Chocolate is latest U.S. organic heavy-hitter

By Regan E. Doherty

CHICAGO (Reuters) - Organic chocolate sales are booming as more U.S. consumers seeking untreated natural ingredients are choosing the sweet treat to satisfy their cravings, and mainstream companies are entering what was once considered a high-end market.

Chocolate is the largest growing snack segment in the U.S. organic market, according to an industry study, with organic sales tallying a 49 percent increase in sales in 2006.

Organic chocolate sales totaled a still small $70.8 million fraction of the market in the year, according to a Euromonitor report cited by the Dagoba Organic Chocolate company, compared with total U.S. chocolate sales in 2006 of about $6 billion.

The average American consumes about 12 pounds of chocolate per year, said Cathy Strange, global chocolate buyer for Whole Foods Market Inc. (WFMI.O), which sells organic brands like Dagoba, Green & Black's, Lake Champlain, Chocolove and Newman's Own.

Jay Jacobowitz, president of Retail Insights, a consulting service for natural products retailers, said the trajectory for organic chocolate will likely track that of the organic food market, which is on a double-digit growth spurt.

Organic chocolate is made from cocoa grown without pesticides and herbicides. Producers use certified organic sugar, essential oils, fruits, and nuts in accordance with USDA organic regulations.

In the chocolate market, as in other food areas, education about issues like sustainability and fair trade, as well as product quality, has evolved.

"We have a growing interest in where our food comes from, its pedigree," Jacobowitz said.