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Germany: Organic sales down for the first time in 2022

For the first time ever, the German organic market has shrunk. From January to October 2022, organic food products sales fell by 4.1%, with volumes declining by 5.7%. Sales are, however, still expected to reach €15 billion, €2.7 billion more than in 2019. That means the organic market maintained its very high 22% sales growth of the pandemic's first year.

GfK data shows that, in 2022, discounters led the 'cheaper' organic product shopping trend. In the first ten months of that year, their organic sales rose by 14.5%. In the full range, organic sales remained about the same. In contrast, greengrocer, natural food stores, and direct marketing sales dropped dramatically by 20%. (AMI data according to GfK data).

At German discounters, many organic products cost as much or are even slightly cheaper than their conventional counterparts. However, price image, not actual price knowledge, drives consumption. For example, in the summer and part of September, organic milk was more expensive in discount and grocery stores than in natural food stores. That was after Aldi raised the price of that milk by 50% overnight in June 2022.

There was moderate organic conversion activity in 2022. That helped stabilize producer prices, though some key organic commodity prices increased. Wheat, rye, and oats prices, for instance, rose by more than 20% last year; fodder wheat by 17%. Organic milk producer prices climbed more than 20%, from €0.51 to €0.62/kg, pork prices by nine percent, and beef by eight percent. Older livestock producer prices, however, stagnated. And spelt's downward price trend continued.

Germany's organic egg market shrank, reducing the laying hen stock. The short-term outlook for organic farming in 2023 should, thus, be assessed as cautious. However, if the economy recovers or consumer incomes consolidate, demand should increase.

Source: Deutscher Bauernverband

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