Best Practices for Organic Policy - What developing country - UNEP

Best Practices for Organic Policy
In addition, if the production targets the special market for certified organic products, there are premium
prices to earn. A recent evaluation (Forss and Lundström 2005) of the EPOPA 5 programme, as well as the
evaluations by the International Fund for Agricultural Development (IFAD) (Giovannucci 2005), show
that the income of participating farmers can increase substantially. Certified production gives access to a
premium market, or simply better market access. Most of the certified production in developing countries
is intended for the export market.
The organic market
The market for organic products has grown rapidly since 1990 and global sales were estimated to be
around US$ 30 billion in 2005 and US$40 billion in 2006 (Sahota 2007). The biggest market is the United
States, followed by Germany, the United Kingdom, France, Japan and Italy. The share of organic products
in total food sales exceeds 4 per cent in Denmark, Sweden, Austria and Switzerland, while in the larger
markets it is about 2 to 3 per cent. 6 In developing countries, organic markets are still small, but growing,
especially in upper-income developing countries.
The first organic markets developed in specialized health food shops and in other non-mainstream outlets.
This has changed over the last 15 years, and normal supermarkets, as well as “organic supermarkets” (e.g.
Whole Foods in the United States, Basic and Alnatura in Germany) in most countries from the
Organization for Economic Cooperation and Development (OECD), sell organic products. Almost all
major retailers and food companies in OECD countries are involved in the organic sector. In most cases,
organic producers have to meet the same competitive parameters as their conventional counterparts
regarding prices, logistics and packaging. Because of the stringent organic standards, organic producers
often have fewer problems adapting themselves to other demanding standards such as EurepGAP. For
example, traceability has already been part of the organic certification process for decades and is not
perceived as a major obstacle to organic producers; the fact that no pesticides are used makes it easy to
fulfil increasing demands that no pesticides be detected in products 7 . Nevertheless, especially for small
producers the demand for documentation and procedures in both organic and other systems can prove to be
too demanding. In developed countries, there has lately been a move for more direct sales by small
producers, something that has been supported by increased interest for local and regional food and
discussions about “food miles” 8 .
Organic is often promoted as a solution particular to small farmers. It is true that small farmers often have
a production system that is closer to organic and therefore are often early adopters of organic production
methods. However, as markets develop and the policy environment changes, large producers will also
enter the market simultaneously with large food industries and multiple retailers. With them, the same
pressures of competition will also be exerted on organic small farms as on their conventional counterparts.
Organic farms in Europe, originally small farms in marginal areas, are today more or less the same size as
conventional farms (in some countries a little smaller, in others a little bigger than average). Therefore,
organic should not be promoted mainly as a strategy for incorporating marginalized farmers in remote
areas in the global markets. Having said that, there are some aspects of organic farming that makes it
particularly suited for small farms, such as low use of inputs, diversity in production system, etc.
5 Export Promotion of Organic Production from Africa, www.epopa.info.
6 The market statistics for organic products are still fairly unreliable in most countries.
7 UNCTAD has carried out considerable research on environmental and health requirements and market access
for developing countries. See, for example, the Trade and Environment Review 2006 (UNCTAD 2006), Food
Safety and Environmental Requirements in Export Markets – Friend or Foe for Producers of Fruit and
Vegetables in Asian Developing Countries? (UNCTAD 2007), Codes for good agricultural practices:
opportunities and challenges for fruit and vegetable exports from Latin American developing countries:
Experiences of Argentina, Brazil and Costa Rica (UNCTAD 2007).
8 “Food miles” concerns the transportation of food in the global food system, and the growing distance between
consumers and producers. It is driven by a mixture of environmental concerns, i.e. energy consumption and
pollution from transports, concerns for the survival of small producers also in developed countries, and the
widening gap between consumers and producers.
4