Thursday, 15 September 2016 08:55

Organics demand ‘exciting’ for land sales

Written by 
Demand for organic dairy products is rising. Demand for organic dairy products is rising.

With 66% of Kiwis now buying organic food, prospects for organic producers look ever more promising, comments real estate firm Bayleys.

The company refers to a recent Organic Aotearoa market report on a strong shift by consumers to organics, for which the domestic market is now $250 million – up 45% in four years. Of the $240m of organic exports last year, fresh fruit and vegetables were the largest by value – $108m.

Bayleys national country manager Simon Anderson says every aspect of protein, fruit and vegetable production offers opportunities for strong returns. And farmers and investors have growing interest in properties suitable for conversion to organics or already organic-certified.

“The highest earning organic crop is kiwifruit which accounts for about 20% of all organic exported produce,” Anderson says. “The SunGold organic fruit is premium, with insufficient supply to meet demand.”

Organics Aotearoa NZ reports a 346% increase in food sales globally since 2000; total sales are now US$80 billion.

And more land is going into organic production – about 1% of the world’s farm land. Australia has the largest area (17m ha), and Europe has 11m ha, or about 10% of its farm area in organics.

NZ has 74,000ha in organics – about 0.5% of the farmed area, averaging $33,000/ha in gross export earnings last year.

Organics Aotearoa chief executive Brendan Hoare says in the past 20 years the infrastructure to support the organic sector has grown. For example, growers once had to make their own organic fertiliser, but now certified manufacturers offer products and treatments.

Hoare says organics has grown more sophisticated because of large European and US corporates buying into established family owned organic brands.

In NZ, interest in organic dairying has risen recently, especially because Fonterra has said it will pay North Island organic suppliers $9.20/kgMS – at least double the anticipated price for the season.

The global market for organic dairy products is expected to grow 12% a year, says Organics Aotearoa NZ. This is off a base that represented 11% of total global dairy sales in 2013; the bulk of sales were in Denmark (24%), Sweden (12%) and the UK (7.5%).

China and India are seen as key growth areas for organic dairy products.

NZ sales have been growing rapidly, with a reported 50% increase in organic sales of milk in the past year.

And the Organic Dairy Hub Co-op (Dairy Hub NZ) is forecasting payment of $8/kgMS for the coming season to suppliers.

Dairy Hub founder Bill Quinn says the cooperative is keen to expand its supplier base into the South Island, and finds farmers keen to talk.

“We are working with 30 larger farmers in South Canterbury and North Otago on the transition process to organic; the interest is there.”

More like this

Forget the buts

With 1300 ha, Chile’s Emiliana Vineyard is the world’s largest organic and biodynamic wine producer. Tessa Nicholson discovers that going organic on a large scale means you have to get past all the reasons not to.

The natural growth of organics

This is the third Organic and Biodynamic Winegrowing Conference Tessa Nicholson has attended. And given the success, it is unlikely to be her last.

Featured

Milestone for Ahuwhenua

Next month will see the first finalists competing for the prestigious Ahuwhenua Trophy in horticulture announced at Parliament.

 

New levy to hit farmers

The New Zealand Agricultural Aviation Association (NZAAA) is up in arms about a proposed new safety levy.

Safety mindset must change

WorkSafe NZ is calling on farmers and other rural businesses to treat health and safety as more than a compliance issue.

Milk price may go higher

Dry weather around New Zealand could restrict milk supply and squeeze global dairy prices higher, says Westpac’s senior economist Michael Gordon.

» The RNG Weather Report

» Latest Print Issues Online

Milking It

Why steal Stihl?

If someone turns up on your farm, selling Stihl 461 chainsaws, please shout out. That’s the message from NZ Young…

Cow talk

Cows do talk, researchers say.

» Connect with Dairy News