#1001-44 The European Market for Organic Meat Products

May 2003, 440 pages
EUR 2999,

Competitive Stakes Rise in Organic Meat Sector
Competition is stepping up in the European organic meat industry as a number of country markets suffer from overcapacity this year.

Organic meat supplies were falling short of demand for a number of years and this encouraged many meat producers in Europe to convert to organic production methods. This is causing large organic meat volumes to come into a market that is showing slowing growth rates. European sales of organic meat products market were increasing at over 20% per annum since 1998 however market growth is projected to slow to 9.5% this year.

Organic meat suppliers in countries like Denmark and Austria are alleviating excess capacity to export markets however opportunities are drying up as more countries become self-sufficient in terms of organic meat supplies. The German and UK markets were the traditional targets of organic meat exporters and both countries have started to experience oversupplies.

In spite of revenues falling by almost a quarter in 2002, the German market remains the largest in Europe. Organic meat sales fell sharply in the middle of last year due to a food scandal involving organic grains. Consumer confidence in organic meat products is returning and positive growth is being observed again this year.

The Italian and UK markets reported the highest growth in recent years. There has been a large rise in organic meat production in the UK and this is causing retailers to substitute imports with domestic products. The Italian market remains undersupplied and organic meat imports continue from a number of countries.

The most important sales channel for organic meat products are the supermarkets, which had 51% market share in 2002. Although most sales are from the supermarkets, the specialist retailers remain important sales channels in many countries. Organic food shops and butchers account for most organic meat sales in the German and Italian markets.

The organic beef segment accounts for most revenues in the European organic meat products market. The BSE crisis and the relatively low price premium are factors behind the high popularity of organic beef with consumers. The high cost of organic grains is responsible for organic pork and organic poultry to have the highest price premium and this hinders consumer demand in some countries.

The European organic meat products market is highly concentrated with about 15 companies having a significant presence. Conventional meat companies are dominating most country markets and they have entered the organic sector either via directly supplying organic meat products or via acquiring dedicated organic meat companies.

This report gives recommendations to companies in the organic meat industry. Attractive product segments are highlighted along with strategies to realise business opportunities. Although the large companies are expected to continue to dominate, there are opportunities for small-medium size suppliers and new entrants.

Product Segments: Organic beef, pork, lamb and poultry

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