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Press Release

Reports reveal areas of growth and challenges in organic sales

The Organic Market Report published today (20th March)by the Soil Association highlights key areas of growth in online retail, independent outlets and a shift towards younger consumers during 2012. Overall, the market has dipped by 1.5% as the UK continues through its most challenging economic downturn for many decades. However, the report predicts a positive future for the UK organic market. This report coincides with the release of the Welsh Organic Producers Survey, produced by Organic Centre Wales on behalf of Welsh Government, revealing trends and future challenges for Welsh organics.

Despite the overall 1.5% dip across the UK, there are a number of positive trends happening in the Welsh organic sector. The Welsh Organic Producer Survey has revealed strong demand for organic meat, with sales of beef up by 32% and lamb up by 69% [for market ready lamb], as well as a 10.6% growth in sales of organic milk. Despite these figures, which were boosted by a number of Welsh farms completing their organic certification in 2011-12, there is a concern that the combination of pressure on organic feed prices and changes to support payments for organic farmers will force many of Wales's organic producers to revert back to non-organic production over the next few years.

The Welsh Organic Producer Survey also highlighted growth in direct sales during 2012, with almost a third (28%) of producers involved in selling direct to the public experiencing an increase in sales, while 55% reported no significant change. Meat (48%) and vegetables (29%) continue to dominate the direct sales market, with more than half (54%) of producers involved in direct selling relying on individual customers for over 80% of their turnover.

A trend echoed at UK level, with the Soil Association Market Report revealing that independent organic meat suppliers have reported an increase in sales of up to 20% over the past month. These increases have coincided with the recent horsemeat scandal, which has resulted in increased sales figures across independents and supermarkets, Kantar Worldpanel data has revealed organic supermarket sales increased in February to their highest level in 9 months.

Speaking about the UK Market Report, Jim Twine, Soil Association Business Development Director said; “In the worst economic downturn in living memory, it's not surprising to find subdued sales of a wide variety of goods and services- and the UK organic sector is not immune to these. Despite a decrease in sales overall, there are areas of significant growth highlighted in the 2013 Organic Market Report. The Soil Association remains confident the UK organic market will return to growth – it is more difficult to know exactly when.

“There is a real risk that if retailers do not work more closely with UK organic farmers and growers, the market could become restricted due to supply shortages. The report shows that when retailers have invested in their organic range their share of the market grows – and the converted organic consumer remains very loyal.

“Governments in England, Wales and NI could look to Scotland's lead, with Action Plans to support organic farmers and growers. The UK Government should mirror European governments and really get behind organic producers in the UK to help support existing organic farmers and grow the market in future. In short – we need a level playing field.”

This message to Government is being echoed within Wales, where the rising cost of organic feed is amplified by increases in fuel costs with supplies having to travel that much further;

“Despite some encouraging sales figures reported by organic producers in Wales, there is no doubt that the changes to support payments are going to hit hard and organic output may suffer as a result,” said Neil Pearson from Organic Centre Wales. “We are working with a number of producers on innovative schemes that will enable them to offset some of the increases in feed costs and there is evidence that more organic farms are looking at ways to diversify to supplement their income from crops and livestock, but despite these efforts our survey found that confidence remains a major issue.”

The latest Welsh Organic Producer Survey found that 15% of organic farmers were considering reverting to non-organic methods over the next 12 months – a figure that has not risen above 3% in each of the four previous studies – and this rose to 47% when considering the next two years. General financial concerns such as high feed prices and dwindling premiums for organic livestock, especially lambs, were cited by 47% of those considering leaving the sector, while the future of agri-environment scheme payments for organic farming and uncertainty of CAP reform in general (34%) was the largest single concern.
“Wales has traditionally punched above its weight in terms of organic production but the results of this latest survey suggest that as much as 42% of our organic land area could revert to non-organic status if the current market conditions and policies on support payments remain as they are,” warned Mr Pearson. “At a time when public perception is showing a shift towards responsibly sourced food and the wider market for organics is showing signs of recovery in the UK, it would be a shame if Welsh producers are forced to exit the market.”


1.About the Welsh Organic Producer Survey
The Welsh Organic Producer Survey has been commissioned by Organic Centre Wales on an annual basis since 2007. The 2012 survey was undertaken via a series of telephone interviews conducted during October and November 2012. Data has been drawn from 647 completed surveys (representing 64% of all certified organic producers) and extrapolated to give pan-Wales results using formulas consistent with previous studies.

A copy of the full report can be found online here

Welsh Organic Producer Survey Press enquiries:
Jenny Mills, Communications Officer, Organic Centre Wales -01970 823029

The 2013 Soil Association Organic Market Report
For press enquiries please contact:
Natasha Collins-Daniel, Press Office Manager – 0117 914 2448 / 07827 925380

Holly Black, Digital Communications and Press Officer – 0117 914 7170

•Download the Soil Association's Organic Market report 2013, sponsored by Triodos bank here

•Kantar Worldpanel data for supermarkets shows that total organic sales for the 4 weeks to February 17th versus the 4 weeks to January 20th is showing an increase of 8.4%. The Soil Association estimate of organic sales across the wider market for those 4 weeks is approx £110m

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