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Latin America Organic Food & Beverage Market to grow with an anticipated CAGR of over 12%- Actual Market Research
Feb, 28
2021

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Latin America Organic Food & Beverage Market to grow with an anticipated CAGR of over 12%- Actual Market Research

 

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According to the report titled- Latin America Organic Food & Beverage Market Outlook, 2026; a recent publication of Actual Market Research, Latin America with a market value of USD 0.96 Billion is the least contributing region globally. In Latin America, almost 228’000 producers managed over 8 million hectares of agricultural land organically in 2018. This constituted 11% of the world’s organic land and 1.1% of the region’s agricultural land. The leading countries were Argentina with 3.6 Million Hectares, Uruguay with 2.1 Million Hectares, and Brazil with 1.2 Million Hectares. With the Covid outbreak, even though the economy remained unstable, the region inclined towards organic intake, which is to support the market growth with an anticipated CAGR of over 12%. Since the last decade, Latin American consumers’ tastes and preferences have changed as they seek to try new products and demand higher quality and product innovation. The manufacturers have been marketing their products based on nutritional facts and health benefits associated.

With a high dominance, the organic food segment accounted to a value of USD 1.44 Billion in the year 2020. Sales are expected to increase in the short and long term in line with the predicted economic growth and due to an expected increase in consumer awareness. The organic fruits & vegetable segment lead the market, which accounted for 51.44% in 2020. Branded organic meat, fish & poultry segment is struggling to gain share, partially because of the ongoing economic recession and the lack of consumers’ awareness about organic products. With the increasing health-consciousness in consumers, there is a growing demand for low-calorie and lactose-free dairy nutrition. This has been a supporting reason for the organic dairy product segment. A recovering economy, increasing disposable income, and an increase in initiatives to inform consumers about the health benefits of organic non-dairy products are all expected to be key driving factors boosting growth in the coming years. Even though in 2017, coffee was recorded as a main organic permanent crop followed by cocoa, the region's organic coffee & tea accounted merely for USD 0.034 Billion in the year. Organic coffee represented 8% of the total coffee area in the region and 47% of the world’s organic coffee.

The increasing availability of organic food products through various e-commerce platforms is also contributing to the growth of the organic food & beverage market in the region. The online stores are to gain more popularity in the region for their vast variety and heavily discounted prices. With the increasing need of the people to gather information about what they consume, the market share of other sales channels like trade shows and exhibition is expected to grow. Farm shops are getting popular where families cultivate plants and raise animals in a natural environment far from cities and they sell products in a house-shop. However, the market is to be considerably dominated by the modern retail segment event through the forecasted period which by the end of 2026 would account for over 42% of the market.

As of 2017, 41% of the total land in Brazil is cultivatable & has a total land area of 2.1 Billion Acres with 5,073,324 farming operations. Being one of the most developing economies in Brazil is an emerging market, in terms of organic consumption. Brazil is a leading market in Latin America, and any changes in the market affect the regional organic market. There has been a rising demand in the country for traditional dairy products such as requeij?o cheese. In the area of healthy food, Argentina goes along with the global trend, yet with a lot of market to grow. The greater awareness of the consumers and the entrepreneurial spirit of the promoters through collaborating in various fairs and shows had allowed the market to become a hotspot for the marketers. High levels of inflation as a consequence of the economic recession have led to value increases while volumes are unstable. To increase awareness of organic products, the Ministry of Agroindustry in Argentina invested in conducting several events such as Organic Food Week, which is an exhibition and cooking classes from renowned chefs. Colombia is called to be one of the world's food pantries, according to the Food and Agriculture Organization of the United Nations. The country has nearly 40 million hectares that can be devoted to agriculture but has only cultivated about 8 Million hectares. The country's tropical climatic conditions make it possible to produce a wide variety of foods throughout the year.