Organic Food Industry

Overview

Organic agriculture, as defined by the International Federation of Organic Agriculture Movements (IFOAM) is “a production system that sustains the health of soils, ecosystems and people. It relies on ecological processes, biodiversity and cycles adapted to local conditions. Organic agriculture combines tradition, innovation and science to benefit the shared environment and promote fair relationships and an excellent quality of life for all involved.” Organic products offer more social, political, economic, cultural and environmental benefits in the long run. The categorization of a product as organic implies two main things:

  • It is free from toxic persistent pesticides, synthetic fertilizers, growth hormones and antibiotics or genetically modified organisms (GMOs).
  • Stringent organic cultivation standards are followed, with respect to impact on soil, water and air.

Global Organic Food Market

Organic farming is practised globally with various levels of success in 178 countries. The global organic food market is predominantly shared by North American continent and European Union. The growth rate (CAGR) for organic products on global front is 16% as compared to the conventional products (CAGR – 10%). The rapid rate of growth of organic market can be attributed to the following factors:

  • Increased emphasis on good health
  • The proliferationof consumption-relatedailments
  • Increased income levels and standard of living
  • Government initiatives aimed at promoting organic products

The change in global demand has led to an increasein global organic cultivated area from 11 Million Hectare(ha) (1999) to 57.1 Million ha (2016). The top three global consumers of organic products are –

  • USA ($43.1 billion)
  • Germany ($10.5 billion)
  • France ($7.5 billion)

Indian Organic Food Market

India ranks among the top three countries with largest wild harvest area for organic products (4.2 million ha). It also houses the highest number of organic producers globally with 835,000 organic farmers. Moreover, India ranks at 9th position in terms of are under organic cultivation with 1.49 million ha.