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• 1.1 The Current Extent of Organic Farming Including Farming Type, Area, and Location
• 1.1.1 Historical Development
• 1.1.2 Recent Trends
• 1.1.3 Grower Numbers, Production Systems and Distribution

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SECTION 1 - THE POTENTIAL FOR EXPANSION OF ORGANIC FARMING

Caroline Saunders and Hugh Campbell

This section is a literature review of the extent of organic farming in NZ; the financial viability of the sector as well as the potential market. It also reviews the environmental public good benefits of organic farming as well as the institutional factors affecting the development of the sector.

1.1 The Current Extent of Organic Farming Including Farming Type, Area, and Location

1.1.1 Historical Development

The organic agriculture movement in New Zealand arose from a wide coalition of interests; urban food consumers, lifestyle residents in peri-urban areas, European migrants to New Zealand in the 1950s and 60s, and direct contact with the British Soil Association. By 1983 this loose coalition had institutionalised itself as the New Zealand Biological Producers Council which administered the standards for production under the BIOGRO certification system. The BIOGRO label has become by far the most predominant labelling system, with the Biodynamic Farming and Gardening Association providing an alternative but less numerically significant label (Demeter). Between 1983 and 1990, the organic agriculture movement transformed itself. Three important features of organic agriculture that developed over this period were:

• the institutionalisation of one main labelling system - BIOGRO.
• the formalisation of standards for organic production and an inspectorate to administer these standards.
• strong international links between the NZ organic agriculture movement and international bodies like IFOAM.

During this period organic production received little attention from the New Zealand government, with no incentives being created for growers to convert to organic production.

1.1.2 Recent Trends

Campbell (1996) argues that two developments in the 1990s have strongly influenced the current structure of the industry:

• the professionalisation of BIOGRO.
• the development of organic exporting.

Despite the long term presence of an alternative agriculture movement in New Zealand, and the specific development of an organic agriculture organisation in 1983, New Zealand had very low levels of organic food production prior to 1990. A Ministry of Agriculture report estimated that the total value of organic food traded in New Zealand in 1990 was NZ$1.1 million (MAF 1991).

However, since that time, organic food production has escalated dramatically. In 1990, two large corporate entities - Wattie Frozen Foods Ltd (WFF) (later to become Heinz-Wattie. NZ), and the New Zealand Kiwifruit Marketing Board (NZKMB) (now Zespri International) - began to experiment with organic products. These two companies have pulled a number of other entities in their wake and they form the backbone of the new organic food exporting industry.

Over the same period of time, the NZBPC transformed its financial and operational structure (being renamed BIOGRO in 1994). During the first years of its operation the NZBPC had relied on voluntary labour to run the organisation and provide inspection of properties for certification purposes. The number of growers entering the industry in the 1990s rendered this structure unworkable and the financial basis for inspection and certification was restructured. In 1994, the fees for inspection were significantly increased in order to establish the basis for a professional inspectorate. This led to a number of long term members of the NZBPC leaving the organisation and moving outside the BIOGRO certification system.

In 1992, a Tradenz Joint Action Group produced a report on the prospects for organic food in export markets. By 1995, the rate of growth in organic exports was such that Tradenz fostered the establishment of the Organic Products Exporting Group and assigned a Tradenz officer to help facilitate the development of organic exporting. These actions were the most significant moves by the New Zealand government to actively support the development of organic food production in New Zealand.

1.1.3 Grower Numbers, Production Systems and Distribution

Data Sources and Analysis

Organic production is not a listed category under any national system of statistical data gathering on New Zealand agriculture. Hence, the only source of information on the current nature and extent of organic farming in New Zealand comes from BIOGRO with limited information from the Biodynamic Farming and Gardening Association which administers the Demeter label. During the annual certification process, growers must declare the area and types of crop/stock being certified as organic. These figures are available for the years 1992-1997. The following results are derived from annual aggregate data from the 1992, 1994, 1995, 1996, and 1997 years. This provides both the most reliable assessment of the current extent of organic farming in New Zealand, and some time series information documenting changes between 1992 and 1997. A summary of which is presented below with a more detailed data in Appendix A.1.

Aggregate analysis of these data is not completely accurate for three reasons:

• First, the information is provided by the growers themselves on a form that has varied over the past four years, for example growers can vary the way in which they categorise land-use and production system. The level of compliance by growers in listing information about their properties also varies, with compliance improving only in recent years. Consequently, the data obtained from grower certification lists must be treated as broadly indicative rather than highly accurate.
• The second reason why the grower certification lists are an imperfect source of information is that since 1994, when inspection fees were raised by BIOGRO, a number of growers have moved outside the BIOGRO certification system, adopted the Demeter label, are supplying the local organic market with uncertified produce, or in the case of Northland, have developed their own, small, alternative organic labelling system.
• Finally, BIOGRO also lists growers certified under the alternative (less prevalent) Demeter label, but Demeter growers have not kept any records of their land use by area. Hence, Demeter figures are available for some but not all aggregate categories.

In compiling the following sets of data, it was decided not to distinguish between land which was "in transition" and that which was "fully certified". Before full organic certification can be granted on farm land, it may be held "in transition" for at least two years. This is an important distinction, but incorporating it into the aggregate data totals would have made the following results very complex.

Contact for Enquiries

Kay Brown
Sector Performance Policy
MAF Policy
Ministry of Agriculture and Forestry
PO Box 2526
Wellington
NEW ZEALAND

Phone: +64 4 894 0695
Fax: +64 4 4 894 0746
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