Demand high, laws tightening for EU organic market - FreshFruitPortal.com

Demand high, laws tightening for EU organic market

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Demand high, laws tightening for EU organic market

Organic fresh fruits and vegetables are no longer a niche category in Europe as the market progresses quickly and more products are added to the offer, presenting year-round opportunities for suppliers. Eosta organic carrots - panorama

According to local distributors, European retailers are focusing increasingly on their organics offerings in direct response to consumer demand for produce that is healthy, safe and offers a story about its origin.

"Lots of organic products have gone mainstream," explains Peter Abma, the commercial director of Fairtrasa Holland which has just celebrated its first anniversary following the merger of Organic Fruit and Vegetables with the Fairtrasa Group in early 2013.

"You can’t think of a supermarket in Europe now that doesn’t stock organic apples and pears, and demand is rising for avocados, limes and ginger too."

Organic apples, pears, oranges, bell peppers and tomatoes on the vine are currently the biggest selling items at Eosta, another major European distributor of organic fresh produce, but its CEO Volkert Engelsman is seeing demand for an ever larger assortment.

"Whereas a few years ago passion fruit and papayas were seen as exotic tropical delicacies, today we are selling organic Mamey sapote, kurkuma and vanilla, which many of our customers don't even stock as conventional,” he says.

Markets to watch

With 83 million inhabitants, Germany represents the biggest market for organics, according to Abma, who supplies mainly Germany, Scandinavia, the U.K., Switzerland, Austria, Greece, Italy, Spain, France and Portugal.

"Consumption is also fantastic in Denmark and with only 5.7 million people living there our turnover in the country is amazing," he says.

Abma has just returned from a trip to Sweden where organic produce represents an impressive 12% of the overall fruit and vegetable departments at the two supermarket chains that work with Fairtrasa Holland.

"It might be a bit over exaggerated but Swedish journalists are claiming that conventional fruits, especially bananas and table grapes, are dangerous to eat because of the pesticides, so we're seeing an enormous increase in the volume of bananas going to Sweden.

Abma says he is also seeing more and more consumers in the Netherlands choosing organic over conventional although currently only 5% of the organic produce distributed by Fairtrasa Holland stays on the domestic market.

Even the U.K. is showing growth following a dip in demand during a prolonged recession.

"Over the past seven years organics have proved to be recession proof because people choosing organics are doing so not out of economic reasons but because they feel it is the right healthy choice for themselves and their families," Engelsman explains.

Abma agrees, and points out that only the occasional purchasers of organic produce returned to buying some conventional items during the economic crisis.

Demand has evolved

According to Engelsman, demand for organic and sustainable products has always been driven by an "awareness elite" who have the intellectual ability to understand the importance of looking after their health and planet.

"In the past, the main reason for choosing organic was the fact that the products were chemical-free but there is much more going on today," he suggests.

Engelsman says today more than ever consumers are making conscious purchasing decisions, with young people in particular choosing organic.

"Consumers want to know where their food is coming from and what is involved in getting the product from the farm to the store.

"Since organic agriculture is generally speaking more transparent and natural, easier to understand and closer to people's hearts these conscious consumers are going organic."

Secondly, he claims that food scares have led to a growing distrust in the food sector at large, whereas organic products enjoy a positive, healthy image that is not connected to large multinationals or stakeholders.

Thirdly, Engelsman believes the health trend in Europe, or rather the focus on proactive healthcare, is also driving demand for natural and healthy products like organics.

Potential for suppliers

While Europe remains a significant organic producer, the need for year-round availability still presents much potential for other suppliers to fill the gap.

"European consumers are keen to buy as locally as possible but they want to eat organic produce all year round and there are always some periods where there is a lack of supply," Abma says.

"That's why we're working with Kenya on organic avocados because there's a gap of a few weeks between Mexico and Peru."

Peru itself also has an opportunity, according to Abma, thanks to the growing demand for the avocado category as a whole, and particularly in view of the quality of organic avocados which have a higher oil content.

In nearby Colombia, meanwhile, Abma believes the potential is huge now that the Colombian government is stimulating investment in production across areas previously deemed too dangerous to enter.

"There's lots of virgin land between the cities and areas controlled by the FARC guerrillas which has never been used," he reveals.

"It's a very interesting prospect because the climate is perfect in Colombia and Cartagena is only a couple of days away from the Netherlands by boat."

A few months ago, Fairtrasa Holland began importing organic fruit from Colombia and Abma sees potential for organic papayas, passion fruit and pineapples in particular.

However, with the European Commission (EC) proposing stricter regulations on domestic and imported organic fresh produce, supply in general could be affected in the near future as the industry adjusts.

Engelsman, however, is confident that the future remains very bright for organics.

"We do not expect that the proposals will have a significant impact on the demand for fresh organic fruits and vegetables," he assures.

"But there are obviously concerns – the new regulations will be tighter so it will be even more difficult for growers who want to convert to organics."

Engelsman concludes that it would be much better if the EC acted tougher on conventional standards and residue limits.

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