BROWN CALLS FOR ANSWERS
I think the organics sector is an important part of the overall product offer in produce. However, despite the zealous campaigning by the Soil Association, it is part of the offer, not the only offer, says Martin Brown, managing director of The Greenery UK.
I think the sector has shown considerable growth over the last few years, but on what grounds? Is it better for you? Is it chemical-free? Neither of these questions can be answered properly; the growth has come from a fear factor that conventional is bad, and organic must be better.
As for glasshouse production, I believe there is a very fine line between organic and conventional. We have been doing a large number of trials on residue-free product, spraying crops before the fruit has formed and then not spraying until after cropping. We have had a lot of success with this - but where does this fit in? It is grown in hydroponics and rockwool and not soil, but will be residue-free. So how is this marketed? If we highlight it as residue-free, does that mean that other conventional product is bad for you? And in the consumers’ eyes, what is the difference between residue-free and organic?
As growers get better at further limiting spraying, the lines between organic and conventional, certainly in glasshouse crops, will become very close. Will there be a premium for it in the future, as there is today? I doubt it.
THE TRUTH IS ON OUR SIDE
The influence of the organic sector goes way beyond the people who buy and produce organic fruit and vegetables, says Guy Watson, owner of Riverford Organic Vegetables.
It has set the agenda in terms of pesticide use, the environment, packaging and sustainable farming, and the Soil Association has been key to these issues and has started the ball rolling.
Most people are changeable about the reasons why they buy organic food. The Soil Association has made many attempts to explain the concept, but issues like biodiversity and animal welfare are not very well understood, and it is difficult to communicate what organic farming is all about.
The campaign for genetically modified food is coming on strong again, but I believe that the truth is on our side, and that organic is the way forward to produce sustainable food for the world.
The big advantage for a business involved in organics is that consumers are genuinely interested in what you do, and you can build up a good database of like-minded people. But the perception of the price of organic vegetables is something that stands in our way. The vegetables we deliver to our customers’ homes are as cheap as those of the supermarket, but when we have carried out customer research, we have found that people think we charge twice the amount we do.
In a broader sense, the organic sector has been very successful. There is a huge amount of dissatisfaction in food at the moment, and people have rightly or wrongly seen organic food as an alternative. I would expect there to be more growth in the future, although over the last 18 months, the local food trend has taken preference, but I think that will be short-lived.
ORGANICS: NO REAL IMPACT
Does the organic label have any real impact on volumes of produce sold? That is the question and I have my doubts, says Colin Galbraith, director of Fresh World. There is now some confusion over organics and conventional, with conflicting reports in the broadsheets and tabloids as to what is good and what is not good for you, as well as about how organic production actually works.
Apart from those who want to save the planet, or vegetarians who do not want their children to be “poisoned”, the vast majority of the population, as long as they are fairly sure that what they are buying is safe, is more concerned with good-quality produce at reasonable prices. Has anybody done a comparison as to the emergence of value packs in the supermarkets and their volume sales say, over the past five years, in comparison to the increase or decrease of organic product? Looking at the shelves, the growth of value packs may be greater than organics, and that tells you that people are more concerned with their pockets than worrying about environmental matters or how food is produced.
Until the organic sector establishes a clear picture of what is positive about its product, or what is extremely negative about conventional, then the vast majority of the population will let it pass over their heads.
Whether supermarkets are selling organic produce and using it as a marketing tool, rather than really developing organic produce for the masses, is questionable. Therefore, the future of the sector in present circumstances is limited, and possibly over-hyped.
There are several producers with very good intentions who offer organic produce direct to consumers, albeit very pricey, but they are serving organic product without going through conventional distribution methods, which must have some environmental benefits. But when it comes to mass marketing of the product through multiple retailers, somewhere along the line the message has been blurred.
FOODSERVICE PREFERS LOCAL
The organics sector is important to the industry, but I am not 100 per cent convinced that it fits fully into the foodservice sector, says Sarah Cooper of Coopers Produce. For us, it would be like if we sold second-grade produce, as well as Class I. It can be difficult to keep them separate in the warehouse, as well as ensuring organic as opposed to conventional is delivered correctly to the customer.
Organic produce has a very rustic appearance, which sometimes does not always look aesthetically pleasing to the eye. Supermarkets, on the other hand, have successfully pushed this sector forward, but I feel that their volumes have left it difficult to guarantee continuity of supply within foodservice. While we have a number of customers requesting organic produce, we tend to find they are more focused on locally grown produce. I believe that produce from a sustainable source, where the growers are receiving the right return, is becoming more important than organic.
I really do feel the focus on locally grown fruit and vegetables from sustainable sources will increase, as this is something we can all relate to and see the benefit of through the UK economy.
ORGANICS WILL SUFFER IN CREDIT CRUNCH
People are tightening their purse strings at the moment, and this will affect the sales of organic produce, says Amry Jones, processed and category manager at importer JO Sims Ltd. As a consumer myself, I have started to convert back to conventional as the purse strings tighten, despite being a fan.
Organic supply continues to be challenging, but that is the nature of the sector. Demand has slowed down, but the sector still has the health message on its side, as well many people preferring the taste, as supported by many top chefs. I believe organics has a really good future.
JO Sims grows organic apples and cherries in the US, and it is one of its most successful areas. But the disadvantage for us in the US is that not many growers are willing to go the extra mile to achieve European certification (EOVP), because the USDA standard is accepted as organic worldwide and, with high demand, Europe is not high on their customer list.
There isn’t one governing body that pinpoints the organic standard worldwide, and it means our supply is limited. We need to start talking to other countries, starting with the US, about their organic standard, with the aim of getting one certified body we can all sign up to.
PREMIUM MUST BE REDUCED TO SEE FURTHER GROWTH
The UK sector has had enormous success over the last three years; however, it now faces a significant challenge, admits Organic Farm Foods’ Adam Wakeley.
The declining UK economy is worrying for the organic produce sector. As consumers find their disposable income reduced by the cost of day-to-day living, the choice to purchase organics over conventional products will become less clear. Retailers are very aware that the premium between conventional and organics is the key reason for organic sales remaining at a low penetration level, when most consumers would purchase organics all the time if the cost were the same, and therefore reducing that premium remains the challenge if we are to see further growth. However, the world market for organics continues to grow, and therefore demand has increased in markets overseas, meaning that growers now have the choice to export to those markets that deliver the best returns. This leaves the UK market with an increasing availability issue.
The spiralling increases in the cost of oil will clearly increase the cost of production for all forms of food production; however, oil-based inputs, such as nitrogen fertiliser, will have a more pronounced effect on the cost of conventional food. This may well help to go some way to reduce the premium between the two types of food production. However, increasing demands from emerging markets may well mean that further premiums will have to be paid to secure availability.
Supermarkets have generally been a great support to the organics sector, as they fully appreciate the need to offer consumers a choice. Certainly Waitrose, Sainsbury’s and Tesco see it as an integral part of the offer, and now Asda is joining the party. We welcome this, as these retailers not only reach consumers across the country, bringing choice to all, but importantly they protect the integrity of organics as the brand remains of paramount importance to them.
The message that the sector has sent to the public has been one of health only, but eating organic is about much more than that - it is also about sustainable, environment-friendly farming, and not all people in the industry understand what the real benefits are.
Organic farming uses around 25 per cent less energy than conventional farming and, when you also take into account the benefits of soil carbon in organic farming, the carbon footprint of organically farmed food is further reduced. This is very important, as I believe that the carbon footprint on food will become key to the decision-making process when consumers purchase produce.
MIXED MESSAGES MUST STOP
There are mixed messages concerning organic and conventional produce, says Peter Cornish, commercial director at Pollybell Organic Farms. And there is a danger to organic produce, if conventional producers continue to reduce chemical inputs and are able to communicate this to customers.
The sector has lost the unprofessional side of its image as availability has improved, but still has some way to go in explaining the quality differences between the two sectors.
However, the organic sector now makes up to 10-15 per cent of the fresh produce market, and I believe its presence may have brought some of the health issues to the fore quicker than the conventional sector was doing.
I think that unless the credit crunch is very intense, there will be no effect on consumer preferences. This is because all food is still relatively cheap and, as long as organics are readily available, they will continue to be chosen.
THROWING UP A CHALLENGE
Worth more than £15 million, with a 3.5 per cent value share of the prepared salad category, the organic salad market is proving increasingly important to the sector, says Mark Newton, managing director of Florette. While offering more choice and versatility to consumers, in turn, the development is challenging producers to adapt production methods to meet organic criteria.
Advantages include the sector’s ability to respond to consumer demands, offering new tastes and trends. Admittedly, this puts new pressures on all parts of the supply chain, meaning producers need to invest further.
Consumers are definitely receiving mixed messages, and there is much confusion about health and environment issues surrounding organics. The sector would benefit from clear debate and good direction, from both the government and the press.
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