A change in Switzerland’s organic food market

Increased competition has hit organic farmers in the Swiss food sector. Last year, the turnover was down 0.5 % to SFr. 1.183 billion, representing three per cent of the food market in the country. And there were 2.6 % fewer organic farms. Still, the Swiss are the world’s biggest buyers of organic products; each person spends SFR 160 annually. The Swiss Research Institute of Organic Agriculture found out that farmers face a number of challenges. The arrival of foreign discount supermarkets like the German Aldi and the French chain Carrefour could be key factors. Organic farmers will no longer be able to charge higher prices unless it can be proved that organic products taste better and are more nutritional. Consumers also need to be informed about the reasons for the higher prices.

Bio Suisse, the umbrella organisation for organic farmers, states in its annual report that Coop as the country’s second largest supermarket chain is successful in marketing regional delicacies in shops close to where they are produced. As the organisation believes, growth in the organic market will be fuelled and jobs will be ensured by this. Coop played an important role bringing organic products to the consumers. 13 years ago, it was the first supermarket chain to stock organic groceries. This led to a higher acceptance among consumers and these efforts have left Coop with a 50 % market share. Migros stayed behind with a share of 24.7 %, reports the NZZ. When starting to stock organic products, Coop’s commitment was seen as a marketing strategy, but by now it has proved its seriousness. 1,400 food items bearing the Bio Suisse label are stocked, fresh produce is the most popular among those.

However, Otto Schmid from the Swiss Research Institute of Organic Agriculture warns organic farmers not to be too dependent on the big chains, since there is growing competition from non-organic products in general, including non-organic premium labels. He refers to a Migros range which gives the false impression to be organic. For the future, Coop is extending its range and improving its communication, since consumers demand tasty, ecologically produced food. Mr. Schmid also states that a similar stagnation took place in Austria before the organic market revitalised itself.

http://www.nzz.ch/2006/07/12/eng/article6866299.html