September 21st, 2010 | Simcha Weinstein | Comments Off on The Challenges of Organic Food Production
Consumer demand for organic products has widened over the last decade. Since the late 1990s, U.S. organic food production has more than doubled, but the consumer market has grown even faster. Organic food sales have more than quintupled, increasing from $3.6 billion in 1997 to $21.1 billion in 2008. More than two-thirds of U.S. consumers buy organic products at least occasionally, and 28 percent buy organic products weekly – this according to the Organic Trade Association. This astonishing growth has led to some shortages in certain areas of the organic supply chain. In response to these shortages, Congress in 2008 included provisions in the Food, Conservation, and Energy Act (2008 Farm Act) that, for the first time, provided financial support to farmers to convert to organic production. But will this be enough?
There are several factors to look at as the organic industry battles through these growing pains. As consumer demand for organic products has broadened, organic retail sales have moved well beyond the boundaries of co-ops and natural foods stores, and are now found not just in college towns and strong urban areas, but in larger mass market stores located throughout the country. Retail giants like Wal-Mart, Costco and Target now carry organic products, and according to a 2008 study by the Hartman Group, 69% of U.S. consumers purchased organic products in 2008. As more and more large-scale conventional retailers enter the organic marketplace, supplies will inevitably become more challenging to keep up with. Food production cannot occur at the same pace that retail outlets can expand. The marketplace is indeed changing.
With the growth of organic demand, it has become increasingly more challenging to find reliable supplies for organic raw materials and ingredients. Dairy farmers and soy producers face the toughest supply challenge as shortages of domestically raised feed grains and soybeans impact the industry. With these shortages we see higher pricing for organic grains and feedstuffs. With the advent of the National Organic Program (NOP) in 2002, organic products can be imported to the U.S. from anywhere in the world as long as they meet the NOP standards and are certified as organic. Still, the cost of bringing in imported food compared to U.S. product is driving the prices upward on many key items.
Not only has the organic supply chain become an issue, but trying to keep up with supplies and remain true to “organic values” is also creating issues for organic growers and manufacturers. The cottage appeal that was once the hallmark of the organic industry is undergoing a face lift. As companies scramble to keep up with supplies, they are suddenly forced to look for organic ingredients in places where the standards for working conditions and wages may not be in line with what we are accustomed to here in the U.S. And while food from these countries is considered acceptable, at least in terms of meeting the standards for organic, they might not always meet the “philosophical standards” that many consumers have come to expect from organic foods. This is our challenge. As organic continues to grow, and perhaps over time even becomes the food of choice for most Americans, can it expand and grow in a way that finds the balance between commerce and the philosophy which made it so popular and exciting in the first place?
Will organic cattle ranchers consistently be able to treat their livestock with respect, providing access to the many acres that they are now free to roam? Will the organic industry end up being a fossil fuel glutton due to the necessity of importing food for year round supplies? Most people who buy organic foods believe that they are buying not only a healthier product, but also are purchasing food from producers who are true custodians of our land – stewards of the earth. Our challenge will ultimately become far greater than simply having enough organic food to sell; our challenge will be to increase organic food production and still remain true to the values that reignited this food revolution decades ago. It’s a challenge we must meet.