Organic Updates

 

The World Market for Organic Bananas*

Organic bananas are a fairly recent item to enter the world market, and although they represent less than one percent of all banana sales, demand has been growing at 20 to 30 percent annually. Major importers are Germany, France, the UK, the United States, Canada and Japan. Major exporting countries include the Dominican Republic, Mexico, Honduras, Costa Rica, the Philippines, and Israel. Global imports for 1998 are estimated at 27,000 tonnes compared with >11 million tonnes for all bananas. A breakout of imports is summarized in the following table.

 

Organic Banana Imports - 1998

 

Demand for organic bananas is expected to remain strong and continue growing. In Europe especially, mainstream supermarkets are behind the surge in demand as they search for higher volume, uniformity and a more constant supply. However, there are constraints to increased production:

 

-- Prevalence of a pathogenic soil fungus not effectively treatable with organic methods;

-- Higher labor costs, and cultural requirements more suited to small and medium-sized farmers than to large-scale growers;

-- Difficulties maintaining soil fertility without synthetic fertilizers;

-- High costs and risks during the transition period from conventional to organic production;

-- Logistical problems such as higher per-unit freight charges due to low volumes shipped.

 

* This analysis reflects information from "The Market for 'Organic' and 'Fair Trade' Bananas," FAO, February 1999.

 

Organic Farming in Poland

Currently, about 500 farms in Poland are certified organic or are in transition to organic production methods. Total area in organic production is about 10,000 hectares (24,700 acres) or 0.3% of Poland’s total arable land. The average organic farm is 12-15 hectares (30-37 acres), which is slightly larger than the average conventional farm, although organic farms larger than 100 hectares (247 acres) do exist.

 

Three organizations certify organic production in Poland: Ekoland, the Polish Association of Organic Farming, and ROL-EKO. Currently, certification by Polish organizations is not accepted for exports destined for the EU. Since 1991, Dutch certifier SKAL has certified some Polish farms, and negotiations have begun with French and Germany certifiers to provide this service. Observers believe there is potential for organics to grow in Poland, particularly to supply the EU market, but improvements are needed in volume produced, packaging and marketing. So far, exports have consisted of black currants, strawberries, onions, dried vegetables, chicory-grain coffee, and frozen fruits and vegetables to Germany and the Netherlands.

 

The government of Poland supports organic agriculture with subsidies that cover the cost of certification (US$25-75). This year, a new subsidy will assist existing and transitioning producers at the rate of US$16-24 per acre). Organic legislation, patterned on existing EU regulations, is being developed.

Source: Attache Report PL9011. The report also includes a translation of Ekoland’s organic standards.

 

Organics in Brazil

Starting from a small base, Brazil’s organic production has grown at a rate of 20% over the last two years according to industry sources. About 10% of Brazil’s total cultivated area (50 million hectares, or 124 million acres) is under "alternative" agricultural production methods, but less than 100,000 hectares (247,000 acres) are certified organic and in commercial production now. Brazilian farmers are becoming more interested in organics for several reasons: the high cost of agricultural chemicals (Brazil imports about half of what they use); the lower costs associated with organic production methods; organic premiums that can range 20-50% above conventional prices; burgeoning consumer demand for organic products at home and overseas; and concerns about the environment.

 

Brazil’s major organic exports are soybeans, sugar and frozen concentrated orange juice (FCOJ). Projected production of organic soybeans for the 1999/00 season is 7,000 metric tons, up nearly 120% from the previous year. Major markets are Germany and Japan. Organic sugar exports for 1999 are expected to total 4,000 metric tons in 1999. Company officials claim that this represents one third of the world market for organic sugar. Organic orange production grew 233% from 1998/99 production levels of 450 thousand 40.8-kilogram boxes to an estimated 1.5 million boxes for the 1999/00 marketing year. The organic orange crop, which is produced by 400 small farmers and represents 5% of the national orange production, is destined for the EU market in the form of FOJC. Other exports include palm oil, tobacco, coffee, fruit pulp, malt and dried beans.

 

Domestic demand for organic products is beginning to expand as well. Approximately 80% of the organic food sold in Brazil moves through supermarkets, and items in highest demand are fresh fruits and vegetables, and refrigerated processed foods. American organic products are virtually unknown in Brazil as most organic imports come from the EU and Argentina.

 

In October 1998, the Brazilian government published proposed organic national standards. The final version is expected to be released soon.

Source: Attache report BR9616.

 

Is Internet Marketing for You?

The Winter 1999 issue of USDA’s Small Farm Digest has an informative article of interest to all producers–regardless of size–who are thinking about advertising on the Internet. The article can help producers decide if the Internet is appropriate for their operations, and lists basic decisions that need to be made and tips on how to get started using this latest form of direct consumer marketing.

 

Internet advertising reaches the world community and can be the entry point for U.S. producers to the export market. As noted in the article, for example, a fruit producer from Utah said that since advertising on the Internet, customer orders have increased, some from as far away as Australia and Europe.

The full article can be viewed at: http://www.reeusda.gov/agsys/sfd/sfdv2n2.htm

 

 

FAS/HTP Expands the Organics Web Site

FAS’s Horticultural & Tropical Products Division organics web site has been expanded and given a new look. In addition to the monthly Organic Perspectives newsletter, and links to articles published by FAS, the new home page features a direct link to attache reports from around the globe that relate to organics. Also included are links to other agencies and programs, and to USDA press releases relating to the National Organic Program.

 

For more news on organics, see HTP’s monthly newsletter "Organic Perspectives," available at the HTP home page: http://www.fas.usda.gov/htp/organics/organics.html

 

The newsletter contains reports on organics from around the world gleaned from attache reports, trips made by HTP’s organics staff, and other sources. The newsletter also covers items of interest about the U.S. national organic program and the domestic organic industry. A list of upcoming conferences, trade shows and other events is included in every issue.

 

(For further information, contact Janise Zygmont (analysis) at 202-720-1176 or Kelly Strzelecki (marketing) at 202-690-1341.)

Last modified: Tuesday, May 08, 2001