Organic Agriculture Industry

Vision Australia

Publication Date	February 2005
Publisher	RNCOS
Product Type	Report
Pages	90
ISBN Number	not applicable
Product Code	RCS00009

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Summary

Organic/biodynamic production is a system that rests upon a broad range of philosophical and practical action strategies, which directly contribute to a healthy biosphere and people. It does not use synthetic chemicals, artificial high input fertilizers, or genetically modified organisms. In fact, it promotes enhanced biological activity through integrated management in its pathway to sustainability.

There is a dramatic global shift towards organic/sustainable agricultural systems and it is a significant emerging agricultural industry in Australia. Currently, Australia has close to 2000 certified organic producers, processors and retailers of organic food and fiber products. They operate in diverse industries, including grains and pulses, horticulture, viticulture, beef and pork, dairy and honey. Collectively these enterprises account for products estimated to be valued at $180 million annually at the farm gate.

Organic markets are emerging worldwide, mainly in response to the increasing consumer concerns about food health and safety, and a community desire for sustainable food production. With an almost unprecedented demand for a commodity in scarce supply, marketing opportunities abound, but an equally serious challenge to the organic industry is shaping a sustainable future and bringing all sectors of the community with it. Challenges of addressing the growing sophistication of an informed consumer, the rapid loss of natural resources, rural viability and terms of trade are big questions for Australia, which in part are now addressed by organic agriculture. Notwithstanding its successes, the research and development needs of the growing organic sector are enormous.

Report Highlights

The number of certified organic farms in Australia and their location.
Different kinds of agricultural products that are grown or produced on certified organic farms.
What are the characteristics of the operators of certified organic farms?
What type of relationships do organic farmers have with these downstream supply chain businesses?
The type of involvement the farmers have, or wish to have, in collaborative forms of marketing.
The ongoing growth of the world's most rapidly expanding food sector.
How might the marketplace adapt to alternative supply models?
How does Organic Agriculture best illustrate the many improvements required in natural resource management, particularly in the Australian environment?
Alternative production and supply chain models that might prove beneficial in breathing life back into rural communities?
How can policymakers use the shift, so successfully illustrated in organic agriculture, as a model for innovative economic and social changes?

Report Features

The organic agriculture industry in Australia is certainly more than the sum of its farmers. It is composed of processors, retailers, input providers, certifying organizations, and a range of other individuals and organizations. Yet, sustainable agriculture, both in Australia and globally, originated with the voluntary efforts of like-minded farmers. It was their innovation that provided the base for the vibrant industry evident today. The aim of this report is to provide a profile of the Australian organic industry at the farm level. Chapter 3 sets out to answer the assessment and review of Australian organic sales and production. As you proceed with Chapter 4, the report addresses organic food supply chain and marketing. The sound management of its supply chain relationships. Ensuring that relationships between farmers and other supply chain members are well structured. Providing meaningful feedback on market needs is crucial to establishing and sustaining demand-focused supply chains.

Chapter 5 examines how processors, wholesalers, and distributors (post-farm-gate supply chain participants), view the sustainable agriculture industry and its development. It also examines the role processors, wholesalers and distributors currently play, and how they see the future.

Chapter 6 reports consumer trends and profiles. Chapter 7 discusses organic food exports and import indicators and what certifying organization labels are displayed on organic produce sold in stores in Australia. As the reader goes through chapter 8, the report contains organic food in overseas market. Legislative framework and regulations are discussed in chapter 9 and finally chapter talks about government initiatives and assistance.

Content

1. Executive Summary
2. Organic Food and Agricultural Market - Key Developments and Research Brief
3. Australian Organic Sales and Production - Assessment and Review
- 3.1 Level of Farm-gate Prices and Price Premiums
- 3.2 Farm-gate Organic Milk Pricing
- 3.3 Value of Production in Recent and Future Years
- 3.4 Total Farm-gate Receipts from Sale of Organic Production, by State
- 3.5 Organic Farmers Lifestyles and Employment Standards
  - 3.5.1 Segmentation by Gender
  - 3.5.2 Education Level
- 3.6 Commodity Level Analysis of Products Sales and Receipts
4. Organic Food Supply Chain and Marketing
- 4.1 Survey of Organic Farmers in Collaboration to Supply-Chain Management
  - 4.1.1 Beef
  - 4.1.2 Sheep and Goat Suppliers
  - 4.1.3 Pig, Pork and Ham
  - 4.1.4 Poultry Products
  - 4.1.5 Milk and Milk Products
  - 4.1.6 Cereals
  - 4.1.7 Vegetables
  - 4.1.8 Fruits and Nuts Production
- 4.2 Future Plans
5. Beyond the Farm Gate: Perspectives of Processors, Wholesalers and Distributors
- 5.1 Demand for Organic Food Processing Units
- 5.2 Supply Chain Snapshots - Role of Processors, Wholesalers and Distributors
- 5.3 Organics - A Demand Driven Sector!
- 5.4 Market Momentum - Effect of Costs, Prices and Premium Offers in relation to Economy
- 5.5 Marketing Activities and Consumer Preferences to Organic Food and Farming
- 5.6 Outlook
6. Consumer Trends and Profiles
- 6.1 Australian Organic Food Market - Buying Capacity
- 6.2 Demographic Profile of Organic Consumers
- 6.3 Attitudinal Profile of Food Consumption by Organic Consumers
- 6.4 Factors influencing increasing rates of Organic Food Consumption
- 6.5 Willingness to Pay for Certified Organic Food Products
- 6.6 Outlook
7. Organic Food Exports and Import Indicators
- 7.1 Exports
  - 7.1.1 Product Certification
  - 7.1.2 Total Certified Organic Food Exports, (1999-2003)
  - 7.1.3 Percentage of Total Export Volume by Destination, 2003
  - 7.1.4 Export Market Development
- 7.2 Imports
  - 7.2.1 Processed Food
  - 7.2.2 Other Imports
- 7.3 Future Outlook
8. Organic Food in Overseas Market
- 8.1 China
- 8.2 Germany
- 8.3 Hong Kong
- 8.4 India, Sri Lanka and South-east Asia
- 8.5 Indonesia
- 8.6 Japan
- 8.7 Malaysia
- 8.8 Philippines
- 8.9 Singapore
- 8.10 South Korea
- 8.11 Taiwan
- 8.12 Thailand
- 8.13 Vietnam
- 8.14 United Kingdom
- 8.15 United States
9. Organic Industry - Legislative Framework and Regulations
- 9.1 Australian Quarantine and Inspection Service
- 9.2 National Standard for Organic and Biodynamic Produce
- 9.3 Other Standards and Regulations
  - 9.3.1 Codex Alimentarius
  - 9.3.2 International Standard 65 and European Standard 45011
- 9.4 Domestic Regulations
  - 9.4.1 Australian Competition and Consumer Commission
  - 9.4.2 Australian/New Zealand Food Standards Code, Imported Food Control Act 1982
10. Government Initiatives and Assistance
List of Figures:
- Figure 2-1: Distribution of Certified Organic Farms by State, 2003
- Figure 2-2: Proportions of Certified Organic Farms producing different Products, 2004
- Figure 2-3: Co-operative or Collaborative arrangements among Organic Farmers
- Figure 3-1: Total Farm-gate receipts from Sale of Organic Production (by State)
- Figure 3-2: Organic Farmers (by Gender)
- Figure 3-3: Number of Organic Farmers (by Qualification)
- Figure 4-1: Organic Beef Product Sold through Supply Channels
- Figure 4-2: Organic Sheep and Goat Product Sold through Supply Channels
- Figure 4-3: Organic Pork Product Sold through Supply Channels
- Figure 4-4: Organic Poultry Product Sold through Supply Channels
- Figure 4-5: Organic Milk and Milk Products Sold through Supply Channels
- Figure 4-6: Organic Cereal Product Sold through Supply Channels
- Figure 4-7: Organic Vegetable Product Sold through Supply Channels
- Figure 4-8: Organic Fruit Product Sold through Supply Channels
- Figure 6-1: Primary Places of Purchase for Certified Organic Food
- Figure 6-2: Organic Food Consumption (by Education)
- Figure 6-3: Organic Food Consumption (by Income)
- Figure 6-4: Motivating Factors behind Food Choice of Organic & Non-Organic Consumers
- Figure 6-5: Attitudes to Food-Related Issues
- Figure 6-6: Simplified path model for increasing consumption of Organic Foods among those who had consumed at least some Organic Food over preceding 12 months
List of Tables:
- Table 2-1: Farm-gate Sales Volumes from Certified Organic Farms in Australia, 2004
- Table 3-1: Description of Supply Chain Businesses
- Table 3-2: Quantities of Organic Product Sold as Organic or Conventional (by Product Category and State), 2004
- Table 3-3: Weighted average Price Premiums for Organic Products (by State)
- Table 3-4: Average Price Premiums for Sales Channels (by State)
- Table 3-5: Average Price for Organic Milk (by State)
- Table 3-6: Proportion of Organic Industries where Farm Business is Main Occupation, (by State)
- Table 3-7: Mean Age of Organic Farmers (by State)
- Table 3-8: Educational level achieved by Organic Farmers
- Table 3-9: Sum of receipts from Sale of Certified Organic Products as Organic (by Product Category), 2004
- Table 4-1: Relationship with Beef Supply Chain Partners
- Table 4-2: Relationship with Sheep and Goat Supply Chain Partners
- Table 4-3: Relationship with Pig and Pork Supply Chain Partners
- Table 4-4: Relationship with Poultry Supply Chain Partners
- Table 4-5: Relationship with Milk Supply Chain Partners
- Table 4-6: Relationship with Cereal Supply Chain Partners
- Table 4-7: Relationship with Vegetable Supply Chain Partners
- Table 4-8: Relationship with Fruit and Nut Supply Chain Partners
- Table 6-1: Implicit Prices for Organic Food Attributes
- Table 7-1: Product Groups included in ANZSPC Codes
- Table 7-2: Total Certified Organic Exports (1999-2003)
- Table 7-3: Certified Organic Exports by Product Group (standardized net mass, kg or l), 1999-2003
- Table 7-4: Percentage of Total Export Volume by Destination, 2003