Unit 3
Unit 3
DEVELOPMENT
Structure
3.0 Objectives
3.1 Introduction
3.2 Milestones in Organic Farming
3.2.1 Present Status
3.2.2 Global Market
3.2.3 Standards and Regulations
3.2.4 Certification and Accreditation
3.3 Organic Farming Initiatives in India
3.3.1 India Organic
3.3.2 Facilitating Factors for Organic Farming
3.3.3 Constraints for Organic Farming
3.4 Organic Market
3.4.1 Major Organic Products from India
3.4.2 Market for Organic Products
3.4.3 Potential Customers for Organic Products in the Domestic Market
3.4.4 Products Comparative Advantage
3.5 The International Market
3.5.1 Japanese Organic Market
3.5.2 US Organic Market
3.5.3 The European Organic Market
3.5.4 Price Premium for the Organic Products
3.6 Future Development
3.7 Let Us Sum Up
3.8 Key Words
3.9 Further References
3.10 Model Answers
In the past few decades, organic farming gained considerable attention in most
of the developed countries. The number of organic farms has substantially
increased, accounting for five per cent and even more in some European countries.
At the same time, the market shares of organic products has also grown up.
Now organic products can be found in shops and supermarkets in most cities.
Today developing countries are the major producers and suppliers of organically
farmed produces to the growing market demand in developed countries. Organic
farming has increasingly gained attention as a way to manage natural resources
in a more sustainable way and to raise income especially of small holders in
developing countries. In this Unit we shall be looking at the status of organic
farming globally as well as locally. We shall also examine the market potential
and future development of organic farming.
Present Status and
Development
Organic farming is being practised in about 120 countries in the world. The ill-
effects of chemicals used in agriculture have changed the mindset of
consumers of western countries that are now buying organic products at a
premium price. Policy makers are also promoting organic farming for restoration
of soil health and re-generation of rural economy apart from making efforts for
creating better environment. We shall be discussing these later in this unit. Now
I
let us understand the development of organic farming movement to the present
status.
I
The organic movement began as a reaction of few scientists and farmers against
the commercialization of agriculture using excessive chemical inputs. Advances
in biochemistry that led to using of urea as a source for nitrogen and development
iI in engineering that led to discovery of the internal combustion engine in the early
20th century made profound changes in farming. Ammonium nitrate, used in
ammunitions, became an abundantly cheap source of nitrogen. DDT, originally
developed by the military to control disease-carrying insects affecting troops,
I was applied to crops, launching the era of widespread pesticide use. Innovation
t
I
in all aspects of agriculture, like advances in large-scale irrigation, fertilization,
I
and the use of hybrid seeds, pushed up the agricultural output to grow in size.
The cropping became more efficient with the widespreed use of chemicals and
iI machinery resulting in reaping bumper harvests. Many of us were happy with
1 these modern farming methods that led to the Green Revolution.
However there were a few farmers and scientists who were very cautious
t about these rapid changes. They started crcitically examining the changes
I happening in the soil, environment, plants and food that is produced and
i health of the people. They also suggested alternative farming strategies to protect
the environment as well as health of the people. These initiatives formed the
basis for organic farming movement. It will be interesting to review these
. initiatives here.
The first initiative was in Germany, by Rudolf Steiner and his book Spiritual
i Foundations for the Renewal of Agriculture, published in 1924. It led to
i
i
The British botanist, Sir Albert Howard studied traditional farming practices in
Bengal, India. He regarded such practices as superior to modern agricultural
practices and recorded them in his 1940 book, An Agricultural Testament.
I The term "Organic Farming" was coined by Lord Northbourne in his book
II "Look to the Earth', fromhis conception of the farm as organism.
Lady Eve Balfour, author of the organics classic The Living Soil, established
the pioneering Haughley Experiment in organic farming on her SuffoUc Farm,UK
in 1939. 45
Overview
the 1940s and published the first issue of Organic Farming a n d Gardening.
It was a truly significant event in the history of organic farming. The book and i
the author are often credited with launching the worldwide environmental 4
movement. 1
,
In the early 1970's David Holmgren and Bill Mollison started to develop i
ideas that they hoped could be used to create stable agricultural systems or 1
/
permanent agriculture. A design approach called permaculture emerged with the i
publication of Permaculture One in 1978
across national and linguistic boundaries. In the 1980s, various farming and
consumer groups worldwide began pressing for government regulation of organic
production. This led to emergence of legislation and certification standards
beginning in the 1990s. Since the early 1990s, the retail market for organic
However, the volume and variety of "organic" products expanded with large
commercial farms.
2) Why there was increase in the consumers for organic products in the
west?
3) Which are the countries having most of organic farmi,ng area under
cultivation?
Organic Farming- An
overview 3.3 ORGANIC FARMING INITIATIVES IN INDIA
The first "scientific" approach to organic farming can be quoted back to the
Vedas of the "Later Vedic Period, 1,000 BC to 600 BC. The "Vrkshayuweda"
(Science of plants), the "Krishisastra" (Science of agriculture) and the
"Mrgayurveda" (Animal Science) are the main works. The essence of these
scriptures was to live in harmony with nature, rather than over exploit it. (Dealt
also in Unit 1).
The Indian National Standards for Organic Production and India Organic Logo
are governed by APEDA, which provides national standards for organic products
through a National Accreditation Policy and Programme.
- The aims of the National Programme for organic production include: ( I ) to
provide the means of evaluation of certification programmes for organic agriculture
and products as per internationally approved criteria, (2) to accredit certification
programmes, (3) to facilitate certification of organic products in conformity to
the National Standards for Organic Products, (4) encourage the development
of organic farming and organic processing.
4) Local market demand is modest with low consumer awareness. The few
established distribution or sales outlets are often not part of the
mainstream.
Organic Fanning- An
3.4 ORGANIL ~ v l n ~ n1r , 1
V l gialllL 1 1U U U L W 11U l l l
1 1VliaJUl IlIUIia
1
According to the FAO study of mid-2003, India had 1,426 certified organic
farms producing approximately 14,000 tons of organic food annually. In 2005,
I
1
black gram); Oilseeds (groundnut, castor, mustard and sesame): Fruits (banana,
sapota, custqd apple and papaya); and Vegetables (tomato, brinjal, and leafy
vegetables), besides honey, cotton and sugarcane (especially for jaggery).
Organic production of meat items like poultry, livestock and fisheries is yet to
figure in India.
TYpe Products
Commodity Tea, Coffee, Rice, Wheat.
Spices Cardamom, Black pepper, White pepper, Ginger, Turmeric,
Vanilla, Mustard, Tamarind, Clove, Cinnamon, Nutmeg, Mace,
Chillies, Vanilla extracts, Thyme, Oregano, Parsley, Garcinia.
Pulses Red gram, Black gram, Pigeon pea, Chickpea, Green gram.
Fruits Mango, Banana, Pineapple, Passion fruit, Orange, Cashew
nut, Walnut, Custard apple and Papaya.
Vegetables Okra, Brinjal, Garlic, Onion, Tomato, Potato.
Oil seeds Sesame, Castor, Sunflower, Groundnut, Mustard.
Others Cotton, Herbal extracts, Honey, Sugarcane.
This accounts for 7.5% of total organic production. The market has not grown
large so far due to lack of marketing initiatives from key players (producers,
traders, NGOs,etc.), the low awareness about organic products and higher
price.
The domestic market for organic products is not well developed as the export
market. Most organic production originates from small farmers. Wholesalers/
traders account for a 60% share in the distribution of organic products. Large
organized producers distribute their products through supermarkets as well as
through self-owned stalls. Considering the profile of existing consumers of organic
products, supermarkets and restaurants are the major marketing channels for
organic products. Major consumers of organic products are in metropolitan
cities like Mumbai, Delhi, Calcutta, Chennai, Bangalore and Hyderabad. The
health conscious middle class families are the majority to buy organic foods.
Vegetables and fruits are the major organic products desired by the 1ndian
customers. NGOs play a very important role in promoting market for organic
products.
Awareness about the presence of organic products is quite low among the large
majority of Indians. In the metropolitan cities only 25% of the consumers was
aware of the goodness organic products. The purchase ratio of organic to
conventional products is 1:10. The organic products currently being consumed
are rice, wheat flour, pulses, vegetable and fruits.
India is likely to grow more crops organically in the coming years for export
market. Accordingly, the area under organic cultivation for some of the export-
oriented crops will go up soon. In addition, there will be increasing production
for local consumption, as domestic market in a growing economy can also
absorb bigger quantities of organic products particularly, fruits and vegetables.
-~ -~ ~
Products available for the export market are rice, wheat, tea, spices, coffee,
pulses, frits and vegetables, cashew nuts, cotton, oil seeds and herbs. The
channels adopted for the export of organic products, except for tea, are mainly
through export companies. Organic tea is produced by organized tea estates
and exported directly.
I i
3.5.1 Japanese Organic Market Present Status and
Development
The largest Asian market for organic products is Japan. The Japanese organic
market has been characterized as a market with high demand and strong
purchasing power, and with low domestic supply of organic products. The
annual growth of the organic market in Japan is about 20 per cent. Organic
products to Japan have to be labelled with the Japanese Organic State Logo
(JAS) and also the imported organic products must meet Japanese national
standards.
I In the United States, organic food is sold to consumers throkgh the following
channels:
Organic land increased over 2004 survey by almost 510,000 hectares (+8 per
cent) in Europe as a whole and by 490,000 hectares (+ 8.5 per cent) in the
European Union. The increase in the EU is due to high grdwth rates in the new
member states (for instance Lithuania and Poland) as well as substantial increases
in Italy and Spain. Support for organic farming in the European Union includes
grants under the European Union's rural development programs, legal protection
under the recently revised EU regulation on organic faming (since 1992) and
the launch of the European Action Plan on Organic Food and Farming in June
2004. Countries that are not EU members-alsb get similar support.
European consumers are used to buying their organic products from the.
supermarket chains, natural food stores or direct from the organic producer. In
the European Union, organic products are grown according to the EU
Regulation 2092191. In Switzerland, BIO SUISSE certification plays an
important role in the marketing of organic products
7) Pineapple 28
8) Banana 31
9) Nuts 40
Hybrid Seed : Seed of plant that got by crossing two varieties or species
*:
defferential from HYV.
4) Rachel Carson
5) Rudolf Steiner
2) 1) 1972
2) Biodynamic -
3) Lady Eva Balfour
4) David Holmgren & Bill Mollison
5) Northbournes terminology
6) Rachel Carson
7 ) 1999
3) Tea, Coffee
4) Cardamom, Black Pepper, White Pepper
5) Mumbai, Bangore,Delhi, Chennai
63 NGOs
Check Your Progress Exercise 3
2) Natural food stores, conventional grocery stores and direct sales from
farms
3) Italy
4) Germany
5) Switzerland
6) APEDA