Organics account for 2.5% of all grocery spending; Premiums go up to 50%

Sales of organic groceries have been surging by up to 20% in recent years. Organic milk wholesale prices are almost more than double that of conventional milk. Consumers shell out premiums of 50% or more to buy organic food. 

Packaged Facts projects sales of natural/organic food and beverages will soar from $28.3 Billion in 2005 to $46 billion by 2010, increasing by nearly 63%, as the popularity and availability of natural/organic products continues to gain momentum.

The corporate giants have turned a fringe food category into a $14 billion business. Organic products now account for 2.5% of all grocery spending. If additive-free "natural" foods are included, the share jumps to about 10%. 

Dairy producers estimate that demand for organic milk is at least twice the current available supply. The U.S. would have to more than double the number of organic cows -- those that eat only organic food -- to 280,000 over the next five years to meet this demand. That's a challenge, since the number of dairy farms has shrunk to 60,000, from 334,000 in 1980, according to the National Milk Producers Federation. And almost half the milk produced in the U.S. comes from farms with more than 500 cows, something organic advocates rarely support. (BusinessWeek report)

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