Significant Opportunities for NZ Organic Exports
Significant Opportunities for NZ Organic Exports in UK
The British consumer’s demand for organic products is surging “dramatically” ahead of supply, says leading organics campaigner Patrick Holden. This is despite the fact that land farmed organically or in conversion in the UK has doubled in area over the past year to reach 250,000 hectares.
Holden, director of the UK Soil Association, will be in New Zealand this week (10 – 14 April). His visit is being hosted by the Soil & Health Association of New Zealand. He will also meet members of the Organic Products Exporters Group, (O.P.E.G.).
Holden says research by the Soil Association last year indicated that the annual UK market for organic products will surpass one billion pounds sterling by early 2001. This figure could be reached sooner. “Everything we predicted last year is turning out to be conservative”, he comments.
The UK currently imports around 70% of all organic food sold. Significant opportunities exist for the whole range of New Zealand organic exports to the UK, says Holden. He cites meat as an obvious example. Organic dairy products are also in demand, he says, with large quantities presently sourced from Denmark.
Holden reports that the major supermarket chains are vying with each other for leadership of the organics market, in particular Waitrose, Sainsbury’s and Tescos. All supermarket retailers are rapidly expanding their organics range in response to consumer demand.
The British farmer is “finally waking up” to this demand, says Holden. There is now three times more land in conversion than is already established as organic. This conversion is being fuelled by premium prices paid for organic products and the severe downturn affecting conventional agriculture. Conventionally produced milk is fetching as little as 13 pence/litre, whereas organic milk fetches nearly 30 pence/litre.
However, Holden is reluctant to use the term “premium” when talking about the market advantage of organic products. “We are obsessed by premiums. We should talk about cost of production, and returning a fair price to the farmer. For instance, the current payout for conventional milk is about 30% below its actual cost of production.”
The fact is that British consumers are driving the market because they are prepared to pay more for organic produce, which they perceive as safer, healthier and environmentally friendly. This is desirable, says Holden, who would like to see more support for organic agriculture.
“Agriculture is not just about producing commodities; it produces a public good. Britain’s National Health Service costs 48 billion pounds a year, whereas our agriculture budget stands at three billion pounds. Only three percent of that (three billion) goes towards organic production.”
In the UK, Holden says that government support for organics is considered inadequate. An Organic Farming Scheme launched last April to help farmers convert ran out of funds only four months later, as far more farmers than anticipated applied. No more funds are supposed to be available before April 2001.
As well as lobbying for greater government assistance, the Soil Association is targeting the UK food industry itself. Holden says he knows of one dairy company helping farmers through conversion, and a few others fore-contracting with their organic suppliers. “There is opportunity for a lot more of this kind of support.”
Holden’s vision is that food companies, the traders who stand to make the most profit, should buy into the principles of sustainable organic agriculture. “They have a responsibility to set aside a percentage of their resource to invest in conversion, research and consumer education.”
The Soil Association is also working closely with food retailers, including big supermarket chains. It meets regularly with the Organic Retailers Group, (an association initiative), to discuss standards, imports, pricing and technical issues.
Holden says that the Soil Association has a positive attitude towards organic imports, as “a legitimate form of sustainable global trade”, with certain reservations. “We don’t expect importers to bring in product to the UK that falls below our organic standards, nor do we expect them to undercut UK products on price, within reason.”
The Soil Association runs a certification scheme that allows an importer to use the association’s label on imported certified organic produce, provided the standards of the certifier in the country of origin are equivalent to the SA standards. This scheme has been used widely by importers of products from other EU countries. (The Soil Association’s Organic Mark is found on more than 70% of all UK registered organic products, and is Britain’s best-known organic label).
Asked to comment on the European Union process of regulating market access for organic products, by establishing a “third country” list of approved suppliers, Holden is less than enthusiastic. “Frankly, I feel very critical of the way the European Commission is organising the establishment of equivalence with third countries. It is very bureaucratic and they’re making a big mess of it.
“The commission could have used IFOAM* standards. That would have been far simpler and globally applicable. The international organic movement has, relatively speaking, got its act together and deserves support. Instead, what we have is big power blocks like the EU and the US (Department of Agriculture) establishing their own criteria for equivalence, and they don’t really know much about organics.”
*International Federation of Organic Agricultural Movements
Patrick Holden has been Director of the UK Soil Association since 1995. He has been involved in the organic movement for 28 years, initially as a full-time organic farmer (1973-1988) and for the last 10 years working for the Soil Association.
He retains his farming interest as a partner on a 230-acre mixed organic farm in West Wales which produces carrots, and milk from 50 Ayrshire cows.
He was a member of the United Kingdom Register of Organic Food Standards (UKROFS) Board (1987-1999) and has international experience of organic standards as Chair of the International Federation of Organic Agricultural Movements (IFOAM) Accreditation Committee (1988-1992).
He is a regular broadcaster, speaker and writer on organic food and farming issues and is a member of the Agricultural Reform Group.
The Soil Association
The Soil Association is the UK's leading campaigning and certification body for organic food and farming. The association develops and provides practical and sustainable solutions which combine food production and environmental protection and human health.
The association has been researching and promoting organic farming as the key to sustainable agriculture since 1946, with its distinctive symbol now widely recognised as the consumer's guarantee of organic quality.
The Soil Association's wholly owned subsidiary, Soil Association Certification Ltd, licenses commercial food production to the highest organic standards and acts as a consumer guarantee of organic quality. The association’s organic expertise has also been applied to developing forestry certification.
Thirty thousand members and supporters back the Soil Association’s campaign for organic farming and sustainable farm use. The association produces two quarterly publications; “Living Earth”, our membership magazine, and “Organic Farming”, the premier journal for organic producers read in over thirty countries around the world.