Marketing prospects for organic and pesticide-free produce

Abstract

The March 1989 food safety episodes involving Alar on apples and the cyanide tainted grapes found in a Chilean shipment were seminal events in the history of U.S. organic agriculture. Demand for organic produce soared as a consequence of these events, and mainstream supermarkets began adding more organic produce to their traditional product lines. But when organic supplies proved scarce, and as prices increased, consumer purchases decreased and many marketing managers began to question the rationality of allocating scarce shelf space to organic products. In fact, many supermarket chains either drastically reduced their organic offerings or dropped them altogether. Some analysts proclaimed that organics had failed the market test. However, two surveys we carried out in 1989 and 1991 among major California supermarket chains show that forecasts of the demise of organic produce in mainstream markets may have been premature. Of 16 chains responding to our survey, 12 continue to carry organic produce. All had carried organics for more than six months, two-thirds of them for more than a year. Of the 12 that carry organics, six rate organics as worse overall than conventional produce. But, interestingly, six rate organics as “about the same” as conventional produce. This is a significant achievement for organics. Organics rated better on environmental impact and residues, worse on appearance and shelf life, and “about the same” on flavor and nutritive value. Despite the constraints and difficulties encountered in marketing organic foods, 8 of the 12 chains that carry organics would carry more organic fruits and vegetables if supplies were available. The prospects for certified “pesticide free” produce are less definite.