Organic Agriculture: A Trade and Sustainable Development Opportunity for Developing Countries
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Organic Agriculture: A Trade and Sustainable Development Opportunity for Developing
Countries
Sophia Twarog, Ph.D.
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What is organic agriculture?
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Certified organic production: over 30 million hectares, 138+ countries
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4Why Should Governments Care?
• Market failure in agriculture
• Private costs and benefits are not equal to public costs and benefits
• Externalities lead to suboptimal solutions
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5Why Should Governments Care?
International Assessment for Agricultural Science and Technology Development (IAASTD) Report:
Over 400 experts co-sponsored by FAO, GEF, UNDP, UNESCO, WHO and World Bank
Conclusion:
We cannot continue business as usual
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6IAASTD Report
“the way the world grows its food will have to change radically to better serve the poor and hungry if the world is to cope with growing population and climate change while avoiding social breakdown and environmental collapse.”
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OA as a national sustainable development opportunity
• Economic benefits• Food security benefits• Environmental benefits• Social & cultural benefits
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Economic benefits
Net income = (price x quantity) – total costs
Generally, organic farmers earn more.
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Food security benefits
• Higher incomes• Higher yields • Diversified production• Improved nutrition
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Food security benefits• 114 case studies in Africa
conversion to organic or near organic
• 116% increase in productivity
• Sustainable: OA builds human, social, natural, financial and physical capital
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Environmental Benefits
• Less pollution• Improved soil, incl. increased water
retention and less soil erosion
• Enhanced biodiversity• No genetic contamination
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Environmental Benefits, cont’d
• Mitigated climate change• Reduced energy consumption• Landscape services
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Social & cultural benefits
• Benefits for smallholders• Women’s empowerment• Builds on traditional knowledge• Reduced rural-urban migration• Improved health & safety• Community revitalization
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OA as an export opportunity—rapid global market growth
Growth of the global market for organic food and drink 2002-2006 (Billion US Dollars)
23.1 25.5 28.733.2
38.6
0.05.0
10.015.020.025.030.035.040.045.0
2002 2003 2004 2005 2006
Billio
n US
Doll
ars
Source Source: The Global Market for Organic Food & Drink, Organic Monitor 2007
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OA as an export opportunity
• Global sales growth rates at least double those of conventional food products
• Acute supply shortages 2005-2008, more balanced 2009
• Developing country exports rising fast• Price premiums
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Regional Distribution of Organic Food Sales 2008
Region %Europe 51North America 46Other 3
TOTAL 2008: 50.9 billion USD ( double the 2003 value of 25 billion USD)Source: Sahota (2010)
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Regional distribution of certified organic production 2006
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Export opportunities include
• Fresh and processed tropical products• Counter-seasonal fresh produce• Other products with demand-supply
gaps• Ingredients for food processing
industry
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Production challenges
• Little or no government support (policies, ag extension, R&D)
• Conversion period• Knowledge intensive• Sometimes lack of organic inputs• Lack of secure land tenure
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Export challenges
OA exports must:• Meet SPS requirements in import mkt
(same as for convent’l products)• Meet requirements of OA regulations
& be certified by approved cert. body• Meet additional requirements of private
standards (sometimes)
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Export challenges
• Agric. Subsidies in import markets• Need for market information• Consumer preferences for local food• Lack of harmonization, equivalence &
mutual recognition
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Recommendations to developing country governments
• Assess national organic sector & policies
• OA action plan• Consider supporting OA R&D,
extension services, certification costs, development of domestic market, exports, harmonization
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Other factors contributing to success
• Community organization• Group certification
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Recommendations at international level
• Pursue harmonization and equivalence• Take into acct special conditions in
developing countries • Provide market info• Support TC/CB in OA
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UNCTAD initiatives
• Publications• UNCTAD-FAO-IFOAM Global Organic
Market Access project• UNEP-UNCTAD Capacity Building Task
Force on Trade, Environment and Development (CBTF)
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For more information
www.unctad.org/trade_envwww.goma-organic.org
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Thank you!