Home » Country info » UK » Country report 2010

Country report - UK 2010

The information in this chapter was compiled by the Research Institute of Organic Agriculture FiBL from a number of sources. It was originally published in the SIPPO-FiBL handbook "The Organic Market in Europe".

History

The United Kingdom has a long tradition in organic farming, with the foundation of the Soil Association in 1946 being a major milestone. Despite an early start, the organic market has developed only slowly compared to other European countries in the mid 1990s. This has been explained by the poor interest of British consumers and the modest government support given to organic farms compared to other European countries. It is only since the late 1990s that demand for organic products has risen significantly, particularly for dairy and meat products. This is due in part to the involvement of several retailer chains and their promotion efforts (Kilcher 2004). In 2008, the UK was the third largest market for organic food in Europe.

The first organic standards were published as guidelines by the Soil Association in 1967. The Soil Association Organic Marketing Company, now Soil Association Certification Ltd., was set up in 1973 to inspect and certify organic food. In total, there are nine control bodies for organic farming and food, with four of them operating only in certain parts of the UK. The Soil Association standards are the most widely recognised private standard in the UK.

In 1981 a major retailer, Safeway, began selling organic products.By 1993 the four biggest supermarket chains Tesco, Sainsbury, Safeway and ASDA, as well as smaller retailers such as Waitrose, also began selling organic groceries and produce, very early in comparison to most other European countries. The three supermarkets with the biggest share in organic products are Sainsbury, Tesco and Waitrose and all continue to develop their range of organic products.
 
The EU Regulation on Organic Production is the basis for UK organic standards. These are implemented under the Organic Product Regulations that was updated after the total revision of the regulation in the UK. The Department for Environment Food and Rural Affairs (DEFRA) has produced a guidance document (PDF 330 KB) on these new organic standards (Defra 2010).

To top

Production base

Since 2004 (674,506 hectares), the organic farming area in the UK has demonstrated consistent growth, even though there was a slight decrease of one percent in 2009. In 2009 738,707 hectares were under organic management (Defra 2010).

Half a million hectares or more than two-thirds of the organic agricultural land are grazing/grassland areas (2009). Slightly more than 200,000 hectares of arable and permanent crops are grown. The key crop groups are green fodder from arable land (almost 130,000 hectares), followed by cereals (60,000 hectares) and vegetables (18,800 hectares). After Italy, the UK has the largest vegetable area in Europe.

In 2009 there were 4,946 organic producers and 2,411 processors. The total number of operators (including importers) was 7,567, constituting a decrease of 4.2 percent compared with 2008 (Defra 2010).

To top

Government support

Financial assistance from the government has been available for converting to organic farming under a number of schemes since 1994, with varying schemes in the four administrations in England, Wales, Scotland and Northern Ireland. Maintenance grants were introduced in 2003/2004, later than in many other EU member states (even later in Northern Ireland). And compared to other EU members, payment rates in the UK are relatively low. The current English scheme is the Organic Entry Level Stewardship (OELS) element of the Environmental Stewardship that was introduced in March 2005 and is open to all farmers and land managers that have organic certification and fulfil the minimal criteria to participate in the agri-environment scheme (Defra 2010). The English Action plan from 2002 was completed in 2007 and not replaced. The current Welsh action plan ends in 2010, a new action plan is under development. In Scotland a new action plan is in preparation after a gap of a few years and in Northern Ireland, the action plan for 2007/2008 has not been replaced.

To top

The market

The British retail market for organic products has been one of the fastest growing markets in Europe until 2008; between 2000 and 2008, the turnover of organic food sales more than doubled (see Figure 36). In 2009, sales of organic products in the UK were worth an estimated 1.84 billion British Pounds, a decrease of 12.9 percent compared with 2008. Sales slowed significantly after 130 l The Organic Market in Europe many years of uninterrupted growth, as shoppers reduced their spending during the economic downturn and leading retailers reduced organic ranges and shelf space. Estimates of organic product share in the overall retail market for the year 2009 was around 3.5 percent. The Soil Association predicts growth in the organic market to be 2 to 5 percent in 2010 (Soil Association 2010).

In the 1970s and 1980s, farmers had to sell their products mainly through direct on-farm sales. Today, direct sales like farm shops, farmers’ markets, box schemes and mail order account only for a small proportion of the retail sales. The majority of sales are in supermarkets and specialised retailers.

The two biggest categories of organic food in terms of retail sales value are dairy and fresh fruits, vegetables and salad (produce). Worst hit by the declining sales in 2009 were the categories produce (with a decline of 14.8 percent), fresh meat and bread and bakery products. In contrast, organic milk, organic baby food and home cooking ingredients were the food categories that resisted the trend, with sales increasing by 1 percent, 20.8 percent and 1.4 percent respectively. The best year on record for organic milk sales was 2009. Sales of organic health and beauty products also continued to grow dynamically, increasing by a third to 36 million British Pounds (Soil Association 2010).

The proportion of households buying some organic food has grown substantially over the years, but fell slightly in 2009 compared to 2008 from 88.9 to 88.3 percent. On average, consumers bought organic products 16 times during the year, compared to 18 times in 2008. Generally, they typically spent 2.9 percent less on organic products per shopping trip. Just like other shoppers, organic consumers have also responded to the recession by economizing.

In total, the organic market relies heavily on a committed core of consumers who buy organic products frequently. Nine percent of households that buy organic food more than once a fortnight are responsible for 56 percent of total sales. A further 14 percent buying organic food more than once a month, but no more than once a fortnight, account for 21 percent of sales. At the other end of the spectrum are the 14 percent of organic consumers that only buy something organic once a year and unsurprisingly account for just 1 percent of total spending.

Organic products attract consumers from a wide socio-economic spectrum. In 2009, manual and casual workers, pensioners, students and people on benefits accounted for 33 percent of money spent on organic, a slight decline compared to 35 percent in the previous year. Consumers with higher incomes increased their share of spending from 65 to 67 percent. Families with children living at home account for a smaller proportion of the organic market than they do of overall food and beverage sales.

Shoppers aged 35 to 64 tend to be the keenest organic buyers. They account for 60 percent of spending on organic products. Shoppers under 35 and over 65 represent 16 percent and 24 percent of spending respectively (Kantar Worldpanel cited by the Soil Association 2010).

The top five reasons for buying organic products were a preference for naturalness/unprocessed foods (40 percent), the restricted use of pesticides (34 percent), better taste (30 percent), better for my well-being (28 percent) and better for the planet (25 percent) (Onepoll.com cited by the Soil Association 2010).

Imports and market requirements

It has been estimated that about 34 percent of the organic food consumed in the UK is imported (Frost and van Diepen 2010), but there are no official figures on this. Important product categories of imports are fruit and salad crops (largely due to seasonal issues), but also cereals, other vegetables, dairy products and pork. British retailers and consumers place very high demands on the external appearance of fresh products. Imported organic foods originate from EU member states, such as Netherlands, Spain and Italy. The main organic suppliers outside of the EU are the USA, Egypt, Israel, Argentina, South Africa and Central America (Kilcher 2004, Frost and van Diepen 2008).

To top

Market access provisions

The market access for organic products is regulated by EU regulation 834/2007 on organic farming (see Part C, Chapter 1). The following additional provisions apply in the United Kingdom:

The UK has an organic control system based on 9 private control bodies. All of these control bodies apply the standards in line with Regulations (EC) 834/2007 but have their own version of standards and/or control manual. In some cases this includes standards for areas not (yet) regulated by the EU. The Soil Association Standard owned by a charity is the only private standard that differs substantially in several areas from the EU regulation. In the market place and by the consumer, the symbol of SACert is presently the best known and SACert labelled products currently occupy about a third of the UK organic market. For use of the Soil Association logo a contract with and certification by Soil Association is necessary.

There is no national label for organic products in the United Kingdom. British supermarket chains dominate the organic market. The word «organic» in combination with the supermarket’s brand name like Marks & Spencer Organic, Waitrose Organic, Sainsbury Organic, Tesco Organic or ASDA Organic are used in marketing. Supermarkets are working with various certification services depending on product and country of origin.

The United Kingdom is one of the strongest importers of organic products. The import of organic products from third countries is regulated by the EU Regulation on Organic Production. Applications for import authorisations for organic products have to be issued by the importing company to the Department for Environment, Food and Rural Affairs (DEFRA).

To top

References

To top

Organic farming in the UK

SIPPO & FiBL 2011: The Organic Market in Europe