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OPN Connect Newsletter 191 · November 5, 2020

Premium Organic Produce Prices Are Justifiable


Does an organic green pepper look any different from a conventional green pepper? Is there a difference in the appearance of organic russet potatoes and conventional russets? If two gala apples were shown to you, would you be able to identify which is the organic and which is the conventional one?

There may not be a difference in the appearance between conventional and organic produce items. However, there is a significant difference in the pricing.

Probably one of the principal challenges of organic produce on the front lines has to do with retail pricing. Many shoppers still ask, "Why does organic produce cost so much more than regular produce?"

Stemilt August 2021

      

 

In the interest of organic versus conventional pricing, I took to the streets and made price checks at six major supermarket banners. I covered the top 15 most popular produce items and compared the variations.

There may not be a difference in the appearance between conventional and organic produce items. However, there is a significant difference in the pricing.

Country Sweet August 2021

Here are the results from each grocery chain, which are identified only as Stores A,B,C,D,E, and F.

  • Store A — Organic prices were 53.6% higher than conventional.
  • Store B — Organic prices were 53.5% higher than conventional.
  • Store C — Organic prices were 33.4% higher than conventional.
  • Store D — Organic prices were 62.7% higher than conventional.
  • Store E — Organic prices were 46.7% higher than conventional.
  • Store F — Organic prices were 43.1% higher than conventional.

The total average of all stores combined revealed that organic produce was priced 47.7% higher than conventional produce.

Organic shopper

Valent August 2021

Some of the high-profile organic items checked showed a wide range of retail prices. Here are a few examples of organic prices that were compared with conventional price variations:

  • Bananas — 19 cents per pound or 34% higher.
  • 2# bag of Carrots — 75 cents or 43% higher.
  • Romaine Lettuce — 48 cents or 17% higher.
  • Broccoli — 78 cents or 36% higher.
  • Cluster Tomatoes — $1.41 per pound or 76% higher.
  • Green Peppers — 53 cents per pound or 57% higher.
  • 5# Russet Potatoes — $2.09 or 79% higher.
  • 1# Carton Strawberries — $1.41 or 35% higher.

Consumers have several preferences when choosing produce items. One of their top concerns when shopping is retail prices. Organic produce falls right into that decision-making factor.

Organic shopper

Chelan August 2021

The items listed above make up a major portion of volume sales in the organic produce category. Peppers, lettuce, and tomatoes generate a significant amount of the organic produce sales. Each of these, along with other organic items, must be treated differently on the farms during growing periods.

There are strict national standards that organic produce growers must follow. Producing organic crops is very labor-intensive. Only natural materials (with some exceptions) can be used to fight off pests, and weeding can be a huge chore and take many work hours to accomplish. There is also a certain amount of product loss due to the sensitivity of the product. This all adds to the costs for growers.

Consumers have several preferences when choosing produce items. One of their top concerns when shopping is retail prices. Organic produce falls right into that decision-making factor.

Ben Josephson, director of sales for Wada Farms in Idaho Falls, ID, explained, "A lot of the price differences are [due to] the cost [of] growing organic potatoes and growing them on a smaller scale. There are also more costs with having a certified organic shed and [the] risk of losing your crop in storage. With conventional, you can apply modern-day storage chemicals to preserve them. With organics, once they start going,you cannot slow them down. The other factor is finding land that is certified organic."

NatureSafe August 2021

Ben Josephson, Director of Sales, Wada Farms

To sum it up, pricing is never an easy practice at the retail level. However, it is a major ingredient in generating revenue. Inadequate retails will pare down profit. Because of the higher cost of producing organic fruits and vegetables, the retails at the store level are justified. Although many consumers are aware of this, we must work towards educating those who are not.

Starr Ranch August 2021

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