Natural, organic industry will grow at slower pace

BOULDER – A local economist and a nutrition publisher foresee slower growth ahead for the natural foods industry.

Economist Richard Wobbekind and Nutrition Business Journal Publisher Patrick Rea shared their economic outlook for the industry on Thursday at the fifth annual Naturally Boulder Days 2009.

The event, with the theme, “Driving Through Turbulent Times,” was held Sept. 2-3 at the Millennium Harvest House Boulder.

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“The industry will recover, but the 20 percent growth rates are a thing of the past,” Rea said. “Firms must remodel for slower rates of expansion.” Rea said he predicts about 5 percent growth rates moving ahead.

Rea said the natural and nutrition industry will have to pay attention to action in Washington D.C., as there is an increasing movement to place additional regulations and supervision on supplement and organic products.

He added that the industry will need to improve strategies on Internet marketing as more consumers shift online.

Although 2008 was a tough year for the economy, Rea said the natural and nutrition product sector increased sales to more than $100 billion. This includes an increase of providing supplements and ingredients to the mass food markets.

Some of the biggest stars in 2008 were in natural pet foods. The sector saw sales spike after the melamine scare in non-natural pet foods, which was sickening and killing pets.

The children healthy foods and supplement market also saw significant growth in 2008, Rea said.

Wobbekind, director of the Business Research Division at the University of Colorado’s Leeds School of Business, gave an overview of the general economy, saying that he saw the light at the end of the tunnel, but recovery would be slow.

In the consumer sector, Wobbekind said that economists have noted the trend of consumers quickly substituting in an out of goods based on incentives. Car sales for example, surged on the Cash for Clunkers program, but now have dropped off.

The big concern in the long run is government spending, but Wobbekind said he doesn’t expect a significant rise in interest rates for at least another 18 months.

In Colorado, Wobbekind said the economy is better off here than in the rest of the nation, but still struggling with job levels equal to three years ago. Economists predict that the state will be one of the first out of the recession, but still predict hardly any job growth for 2010.

Farmers should collaborate

Fred Kirschenmann, the keynote speaker at Naturally Boulder Days, said driving through turbulent times has more to do with collaboration among farmers and adjusting to climate changes than it does with the immediate pressures of the economy.

Kirschenmann, a leader in the sustainable agriculture industry, said people have been living in the industrial revolution too long, and that era will end within the next couple decades out of necessity.

Instead of companies and farmers looking out for themselves and finding ways to make the most profit with the smallest investment, emphasis will be placed on improving soil quality, adapting to weather changes, partnering with other growers to deliver products and growing sustainable crops.

Retzloff receives lifetime award

Naturally Boulder Days kicked off its fifth year with the presentation of four awards Sept. 2, one to a Boulder entrepreneur and three to local companies.

Mark Retzloff, chairman and co-founder of Boulder-based Aurora Organic Dairy, received the Lifetime Achievement award. Retzloff co-founded Aurora Organic Dairy in 2003 and currently serves as chairman.

 Retzloff began his 40-year career in natural products in 1969 as a co-founder of Eden Foods, and has since participated in the startup and management of several leading natural and organic foods companies, including Alfalfa’s Market and Horizon Organic Dairy.

Mix1, a nutritional beverage company in Boulder, received the Best Young Business award; Eco Products, a producer of compostable food-service ware based in Boulder, received the Company of the Year award; and Community Food Share in Niwot, Boulder County’s food bank, received the Local Hero Award.