New Zealand's organic sector showing major growth

The New Zealand organic sector is growing by around 15 per cent, per annum, according to this year’s bi-annual Organic Aotearoa New Zealand (OANZ) Market Report, which shows there has never been higher demand.

Exports make up 60 per cent of that value, but the domestic organic market is growing twice as fast as conventional production. Chairman Doug Voss says there has been a 30 per cent growth since the last report in 2016 and has an estimated value of $600million, which is consistent with research done internationally on increasing organic sales.

"That was in line with what we expected," Mr Voss said. "We have had good growth, and good responses from surveys that we have been conducting about what people think about organics. A significant finding was 80 per cent of New Zealanders purchased organics, at least, on a fortnightly basis. The reasons were because 86 per cent of them was to look after their own, and their family's health. So the food safety aspect is coming through strong."

The value of exports are up 42 per cent to $355m, fresh fruit and vegetables up 26 per cent to $136m. Europe, North America and Australia continue to be the sector’s primary export destinations, together comprising 69 per cent of all exports, with the global market for organic food worth 85billion Euros, and growing at 10.5 per cent p.a.

Source: 2018 Organic Aotearoa New Zealand (OANZ) Market Report

Mr Voss is also a certified organic kiwifruit grower for more than 20 years, supplying through Zespri, and says demand for organic kiwifruit internationally is so high, it often cannot be met.

"The main horticultural products are kiwifruit and apples - and the viticulture industry is also growing significantly," he said. "If you look at the total dollar value, they are not big money at present when compared with conventional production, but are growing more significantly at good prices. I know in kiwifruit we've have had a significant increase in returns in Europe in the last two years, and it continues to be one of our major export market. While, globally, Japan continues to be our major Asian market supported by other established and developing market destinations in both East Asian and South East Asian markets are established markets which are growing. While volumes and returns from the USA continue to grow."

OANZ says the grower base of organic producers is also growing, thanks to programmes put in place that encourage them to change their growing methods - and it is already paying dividends.

"There is clearly a strong basis for growth," Mr Voss said. "The returns for organic kiwifruit growers are increasing and the gap between conventional and organic returns is widening, and getting greater. There is a strong rationale to move to organic production."

Photo Courtesy: Organic Aotearoa New Zealand (OANZ)

One of the key issues for New Zealand is that there is no legal definition of "organic". In the United States took measures to clarify this problem 12 years ago and Mr Voss says they have had continued increases in production because everyone is on a level playing ground, and people cannot claim they are organic when they are not.

"We are one of the very few countries in the world that doesn't have a legal definition of organic and a national standard to support that," he said. "That in our opinion is quite a significant barrier to people investing and growing organics. We are supporting a process currently underway by the New Zealand Government at present to counter that. They have consulted with the industry and the wider community - and there is an 85 per cent support from them acting on that. We believe that if we get that in place, it will trigger more significant growth."

Photo Courtesy: Organic Aotearoa New Zealand (OANZ)

OANZ is hoping that one thing to come out of the government review with the adoption of a national standard is that it will enable the use of a national certification mark, providing consumers with clear and consistent labelling of what is certified organic products.

While the report found clear growth in the supply and consumption of organic products, Mr Voss adds there is also significant environmental benefits from using 'less intensive organic' growing methods.

"The pressure on the environment is less, but there is also the improvement in growing techniques," he said. "Organic producers can obtain higher net returns per hectare to those of conventional producers. You're not getting the same impact with the use of organic fertilisers and sprays on the soil and water ways. So, it is a win-win situation, and it is the same anywhere you go around the world, it's one of the main discussion points around the sustainability of food production. I think organics are in a space to make a real contribution in that area."

To read the full report visit: www.oanz.org/publications/reports

For more information:
Organic Aotearoa New Zealand
Phone: +64 27 943 2511
[email protected]