General Mills Inc. (NYSE: GIS) has made a push recently to promote a more organic and even healthy lifestyle. In its most recent announcement, the company said that it will accelerate its commitment to more than double the organic acreage from which it sources ingredients. It now expects to meet its goal of 250,000 acres by 2019.
This increased acreage is directly linked to the company’s goals to grow net sales from its natural and organic products. In February at the Consumer Analysts Group of New York conference, Jeff Harmening, General Mills executive vice president and chief operating officer for U.S. Retail, said the company expects to reach $1 billion in net sales from natural and organic products by 2019, a full year ahead of its previous target.
If we track from 2009, General Mills has increased its organic acreage by 120% and is now among the top five organic ingredient purchasers — and the second largest buyer of organic fruits and vegetables — in the North American packaged food sector.
The company has made sizable investments to meet growing consumer interest in natural and organic foods, which is expected to drive double-digit industry sales growth over the next five years.
John Church, Executive Vice President, General Mills Supply Chain, commented:
To achieve the growth we anticipate for our natural and organic brands, we will need a more robust pipeline of organic growers. We’re building strategic relationships directly with farmers for our products and are dedicated to working with growers to optimize production and quality, adopt standard practices and accelerate supply.
Shares of General Mills were trading up 1.2% at $60.69 Wednesday morning, with a consensus analyst price target of $58.63 and a 52-week trading range of $47.50 to $60.27.