Organic farmers fight back after FSA report

It was the news the UK’s 5000-strong community of organic farmers didn’t want to hear.

A report issued by the Food Standards Agency last month cast doubt on one of the organic movement’s core selling points – that organic food was healthier and more nutritious than conventional produce.

Based on research into the nutrient differences between organic and conventional food over the past 50 years, the report’s conclusion was a blow for a sector widely reported to have been struggling in recent months.

According to research published by grocery think-tank the IGD earlier this year, the number of people buying organic produce has dropped from almost a quarter to 19%.

Meanwhile, the latest TNS data show take-home sales of organic food and drink fell 10.9% to £1.01bn in the year to May.

At a time when retailers are pushing premium lines, organic is seen by many consumers as a luxury they can live without during the recession.

Prince Charles’ organic food range, Duchy Originals, has seen a dramatic slump in sales. Profits fell from £1.53m in 2007 to just £57,400 last year, and supermarket chain Waitrose is rumoured to be in talks to take over the struggling brand.

Environmental group Sustain last month launched a plan to raise £500,000 from organic companies to fund an organic advertising campaign to inject fresh growth into the sector.

Backed by organisations including Rachel’s, OMSCo and the Soil Association, Sustain hopes the three-year, £1m campaign will “sort out the confusion” and make sure people “don’t trade down from organic”.

But for former organic farmer Marcus Maxwell, who farms 3000 sheep and 300 beef cattle in Dumfries, the signs of consumers moving away from organic produce led him to return to conventional production systems earlier this year.

“Organic has lost its momentum in the credit crunch,” he said. “People don’t want to pay a huge amount for food. Last year there seemed to be a bit of demand, but lots of lambs are going into conventional markets.

“We weren’t getting a premium for lamb and the feed costs were astronomical – almost three times as much as conventional feed.”

Mr Maxwell said he was forced to reduce stock numbers because he could not grow enough oat silage, and weeds were a big problem.

“Conventional fertiliser is expensive, but it’s made the farm more productive – we have increased the number of cows and we can keep stock on the farm longer,” he said.

“We calculated the youngstock made us £10,000, which has more than covered our loss in organic payments.”

But despite the recent battering the organics sector seems to have taken, retailers are reporting some revival in the market.

Last month, Tesco said the organic sector was seeing some “green shoots of recovery” after sales were hit by the recession.

According to the retailer, month-on-month increases in organic vegetable sales since the start of the year suggested the market would be back on track by the end of the year.

Last week, organic milk buyer OMSCo also reported that retail sales of organic milk had increased significantly – up 10.5% in four weeks.

Encouraged by this upturn, OMSCo is poised to launch a £1m multi-media campaign promoting the benefits of organic milk.

“The most important thing for us to do is to remind consumers of the nutritional differences of organic milk,” said marketing director Richard Hampton.

After the FSA’s report, Mr Hampton may have his work cut out, but there are still enough consumers and suppliers out there who wholeheartedly back organic production and are sure of its future.

Charlie Armstrong, who grows potatoes and rears 4500 breeding ewes on his 1012ha organic farm in Alnwick, Northumberland, said he would never return to conventional production systems.

“There’s still a huge difference at different times of year between conventional and organic lamb, beef and potatoes,” he said. “Ultimately, I have two markets for my produce – conventional and organic – which has to be better than one.

“The market for conventional produce hasn’t gone down, but conventional has gone up from a very low starting point.

“We are still better off being organic, especially with the organic subsidy. I can see why people would be nervous switching to organic, but I wouldn’t go back.”

Richard Jacobs, chief executive of Organic Farmers and Growers, a certification body that helps oversee the UK’s 5000 registered organic farmers, said the organic market had “consolidated”, rather than slumped.

“Organic farmers are still selling their produce perfectly well,” he said. “The FSA report won’t affect sales further – as far as we’re concerned, people who buy organic don’t buy it for nutritional reasons, it’s because they understand the production systems and prefer them to conventional ones.”

IGD chief executive Joanne Denney-Finch agreed the organic market would not be hindered by consumers being put off by claims about nutrition.

“Producers of organic foods have invested heavily in developing their proposition and are unlikely to yield this market without a fight,” she said.

“Traditionally, this has been positioned by producers and perceived by shoppers as a premium product offering a range of values, including animal welfare, environmental benefits, superior quality and taste.

“The challenge for organic is to make sure communication of its benefits is clear and consistent, so shoppers can weigh up the ‘value for their values’ for themselves.

“If they get that right, it would be sensible to assume volume sales could pick up as the economy recovers.”

But regardless of reports or customer demand, Mr Maxwell said the most important thing was that farmers should not be drawn into the old organic-versus-conventional arguments.

“There are lots of good things about organics, but organic is no better or worse than conventional,” he said.

“The organic movement pushes that it has good environmental credentials, but we had to go and top thistles, which takes eight tanks of diesel. What we were saving with one hand, we were taking away with the other.

“There needs to be more environmental work, which is the same for both sides. We have a long way to go.”