Organic Ethnic and Fair Trade Foods FINAL

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Organic, Ethnic, and Fair Trade Foods

Introduction .................................................................................................................................... 2

Scope of the Report ................................................................................................................. 2 The Canadian Market .................................................................................................................. 4

Imports ....................................................................................................................................... 8

Trends and Opportunities ..................................................................................................... 12 Trade Practices........................................................................................................................... 16

Competition ............................................................................................................................. 16

Trade Shows ........................................................................................................................... 17

Quality ...................................................................................................................................... 17

The Buyer ................................................................................................................................ 20

Price ......................................................................................................................................... 23 Packaging and Transportation ............................................................................................. 24

Labelling................................................................................................................................... 25

Distribution................................................................................................................................... 28 Import Regulations ..................................................................................................................... 32

Inspection ................................................................................................................................ 32 Tariff Rates .............................................................................................................................. 33 Licensing .................................................................................................................................. 34 Relevant Canadian Laws and Regulations ........................................................................ 34

Taxes ........................................................................................................................................ 34

Antidumping ............................................................................................................................ 35

Tips for Exporters ....................................................................................................................... 36

Sources of Information .......................................................................................................... 38 Trade Shows ........................................................................................................................... 39

Publications ............................................................................................................................. 39

This publication has been produced by TFO Canada with funding from the Canadian International Development Agency. All information

provided in this document is based on the best available at the time of preparation and is offered without responsibility on the part of TFOCanada. The reader is advised to check periodically with TFO Canada for updates.

This publication is distributed subject to the condition that it shall not, by way of trade or by any means, be lent, sold, hired out or otherwisecirculated in any form other than that in which it is published, including this notice. This publication shall only be made available to assist

businesses, trade support organizations, and government agencies which have their head office and operations residing in countries eligible forinternational development assistance from the Canadian government. In no case may it be sold or distributed at any cost, direct or implied, nor

may it be published on a publicly accessible website or equivalent, without TFO Canada ’s consent.

© Trade Facilitation Office Canada, 2013

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Organic, Ethnic, and Fair Trade Food s

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1 Introduction

Population

Canada’s population, estimated at 35.1 million inhabitantsin January 2013, is expected to reach between 40 and 47million by 2036 according to Statistics Canada.

Although it is the second largest country in the worldin terms of land area, Canada’s population density isthe lowest of all major industrialized countries, atonly 3.7 persons per square kilometer (km2). A largepart of Canada is above the temperate zone. In thisnorthern part, extremely cold temperatures,transportation challenges, and a high cost of livingaffect agriculture and habitation. It is not surprising,

therefore, that population density in the Yukon, Northwest Territories, Nunavut and Northern Québec

average less than one person per km2. In the temperate zone, however, population density ranges from24.7 persons per km2 in Prince Edward Island, to 1.4 persons per km2 in Newfoundland and Labrador. Insummary, nearly 80% of Canadians live within 160 kilometers of the border with the United States (U.S.),mainly in large urban centres throughout the central and western parts of the country. In 2011, nearly 7Canadians in 10 were living in one of Canada's major cities, up from 6 in 2006.

Scope of the Report

In 2007, Canada became the first country in the world to track organic products moving across its border. As of June 2013, a limited number of Certified Organic Commodity Harmonized System Import Codeswere registered to track imported organic products ranging from dairy to fruits and vegetables. This list(shown below) is a work in progress and exporters should check for up-to-date codes through the

Canadian Food Inspection Agency (CFIA) website at: http://www4.agr.gc.ca/AAFC-AAC/display-afficher.do?id=1199997881628&lang=eng

http://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/demo23g-eng.htmhttp://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/demo23g-eng.htmhttp://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/demo23g-eng.htmhttp://www.rcmp-grc.gc.ca/bi-if/index-eng.htmhttp://www.rcmp-grc.gc.ca/bi-if/index-eng.htmhttp://www.rcmp-grc.gc.ca/bi-if/index-eng.htmhttp://www4.agr.gc.ca/AAFC-AAC/display-afficher.do?id=1199997881628&lang=enghttp://www4.agr.gc.ca/AAFC-AAC/display-afficher.do?id=1199997881628&lang=enghttp://www4.agr.gc.ca/AAFC-AAC/display-afficher.do?id=1199997881628&lang=enghttp://www4.agr.gc.ca/AAFC-AAC/display-afficher.do?id=1199997881628&lang=enghttp://www4.agr.gc.ca/AAFC-AAC/display-afficher.do?id=1199997881628&lang=enghttp://www.rcmp-grc.gc.ca/bi-if/index-eng.htmhttp://www.statcan.gc.ca/tables-tableaux/sum-som/l01/cst01/demo23g-eng.htm


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Current List of Certified Organic Commodity Import Codes, June 2013

Chapter 4 - Dairy Products, Eggs, Natural Honey

0403101010 Yogurt within access commitment0403102010 Yogurt over access commitment

Chapter 7 - Edible Vegetables; Certain Roots and Tubers0701900010 Potatoes, except seed0702002910 Tomatoes, Cherry, except process0702009921 Tomatoes, Roma, excluding greenhouse0702009929 Tomatoes, excluding greenhouse0703103910 Onions or shallots, green0703109910 Onions0704109010 Cauliflowers and headed broccoli0704209010 Brussels sprouts0704902910 Broccoli0704903910 Cabbage, except Chinese0704904910 Chinese cabbage or Chinese lettuce0705119020 Cabbage lettuce, head lettuce, excl. greenhouse0705199029 Lettuce0705199021 Lettuce, pack fresh salad cut mixes, 1kg0706102011 Baby carrots, in pack 1 kg each0706104010 Carrots0706903010 Beets0706905910 Radishes0707009920 Cucumbers & gherkins, excluding greenhouse0708109910 Peas (Pisum sativum)0709209910 Asparagus

0709300010 Eggplants, aubergines0709409010 Celery, other than celeriac0709609020 Peppers: Capsicum or Pimenta, excl. greenhouse0709700011 Spinach, NZ & orache spinach (garden), 500g0709700019 Spinach, New Zealand & orache spinach0709994010 Sweet corn-on-the-cob

Chapter 12 - Oil Seeds And Oleaginous Fruits; Seeds AndFruits; Medicinal Plants1211901010 Herbal tea, in bags, for individual servings

Chapter 15 - Animal or Vegetable Fats And Oils

1509100011 Olive oil, virgin, in container sizes < 18 kg

Chapter 8 - Edible Fruit & Nuts; Citrus Fruit or Melon Peel

0803900011 Bananas, other than plantains0804300011 Pineapples0805100012 Oranges, except Temple0805400010 Grapefruit, including pomelos0805500011 Lemons0805500012 Limes0806109110 Grapes, o/t species Vitis labrusca0807110010 Watermelons0807200010 Papaws (papayas)0808101081 Apples, Golden Delicious, not for processing0808101082 Apples, Red Delicious, other than for processing0808101083 Apples, Granny Smith, other than for processing0808101084 Apples, Gala, other than for processing0808101089 Apples, other than for processing0808302910 Pears0809292910 Cherries0809302910 Peaches, excluding nectarines0810109910 Strawberries, except for processing0810201910 Raspberries & loganberries0810401011 Cranberries0810401022 Blueberries, cultivated

Chapter 9 - Coffee.Tea, Maté and Spices0901110010 Coffee, not roasted, not decaffeinated0901210010 Coffee, roasted, not decaffeinated0902101010 Green tea, not fermented, individual serving bags0902109010 Green tea, not fermented, in packages 3 kg0902301011 Black tea, not decaf, individual serving bags0902309011 Black tea, not decaf, in pack


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The Canadian Market

Organic Foods

According to a major new report by the Canada Organic Trade Association1 (excerpts of which arepresented here), in 2012 Canada’s certified organic food market was valued at nearly $3 billion out of atotal organic market of $3.7 billion, as shown in the table below.

Estimated Value of Canadian Organic Sales in 2012

Sales Value ($ million) Market Share (%)

Total Canadian Organic Market 3,686.6 n/a

Total Organic Food & Beverage Sales (excluding alcohol) 2,978.6 1.7Organic Alcohol 135.0 0.67

Organic Supplements 34.4 1.25

Organic Fibre (linen & clothing) 24.2 0.15

Organic Personal Care 41.1 0.45

Organic Pet Food 4.1 0.25

Organic Household Products 8.2 0.2Organic Flowers 3.0 0.1

Organic Exports from Canada 458.0

The traditional market for food in Canada has shifted considerably in terms of tastes, largely as a result ofmore women in the workforce, immigration, an ageing population, and an increase in health-

consciousness. In general, reliance on organic and semi-prepared food has increased, the average mealpreparation time has fallen, and purchases of healthy fast foods have grown. Supporting theseobservations is the fact that the value of the Canadian organic food market has tripled since 2006, faroutpacing the growth rate of other agri-food sectors. In 2006, organic products made up less than 1% ofgrocery sales (excluding fresh) in mainstream retail in Canada; by 2008 this climbed to 1.3%, and in 2012reached 1.6% nationally. Including fresh products, organic foods make up 1.7% of total food sales withthe very low market penetration of organic meats and poultry dampening total market share. BritishColumbia continues to lead this trend with organic products enjoying nearly double the market share thanthat seen in the rest of the country. Alberta and Ontario have the next most developed organic marketsbased on mainstream retail sales.

The Canadian Organic Trade Association report noted that Canadians who buy organic groceries onlyspend $17.50 more per week than those who do not purchase organic (the weekly grocery bill for an

organic shopper is about $132.70 compared to a conventional shopper who spends $115.22 per week). Itis interesting for exporters to note that most Canadians (98%) expect to increase or maintain theirspending on organic food over the next year, mainly in the fruit and vegetable, meat and poultry, dairy,and bread and grains categories.

A diverse consumer base is driving the sector, with 58% of all Canadians buying organic products everyweek. In 2012, Canada’s major weekly buyers of organic groceries were found to be:

By ethnicity: 67% non-Caucasian

1 Canada’ s Organic Market: National Highlights 2013: http://www.ota.com/pics/media_photos.171.img_filename.pdf

http://www.ota.com/pics/media_photos.171.img_filename.pdfhttp://www.ota.com/pics/media_photos.171.img_filename.pdfhttp://www.ota.com/pics/media_photos.171.img_filename.pdfhttp://www.ota.com/pics/media_photos.171.img_filename.pdf


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By region: 66% British Columbians By age: 62% 35-44 year-olds By education: 61% university educated By family unit: 62% families with children under two years old; and By urban area: 63% of people in Canada’s largest cities

The Canadian food industry has also changed in light of consolidation and technological developments.Since the fastest growing market for foods in Canada is the organic and ethnic sector, a common threadof consumer interest has been found in healthy, natural, flavourful alternatives – not only for consumptionbut also for the perception of being friendlier to the environment. Since Canadians are eating moreorganic foods, many ethnic foods, especially Indian, Halal, Kosher, Latino and Asian, are joining the“ethnic gone organic” trend, while the specialty food market shows a move towards the more flavourfultastes of ethnic cuisine.

In 2012, dairy products, roasted-in-Canada coffee, soyadrinks, eggs, and bread were the most popular organicfood purchases, with strong competition emerging fromCanadian companies in the processed sector,particularly for ready-to-eat cereals, baby food, juicesand drinks. The adjacent chart shows the top 10Canadian-produced organic pre-packaged food sold inCanada in that year in $ millions.2

For organic food products in general (Canadian andnon-Canadian producers), the beverage categorynarrowly beat out dairy and eggs due to strong sales oforganic coffee, valued at half the sales of all organic beverages. Bread and ready-to-eat cereals led salesin the bread and grains category.

■ Fruit & Vegetables ■ Beverages

■

Dairy & Eggs ■

Bread & Grains ■

Packaged/Prepared Foods

■ Condiments ■ Snack Foods ■ Meat, Poultry, Fish

Growth in sales of pre-packaged organic foods between 2008 and2012 were as follows:

Top 10 Organic Pre-Packaged Grocery Category Segments, 2008 and 2012

Categories 2008 Sales ($ millions) 2012 Sales ($ millions) Annual Growth (%)Soya Drinks 47.3 58.4 48

Milk 37.2 57.7 8.9

Coffee (Roast &Ground) 27.2 47.0 10.5Yogurt Products 35.4 44.2 5.0

RTE Cereal 32.0 37.6 3.7

Eggs 15.7 21.6 6.8

Soup 19.5 20.1 0.7Bread (Commercial) 13.1 19.0 7.8

Juices & Drinks (Shelf Stable) 9.8 16.1 9.8

Baby Food 11.4 12.8 2.7

2 Canada’ s Organic Market: National Highlights 2013: http://www.ota.com/pics/media_photos.171.img_filename.pdf

http://www.ota.com/pics/media_photos.171.img_filename.pdfhttp://www.ota.com/pics/media_photos.171.img_filename.pdfhttp://www.ota.com/pics/media_photos.171.img_filename.pdfhttp://www.ota.com/pics/media_photos.171.img_filename.pdf


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Source: Canada Organic Trade Association, Canada’s Organic Market: National Highlights 2013

Exporters will find that success in this market will be linked in large part to the quality and uniqueness oftheir product, as well as how that product addresses the consumer’s needs for convenience and nutrition. Also prevalent are safety concerns about farming, processing trends, and technologies such as genetic

modification and food irradiation.

Ethnic Foods

Canada is a land of tremendous ethnic diversity brought about by successive waves of immigration fromvarious parts of the world. Immigration has become even more important in recent decades as thecountry’s birth rate has gradually fallen below replacement levels.

The latest Statistics Canada data3 shows that by 2031:

Between 25% and 28% of the population could be foreign-born, the highest historical ratio to date. About 55% of this population would be born in Asia, and about 47% of second-generation Canadianswould belong to a visible minority group, nearly double the 2006 level of 24%. Second generationrefers to those who are Canadian-born and have at least one parent born outside Canada.

The majority (96%) of people belonging to a visible minority group would continue to live in one of themajor metropolitan areas, making up 63% of the population of Toronto, 59% in Vancouver, and 31%in Montréal. In contrast, they would comprise no more than 5% of the population in St. John's,Greater Sudbury, Trois-Rivières, Québec, or Saguenay.

Most of this visible minority population would be young: 36% of the population under 15 years of agewould belong to a visible minority group, compared to 18% of persons aged 65 and over.

South Asians and Chinese should still be the largest visible minority groups in Canada. The South Asian population would rise to 3.2 million to 4.1 million, compared to 1.3 million in 2006, while theChinese population would go from 1.3 million in 2006 to between 2.4 million and 3 million in 2031.

Arabs and West Asians are the visible minority groups that would grow the fastest. Canada’s Arabpopulation could thus number between 806,000 and 1.1 million in 2031 and its West Asian populationbetween 457,000 and 592,000.

The number of non-Christians would more than double, reaching between 5.3 million and 6.8 million

in 2031 compared to 2.5 million in 2006, or from 8% of the population in 2006 to 14% in 2031. Withinthe population having a non-Christian religion, approximately one person in two would be a Muslim in2031, whereas the corresponding proportion in 2006 was estimated at 35%. Fewer than twoCanadians in three would have a Christian religion in 2031. Three Canadians in four (75%) had aChristian religion in 2006. The corresponding proportion in 1981 was 97%.

These trends are important since, through marriage or common law relationships, Canadians areincreasingly partnering with ethnic groups different from their own. This trend is leading to a newgeneration of multi-ethnic children with more open attitudes relating to lifestyles and cultures, which inturns affects the broader Canadian population. As these new cultures continue to come together andtolerance to this synthesis increases, markets for food products from diverse traditions increase. Fruitsand vegetables which are familiar to these ethnic groups are already appearing in the Canadian marketand are quickly becoming mainstream options. Packaged coconut water is a good example of a drink thatis rapidly growing in this market because of both the ethnic connection and perceived health benefits.Joining Indian, Caribbean and Mediterranean foods which have long enjoyed popularity here, Halal andkosher foods are becoming the fastest growing sectors of Canada’s food industry, going beyond theirtraditional markets to appeal to consumers interested in organic and ethnic options. Consumption ofkosher foods is currently supported by approximately 330 thousand Jewish consumers, and Halal by anestimated 1 million Muslims. Grocery giant Loblaws has capitalized on mainstream ethnic foodopportunities by developing a line of fusion and authentic ethnic ready-made meals. The President'sChoice line of frozen Indian, Thai and Chinese appetizers and entrées offers a wide selection of dinners

3 The ethnocultural diversity of the Canadian population. March 9, 2010. Statistics Canada. http://www.statcan.gc.ca/pub/91-551-x/2010001/hl-fs-eng.htm. Additional charts and statistics were obtained from: http://www.cic.gc.ca/english/resources/statistics/menu-fact.asp

http://www.statcan.gc.ca/pub/91-551-x/2010001/hl-fs-eng.htmhttp://www.statcan.gc.ca/pub/91-551-x/2010001/hl-fs-eng.htmhttp://www.statcan.gc.ca/pub/91-551-x/2010001/hl-fs-eng.htmhttp://www.statcan.gc.ca/pub/91-551-x/2010001/hl-fs-eng.htmhttp://www.cic.gc.ca/english/resources/statistics/menu-fact.asphttp://www.cic.gc.ca/english/resources/statistics/menu-fact.asphttp://www.cic.gc.ca/english/resources/statistics/menu-fact.asphttp://www.cic.gc.ca/english/resources/statistics/menu-fact.asphttp://www.statcan.gc.ca/pub/91-551-x/2010001/hl-fs-eng.htmhttp://www.statcan.gc.ca/pub/91-551-x/2010001/hl-fs-eng.htm


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ranging from butter chicken and chicken tikka masala to pad thai and general tao chicken, all of whichcater to today's time constrained consumers. Several brands of Indian simmer sauces, marinades andchutneys; ready-to-eat frozen meals; spices; and tea are natural, organic, and trans fat- or gluten-free.Organic rice and pulses, staples of Indian cuisine, are also prevalent in many grocery stores.

With the rapidly growing Muslim population, more companies are certifying theirproducts as Halal and using services such as the Halal Product Development Services(www.halalproductservices.com) to help them make a smooth transition into this market.These products are crossing cultural boundaries with the introduction products such asfrozen Halal Italian meat ravioli, Halal Ukranian potato and cheddar pierogies (stuffeddumplings), and Halal baby food.

Fair Trade Foods

Fairtrade Canada reports that every year, a growing number of Fairtrade certifiedproducts are available in Canadian stores and restaurants. In May 2013, Toronto wasofficially designated the largest Fair Trade City in North America, with 273 retail outletsand 155 cafés carrying two or more distinct Fairtrade certified products.

According to Fairtrade Canada, sales of selected labelled Fairtrade certified productsrose significantly in 2011, as shown in the following chart:

Canadian Sales of Labelled Fairtrade Certified Products by Volume (kg), 2008-2011

Coffee Cocoa Tea Fruit Grains Nuts & Oils Herbs & Spices2008 5,029,440 604,958 87,457 1,483,786 22,184 510 3,970

2009 5,610,955 337,769 90,080 2,307,557 55,256 1,443 5,505

2010 5,876,689 1,385,070 56,834 3,104,787 18,370 6,683 3,9892011 6,118,803 1,786,261 64,627 2,111,870 22,166 11,067 4,750

Total 22,635,887 4,114,058 298,998 9,008,000 117,976 19,703 18,214

Source: Fair Trade Canada, Facts and Figures 2013 (http://fairtrade.ca/en/about-fairtrade/facts-figures)

Between 2008 and 2011, over $22.6 million worth of Fairtrade certified coffee was sold in this market,$4.1 million worth of cocoa, and nearly $300,000 worth of tea. Fairtrade certified fruit was a big seller, at$9 million over the four year period.

According to a survey conducted by Fairtrade Canada4 most Canadians are concerned about traditionalFair Trade issues, namely worker exploitation, unfair trade practices, and poverty in developing countries.They have high expectations for companies to act responsibly when working in developing countries,especially with regard to fair pay for workers and farmers. Between 2008 and 2011, the number ofFairtrade customers in Canada increased from 14% to 17%, with 10% being young customers and 7%mature ones. In the same survey, 86% of respondents believe that companies play an important role inprotecting the environment, and an increasing number of customers say they choose Fairtrade certifiedtea (33% in 2011 compared with 23% in 2008), coffee (30% compared to 22% over the same period), andbananas (30% compared to 26%) when available. Fairtrade products are sold mostly in supermarkets(60% of sales), coffee shops (30%), and health food stores (28%). When examining demand compared to

existing outlets, fast food restaurants and discount stores offer the greatest potential for growth of retailsales, at 18% and 16% respectively.

To become Fairtrade Certified and be allowed to display the Fairtrade mark, Canadian importers anddistributors must meet stringent international criteria set out by Fairtrade International (FLO) and becertified by an accredited, independent certification organization. The quality of the Fairtrade product

4 Fairtrade Canada, Fairtrade International Consumer Perceptions Survey 2011

(http://fairtrade.ca/sites/default/files/Fairtrade_2011_Consumer%20Perceptions%20Survey_Canada_Consumer_EN.

pdf )

http://www.halalproductservices.com/http://www.halalproductservices.com/http://www.halalproductservices.com/http://fairtrade.ca/http://fairtrade.ca/http://fairtrade.ca/en/about-fairtrade/facts-figureshttp://fairtrade.ca/en/about-fairtrade/facts-figureshttp://fairtrade.ca/en/about-fairtrade/facts-figureshttp://fairtrade.ca/sites/default/files/Fairtrade_2011_Consumer%20Perceptions%20Survey_Canada_Consumer_EN.pdfhttp://fairtrade.ca/sites/default/files/Fairtrade_2011_Consumer%20Perceptions%20Survey_Canada_Consumer_EN.pdfhttp://fairtrade.ca/sites/default/files/Fairtrade_2011_Consumer%20Perceptions%20Survey_Canada_Consumer_EN.pdfhttp://fairtrade.ca/sites/default/files/Fairtrade_2011_Consumer%20Perceptions%20Survey_Canada_Consumer_EN.pdfhttp://fairtrade.ca/sites/default/files/Fairtrade_2011_Consumer%20Perceptions%20Survey_Canada_Consumer_EN.pdfhttp://fairtrade.ca/sites/default/files/Fairtrade_2011_Consumer%20Perceptions%20Survey_Canada_Consumer_EN.pdfhttp://fairtrade.ca/en/about-fairtrade/facts-figureshttp://fairtrade.ca/http://www.halalproductservices.com/


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must be consistent and competitive to other brands sold in this market. Standards to be met forcertification include fair price and premiums; fair and safe labour; environmental standards related to theproduct and its manufacture; and credit and contracts. Fairtrade Canada offers links to the standardsrequired for 13 product groups through their website: http://fairtrade.ca/en/products/products-canada. Forexample, the international standards for Fairtrade certified Cocoa are:

Producers are small family farms organized in co-operatives, which they own and govern. The minimum guaranteed price is paid directly to the producer co-op. The minimum floor price is

currently set at US$2000/metric ton (MT) for conventional cocoa beans and US$2300/MT for organiccocoa beans. When the world market price is higher than Fair Trade, the market price, plus thepremium, is paid to producers.

A Fairtrade Premium of US$200/MT is included in the purchase price. This premium is used bycooperatives for social and economic investments such as education, health services, processingequipment, and loans to members.

Environmental standards restrict the use of agrochemicals and encourage sustainability. Pre-harvest lines of credit, of up to 60% of the purchase price, are given to co-operatives if requested. No forced labour of any kind, including child labour, is permitted.

Clicking on the links below will provide standards, including pricing, for other organic products.

Coffee Fruit Grains and Cereals Nuts and Oils

Spices & Herbs Sugar Tea Wine

Imports

According to Statistics Canada, imports of organicfoods identified by the HS Codes outlined in thisreport are on track to reach a five year high in 2013.Imports of ethnic and Fairtrade foods are notidentified separately for customs purposes.

For the first three months of this year alone, importsamounted to $155 million. This compares to $473million in 2012, itself the highest value in precedingyears. Just as part of the higher import numbers in2012 and 2013 reflect the addition of new HS codes for customs purposes, the low number in 2010 isreflective of adjustments in data collection as the new organic food regime was being put into place. In2012, imports of organic foods included in the Organic Trade Association report captured 46% of themarket by volume, exceeding the 43% captured by domestically produced brands.

Organic Dairy Products: In 2012, Canada imported $745,658 worth of organic yoghurt compared to$279,264 in 2009; the United States was the major supplier in both years.

Organic Fresh Vegetables: Imports of organic fresh vegetables were valued at $157 million in 2012, upfrom $140 million in 2009.

Organic Fresh Fruits: Likewise, imports of organic fresh fruits valued at $123 million in 2012, exceededthe $111 million imported in 2009.

Organic Tea and Coffee: In 2012, stable consumption of imported organic coffee was evident,unchanged from 2009 imports of $154 million. While imports of organic green and black tea were lower,at $5.1 million and $5.8 million respectively, these were significantly higher than in 2009 when theirimports were valued at $3.3 million and $2.3 million respectively. However, whereas in 2009 more black

http://fairtrade.ca/en/products/products-canadahttp://fairtrade.ca/en/products/products-canadahttp://fairtrade.ca/en/products/products-canadahttp://fairtrade.ca/en/products/cocoahttp://fairtrade.ca/en/products/cocoahttp://fairtrade.ca/en/products/cocoahttp://fairtrade.ca/en/products/coffee-0http://fairtrade.ca/en/products/coffee-0http://fairtrade.ca/en/products/fruithttp://fairtrade.ca/en/products/fruithttp://fairtrade.ca/en/products/grains-and-cerealshttp://fairtrade.ca/en/products/grains-and-cerealshttp://fairtrade.ca/en/products/nuts-and-oilshttp://fairtrade.ca/en/products/nuts-and-oilshttp://fairtrade.ca/en/products/spices-herbshttp://fairtrade.ca/en/products/spices-herbshttp://fairtrade.ca/en/products/sugarhttp://fairtrade.ca/en/products/sugarhttp://fairtrade.ca/en/products/teahttp://fairtrade.ca/en/products/teahttp://fairtrade.ca/en/products/winehttp://fairtrade.ca/en/products/winehttp://fairtrade.ca/en/products/winehttp://fairtrade.ca/en/products/teahttp://fairtrade.ca/en/products/sugarhttp://fairtrade.ca/en/products/spices-herbshttp://fairtrade.ca/en/products/nuts-and-oilshttp://fairtrade.ca/en/products/grains-and-cerealshttp://fairtrade.ca/en/products/fruithttp://fairtrade.ca/en/products/coffee-0http://fairtrade.ca/en/products/cocoahttp://fairtrade.ca/en/products/products-canada


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tea was imported than green tea, the reverse was true for 2012, when imports of green tea exceeded thatof black tea.

Medicinal Plants - Herbal Teas: Placed in a separate HS classification category, imports of herbal teasdeclined in 2012 to $1.2 million from $1.4 million in 2009.

Organic Olive Oil: Imports of organic olive oil more than doubled over the past four years, rising from$7.3 million in 2009 to $16.8 million in 2012.

Organic Prepared Foods and Milk Beverages: Imports of organic tomato sauces were valued at $8.7million in 2012. Imports of infant foods containing milk solids and beverages containing milk were sourcedalmost entirely from the United States.

Imports of Organic Foods in 2012, by Quantity (Kg) and Value ($)

Kg $

Chapter 4 - Dairy Products, Eggs, Natural Honey 293,189 745,6580403101010 Yogurt within access commitment 292,080 743,264

0403102010 Yogurt over access commitment 1,109 2,394

Chapter 7 - Edible Vegetables; Certain Roots and Tubers 71,583,956 156,930,8730701900010 Potatoes, except seed 4,419 1,240,887

0702002910 Tomatoes, Cherry, except process 183,740 659,763

0702009921 Tomatoes, Roma, excluding greenhouse 645,134 1,109,152

0702009929 Tomatoes, excluding greenhouse 1,252,730 3,731,014

0703103910 Onions or shallots, green 541,190 1,637,977

0703109910 Onions 3,946,116 3,066,534

0704109010 Cauliflowers and headed broccoli 3,424,492 4,676,364

0704209010 Brussels sprouts 24,000 156,528

0704902910 Broccoli 1,977,274 2,582,001

0704903910 Cabbage, except Chinese 1,086,863 1,954,722

0704904910 Chinese cabbage or Chinese lettuce 467,567 488,397

0705119020 Cabbage lettuce, head lettuce, excl. greenhouse 890,881 1,133,8390705199029 Lettuce 4,071,406 27,846,361

0705199021 Lettuce, pack fresh salad cut mixes, 1kg 7,816,727 19,385,777

0706102011 Baby carrots, in pack 1 kg each 2,952,740 4,055,927

0706104010 Carrots 6,791,891 7,236,474

0706903010 Beets 508,720 1,010,178

0706905910 Radishes 130,564 284,570

0707009920 Cucumbers & gherkins, excluding greenhouse 925,511 1,682,429

0708109910 Peas (Pisum sativum) 57,219 315,002

0709209910 Asparagus 330,188 1,772,544

0709300010 Eggplants, aubergines 312,662 524,106

0709409010 Celery, other than celeriac 3,317,146 4,129,425

0709609020 Peppers: Capsicum or Pimenta, excl. greenhouse 1,433,506 3,755,932

0709700011 Spinach, NZ & orache spinach (garden), 500g 272,736 2,256,180

0709700019 Spinach, New Zealand & orache spinach 750,614 2,945,317

0709994010 Sweet corn-on-the-cob 113,328 138,965

Chapter 8 - Edible Fruit & Nuts; Citrus Fruit or Melon Peel 70,307,847 123,124,408

0803900011 Bananas, other than plantains 32,165,933 29,467,302

0804300011 Pineapples 2,407,112 2,800,852


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0805100012 Oranges, except Temple 4,463,141 5,878,089

0805400010 Grapefruit, including pomelos 1,277,700 1,598,270

0805500011 Lemons 5,020,950 7,155,319

0805500012 Limes 3,353,440 3,200,985

0806109110 Grapes, o/t species Vitis labrusca 2,248,550 7,350,739

0807110010 Watermelons 526,258 536,7170807200010 Papaws (papayas) 77,791 292,885

0808101081 Apples, Golden Delicious, not for processing 467,406 888,732

0808101082 Apples, Red Delicious, other than for processing 1,154,733 1,894,995

0808101083 Apples, Granny Smith, other than for processing 1,661,408 $2,925,034

0808101084 Apples, Gala, other than for processing 4,497,232 $8,262,977

0808101089 Apples, other than for processing 2,433,889 $4,967,259

0808302910 Pears 512,847 $2,529,521

0809292910 Cherries 556,985 $1,516,339

0809302910 Peaches, excluding nectarines 3,529,462 $15,193,741

0810109910 Strawberries, except for processing 1,017,128 $7,881,4400810201910 Raspberries & loganberries 1,711 $8,805

0810401011 Cranberries 2,934,171 $18,774,407Chapter 9 - Coffee.Tea, Maté and Spices 26,997,123 $165,197,7720901110010 Coffee, not roasted, not decaffeinated 24,502,037 $120,552,675

0901210010 Coffee, roasted, not decaffeinated 1,886,052 $33,709,672

0902101010 Green tea, not fermented, individual serving bags 96,530 $2,109,855

0902109010 Green tea, not fermented, in packages 3 kg 93,685 $1,102,547

0902301011 Black tea, not decaf, individual serving bags 228,785 $3,874,090

0902309011 Black tea, not decaf, in pack


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Chile Ontario 4,257 $6,535

Québec 7,430 $6,003

South Africa Ontario 197,878 $324,631

Québec 142,882 $195,579

0805500012 Limes, fresh Guatemala Ontario 3,850 $11,981

0806109110 Grapes,o/tspecies Vitis labrusca,fresh

Chile Manitoba 3,938 $11,040Ontario 73,420 $228,615

Québec 16,302 $50,489

China Ontario 641 $490

Guatemala Ontario 17,199 $198,878

Honduras Ontario 3,461 $45,361

Peru British Columbia 2,207 $11,646

Ontario 21,220 $56,118

Québec 35,424 $159,968


Québec 2,445 $19,3150808101081 Apples,

Golden Delicious, fresh

Chile Québec 9,761 $22,594

0808101083 Apples,Granny Smith, fresh

Chile British Columbia 24,546 $50,819

Ontario 128,832 $215,743


Québec 42,336 $64,680

0808101084 Apples,Gala, fresh

Chile Alberta 1,143 $1,749

British Columbia 279,297 $575,394

Ontario 553,413 $869,835

Québec 7,182 $13,493

0808101089 Other Apples, fresh

Chile British Columbia 33,999 $107,225

Ontario 155,347 $332,509

Québec 28,633 $89,548

0809302910 Peaches,excl nectarines, fresh

Chile Ontario 53,006 $127,763

Mexico Ontario 77,815 $197,7540810401022 Blueberries,cultivated, fresh

Chile Alberta 40,185 $321,694

British Columbia 110,881 $755,607

Manitoba 15,054 $93,014

New Brunswick 3,877 $38,676

Ontario 658,125 $4,094,436

Québec 38,244 $197,450

Saskatchewan 1,216 $10,274

Source: Statistics Canada, Canadian International Merchandise Trade Database, 2013

Trends and Opportunities

Canadians remain interested in foods that are fresh, balanced, and have a good nutrient content. Theylook for foods that have a low trans-fat content, are made with whole grains, and that are low in sugar,salt and sodium. When buying, consumers also examine the product to see if Omega-3 fatty acids arepresent (a positive factor) and if the food is organically grown. The country of origin is also important, andmore than half of Canadians: believe that organic farming is better for a healthy environment; considerorganic foods a healthier, more nutritious choice; believe ecological sustainability is an importantconsideration when choosing food products; and want products that are not genetically engineered.


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Corporate Social Responsibility

An exporter’s Corporate Social Responsibility (CSR) strategy is important in trade with this country. CSRis not a new concept but buyers are taking a direct and deliberate look at the total production processincluding procurement, manufacturing, and waste disposal. Exporters should try to market themselves byoffering buyers their published CSR statements and try to choose to work with vendors committed to the

same level of compliance. While labour rights issues are not currently viewed by most buyers as being asimportant as environmental issues, importers do evaluate these factors as part of the whole picture,particularly when making decisions about whether to buy from specific countries. As well, major violationsof human rights and/or political or social instability can affect sourcing decisions. Brands clearly wantgovernments in producer countries to improve on environmental and labour standards regulations andtheir enforcement. According to companies interviewed in a recent survey, countries in Central Americaand the Caribbean could gain some degree of competitive advantage over Asian countries with relativelylower production costs if they meet the challenges described above.

The Environment

On-going concern over the environment alters the way many Canadians view products, with the demandfor organic and natural foods and medicinal products continuing to rise. Environmentally-friendly goodssuch as detergents that are less polluting and biodegradable or recyclable products and packaging are

also favourably viewed.

Buy Local (100 mile limit)

Driven by the ‘green’ trend, the increasingly popular ‘buy local’ movement supports local producers(within a 100 mile limit). This will likely have more of a negative effect on imports in the summer than inthe winter months. During the growing season in Canada, consumers, chefs and even some foodmanufacturers are becoming more proactive in sourcing their cooking ingredients directly from farmersand local artisan producers. As a result, restaurants are forming exclusive partnerships with local foodproducers to supply outlets with all of their required ingredients for a true farm-to-fork concept.

Ageing Population

An important factor to consider in marketing organic foods in this market is the fact that Canada’s

population is ageing rapidly and becoming more urban; both of these factors will have a positive impacton the demand for a wide range of healthy foods. Two main reasons for the ageing of the population arethe nation’s low fertility rate and increasing life expectancy. Statistics Canada predicts that the first of the‘baby boomers’ which make up the bulk of Canada’s population will reach the age of 80 in 2026. Thesecitizens are relatively wealthy, well educated and willing to purchase food that they consider healthy andexotic, focusing on foods with quality ingredients.

Other Trends

Organic and ethnic food producers could take guidance from the following general food trends tocapitalize on this lucrative market:

Functional Food: As consumers increasingly become more health conscious, demand for productswith added health benefits and nutrients keeps rising. Such products include yogurt, frozen yogurt,

juice, tea, ready-to-drink tea, almond milk, coconut water, breakfast cereal, bread, eggs, condiments,superfoods (broccoli, sweet potatoes, etc.), and fish, chicken, and pork products. Many of theseproducts are enriched with nutraceuticals ranging from vitamins, fibre and calcium, to omega-3,probiotics, and antioxidants. Food and beverage products that contain superfruit (e.g., exotic varietiessuch as açai, gogi berries, mangosteen, noni, and pomegranates, as well as cranberries andblueberries) are also common on store shelves. Manufacturers have introduced many of theseforeign fruit to consumers through flavour extensions for yogurt, snack, vinaigrette, jam, tea and juiceproducts. The blending of mainstream fruit flavours (e.g., strawberry, raspberry) with less familiarsuperfruit varieties in food products has also helped boost the popularity of these healthy fruit. Foodand beverage products containing superfruit are seeing tremendous growth due to their highantioxidant content and nutritional benefits. Based on current demand, industry experts suggest that


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superfruit pulp, extracts, juice and flavourings will continue to appear in a wider variety of products.Consumers are also seeking products that offer extra health benefits, such as immune support. Avast number of products now contain antioxidants, probiotics or prebiotics to strengthen immunity andimprove overall health. Such products include juice, add-to-water flavouring crystals, yogurt, frozenyogurt, breakfast cereal, ready-made meals, and bread. The segment is expected to continue to grow

as consumers look for more of the friendly bacteria and antioxidants in their food products. Better-For-You Food: There has been an explosion of interest in gluten-free products; products with

low or no calories, fat, sugar or salt; whole grain; and high-fibre and calcium alternatives in responseto consumer demand for lighter diet options. All of these formulations have become particularlypopular in staple food categories such as dairy, baked goods, oils, and fats, as well as in theconvenience segment (e.g., frozen and chilled ready-meals).

Portion-Controlled Products: Manufacturers have responded to consumer demand by offering awide assortment of 60, 90, and 100 calorie snacks. Consumers are more inclined to purchase portionor calorie controlled versions of their favourite food and beverage, often less healthy products, ratherthan drastically modifying their diets. Products include portion-controlled packages of cookies, chips,crackers, popcorn, chocolate, muffins, yogurt, granola snacks, carbonated soft drinks, juices, andchocolate milk.

Dietetic Products: Demand for lactose, glucose, and allergen-free food and beverages, as well asfor foods with “no salt or sugar added” for diabetics is rising, driven by health-conscious consumersand those with food allergies and intolerances.

Artisan and Specialty Food: Canadian trade shows reflect the growing demand for premium foodproducts such as premium jam and preserves; tea; gourmet spices and barbecue rubs, condiments,sauces, oils, spreads and dips; matcha green tea; dark and European chocolate; and bison meat.Premium packaging, product displays and promotional materials are used. Retailers are expandingtheir gourmet food offerings with artisanal cheese, bread, dips, oils, spreads, condiments andconfectionary; freshly-prepared meals and desserts; greater ethnic and international foodassortments; premium tea and coffee; and larger wine selections to cater to consumer demand.Stores are also being re-designed to create inviting upscale shopping environments for consumers.

Premium, Bite-Sized Indulgence Food: The largest dessert trend is for smaller-portioned and bite-size rich desserts. For example, mousses, cheesecakes, crème brûlée, crème caramel, chocolate,and tiramisù are displayed in small, bite-size portions for the retail grocery and foodservice sectors.The popularity of two-bite and petite deluxe desserts can be attributed to rising health concerns and

time-pressed consumers who do not have time to prepare or eat large and very filling desserts. Available to shoppers at retail grocery outlets, these gourmet products particularly appeal toconsumers as they can enjoy restaurant-style desserts at reasonable prices for home consumption.

Child-Focused Organic Foods: These are particularly prevalent in cereals, snacks, and juices. Packaging: Developments in retail packaging include:

Clear: Some manufacturers are packaging fruits, vegetables and prepared foods like soups andsauces in clear jars or high-end plastic bags – some of which are squeezable – instead oftraditional cans. This makes the product clearly visible; sometimes even the product labels aretransparent.

Tetra: Tetra packs hold an expanding line of products particularly in the drinks; soups; andsauces categories.

Compostable: While innovations in packaging reductions continue, packaging that is defined ascompostable after use is also becoming more prevalent. With municipalities across Canada

introducing ‘clear’ or ‘compost’ recycling programs, these products are very well placed. Bulk is ‘Green’: Bulk food products are being marketed here as a ‘green’ packaging initiative.

As a result of rising energy prices and carbon footprint concerns, speed to market has become extremelyimportant to buyers. They look at how close the suppliers are to the Canadian market, and how close theyare to local or regional inputs. Medium cost countries and suppliers who are well-positioned on theseissues can therefore benefit from potential competitive advantages. It is expected that brands willincreasingly demand environmentally sound practices at every stage in the process, from field to market.To this end, suppliers are encouraged to pursue long term relationships with nearby raw materialproducers rather than using multiple producers in farther off locations; this makes it easier to solvematerial defect problems.


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The last trend to discuss is the role that bilateral and regional tradeagreements play in this market. As tariffs are removed, buyers aremotivated to source from those particular countries and regions. Leading upto and after the end of tariffs, many buyers start to reduce the number ofsmall suppliers with whom they have direct relationships and instead begin

establishing longer-term relationships with a fewer number of largesuppliers. This does not necessarily mean the demise of small business asthese large companies often have their production done in several wholly owned or subcontract facilitiesin a number of countries. Canada is party to several regional, bilateral and multilateral trade agreementsfor goods and services. These agreements cover topics such as market access; investment; governmentprocurement; subsidies; agriculture and services competition; intellectual property rights; disputesettlement; antidumping; and countervailing duties. More details are available at :

http://www.international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/index.aspx . There is alsoan Agreement on Internal Trade which aims to reduce inter-provincial barriers to the movement ofpersons, goods, services and investment within Canada. Further details and updates on any of these canbe obtained through the Industry Canada website: http://www.ait-aci.ca/index_en/ait.htm .

Canadian buyers have stated thatdeterrents to importing fromspecific countries includeinconsistent product quality, poorpackaging and unacceptable

hidden costs in waybills.

http://www.international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/index.aspxhttp://www.international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/index.aspxhttp://www.ait-aci.ca/index_en/ait.htmhttp://www.ait-aci.ca/index_en/ait.htmhttp://www.ait-aci.ca/index_en/ait.htmhttp://www.ait-aci.ca/index_en/ait.htmhttp://www.international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/index.aspx


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3

Trade Practices

Competition

Canadian businesses engaged in the importation, resale, distributionand retail sales of food products across Canada look for sales supportas well as regulatory compliance, marketing and promotional effortsfrom their foreign suppliers in order to market their products anddevelop new client bases. Since Canada ranks among those countrieswith the highest imports per capita, exporters from all over the world arepresent here, competing fiercely and consistently for a part of this

lucrative market. To make inroads here, an exporter must therefore either offer a completely new productor be able to push aside an existing supplier with a more attractive offer in terms of quality, service, price,packaging or labelling.

According to a recent report by Neilson Market Track, new items help to increase overall sales, especiallywhen sales of existing products are stagnant. Amongst organic products identified as grown, processedor packaged in Canada, ten products accounted for nearly three-quarters of total Canadian product sales:tea, cooking oils, coffee, ready-to-eat cereals, shelf-stable juices and drinks, flour, dry pasta, bread, hotcereals dried beans, and rice. There is a healthy degree of competition amongst brands in these productcategories.

The key to successful exploitation of the Canadian market is the development of an organized marketingstrategy. The following require priority attention:

develop an easy to use website with pictures andcontact information;

rapid turnaround in sample production; same-day reply (by e-mail, fax, or telephone) to

every communication; on-time deliveries, with any delays agreed to in

advance with your buyer; delivery of product which corresponds precisely

with agreed-to specifications or samples, with anychanges agreed to in advance with your buyer;

continuity of supply; maintenance of high quality at a

competitive price; appropriate packaging material for

overseas shipments; adequate handling and storage facilities; promotion, especially of new products

(include names of current or past clientsand/or their countries);

knowledge of payment terms.

In addition, you should ensure that your representative who is in contact with the buyer speaks and writes

clear and fluent English or French, depending on the buyer’s preference. Exporters can focus onstrategies including:

adjusting to globalization by becoming niche players, specializing by product or by market; improving export marketing skills and knowledge of foreign markets; putting more emphasis on product development and the production of quality-assured and

environmentally friendly products, i.e., adopting the ISO 9000 series or similar quality standards;ISO 14001 series or similar environmental management standards; and ISO 26000 guidance on social responsibility.

Consistency in quality and delivery of theproduct with ordered specifications arecrucial to maintaining Canadian orders.

Continuity of supply is a key factor in theimporter’s, wholesaler’s and retailer’scommitment to marketing importedgoods in Canada. Sporadic shipmentswill damage the exporter’s reputation andchance of success in Canada.

http://www.nielsen.com/ca/en/news-insights/events-webinars/2012/what-s-in-store--2012.htmlhttp://www.nielsen.com/ca/en/news-insights/events-webinars/2012/what-s-in-store--2012.htmlhttp://www.nielsen.com/ca/en/news-insights/events-webinars/2012/what-s-in-store--2012.htmlhttp://www.iso.org/http://www.iso.org/http://www.iso.org/http://www.iso.org/iso/iso_catalogue/catalogue_ics/catalogue_detail_ics.htm?csnumber=31807http://www.iso.org/iso/iso_catalogue/catalogue_ics/catalogue_detail_ics.htm?csnumber=31807http://www.iso.org/iso/iso_catalogue/catalogue_tc/catalogue_detail.htm?csnumber=42546http://www.iso.org/iso/iso_catalogue/catalogue_tc/catalogue_detail.htm?csnumber=42546http://www.iso.org/iso/iso_catalogue/catalogue_tc/catalogue_detail.htm?csnumber=42546http://www.iso.org/iso/iso_catalogue/catalogue_tc/catalogue_detail.htm?csnumber=42546http://www.iso.org/iso/iso_catalogue/catalogue_ics/catalogue_detail_ics.htm?csnumber=31807http://www.iso.org/http://www.nielsen.com/ca/en/news-insights/events-webinars/2012/what-s-in-store--2012.html


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Trade Shows

Please note that TFO Canada does not provide letters of invitation to assist with obtaining travel or entryvisas. These must come from the buyer directly, or from proof of registration at a trade show.

The Canadian Food Inspection Agency publishes a Food and Horticultural Products Import Guide forTrade Fairs and Shows in Canada. Suppliers should review this document when preparing to exhibit inCanada.

Canadian importers and a number of retail buyers usually visit foreign markets and their suppliers once ayear. They normally organize such trips to coincide with the most important foreign trade shows such asBioFach, the largest international organic and natural food trade fair (www.biofach.de/en) where they canexplore possibilities for imports, as well as assess industry trends. It is advisable to check with your agent,buyer or Embassy’s commercial counsellor to fully assessthe documentation requirements, costs and benefits ofyour participation in trade shows.

Major trade shows in Canada include:

Bakery Showcase: Held every two years, the next oneis scheduled for May 2014 in Toronto.

CFRA Show showcases international, national andlocal suppliers of specialty, niche and commodityproducts. The next one is in March 2014.

Grocery Showcase is next held in March 2013. Grocery Innovations Canada will be held in October

2013. SIAL, an international exhibition of food, beverages,

wine and spirits, is held every second April in Montreal. The Canadian Health Food Association (CHFA) food

shows are also important: the next CHFA West will beheld in April 2014; CHFA Québec is held in February;and CHFA East in Toronto in October.

Quality

There are two main guides for ensuring that organic products sold on the Canadian market are safe forconsumption: the mandatory Organic Products Regulations (OPR) and the voluntary Canadian OrganicRetailing Practices Manual and Guide. The latter is a ‘best practices’ guide that outlines suggestions toprotect the organic integrity of the products through all stages to market.

Canada’s OPR ensure that the Canadian organic standards and permitted substances list are mandatoryfor all organic food imported into Canada. Organic products may be imported if they are:

Certified to the Canadian Organic Standard; Certified as organic in accordance with an agreement, entered into with another country,

regarding the importation and exportation of organic products; and Certified as organic by a recognized certification body.

All importers of organic products must be able to demonstrate, at all times, that the imported productconforms to these import requirements. The importers must retain all documents attesting to this fact.These documents will be verified by CFIA inspectors. By enforcing the organic principles of production,

Both exporters and importers should ensure that eachtransaction or contract is specific about questions relatingto non-performance of either party, as well as theacceptability or not of products as delivered, e.g., bystating product specifications and/or payment terms. Anypotential for disagreement should be covered byspecifying an arbitration board, e.g., the DisputeResolution Corporation or the Canadian InternationalTrade Tribunal and their relevant rules of arbitration.Trade disputes between Canada and other countries maybe settled under relevant arbitration panels such as theInternational Chamber of Commerce (www.iccwbo.org),or others constituted under the WTO and NAFTA.Importers may also appeal to the Canadian InternationalTrade Tribunal (www.citt-tcce.gc.ca), an independent,quasi-judicial tribunal that, among other duties, reviewsdisputes between importers and the CBSA. For fresh

produce, the Dispute Resolution Corporation(www.fvdrc.com) is a useful resource. Both parties shouldagree beforehand to be mutually bound by the contract.

http://www.inspection.gc.ca/english/imp/exhibite.shtmlhttp://www.inspection.gc.ca/english/imp/exhibite.shtmlhttp://www.inspection.gc.ca/english/imp/exhibite.shtmlhttp://www.biofach.de/enhttp://www.biofach.de/enhttp://www.biofach.de/enhttp://www.bakingassoccanada.com/bakery%20showcase/bakery%20showcase%20-%20about.aspxhttp://www.bakingassoccanada.com/bakery%20showcase/bakery%20showcase%20-%20about.aspxhttp://www.crfa.ca/tradeshows/crfashow/http://www.crfa.ca/tradeshows/crfashow/http://www.cfig.ca/page.asp?id=8http://www.cfig.ca/page.asp?id=8http://www.groceryinnovations.com/http://www.groceryinnovations.com/http://www.sialcanada.com/sial/en/http://www.sialcanada.com/sial/en/https://www.chfa.ca/tradeshows/expo-west-2014/https://www.chfa.ca/tradeshows/expo-west-2014/https://www.chfa.ca/tradeshows/expo-west-2014/https://www.chfa.ca/tradeshows/chfa-quebec-2013/https://www.chfa.ca/tradeshows/chfa-quebec-2013/https://www.chfa.ca/tradeshows/chfa-east-2013/https://www.chfa.ca/tradeshows/chfa-east-2013/https://www.chfa.ca/tradeshows/chfa-east-2013/http://www.inspection.gc.ca/food/organic-products/eng/1300139461200/1300140373901http://www.inspection.gc.ca/food/organic-products/eng/1300139461200/1300140373901https://www.ota.com/bookstore/19.htmlhttps://www.ota.com/bookstore/19.htmlhttps://www.ota.com/bookstore/19.htmlhttp://www.fvdrc.com/http://www.fvdrc.com/http://www.fvdrc.com/http://www.fvdrc.com/http://www.citt-tcce.gc.ca/http://www.citt-tcce.gc.ca/http://www.citt-tcce.gc.ca/http://www.citt-tcce.gc.ca/http://www.iccwbo.org/http://www.iccwbo.org/http://www.iccwbo.org/http://www.citt-tcce.gc.ca/http://www.citt-tcce.gc.ca/http://www.citt-tcce.gc.ca/http://www.fvdrc.com/http://www.fvdrc.com/http://www.fvdrc.com/http://www.fvdrc.com/http://www.citt-tcce.gc.ca/http://www.iccwbo.org/http://www.citt-tcce.gc.ca/http://www.citt-tcce.gc.ca/http://www.fvdrc.com/http://www.fvdrc.com/https://www.ota.com/bookstore/19.htmlhttps://www.ota.com/bookstore/19.htmlhttp://www.inspection.gc.ca/food/organic-products/eng/1300139461200/1300140373901https://www.chfa.ca/tradeshows/chfa-east-2013/https://www.chfa.ca/tradeshows/chfa-quebec-2013/https://www.chfa.ca/tradeshows/expo-west-2014/http://www.sialcanada.com/sial/en/http://www.groceryinnovations.com/http://www.cfig.ca/page.asp?id=8http://www.crfa.ca/tradeshows/crfashow/http://www.bakingassoccanada.com/bakery%20showcase/bakery%20showcase%20-%20about.aspxhttp://www.biofach.de/enhttp://www.inspection.gc.ca/english/imp/exhibite.shtmlhttp://www.inspection.gc.ca/english/imp/exhibite.shtml


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the regulations ensure that the organic integrity of a product is not compromised at any stage ofpreparation. This includes preventing the co-mingling of organic and non-organic agricultural productsand contact of organic products with prohibited substances.The Canada Organic Office provides information on:

Certification and conformity verification Labelling and general information Standards

Certification: All food, beverage and livestock feed products for sale in Canada must be certified toCanadian standards and accredited by a “Conformity Verification Body” recognized by the CanadianFood Inspection Agency (CFIA). The CFIA enforces the regulations through the new Canada OrganicOffice. The current list of approved accreditors can be found at this website:http://www.inspection.gc.ca/food/organic-products/certification-and-verification/certification-bodies/canada/eng/1327861534754/1327861629954.

Any supplier wishing to obtain certification for an agricultural product must apply within 12 months ofwhen the agricultural product is expected to be marketed as an organic product. As such, personswishing to obtain certification should be under the oversight of a Certification Body for a sufficient periodof time prior to the granting of certification to permit proper assessment of the operator’s managementsystem and its compliance with the proposed Regulations. Organic certification must be renewed onregular basis, within 12 months from the date of granting. This renewal of certification would be requiredto verify that the criteria continue to be met by the holder of the certification.

Regulation equivalency agreements are in place between Canada and Costa Rica, the European Union,Switzerland, and the United States. For the Costa Rica Agreement, plant products that are: produced andprocessed in Costa Rica; are in conformity with the National Organic Production Regulations of CostaRica and; are produced and processed under an organic certification program that provides safeguardsand guidelines governing the production and processing of such products, are deemed equivalent tothose products that have been produced and processed in accordance with the 2009 Canadian OrganicProducts Regulations. Organic products exported from Costa Rica for import to Canada under thisrecognition may bear the Canada Organic Logo and/or Costa Rica's organic seal as spelled out in the

letter of equivalence recognition. Organic products must be accompanied by an organic certificate issuedby Costa Rican accredited Certification Body. Organic products imported into Canada must meetCanadian food safety and labelling requirements.

Any import-export agreements with other countries would be signed only if Canada is satisfied that theymeet the principles and objectives of the OPR. The ability to enter into these agreements will provide costadvantages to consumers along with the additional choice of products available, especially in light ofCanada’s high dependence on imported organic goods.

Standards: There are Canadian guidelines on the use of additives, preservatives, antioxidants (sulfurdioxide), pesticide, and chemical residues which both the importer and exporter should be familiar with,since failure to comply with these standards can result in fines and possible seizure of goods. Of note,certain colours approved in the U.S. cannot be used in Canada. Also, while saccharin and cyclamate are

sold as sweeteners in Canada, they cannot be used in processed foods intended for this market.Bacterial counts such as coliform, E. coli, salmonella, bacillus cereus, S. clostridia and fecal streptococci,along with aflatoxins, mould and yeast level/types are strictly limited by Canadian standards. Thestandard of products exported to Canada should not be left to the discretion of the individual exporterbecause a single shipment of inferior quality could jeopardize the reputation of the exporting country. Byenforcing high standards on a country’s products, the resulting positive international reputation will lead toimproved competitiveness and export earnings.

Grading: Since the Canadian market is already supplied with prime quality products of all kinds, astringent system for grading and quality control in the exporting country should be established. Processedfoods sold in Canada are graded according to rules set out in the Processed Products Regulations.

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These grades are based in factors such as closeness to the typical flavour of the fresh fruit or vegetable,uniformity of colour and size, levels of sand and grit, insect and mechanical injury, rust spots, blemishesand other defects. In addition, frozen foods are checked for texture and freezer burn.

Canadian grade names cannot be used on fresh produce as these are national trademarks and restricted

to produce grown in Canada. In order of quality, these Canadian grades are Fancy, Choice, Standard, A,B and C. There is generally no objection if the imported product is graded and so marked according to thecountry or origin’s established criteria for that grade. In this case, the imported product must be sold in its

original container bearing the identification of the country of origin. More information is available at:www.inspection.gc.ca/english/fssa/frefra/cdnreqe.shtml .

Food Safety and Security: The Food Safety System in Canada has three major partners: the Federalgovernment, the Provincial and municipal governments, and the food industry. The Canadian FoodInspection Agency (CFIA), Health Canada, and Canada Border Services Agency all work on differentaspects of food safety. The CFIA monitors the safety and security of Canada’s food supply through itsFood Safety Enhancement Program (www.inspection.gc.ca/english/fssa/polstrat/haccp/haccpe.shtml ),and the Protecting Our Borders and Skies (http://dsp-psd.pwgsc.gc.ca/Collection/T22-114-2002E.pdf ) public awareness campaign. The latter, focused on enhanced biosecurity measures, is intended to further

prevent the introduction of pests and diseases which pose a risk to plant and animal health in Canada.Exporters could consider using those guidelines to adjust production and monitoring systems forprocessed fruits and vegetables, including low acid pickles, aseptically packaged fruit and vegetable juices, frozen fruits and vegetables, and low acid canned vegetables. Such prudent measures, two ofwhich are outlined below, would greatly enhance the product’s appeal not only in Canada, but in otherinternational markets.

Hazard Analysis Critical Control Points (HACCP): This practical system helps producers to review allpotential health and safety hazards in their plant operation and focus on controlling the points that arecritical to the safety of the finished product. The Canada GAP food safety program, established in2012 (http://www.canadagap.ca), has a globally recognized system that would cover all theserequirements. Briefly, the benefits of using the HACCP system include:

international acceptance of your products as the system is adopted worldwide; national acceptance, allowing you to become a leader in national industry; defining responsibilities between government and industry; improved marketability, using internationally recognizable logos and symbols; reduced recalls and product destruction, vital to an exporter’s reputation for quality.

Based on the HACCP, the following may be used as a guide by exporters:

Review your business and company procedures, physical facility, processes, shipping, anddistribution systems. Identify areas where you might be vulnerable to potential sabotage orterrorist attacks and outline control measures for each of these areas.

Ensure that there are adequate security measures for your facility and employees. Have procedures in place to ensure the composition and integrity of all ingredients, raw

materials and packaging materials in each facility. Develop procedures to ensure the integrity and security of your manufacturing equipment and

water supply used in manufacturing. Develop procedures and anti-tampering measures to ensure the security of your products

once they are produced and shipped to retail. Develop an action plan to respond to an emergency, including cordoning off areas, moving

employees and contacting identified authorities. Ensure all hazardous chemicals and pesticides are securely stored away from processing

and handling and are listed on safety sheets on site.

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Recalls: The CFIA issues food recalls in the event that there is a public safety hazard. Recalls could bea result of physical, chemical or biological hazards associated with foods for human consumption. Thesehazards could be foreign objects such as plastic or metal fragments (physical), cleaning solutioncontamination (chemical), or a situation such as E. coli or Salmonella bacteria contamination. Themajority of recalls are instituted voluntarily by companies involved in their sale, distribution or production

to ensure that all products are recalled effectively and consumer health and safety is preserved. TheCFIA works with the responsible parties to ensure that the recall is effective, and advises the generalpublic about the recall.

Irradiation: Organic foods are not permitted to be irradiated. However, for non-organic (ethnic) foodsirradiation is a food safety and preservation technology, similar to pasteurization. While pasteurizationuses heat to kill microorganisms, irradiation uses a form of energy called ionizing radiation. The processinvolves exposing food, either in bulk or packaged, for a specified amount of time to gamma rays. It issimilar to ultraviolet (UV), visible and infra-red light, microwaves and radio waves used forcommunication. The effects of irradiation on the food and on animals and people eating irradiated foodhave been studied extensively. Irradiation is a safe and effective tool that can help to prevent many foodborne diseases. Any imported irradiated food must also be approved for irradiation in Canada, and mustcomply with the relevant regulations, including labelling requirements.

Protective Coatings: Protective edible coatings and waxes are applied to fruits and vegetables as part ofthe post harvest treatment of fresh fruits and vegetables as a method of preservation. The PermittedSubstances List provides details on what is allowed for organic foods.

For non-organic ethnic foods, there are a number of protective coatings such as mineral oil, petrolatumand paraffin that are regulated as food additives under the Food and Drug Act and Regulations. TheseRegulations set the limits for the quantity of protective coatings that can be used. In other countries, theremay be some wax and coating products that are generally recognized as safe for use on food; however,these products must comply with Canadian regulations and be acceptable for use in Canada. There areother protective coatings that are not currently regulated as food additives but have traditional foodingredients uses, e.g., vegetable oil. Other substances such as shellac, beeswax, candelilla wax andcarnauba wax are considered aids to processing. It is important to note that allergens and any proteinsderived from them should not be used as components in protective edible coatings. More information on

undeclared allergens and acceptability of post harvest protective coating treatments is available at:http://www.inspection.gc.ca/english/fssa/frefra/safsal/nonallergene.shtml while information on the use ofsulphites in fresh produce is available at: www.inspection.gc.ca/english/fssa/frefra/safsal/sulfitee.shtml

The Buyer

Entering a new market can be daunting, but with a well-defined marketing plan, the rewards will be wellworth the effort. Exporters have one chance to make a good first impression. Use this chance to showwhat you are selling. Initial information about your company should include photographs, prices,specifications, and quality/safety certifications of your latest products. You can also include photos of yourproduction facilities. The internet is an essential tool for communication with Canadian buyers, so developa website or have an e-mail address that will allow you to readily provide this information so that they can

quickly assess whether they are interested in pursuing an arrangement with you. If you do not show insuch an immediate and concrete fashion what you are capable of, the buyer loses interest.

Major stakeholders in the industry include the:

Canadian Organic Growers (www.cog.ca); Organic Agriculture Centre of Canada (www.organicagcentre.ca); Canadian Organic Trade Association (www.ota.com/otacanada.html); Canadian Horticultural Council (www.hortcouncil.ca); Canadian Produce Marketing Association (www.cpma.ca); Canadian Council of Grocery Distributors (www.ccgd.ca);

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inspection of the product to determine if it complies with stated specifications, for the company’s ownsatisfaction.

If the samples are acceptable, the importermay place a trial order with the supplier. Ifsome adjustments are required, the

importer will request new samples basedon the instructions for needed changes. Atrial shipment which is consistent with theaccepted samples and which is deliveredaccording to an agreed-to deliveryschedule may then be sent to Canada. Theimporter generally advises the supplier of

the sizes and styles that should sell best in Canada and on the condition that the product should arrive inthis country. The importer uses samples to assess the interest of wholesalers and retailers in carrying theproduct. Exporters should bear in mind potential competition from suppliers in the United States andMexico. Canadian importers are aware of the advantages of purchasing from North American suppliers — lower transportation costs, shorter delivery and lead times and simpler payment mechanisms. Theseexporters are also usually very familiar with the Canadian market and business norms. Exporters shouldconsider these facts when setting prices and evaluating business practices.

Import terms vary with individual importers. In general, quotations should be made f.o.b. foreign port,including packaging, but may be requested c.i.f. to a named warehouse. Payment for imports fromtraditional suppliers is generally cash against documents. The majority of Canadian importers will notwork with Letters of Credit but may select other credit formats and terms that would suit both parties. Contracts often include a clause stating that the goods must be inspected and signed off in-country by thebuyer or agent prior to shipping. The importer usually requests a guarantee to be included in the contractagainst hidden quality defects.

Please note that consignment terms are illegal in Canada and are strictly enforced by the CFIA. However,there is one exception to this rule: if exporters are members of the Fruit and Vegetable DisputeResolution Corporation (www.fvdrc.com), they are allowed to ship on consignment terms. All commoditiesmust carry a price, the value of which may be previously decided between a receiver and a shipper. The

Anti-Consignment Selling Regulations are strictly enforced, and Canadian produce importers mustpresent a completed and signed Confirmation of Sale (COS) form to the Canada Border Services Agencybefore a shipment is released. No other document is acceptable as a substitute and the load will be helduntil a COS is presented. Information on this form should include product description, details of the sale,names and addresses of buyer and seller, and evidence that the dealer purchased or had an agreementto purchase the product. This document is used in place of the customs invoice. Once an importedproduct has established a reputation for high quality, a brand name and trademark should be adopted.Such identification is important so that customers can easily recognize the product and know that itrepresents good value.

Dealing with Non-Payment: Exporters could take certain steps to prevent disputes from occurring, or toseek recourse if this is inevitable. One very simple, inexpensive but very effective legal tip that couldprovide the winning edge in court is to have all the signatures on important contracts or agreements

notarized (acknowledged by a notary public). You should also screen your clients – check their reviewsand credit rating through the Better Business Bureau (http://www.bbb.org/canada/Find-Business-Reviews/). A credit report can be a useful tool to assess the credit worthiness of the potential client and tohelp you to set credit terms for the contract. For a fee, companies such as Dunn and Bradstreet Canada(www.dnb.ca) can also assist with this task. Suggestions are also offered by several websites; somepractical ideas from these sites are highlighted here for your consideration: Forbes(http://www.forbes.com/sites/sundaysteinkirchner/2012/05/22/what-to-do-when-a-client-doesnt-pay/ ) andGeekpreneur (http://www.geekpreneur.com/what-to-do-when-your-client-doesnt-pay ) offer the followingsuggestions, which could be adapted to each exporter’s situation:

Items a buyer may cover in negotiating with a supplier include:

Product attributes packaging

logo mould breadth of product line quality price range product exclusivity country exclusivity special arrangements

Ordering services availability of product

promptness of initial delivery availability of repeats promptness of repeats product substitution complete or split shipments order revision reliability of shipping direct to Canada

http://www.fvdrc.com/http://www.fvdrc.com/http://www.fvdrc.com/http://www.bbb.org/canada/Find-Business-Reviews/http://www.bbb.org/canada/Find-Business-Reviews/http://www.bbb.org/canada/Find-Business-Reviews/http://www.bbb.org/canada/Find-Business-Reviews/http://www.dnb.ca/http://www.dnb.ca/http://www.dnb.ca/http://www.forbes.com/sites/sundaysteinkirchner/2012/05/22/what-to-do-when-a-client-doesnt-pay/http://www.forbes.com/sites/sundaysteinkirchner/2012/05/22/what-to-do-when-a-client-doesnt-pay/http://www.forbes.com/sites/sundaysteinkirchner/2012/05/22/what-to-do-when-a-client-doesnt-pay/http://www.geekpreneur.com/what-to-do-when-your-client-doesnt-payhttp://www.geekpreneur.com/what-to-do-when-your-client-doesnt-payhttp://www.geekpreneur.com/what-to-do-when-your-client-doesnt-payhttp://www.geekpreneur.com/what-to-do-when-your-client-doesnt-payhttp://www.forbes.com/sites/sundaysteinkirchner/2012/05/22/what-to-do-when-a-client-doesnt-pay/http://www.dnb.ca/http://www.bbb.org/canada/Find-Business-Reviews/http://www.bbb.org/canada/Find-Business-Reviews/http://www.fvdrc.com/


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1) Standardize your business practices: Draw up a contract for every job, every client, every time. Acontract should include a description of the work, payment information, and payment schedule. Insertmilestones to break the payment intoinstallments. Clients rarely argue withthese, especially when they also include

milestones for delivery. Decide how toaccept payment – many professionalssuggest taking a down-payment (up to50%) before the start of any project, andcollecting the balance upon completion,before turning over any goods or servicesto your client.

2) Take action: Bill your clients on time and address non-payment immediately. When you send yourinvoice, include a date by which payment should be made. Once that date passes, send a reminder.If you need to remind a client to make a payment, it is possible that they just forgot, but there is also agood chance that something has gone wrong. You need to discover what is causing the hold-up andsee if there’s anything you can do to unblock the payment. Send the reminder but also send the clienta polite e-mail, asking if they have any questions.

3) Negotiate changes and terms: In most cases, the reminder will be enough to prompt payment.Individuals can forget or may be waiting for a payment to come in before they can send another oneout, and the accounting department of small firms may be too busy to reach your invoice at the rightmoment. A gentle nudge is usually enough at those times to receive your money without damagingyour professional relationship.

Price

Since the Canadian market is relatively small, Canadian importers attempt to obtain exclusive importingrights for the specific items they agree to import. For large production ranges, it is customary to allowsome price discount (5% to 10%) which enables the retailer to cover their operating costs and maintain areasonable gross margin. The exporter may also be requested to provide rebates as a result of poorproduct quality, damage before or during shipping or late delivery. An exporter may initiate special terms

which allow the exporter to shift warehousing or inventory costs over to the retailers. Large

Organic Ethnic and Fair Trade Foods FINAL

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