In the 20 years since the USDA published its final organic farming rules, the industry has experienced tremendous growth.
A recent report from the USDA examines the industry’s expansion over the past two decades. Organic food and agriculture became a federally regulated industry in the U.S. after the USDA published the final rule in 2000 to implement the Organic Foods Production Act of 1990.
Under the final rule, which took full effect in 2002, USDA established the National Organic Program to provide regulatory oversight so that all organic agricultural products sold, labeled or represented as organic be in compliance with the regulations, the report said.
The report noted that total organic-certified land in the U.S. has trended upward since 2000, reaching 4.89 million acres in 2021.
Certified-organic U.S. land for growing crops or livestock increased from 1.8 million in 2000 to 4.9 million in 2021, the report said. Organic sales in 2021 accounted for about 3% of U.S. farm receipts even though organic acreage was still less than 1% of U.S. farmland.
Organic fruits and vegetables are the largest organic retail sales food category, surpassing $22 billion in 2022 and making up about 36% of all organic retail sales, according to the Organic Trade Association.
Rising consumer demand for organic fruits and vegetables has helped lead to a steady increase in organic cropland acreage since 2000, with declines in just three USDA National Agricultural Statistics Service survey years (2002, 2014 and 2016), the report said.
“Producers continually have increased the area devoted to organic specialty crops (the category for fruits, vegetables, and tree nuts),” the report said. Fruit and nut acreage increased 76% between 2011 and 2021.
“With U.S. consumer demand for organic food growing faster than certified organic acreage, an extensive organic trade sector also emerged,” the report said.
Regional differences in organic agriculture have become less pronounced, according to the USDA report.
“Organic acreage and sales historically concentrated in the Pacific region (particularly in California) have expanded across the country, most recently to the Appalachia and Delta regions,” the report said.
Organic produce finds mainstream
The report said organic producers have experienced increased market access over time.
Conventional grocery retailers have overtaken natural food stores as the most popular outlet for organic food. From the 1970s until the mid-2000s, most organic retail sales occurred in natural food stores.
“Conventional grocery retailers have since become the most popular outlet for organic food, with 55.6% of sales in 2021,” the report said.
Producers also continue to market their products directly to consumers, via farmers markets, Community Supported Agriculture programs, farm co-ops and the internet. The share of direct-to-consumer sales peaked at 12.6% in 2021 after stalling at 10% from 2006 to 2012, according to the report. While sales through offline direct-to-consumer channels have decreased since 2010, growers have expanded their use of the internet in marketing their products directly to consumers, particularly during the COVID-19 pandemic.
“In 2012, internet sales accounted for 2.1% of total organic sales, increasing to 4.5% by 2019 and 6.5% in 2021,” the report said.
Federal funding in support of organic agriculture also has grown tremendously. For example, the report said, the mandatory spending authorization for the Organic Agriculture Research and Extension Initiative has grown from $3 million in 2002 to $50 million in 2023.
