UK shoppers want ethical food without paying more

Tue Jul 7, 2009 1:46pm EDT
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By Sharon Lindores

LONDON (Reuters) - Britons have an appetite for ethical food, but as the recession bites shoppers are anxious to spend less.

Sales of ethical food, such as organic produce grown without chemicals, and Fairtrade products for which farmers in poor countries are paid more to help improve living standards, are both slowing.

"There is a huge propensity for people wanting things to be done in an ethical manner," said Jonathan Banks, U.K.-based business insight director with market research firm the Nielsen Company.

"But they are not going to make repeat purchases on something that is not good value for money," he said.

After years of rapid growth, organic sales in supermarkets fell 11.6 percent year-on-year to June 14, 2009 and Fairtrade sales rose just 5.7 percent, according to statistics from research company TNS Worldpanel.

In 2008, organic sales totaled 2.1 billion pounds in the UK and Fairtrade sales were in excess of 700 million pounds, according to organic and Fairtrade industry sources.

Organic foods in supermarkets are typically marked up 25 percent, Neilsen's Banks said, adding that the premium is turning price-conscious shoppers against purchases.

Sales of organic produce in farmers' markets, boxes of organic food delivered to people's homes, and standard Fairtrade food items appear to be recession proof.   Continued...

<p>Freshly picked, organically grown potatoes sit in a basket on an allotment in the village of Lane End, Buckinghamshire, southern England, June 23, 2007. REUTERS/Simon Newman</p>