Saudi Arabia Organic Food Market to Grow at a CAGR of 14.8% during 2019-2026

February 20 11:28 2020
Saudi Arabia Organic Food Market to Grow at a CAGR of 14.8% during 2019-2026

Saudi Arabia Organic Food market
New analysis from GMI Research, expects the Saudi Arabia Organic Food market to grow at a robust CAGR of 14.8% from 2019-2026. Saudi Arabia Organic Food market generated revenues of USD XX million in 2018 and it is projected to reach USD XX million in 2026.

The key factors propelling the Saudia Arabia organic food market growth are favourable government initiatives such as the Sustainable Agricultural Rural Development Program and Organic Action Plan, increased awareness pertaining to the health benefits of organic food among consumers, especially millennials as well as rising urban population and increasing household disposable income.

Organic foods are produced using natural and organic ingredients that are grown as per the standards of organic farming. Organic food is produced without using synthetic chemicals such as fertilizers, pesticides and hazardous chemicals. Organic food does not contain artificial preservatives to sustain a longer interval of time and is rich in nutrients such as vitamins, minerals, antioxidants, carotenoids, magnesium, iron and phosphorus.

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The increasing consumer consciousness regarding food safety, quality and nutritional intake across Saudi Arabia are creating more opportunities for organic food market growth over the forecast period. Millennials are also becoming highly aware of the importance of a healthy diet and overall well-being. Also, the growing awareness of the detrimental effects of chemicals and other additives in food plays a vital role in moving consumers towards organic foods.

Rising urban population and increasing household disposable income are one of the key factors bolstering the growth of the Saudi Arabia organic food market over the forecast period. The adoption of modern lifestyle and increasing disposable income is shifting the consumer preference towards healthy diet patterns and encouraging the consumption of organic food. Moreover, the rising urban population, along with the growing awareness about the remarkable benefits of organic food products, will further increase the demand for organic food products in Saudi Arabia.

The growth of organic agriculture has been accompanied by strict national legislation in order to set the minimum requirements for organic production and favourable government initiatives such as the Sustainable Agricultural Rural Development Program and Organic Action Plan. The Sustainable Agricultural Rural Development Program promotes organic production through an investment of SR 750 million to support small farmers. In addition, the Organic Action Plan focuses on increasing organic production by 300 percent that will further help farmers to increase their production without burdening the scarce water resources.

To know more about the Saudi Arabia Organic Food Market: https://www.gmiresearch.com/report/saudi-arabia-organic-food-market/

Based on type, Organic Diary segment is projected to grow at the highest CAGR of 18.0% during the forecast period owing to the increasing consumer preference for naturally and organically grown dairy products, especially organic milk. In addition, the availability of new innovative products containing low fat and reduced level of sodium have further fuelled the growth of the market. On the other hand, Organic fruits and vegetable segment accounted for the lion’s share of the market in 2018. The key factor which is driving the growth of this segment is increased demand for organic fruits and vegetables by the consumers throughout the year. In addition, the aggressive discounts being given by key players and increasing household disposable income has further spurred the growth of the market.

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Based on the distribution channel, the online store’s segment is expected to grow at the fastest CAGR during the forecast period owing to the increased penetration of e-commerce in the country coupled with favourable government initiatives such as the digital economy initiative.  Souq/Amazon and Noon are the prominent players selling organic food products in the online space. In addition, many new e-commerce companies such as True Beauty by Almizan are coming up with their innovative platforms and are offering organic food products at a competitive price. On the other hand, Supermarket/hypermarket accounted for the lion’s share of organic product sales in 2018. The key factor which is fuelling the growth of the segment is, increase in availability of a  wide range of organic food products at various hypermarkets such as danube, tamimi, carrefour and lulu. In addition, the discounts offered by major players at these hypermarkets and supermarkets are quite attractive when compared with other bricks & mortar distribution channels and thus are being most preferred by the consumers.  

Major key players in Saudi Arabia Organic Food market includes Arla Foods, General Mills Inc., Organic Valley, Danone, Organic Life Est., Natureland, Abazeer, Almizan Natural Trading Company, HiPP and Heinz Baby, among others.   

The Saudi Arabia Organic Food market has been segmented on the basis of type and distribution channel. Based on type, the market is segmented into organic meat & poultry, organic dairy, organic fruits & vegetables, organic spices & pulses, organic processed food, organic cereal & food grains and other food types. Based on distribution channel, the market is segmented  into supermarkets/hypermarkets, online stores, specialized stores, and other distribution channels.

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