National Benchmark Survey of Organic Food Production

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National Benchmark Survey of Organic Food
Production

• By Richard Jacobs
• Business Manager, OFG

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OFG in a nutshell

• The UKs oldest organic cert body
• Second largest UK organic cert body
• Licensing approx 125,000 hectares of organic and
  in-conversion land
• Ethos defend the standards rigorously but apply
  them in a practical manner
• Production and processing departments

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About the survey

• Largest survey of its kind in the UK
• A need to hear from the people on the ground
• Sent to all organic producers in the UK (approx
  4,000)
• No incentive offered to complete it and all
  responses anonymous
• Extremely good 29 (1,144 replies) response rate
• Results and methods verified by Harper Adams
  University College.

Thorough, fair, unbiased, scientific
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Some facts and figures

• 63 of respondents rated their profitability as
  low or borderline
• 12 said their business was unviable at current
  prices
• 90 expected to be farming organically in one
  years time BUT
• 30 were undecided on the five-year horizon!
• 60 believed supermarket buyers had major
  responsibility for improving the price they
  received

Alarming levels of uncertainty and doubt about
the future
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View from the ground

• Producers saw the following solutions (in this
  order)
• Increased public sector procurement
• More co-operation
• Grants and subsidies
• More/better training

Trend of reliance on others for solutions
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Marketing co-operatives are apparently the
preferred route - HOWEVER
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So, a long way to go? Or huge, untapped potential?
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Assuming those 48 would follow through, is it
enough?
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Likely maximum investment sum
Mean 5,298 among 465 farmers Median 1,000
same sample
120000
100000
80000

60000
40000
20000
0
1
28
55
82
109
136
163
190
217
244
271
298
325
352
379
406
433
460
Farmers
Is 1,000 each enough start-up and working
capital?
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For each of the people listed below, how would
you rate their
responsibility for generating better prices for
your produce?
100
90
80
70
No reply
60
None
50
Minor
40
Major
30
20
10
0
NFU
Yourself
Processors
Wholesalers
Organic certifiers
Supermarket buyers
Government policy
Producer co-operatives
Concerning that farmers see supermarkets as more
responsible than themselves!
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Thinking of things that may improve your
profitability medium to long
term, how would you personally view each of these
factors?
100
90
80
No reply
70
60
Unwelcome
50
Neither
40
30
Welcome
20
10
0
Grants/subs
Training NPD
Training technical
Training business
More co-operation
Training marketing
Training co-op marketing
Public sector procurement
Too much expectation of public sector? At least
co-operation is second!
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Where among these areas do you see opportunities?
100
80
60
No reply
No
Maybe
40
Yes
20
0
Internet selling
Luxury products
Manufacturing JV
Marketing/sales JV
Own retail outlet(s)
Low cost production
On farm processing
Farming joint venture
Supermarket alliances
Co-operative marketing
Convenience products
Product development JV
Somewhat encouraging weighting towards
co-operative marketing
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Summingup

• Recognition that co-operatives are the way
  forward
• Marketing and training not seen as a high enough
  priority by individuals
• Heavy expectation of public sector
• Worrying numbers see others as more responsible
  for their income than themselves
• Apparently limited willingness/ability to commit
  serious financial investment to co-ops
• Success means applying solid business practice to
  our sustainable and increasingly popular methods

Some positives to work with. Some hurdles to
overcome.
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