As people from Haiti to Ethiopia are tragically struggling to cope with rising food prices, many are piecing together the reasons behind our recent price spikes. The culprits lie in everything from the switch to growing crops for biofuels to market speculation. The situation is complex and involves multiple factors. But as economists tally up the numbers and politicians scramble for solutions, others are beginning to wonder if this is the end for organic food as we know it. For years, the organic industry has seen sales growth in the double digits, far outpacing any other sector of food products. Articles have been popping up to question the feasibility of anyone of moderate means buying organic. It seems like the unfortunate and untrue "elitist" stamp might be making a comeback.
These assumptions miss one of the most important points of rising food prices -- oil. Whether the food crisis is the result of biofuels pushing out agricultural land or investment speculation, it has proven one thing to be clear -- as oil prices rise, food prices rise. We may not think about it very much, but our conventional food system is unfortunately based on fossil fuels, and we must face the reality that oil is not a renewable resource. With increasing fuel prices come increasing food prices, unless we change the way we farm.
On the organic front, fortunately the naysayers were wrong. Organic food growth has not taken the nose dive that some thought it would; in fact, it's still thriving. A report out yesterday estimates that 2008 sales of natural and organic food and beverages will continue at a double-digit growth rate to reach $32.9 billion. For the period of 2005 to 2008, organic and natural food products grew 67.6 percent with a compounded annual growth rate of 18.8 percent. While these 2008 figures may not be as high as some of the amazing spikes in organic growth from a few years ago (often in the 20 percent range), they are clearly still higher than any other food sector. What does this demonstrate? That increasingly, despite economic costs or difficulties, consumers are willing to pay more for products grown without synthetic fertilizers, pesticides, GMOs, growth hormones, or sewage sludge.
While it may seem trivial, it is a true testament to the way in which Americans want their food grown, processed, and handled. And it looks like the times are changing as the "price gap" between organic and conventional foods continues to close with the rising cost of oil. The USDA estimates that egg prices will increase an average of 14 percent in 2008. Further research from the USDA notes that in the month of September from 2004-2007, wholesale egg prices rose from 54 cents to $1.22 for a dozen conventional eggs; yet, a dozen organic eggs only rose three cents -- from $2.34 to $2.37. The price per pound of high-fructose corn-syrup went up $3.00 between 2006 and 2007, and the price of corn per bushel more than doubled in many cases during the same period. It seems likely that the areas closing the price gap the fastest will be the animal products and other items like corn-syrup that typically rely on grains for feed or production. As conventional corn, soy, and other commodity prices rise -- due in part to the significant increase in the cost of fossil-fuel based fertilizers and pesticides -- organic foods will likely look even more attractive for our pocketbooks.
While rising food prices are not welcome news for anyone, they are helping to flush out many of the externalities of our industrialized conventional food system. No longer can we afford to push aside the negative environmental, health and social issues that often unintentionally accompany industrial food production. For a long time Americans have enjoyed "cheap food," thinking that we could really pay $0.99 for a box of Ho-Ho's and not face any consequences. Increasing health care costs, rising obesity rates, and polluted communities have demonstrated otherwise. While organic isn't perfect, it does aim to incorporate many of those costs, which is why, until recently, it has been more expensive up front. While organic may still be more expensive, trends are clearly showing that compared to conventional, it is much more price stable. Aligned with consumer demand, organic is getting more abundant, cheaper, and certainly more mainstream. As people continue to vote for a new food future with their wallets this will be increasingly true, and we can expect to see the price differences in conventional and organic foods close even more.
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Comments
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Jonas Posted 9:27 am
11 Sep 2008
Over here in the EU, it is less than 1 percent.
I have nothing against organic food in highly developed, wealthy markets with few poor people.
But it would be a criminal disaster to implement organic food projects in countries where people still have to farm and work to make a living.
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Pangolin Posted 10:18 am
11 Sep 2008
Contrast to Haiti where small rice farms were replaced with large tracts farmed by mechanized agriculture and you can see the results. The country that converted to organic agriculture eats; the country that attempted to exploit trade and green-revolution techniques starves.
Who would rather be a Haitian than a Cuban?
Put the Carbon Back
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Tasermons Partner Posted 3:30 pm
11 Sep 2008
But it would be a criminal disaster to implement organic food projects in countries where people still have to farm and work to make a living.
Jonas, most countries with a high percentage of agricultural workers ALREADY rely mostly organic foods.
That's usually why they have so many people employeed as farmers to begin with.
Coutries with industrial-scale agriculture typically require less of a workforce, since most of the process is mechanized and requires relatively little labor.
Organic farming generally encourages a larger agricultural workforce, especially if it's on a local or small-scale production models.
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Jonas Posted 3:43 pm
11 Sep 2008
It is these regions that urgently need modern agriculture and inputs, in order to survive.
It's the most important development objective around. The rapid transition from primitive, organic, low-yield agriculture, towards highly intensive, modern, high yield farming.
This transition is:
good for people - because it allows them to eat instead of starve to death
good for the environment - because it requires far less land, which means far less deforestation, soil erosion, soil nutrient depletion, etc...
good for development; because when farmers get modern, a large share of them has to move to cities, which is great, because rural-urban migration straightforwardly leads to reduced fertility rates, thus reducing pressures on the environment further
The worst thing that could happen to developing countries is a continuation of the organic agriculture they are currently practising.
Luckily, governments, aid agencies and scientists are beginning to understand this.
Initiative likes the Alliance for a Green Revolution in Africa (AGRA) are key.
Like Sir David says: green bourgeois organic food pushers are responsible for keeping Africa poor and for killing hundreds of thousands of people.
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Michael Hoexter Posted 6:29 am
12 Sep 2008
http://terraverde.wordpress.com/2008/04/07/exchange-with- ...
I believe it's possible to learn the benefits of older methods of cultivation while applying more sophisticated farm implements strategically.
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EnviroFan Posted 4:29 am
13 Sep 2008
Check out the Rodale Institute and their organic farming model. Their organic fields have been OUTPRODUCING the conventional fields for YEARS. Perhaps the debate is a little more nuanced than simply claiming that industrial ag is better. Done properly, organic can outproduce conventional without bringing such horrible ecological effects (eg, the dead zone in the Gulf of Mexico). I would even say that following the Rodale production method would actually lead to the things you claim industrial ag does.
Let's make this place better.
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Wolverine Posted 5:04 am
13 Sep 2008
No, what's a criminal disaster is to produce and use artificial chemicals that poison the Earth and everything that lives here. Feeding some members of an already grossly overpopulated species is no excuse for poisoning the Earth. Your anthropocentric fanaticism is thoroughly disgusting.
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