Organic Foods May Be Victim Of Their Own Success

  • November 17, 2006
Demand is far outstripping supply for organic food and beverages, and despite triple-digit growth in organic farmland in Latin America, Asia and Africa since 2000, the industry's long-term stability is fragile, a new report says.

According to Organic Monitor, a British consultancy, countries where consumers have high disposable incomes are driving demand, with Switzerland, the United States and Singapore out front.

"Over-concentration of demand could put the global organic food industry in a fragile condition," said Amarjit Sahota, director of Organic Monitor. The shortages are most evident in North America, and many U.S.-based companies are currently scouring the globe for organic ingredients.

Nuts, beans, and seeds are increasingly being imported from Turkey, China, and Brazil. Herbs and spices are coming from Paraguay, India, and Ethiopia. Organic fresh fruit and vegetables are increasingly coming in from African and Asian countries.

Several European countries are also experiencing supply shortages, said Organic Monitor, as consumer demand for organic foods escalates. G7 countries account for more than 80 percent of sales, while they have only 12 percent of international organic farmland. The report also points out that divisions and differences among the three major trading blocks--Europe, North America and Asia--are impeding the global organic food and beverage industry.



The report projects that revenues will approach $40 billion this year.

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