Ryan Koory, senior economist, Mercaris, Silver Spring, MD, provides insight into the current organic commodity grain outlook, including market pricing and acreage dedicated to organic grain cultivation. This is the first installment of a new, regular content perspective on the business of snack and bakery commodities.
Food use remains the minority share of U.S. organic grain and oilseed demand. But as a market driver, its importance cannot be understated. From a product-side perspective, consumers demand organic cereal and oilseed crops as either animal feed in the form of meat, or as packaged food goods like boxes of cereal, crackers, bread, etc. Due to the sizable presence of meat protein in U.S. diets, organic crop use for animal feed provides the lion’s share of demand, similar to what you see in the corn and soybeans in the conventional sector. However, unlike the conventional sector, packaged organic food goods have a lot of space to increase their market share, and there is room to provide price premiums and incentives for farmers to expand acreage.