Denmark’s organic industry is booming again

The growth of Denmark’s organic industry has speeded up once again. This is good news for Denmark that will be “Country of the Year” at BioFach 2009. According to the estimate of the industry association Økologisk Landsforening, after an 18 % increase in turnover in 2006, sales of organic products increased by 25 % in 2007. This translates into organic turnover of around 450 million Euros for the retail trade and a good 680 million for all sales channels. Later in the spring, precise figures will be published by Danmarks Statistik.

Picture: Minister for agriculture Eva Kjer Hansen and Claus Rättich (left) NürnbergMesse

Fruit and vegetables continued to be particularly popular. Organic eggs accounted for an impressive market share of 17 %. On Økologisk Landsforening’s info-portal, Birthe Landdal Hansen, a researcher at the agency Kairos Future, estimates that the boom in organics will continue for another ten years, and in consequence by 2017 20-30 % of all food products will carry the state organic logo.

The current market share of organic products in Denmark is 5.6 % compared with about 3 % in Germany. The figure is said to be as high as 10-12 % in Copenhagen. In the capital 45 % of all food used in school catering, old people’s homes, hospitals and offices are organic. The aim is to increase this figure to 90 % by 2015. Copenhagen has trebled the budget for organic food in school canteens to two million Euros for 2008.

The conventional chain Irma (picture) is another powerful driver of the organic market. In 2007, Irma increased its turnover of organics by 13 %, and organic products now account for 34 % of its total turnover. “Organic is something that has become so powerful that it benefits our whole enterprise – our total turnover has been rising constantly,” says sales manager Alfred Josefsen. The price of organic food is pegged by Irma at a maximum of 25 % above the price of comparable conventional products. The Coop Denmark subsidiary that has so far operated only in Copenhagen, now wants to expand to Arhus and Odense.

In the case of some other retail chains that jumped on the organic band wagon somewhat later, growth in 2007 was even higher. The SuperBrugsen chain, that has stores all over the country, recorded a 35 % increase in turnover of organics compared with 2006, and the figure for Spar was 29 %. When the discount chain Rema 1000 (picture) doubled its range to 90 organic products, turnover shot up by a massive 60 %.

Egefeld (picture), Denmark’s first organic supermarket that started in the summer of 2006 has done very well. In the early days it was chosen by customers as the best new shop in Copenhagen, and later the Fredriksberg district of the capital honoured the new enterprise with a business award. More new shops have been founded – farm shops and organic stores, which are of course much smaller than supermarkets. Organics are experiencing strong growth in gastronomy too. There are now several small organic cafes and the gourmet restaurant Geranium in Copenhagen. An organic pizzeria has opened in Søborg. And the capital can now boast a new and very popular farmers’ market in the summer.

The industry association Økologisk Landsforening actively supports this growth. In January it brought out a new quarterly magazine called Økologisk that combines lifestyle and consumer information. At the end of 2007 the baby club Ǿkobarn was launched and many young parents have shown great interest in it. The minister in charge of agriculture and food, Eva Kjer Hansen, has proposed the founding of a European research centre for ecology and agriculture in Denmark. According to the newspaper Børsen, the centre will be set up with the help of EU funding. (picture: Egefeld)

As in other countries, processing companies in Denmark are suffering because of a lack of raw materials. The dairy giant Arla (picture) is hardest hit – in 2007 the company processed 36 % more organic milk than in the year before, a total of 300 million kg, but maintains it could easily sell another 100 million kg. Demand for the milk is high in Germany and Britain in particular. Danish organic milk is delivered to Germany in tankers, and since January Arla has been selling its well known Lurpack butter in organic quality in Asda, Waitrose and Sainsburys. They will be joined by Tesco later.

The production of organic pork has doubled in two years. In 2007, 70,000 organic pigs were slaughtered. More than half of the pork is exported, mainly to Britain. On the domestic market too the critical mass is being reached that is necessary for healthy price development. In three years the producer prices have risen by 70 %, and at the same time the consumer prices have fallen by 25 %. (picture: Egefeld)

In 2007, organic processors launched their biggest marketing campaign ever abroad. In October, nine producers presented 20 products at the “Danish Week” in Tegut’s 300 stores in Germany: Galla Food (salads), Løgismose (cheese), Fields of Flavour (soups), Danforel (smoked fish), Svanso (jams), Le Blé d’Or (confectionary), Woodshade Organics (chocolate), Urtekram (rice waffles/picture) and Skee Is (icecream). Fields of Flavour soups have been on sale in Vierlinden stores since last November. Most of these manufacturers were present at this year’s BioFach. (List of participants click here)