Farming News - UK organic market worth more than £2bn

UK organic market worth more than £2bn


On Tuesday, timed to coincide with the NFU’s annual conference, Defra secretary Andrea Leadsom announced that UK food and drink exports have risen to the £20 billion mark. Meanwhile, organic producers are celebrating the return to strength of their sector, with the latest figures from certification body the Soil Association revealing that the UK’s organic sector is now worth more than £2bn.

Though it still lags behind other European nations’ sectors, the 2017 Organic Market Reportreveals that the UK’s organic sector has grown for the fifth consecutive year, having recovered from a multi-year contraction in the wake of the 2008 financial crisis. The sector is now worth £2.09 billion. The report shows that total sales of organic products increased by 7.1% in 2016 while non-organic sales continued to decline.

Even so, the organic sector only represents around 1.5% of the total UK food and drink market.

The report outlines several causes for celebration for organic producers; whilst independent retailers have led sales since the sector returned to growth, supermarket sales of organic products were up 6.1% in 2016 (independents’ sales still rose further though, up 6.3%). Home delivery schemes continue to increase dramatically too, with sales experiencing a growth of 10.5%, and catering and food services grew by 19.1%.
 
At the market report’s launch in London, Soil Association leaders said the UK organic sector is in a good position, after Farming Minister George Eustice guaranteed that funding for organic farmers will continue for at least two years after Brexit. The window to apply for support in Scotland is currently open and Northern Ireland is also due to open shortly.
 
Having declined or remained stable for almost a decade, the amount of land in conversion to organic in Britain is now beginning to creep up. Certifiers have publicised the fact that demand for organic produce in Britain has been outstripping supply for some time, and in 2016 Defra reported the first increase (4.9%) since 2007. Despite the increase in land under conversion and applications for organic certification, the overall amount of organic farmland in the UK continued to decline over 2016.

Commenting on the shifting organic landscape on Tuesday, Simon Crichton, Food, Farming and Trade Team Manager at Triodos Bank said, “We’ve helped farmers to finance 1,185 hectares of additional organic land in 2016, a threefold increase on last year. We’ve seen dairy doing well as are those who have direct relationships with consumers, whose confidence in organic has increased.

“There are a number of opportunities for organic farmers at the moment - but those looking to convert, need to have a solid market for their product. Clearly, having certainty around support payments would be of great assistance but agriculture has always had to take a long term view and organic methods are well placed for both environmental and financial sustainability.”

Organic exports up: half of certified producers exporting goods
 
Liz Bowles, head of farming at the Soil Association said, “It has been a difficult time for all British farmers but the future looks positive for organic. We are relieved that organic support is set to continue for new applications until at least 2020 and we are constantly working to ensure organic farming is part of all the post-Brexit agriculture discussion.
 
“There are good opportunities for organic farmers if you find the right market. Dairy, beef, poultry and eggs have all seen sales growth this year. British farmers can take confidence in the fact that UK-produced organic products are highly regarded around the world so export is and will continue to play a big part in UK organic. In addition people are more aware than ever about buying British, and more aware about how their food is produced, which will help increase organic sales in the future.”
 
Playing into the export statistics released on Tuesday by the environment department, the Soil Association highlighted increasing export sales, claiming that UK organic sales are catching up with market growth rates around the world. The global organic food market is valued at $81billion and the UK represents around 4% of global sales and nearly half (49%) of Soil Association Certification licensees are exporting products - compared to 20% of producers in the wider food industry - with an estimated value of exports at £250m.