New Zealand Organic Market Report

The New Zealand Organic Market Report 2012 is the latest in a series of reports quantifying and describing the New Zealand organic sector. It provides the results of a census of organic product exporters, information from organic certifiers as well as surveys of the domestic market. This third edition of the report also includes case studies and other recent developments. The organic industry has been growing very well and further ambitious goals are set. Specialised retail is also gaining ground in New Zealand.

(Picture: Growing grapes organically in New Zealand)

The total value of the organic sector in New Zealand in 2012 is estimated at NZD340-360m (219m-232m EUR). This figure is based on the combined value of exports of organic products from the country and the retail sales of organic products within New Zealand. The sector has grown by about 25% since 2009. Organic exports alone were worth between NZD215 and 225m (135m - 140m EUR) in 2012 – an approximately 25% increase since 2009. Europe, North America and Australia continue to be the sector’s primary export destinations, together comprising 70% of all exports. However, there has been significant growth in the export value to Asia, with exports to Korea rising from 8% to 11% of total exports, while those to China increased from less than 1% in 2009 to 2.6% in 2012. Exports to other Asian countries, apart from Japan (2012: 10 %), doubled in value (NZD12.5m) to 6% of total organic exports, according to the report. (Picture: Potato farming)
 

Fresh fruit and vegetables are still the most important product category by value, accounting for more than NZD96m (60m EUR) and 45% of total exports. However, this is a decrease in their proportional contribution to New Zealand organic exports from 50% in 2009 and 73% in 2007. Dairy products continue to be the second largest export category and have grown by 33% since 2009. Processed foods and ingredients have increased by 45% since 2009 and now include the largest number of export market participants of any category in this study. The increase in the value of exports of organic beverages, wine and beer has risen by 70% since 2009, and the figure for meat and wool in the same period was 11%, with a number of new participants entering this field. (Picture: Organic goats)

Organic sales in specialised retail	2009	2012
Organic sales	68%	67 %
Locally sourced products	17%	18%
Domestically sourced products	65%	56%
Imported products	18%	26%
Fresh products	45%	39%
Processed or manufactured products	55%	61%

Estimates for the value of the domestic market for certified organic products range from NZD126m to 133m (81m-86m EUR). Of the total domestic market for organics, approximately 80% of sales in terms of value occur through supermarkets. Sales in 2012 of non-fresh organic products in supermarkets increased by close to 27% over 2009 figures, with a 7.5% increase from 2011 from NZD62.8m (40.5m EUR) in 2011 to 67.5m (43.5m EUR) in 2012. Organic sales across all categories account for around 0.6% of the total value of supermarket sales, according to the report.
 

Sales of organic products in specialised retail were worth approximately NZD25.5m in 2012 (16.5m EUR) – almost twice as much as just three years previously. Since the last sector census, several established specialty retailers have significantly expanded their operations or the value of their sales of organic products. The relative share of total sales of organic products at specialty shops exhibits little change from 2009. Total sales value remains dominated by processed foods and fresh fruit and vegetables. Meat and dairy products are also significant sources of sales. A broad variety of products constitute the ‘other’ category, like organic cleaning and gardening products. (Table: Characteristics of organic sales in specialised retail shops 2009 – 2012)

Jim Kebbell and Marion Wood (see picture) are among the pioneers of the organic movement in New Zealand. As early as 1975 they bought some land in Te Horo, one hour's drive north of Wellington, and grew organically. In 1991, they founded Commonsense Organics  to make organic food more accessible to New Zealanders. Besides organic food, the focus of Commonsense is on allergy-aware goods, environmentally friendly products and fairtrade items. Jim and Marion now run four stores,  and they hope to open a fifth store in Johnsonville shortly. Their goods are also delivered all over the country via their online shop.
 

About 40% of Commonsense Organics’ groceries are organic. All their fresh produce is organic, with the only exception being bananas, which are grown organically but lose certification when they enter the country, and mushrooms, which are not grown organically in New Zealand. Customers are encouraged and informed about eating seasonally. To support this, a seasonal guide is available for downloading from their website, and products are only sold when they are in season, for example tomatoes are not offered in winter. (Picture: Commonsense Organics focuses on seasonal organic produce) 

Much is done to promote organics. A list of events is available from the Commonsense page on Facebook. Commonsense Organics was set up to mainstream organics and this has been achieved, according to Marion. Their main target groups are pregnant women and women with young families, professional people – the ‘eco-chic’, foodies, greenies, people with allergies, and people with health issues. Consumers are keen to have organic produce, especially bananas, apples, pears, lettuce and broccoli. They appreciate the provision of high-value organic food and like the fact that Commonsense is a family-based independent business which is values-driven.

Piko Wholefoods Co-operative in Christchurch is a charitable co-operative owned by the Te Whanau Trust. Piko began trading in March 1979. One of the reasons for starting Piko was to provide an outlet for organically grown produce -vegetables, grains, beans, dried fruits, nuts, herbs and spices. Piko was committed to bulk purchases and simple, self-packaging to keep prices down. The shop provided window space for community notices. By operating collectively, the co-operative provided flexible working hours, part-time work and an interesting alternative to the boss-worker relationship. Knowledge of tasks was to be shared so that all members understood the different functions and were given the opportunity to learn new skills. These are still the ideals behind the functioning of Piko: Members of the trust work at the store and all decisions are made co-operatively by staff members. Profits are regularly donated back into the community. (Picture: Store front of Piko)
 
According to Lillian Duval from Piko, they offer a wide range of the organic products on the market. Over 80% of Piko’s products are organic, and a good 50% come from New Zealand. Some of the top sellers are organic almonds, flaxseed oil, coconut oil, oats, sunflower seeds and non-hulled tahini, as well as all the fresh produce. Customers come from a wide spectrum but are predominantly middle-aged and female, often with young children and middle-class. Customers who have one or more food allergies are very common, as a wide variety of products tailored to suit their needs is sold. The company also focuses in particular on people with extreme allergies. (Picture: Piko offers a selected choice of organic products)

As of 2012, there are more than 40 farmers’ markets operating throughout New Zealand. While obtaining figures for the value of organic sales at farmers’ markets is possible, it would require a survey or census of participants at a range of markets throughout New Zealand. It should be noted that, unlike many countries, the labelling of organic products in New Zealand is not regulated, which creates additional confusion.
 

The total land area under organic certification in New Zealand was 106,753 hectares in 2012, according to the New Zealand Organic Market Report 2012. However, this represents a decline from the 124,463 hectares under certification in 2009. Approximately 9% of horticultural land and 1% of farmed grassland in New Zealand is under organic certification. (Picture: Cover of the New Zealand Organic Market Report)

By 2012 there were over 100 vineyards growing grapes organically, representing 7.6% of all grapevines. The growers’ association, Organic Winegrowers New Zealand, has declared a goal of raising that figure to 20% by the year 2020. Organic grapes are the fastest growing section of organic horticulture, which saw a total increase in land area (including grapes) of 37% between 2009 and 2012 to 11,188 ha. The land area under organic livestock production was 92,522 ha in 2012 – a 14.8% decline since 2009. However, this appears to have been due to the loss of a few less productive properties, as the value of dairy, meat and wool increased over this period. In 2012 there were 1,221 licensees and 1,765 licensed certified organic operations in New Zealand – an increase of 6.6% and 24.6% respectively since 2009 and a 42% and 46% increase since 2007. More information on the organic sector of the country is available from the New Zealand Market Report 2012.