consumer interest in sustainable and cruelty-free options. The market has also witnessed a surge in organic snack options, including granola bars, chips, popcorn and energy bars. Manufacturers are focusing on creating healthier, organic alternatives to traditional processed snacks to meet the demand for convenient and better-for-you options. 

In recent years, the growth of e-commerce has influenced the organic food and beverage market, enabling direct-to-consumer sales and increasing accessibility. Online platforms, subscription services, and meal kit delivery companies are offering a wider selection of organic products, providing convenience and reaching a broader consumer base. The market for organic baby food has experienced significant growth, driven by parents' desire to provide healthy and organic options for their infants and young children. Organic baby food brands are expanding their product lines to offer a wider variety of organic purees, snacks and toddler meals. Earth's Best, Plum Organics, Happy Family Organics, Gerber Organic, Sprout Organic Foods, Beech-Nut Organic, Ella's Kitchen and Peter Rabbit Organics are some well-known brands that specialize in organic baby food.

Regenerative agriculture practices, which focus on improving soil health and promoting biodiversity, are gaining attention in the organic market. Consumers are looking for organic products sourced from farms that implement regenerative practices, as they offer potential environmental benefits and contribute to sustainability. Busy lifestyles have fueled the demand for organic convenience foods, including ready-to-eat meals, snacks and pre-cut produce. Consumers are seeking organic options that offer convenience without compromising quality or healthfulness. Organic foods and beverages that are high in protein are in demand as they can provide sustained energy and support muscle recovery. Superfoods and functional ingredients are sought-after for their nutrient density and potential health benefits. Organic products incorporating ingredients like chia seeds, hemp seeds, spirulina, matcha and turmeric offer a natural source of energy while providing additional nutritional value. Also, cold-pressed juices and smoothies made from organic fruits and vegetables are favored by those looking for a refreshing and energizing beverage. These products retain more nutrients compared to traditional juice processing methods, offering a natural and invigorating energy source. Consumers are increasingly seeking organic snacks that provide sustained energy while being mindful of ingredients and nutrition. Snack options like organic trail mixes, fruit and nut bars, and baked snacks made from whole, organic ingredients are preferred for their wholesome and energizing properties.

With the increasing need for efficient and sustainable food production, there is a rise in vertical farming and controlled-environment agriculture. These methods allow for year-round organic cultivation in urban environments, reducing reliance on traditional farming practices and minimizing environmental impact. Also, the development of cellular agriculture techniques leads to the production of organic meat products without the need for traditional animal farming. 

Lab-grown meat has become a viable option, meeting the demand for sustainable and ethically sourced protein. There are major advancements in organic food preservation techniques that extend shelf life without compromising quality. This includes methods such as high-pressure processing (HPP), pulsed electric fields (PEF) or natural antimicrobial agents to maintain the freshness and nutritional value of organic products. VR and AR technologies are also enhancing consumer experiences by providing virtual tours of organic farms, interactive product information and immersive storytelling, helping consumers connect with the origins and production processes of organic food and beverages. On the other hand, blockchain technology has the potential to revolutionize supply chain transparency. By utilizing blockchain systems, consumers can access detailed information about the origin, production methods, certifications and quality of organic products, ensuring greater transparency and trust. “Organic farming practices contribute to soil fertility, biodiversity conservation, and reduced chemical residues in food, making it a vital component of sustainable agriculture and food security," says Dhwipal Shah, research director with Bonafide Research.

Today’s interest in organic may have intensified, but the organic industry's growing popularity is not new. Consumers are eating more organic food and using more organic products than ever before. Moreover, an increase in income levels, an improvement in standards of living, a growth in environmental concerns, and an increase in health hazards due to inorganic foods are some other driving factors in this market. 

Further, the demand for organic food is not limited to retail settings. The foodservice industry, including restaurants, cafes and institutional food providers, has been incorporating more organic options into its menus. This trend is driven by consumer preferences for organic choices when dining out or ordering food. Organic food is not limited to crops. Organic livestock production is an important sector within the organic food industry. Organic livestock must meet specific welfare standards, such as access to outdoor areas, organic feed and restrictions on the use of antibiotics and hormones. 

The organic food industry also includes organic aquaculture, which focuses on producing organic seafood and fish. Organic aquaculture standards require sustainable and environmentally friendly practices, such as using the organic feed, minimizing pollution and ensuring animal welfare. Organic fruits and vegetables are among the most popular organic products. Consumers opt for organic produce due to concerns about pesticide residues and the desire for more natural and healthier options. Companies in the organic food market are focusing on the introduction of new product categories and varieties. Organic food manufacturers are coming up with new and innovative organic food products in the form of ready-to-eat snacks, cookies, organic tea, pulses, spices, edible flowers, frozen waffles, medical plants, herbs and organic juices. 

On the other hand, the organic beverage industry continues to innovate with new product offerings and flavor profiles. This includes unique blends, innovative ingredient combinations and functional formulations to cater to evolving consumer preferences. Consumers are becoming more health-conscious and seeking alternatives to dairy products. Many people are adopting plant-based diets or reducing their dairy intake due to various reasons, such as lactose intolerance, allergies, ethical concerns or environmental sustainability. Organic non-dairy beverages offer a viable option for individuals looking for nutritious and dairy-free alternatives. The rise in vegan and vegetarian lifestyles has contributed to the increased demand for non-dairy beverages. Organic non-dairy beverages, such as almond milk, soy milk, coconut milk and oat milk, provide essential nutrients while being free from animal products. The market has also witnessed a surge in product innovation and variety in the organic non-dairy beverage segment. Manufacturers have developed new formulations and flavors to cater to different tastes and dietary preferences. However, organic coffee and tea have seen significant growth and popularity. Consumers appreciate the assurance of organic cultivation methods and the absence of synthetic pesticides. Fair trade and sustainable sourcing practices are often associated with organic coffee and tea.