Agriculture Reference
In-Depth Information
Conclusion
We have deliberately avoided offering a firm conclusion on just how big the organic market
will grow. Slowing rates of expansion in Europe may suggest that projections the organic
market could reach US$100 billion by 2006 are unduly optimistic, and that global demand for
organic foods may plateau well before we reach this mark. However, few have so far tried to
assess the implications of growing middle classes outside the developed economies of Europe,
North America, Japan and Australia/New Zealand. Further, there is considerable scope still
through adaptations in production, distribution and retailing strategies, and through the
manipulation of retail price premiums, to inf luence demand in the West. The organic industry
needs to at some point confront the question as to whether it wants to grow beyond a market
share that enables it to be dismissed as a niche market and whether it is prepared to take the
steps necessary to support higher levels of demand. For some, legitimately, the answer will be
no. For others, there will be no question that if environmentally sound agricultural practices
are to become the norm there is no choice but to promote aggressive expansion in the organic
sector. However, it cannot be taken for granted that the spectacular growth we have seen in the
organic market over the last decade will continue indefinitely. Neither can it be taken for
granted that the strategies which have underpinned that growth to date will be sufficient even
to ensure the social and economic sustainability of the organic sector as it now stands.
The most obvious way to increase demand for organic foods is to lower retail price
premiums. Improving the visibility, availability and labelling of organic foods also carries
considerable potential. Achieving these will depend not just on an expansion of production
but on the organisation of a range of supply chain arrangements to move organic foods from
the field to the point of sale as clearly differentiated products. Some of these arrangements will
be highly integrated national and international networks. Others will be highly localised and,
at times, informal. We have argued that while concern regarding the potential loss of key
organic values and principles alongside market expansion is justified, the entry of mainstream
retailers and other businesses into the organic sector has created opportunities for smaller
enterprises and supply chains. This may not always be the case, but presently it appears that
the increased market share of large retailers has come from the higher demand they have stim-
ulated and not from the transfer of sales from elsewhere.
In closing, we would reiterate the point that underlies concern about 'conventionalisation';
that is, that organic foods must retain their integrity and authenticity if they are to maintain
any economic value (Latacz-Lohmann and Foster 1997). Although only loosely defined, the
concepts of integrity and authenticity have enabled organic foods to signify a variety of often
intangible attributes related to quality, safety, ecology, tradition and provenance. These per-
ceptions have provided the organic industry with the free advertising that has afforded its
status as the main alternative to industrial agriculture and emphasised all the risks and uncer-
tainties with which mainstream production is attributed. If the market for organic food is to
continue to grow, it must continue to offer, from standards to supermarket shelves to farmers'
markets, the taste, smell and texture of authenticity.
References
Baecke, E., Rogiers, G., De Cock, L. and Van Huylenbroeck, G. 2002. The supply chain and
conversion to organic farming in Belgium or the story of the egg and the chicken.
British
Food
Journal
104(3-5): 163-174.
Beharrell, B. and MacFie, J. 1991. Consumer attitudes to organic foods.
British
Food
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93:
25-30.
