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Swedish Eko (Organic) Grocery Sales Decrease for the First Time in 12 Years

22nd February 2021

Denis Buckley, Global Graduate Stockholm, Bord Bia - The Irish Food Board

Swedish Organic sales source.PNG

Swedes have long prioritized organic food and have been willing to pay a premium for them. All the leading retailers in Sweden have their own eko (organic) range whereby prices can be considerably higher than their non-eko counterparts.

Swedish Organic sales img2.PNG

Organic food in Sweden is represented by the Krav label. It is a Swedish ecolabel for food based on ecological principles and includes high demands on animal welfare, health, social responsibility and climate impact. Krav can be seen throughout labels on all organic product categories within Sweden and is instantly recognisable to consumers. There are two options to market organic products imported or brought in to Sweden as KRAV-labelled. Either the producer applies to become KRAV-certified or the producer supplies to a KRAV-certified importer. Krav in of itself is not a certification body; however, there are a total of seven certification bodies accredited to carry out KRAV-certification outside Sweden. These certification bodies can be found here (Krav, 2021).

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The retail value of organic packaged foods in Sweden increased by 3% in 2019 to be worth a total of SEK 6.48 billion (€645million). Although Sweden has twice the population of Ireland, this Swedish figure is in stark contrast to the 2019 Irish figure of €149million (Euromonitor, 2021). So, it may come as a surprise to some when they hear that 2020 sales of organic groceries in Sweden have actually decreased whilst sales of organic produce in the rest of the world throughout COVID have, by in large, increased.

Ekoweb have been monitoring the organic market in Sweden for 12 years and 2020 represented the first time since their projects inception that sales in the Swedish market have decreased {by 2%} (Foodsupply, 2021). What is the reasoning behind this?

  1. Consumers’ sustainability & health focus is no longer solely on ‘organic’.

‘Organic’ is now one of several value words for Swedish consumers when making a purchase decision. Consumer focus is now often split between both health and environmental concerns surrounding the climate.

  1. Reduction in the marketing of organic products meaning poorer exposure.

The Swedish grocery trade has appeared to reduce their marketing of organic goods over the past four years. According to the analysis company Matpriskollen, ICA has reduced its organic campaigns by 50% and in general the grocery trade has reduced its campaigns by 33% since 2016 (Foodsupply, 2021).

  1. Increased consumer demand for finished meals (convenience).

During a recent panel discussion between the leading Swedish retailers it was noted that changing consumption patterns have meant difficulty for the category when gaining ground. Peter Hellström of Axfood observed that “Consumers are becoming more and more comfortable and one of the big challenges will be to meet the trend with fast meals and semi-finished products that are also organic” (Foodsupply, 2020). Whilst there are ample non-organic finished products and meals available, the same cannot be said for organic meals. This is affecting sales of organics as consumers prioritise convenience.

  1. Increased vegetarianism and veganism.

Over the past few years, the greatest organic decreases have been seen in meat and dairy as vegetarianism and veganism grow. A recent survey annual commissioned by Axfood found that a growing number of Swedes are eating more and more vegetarian food: almost a quarter (23%) of consumers state that they will continue to change their eating habits and eat less meat in 2021 (IGD Retail Analysis, 2021). This pertains to the consumer lifestyle trends of both health & wellbeing and responsible living as has been outlined by Bord Bia (Bord Bia, 2021). Consumers who previously bought organic meat and dairy have to a greater extent gone. Thus, many Swedish farmers producing organic meat or dairy have now returned to normal production (Foodsupply, 2019).

It is likely that consumer demand for convenience will increase post COVID, but will organic grocery sales in Sweden continue to decrease? That is yet to be seen, although it looks like those with influence in Swedish retail are well aware of the latest consumer trends and happenings. They will be well placed in developing organic products and finished meals which are both convenient and tailored to their customers’ dietary requirements. It will be interesting to see whether or not there will be a further reduction in organic grocery sales throughout the coming year and whether a similar situation may arise in Ireland.

 

References:

Bord Bia (2021) – Consumer Lifestyle Trends. Available at: https://www.bordbiaconsumerlifestyletrends.ie/trends/

Euromonitor (2021) - Market sizes: Organic packed food in Sweden.

Euromonitor (2021) - Market sizes: Organic packed food in Ireland.

Food Supply (2021) - Trend break: Eco-sales are declining in Sweden. Available at: https://www.food-supply.se/article/view/774411/trendbrott_ekoforsaljningen_minskar_i_sverige

Food Supply (2020) – Organic continues to slow down. Available at: https://www.food-supply.se/article/view/698001/ekologiskt_fortsatter_att_sakta_in?rel=related

Food Supply (2019) – The Eco trend stops. Available at: https://www.food-supply.se/article/view/743360/samarbete_ger_battre_ekoleveranser?rel=related

IGD Retail Analysis (2021) - How Nordic retailers are championing sustainability. Available at: https://retailanalysis.igd.com/markets/sweden/news-article/t/how-nordic-retailers-are-championing-sustainability/i/27486

Image Source: Denis Buckley (BordBia).

Image Source: IGD Retail Analysis.

Image Source: Unsplash.

Krav (2021) – Become Krav Certified. Available at: https://www.krav.se/en/for-companies/certification-of-krav-organic-products/become-krav-certified/

Krav (2021) – Krav Certification Bodies. Available at: https://www.krav.se/en/for-companies/certification-bodies/

Krav Mark (2021): https://www.krav.se/en/

Krav (2021) – Supply to a Krav certified company. Available at: https://www.krav.se/en/for-companies/certification-of-krav-organic-products/supply-to-a-krav-certified-company/