The market for organic products
The UK organic market grew in 2008 due to the increase in the proportion of households eating organic and an increased average spend on organic products per shopping trip.
Nine out of ten UK households now buy some organic food, compared to 76.5 percent five years ago.
Assessment of the Market for Organic Food
A number of key facts concerning the United Kingdom Market for organic food and drink in 2008 (most recent figures available) are shown below.
- The UK market increased by 1.7 percent to £2.1billion showing an increase of 20 percent over the previous year. Most of the growth was in the first six to nine months but fell back in the face of the economic downturn in late 2008
- The multiple supermarket retailers were the major marketing outlets to the consumer with around 73 percent of sales.
- Independent retailers and farm gate sales accounted for the other 27 percent of sales. Of this farmer’s markets, box schemes and mail order made up 8 percent.
- The highest rate of growth in organic sales was through independent retailers.
- Organically managed land accounted for approximately 3.9 percent of the UK’s total agricultural land area. In January 2008 there were 4,955 organic producers in the UK (7 percent more than the previous year).
- By January 2008, the amount of organically managed land in Northern Ireland increased by 15 percent to 10,411 hectares. However, at 1.0 percent of NI’s total agricultural land this is much lower than other parts of the UK and there are significant opportunities for development.
- The number of in-conversion and organic producers rose to 246, a marginal increase of 3 percent.
Marketing Organic Food in Northern Ireland
Organic farms currently produce mainly dairy products, beef, sheep, poultry and eggs, supplying both local markets and the rest of the UK and beyond. There are over 50 organic processors and several successful vegetable box schemes and specialist shops
Since the arrival of the main UK supermarket chains, there has been increasing availability of organic products and the local market expanded to approximately £30 million in 2008.
As organic farming is relatively less developed in Northern Ireland, compared to the rest of the UK, organic supply chains are still emerging for some products.
It is therefore important that anyone planning to produce organic food considers how and where they will market their organic products to obtain organic premiums.
Once a farm has started organic conversion it will take at least two years to produce fully organic products.
Organic food production and marketing should be strategically planned to ensure that production increases in line with market demand.
Where organic food requires further processing it is essential that processing partners are identified in advance.
There are several ways in which organic food can be marketed.
Some current options are:
a) Join an Organic Marketing Organisation in Northern Ireland
A small number of local organic producer groups exist to co-ordinate supplies and market organic foods from farm to retail.
They are an important means of meeting other organic producers and achieving economies of scale in the marketplace.
Emerald Organics (Dairy)
Contact: Roy McCracken 028 8284 1592
NorthWestOrganicCo-operative
Office: 028 7133 7950
Contact:
Stan McWilliams 00 353 74 93 84107
Stan McWilliams 00 353 74 93 84107
United Irish Organics (Dairy)
Contact: David Laughlin 028 2954 0272
b) Individual Partnerships with Processors
ABP/Sainsbury Partnership in Livestock (beef)
Contact: Liam McCarthy 028 3026 3211
Dunbia (lamb and beef)
Contact: Jim Carson 028 8772 0720
Linden Foods (lamb and beef)
Contact: Frank Foster 028 8772 4777
Moy Park (Chicken)
Contact: Tom McKeown 07778 033786
O’Kane (Turkeys)
Contact: Colin Taylor 028 2564 1111
Farmlay Eggs
Contact: Eileen Thompson 028 3752 2707
Skea Eggs
Contact: Harold Richmond 028 8776 1252
Whites Speedicook (Oats)
Contact: Glenn Speer 028 3752 2344
Mobile: 07872 836675
Wilson’s Country Potatoes
Contact: Mark Lewis 028 3839 1029
c) Direct Sales
Farm Shops – Perhaps the simplest form of direct selling. It requires close proximity to a large local population or significant passing trade. It can be expensive to establish a good shop.
Farmers Markets - An inexpensive means of selling. It avoids large scale capital investment and allows concentration on specific products. Few currently exist in Northern Ireland and producers may need to travel long distances to sell their organic products.
Box Delivery Schemes – Like farm shops a large local population is required. Costs revolve around distribution rather than capital.
The producer is offering increased convenience by delivering either to a central pick-up point or door-to-door. Labour requirement is intensive and constant.
Mail Order/e-commerce – Mail order involves more complex delivery procedures. A greater area is targeted (NI, ROI, UK) and therefore requires different promotional activities and good communication and delivery systems. Next-day delivery is usually a requirement.
Ecommerce adds a new dimension, improving the promotional opportunity but increasing accessibility and need for quick response.
It is worth considering supplying an existing box scheme or farm shop(s) initially to minimise costs
For information on the following:
- Recent developments regarding marketing opportunities;
- Supply Chain Development Programme;
- Processing and Marketing Grant Scheme;
- Marketing and Development Grant Scheme
Contact a Supply Chain Development Branch Adviser listed below.
Contacts for further information
© DARD - December 2010
