Sugar Duties Jeopardize Organic Advantage as Generation Z Seeks Budget-Friendly Wellness Options
The introduction of tariffs on imported sugar is having a growing impact on how consumers make purchasing decisions, especially among Gen Z and more progressive buyers, as organic food retailers brace for possible price increases. Historically, these tariffs have led to U.S. sugar prices remaining about 50% higher than the global average, pushing food manufacturers to opt for more affordable alternatives like high fructose corn syrup (HFCS) [3]. This policy has had a ripple effect on organic foods, which are already priced about 53% above standard groceries [4]. Experts suggest that additional tariffs might reduce the price difference between organic and non-organic products by driving up costs for imported conventional produce, which makes up more than a third of fruits and vegetables brought into the U.S. [4].
Younger generations, including Millennials and Gen Z, are central to the expansion of the organic market, with 44% of buyers considering organic certification to be important or highly important [2]. These consumers are drawn to products that are healthy, environmentally friendly, and ethically sourced—spurring sales of organic baby foods, plant-based proteins, and products with clean labels [2]. According to the Organic Trade Association’s 2024 report, organic sales hit $69.7 billion in 2023, marking a 3.4% increase from the previous year [1]. However, this growth, which relies on higher prices, could be threatened if tariffs further accelerate inflation. For example, replacing HFCS with real sugar in products like
Trade regulations and shifting consumer priorities are closely linked. While organic labels typically assure buyers of transparency, better animal treatment, and environmental stewardship, younger consumers are most influenced by health benefits—like avoiding synthetic pesticides and antibiotics [1]. Yet, this group is also becoming more mindful of environmental issues, hinting at a future trend toward more altruistic buying motives [2]. This evolving mindset gives the organic sector opportunities to innovate with new products, such as convenient organic proteins or plant-based options that match Gen Z’s focus on ease and sustainability [2].
Changes in policy could help address these hurdles. Supporters of reform believe that ending sugar tariffs would make natural sweeteners more affordable, fostering a healthier and more dynamic marketplace. For instance, reducing import restrictions on sugar could help close the price gap between organic and conventional foods by boosting supply, as organic imports currently make up less than 5% of total produce [4]. Such reforms would fit with the increasing demand for both transparency and budget-friendly options, especially among younger, more cost-conscious consumers [1].
The outlook for the organic industry will depend on its ability to balance innovation with keeping products within reach for average consumers. While tariffs may provide short-term support for domestic sugar farmers, they could also turn away younger generations who care about health and affordability. As Millennials and Gen Z make up a larger share of the population, industry leaders will need to find ways to lower costs and highlight the real benefits of organic certification to support ongoing growth [1].
