Organic food could be 'missed opportunity', warns report

The study, from the Centre for Agricultural Strategy of the University of Reading's School of Agriculture, Policy and Development, argues that an opportunity is being missed.

It claims that farmers in the UK, Denmark, Ireland, Italy and Portugal are increasingly reluctant to consider organic production, even though the market for organic produce is growing all the time.

"The UK has the third largest retail market for organic produce in the world,"​ said Philip Jones of the Centre for Agricultural Strategy. "Yet less than half of the produce we buy is home grown.​

"The situation in some other EU countries is even more challenging, with reversions back to conventional agriculture increasingly common in countries like Denmark."​

This is despite the fact that a significant portion of European consumers clearly want to buy organic. The Soil Association's latest figures show that organic food and drink sales grew by 11 per cent in 2004.

But with these increased sales comes greater pressure on farmers.

The Reading report is based on a large EU-funded research project that shows that farmers face a number of obstacles to organic conversion. These include a lack of established markets for organic produce, particularly for direct and local marketing; falling price premia; and the high investment costs necessary for organic livestock enterprises.

But most importantly, there is a perception among farmers in all the study countries that organic is a niche market with limited growth potential.

As a result, the Soil Association estimates that just less than four per cent of UK farmland is managed organically. And unless retailers provide real guarantees they will support domestic organic produce across the board, many farmers are still reluctant to undergo the expensive conversion process.

There is also the danger that unless governments and supermarkets take action, consumers will become distrustful of food labelled as organic. Recent publicity surrounding the food miles issue has marred the reputation of the top four UK supermarkets Tesco, Asda, Sainsbury's and Morrison's.

Last year Tesco, Asda and Morrison's were found to import huge amounts of organic pork and beef.

And the UK's Food Standards Agency has been working on the development of new testing methods for organic food following allegations that some suppliers have been involved in fraud.

Some positive steps have been taken. Sainsbury's, currently the UK's third largest chain, has seen demand for British organic milk soar by 80 per cent in 2005, and says it is encouraging domestic farmers to convert to organic production.

It has also promised suppliers that it will contribute to organic conversion costs in a new three-year scheme.

This is the type of scheme that the researchers at Reading see as vital if opportunities within domestic organic markets are to be realised.

"It is clear that interested parties such as governments and supermarkets should be trying to increase demand for organic products, particularly through raising the awareness of the organic concept amongst the public by means of generic advertising and education campaigns,"​ said Jones.