In the spotlight: Brussels organic plans cause concern
Industry watchers believe proposals could see producers quit organic production
Food retailers across the EU are facing additional administration to sell organic food products, because of reforms proposed last week by the European Commission.
At present, EU member states may exempt wholesalers and retailers selling pre-packaged organic products from annual controls required for manufacturers and farmers creating organic food products.
But under a new suggested comprehensive overhaul of the EU's organic food controls, the exemption would end – assuming the idea is accepted by the EU Council of Ministers and the European Parliament. It would subject retailers to spot checks of their handling and selling of organic products.
Roger Waite, the spokesperson food and agriculture at the Commission, said Brussels wanted every part of the organic food chain controlled. "We have discovered fraud cases. There have been frauds where conventional products are being sold as organic. People have been messing around with the labels. Given the success the sector has seen, the temptation for fraud further upstream in the food supply chain is growing, and so we need to respond."
There had, Waite insisted, been damage to the reputation of the organic food sector. Brussels' proposals would also widen the requirements for manufacturers, processors and packagers to ensure that they are not damaging the environment when handling and using ingredients previously certified as organic.
If the plans are passed, producers might have to use certain kinds of packaging materials and not waste energy. The exact details of how such environmental screening would work have yet to be written into the proposals, and agreement on these issues might be made separately, but Waite said one option would be to use the rules of the EU's European Eco-Management and Audit Scheme (EMAS), which is currently voluntary. Under the current proposals, micro-enterprises would be exempt from the scheme (companies employing up to 10 people and turning over a maximum of EUR2m each year). Waite said: "Our proposals will cover all operators throughout the chain, ensuring they manage their environmental performance."
Another proposed tightening of the rules surrounds ingredients. At present, some products labelled as organic are allowed to contain a series of conventionally-produced ingredients. Under the proposals, it would no longer be possible for dried raspberries, gooseberries, dried redcurrants, dried passion fruit, acorns, Peruvian pepper, kola nuts, and more. On the producer side, livestock handlers would no longer be able to include up to 5% non-organic protein content in feed; and to grow cereals, fruits and vegetables, organic seed-stock will have to be used from 2021.
While the Commission argues there are clear potential benefits from the reforms, which it claims simplifies and streamlines complex legislation, harmonising rules amongst member states, the proposals could create a significant amount of additional work, and there has been criticism.
Amarjit Sahota, president of organic sector research and consultancy group Organic Monitor told just-food, there was a risk that, if all these additional controls were introduced, food companies and producers would move out of organic production.
He said on average organic food accounted for 3% of EU food sales today and that could fall to 1%. The additional environmental controls would be "very difficult to implement," Sahota said. He argued the extension of requirements to retailers could hit smaller specialist organic shops and chains hard, because of the higher costs involved. "There's going to be an outcry if they have to do this because some supermarkets aren’t labelling in the right way."
Sahota said specialist shops labelled their products accurately because that served informed consumers – and such retailers were especially strong in Germany, one of Europe's strongest organic markets.
And these concerns are exacerbated for EU manufacturers by the fact that imported organic food products can currently be manufactured under varying quality standards that might be less onerous than those demanded in the EU. To that end, the Commission stresses it wants to tighten the requirements for imported organic foods. In future, EU-approved organic certification bodies would demonstrate that exporters "comply" with the EU standard, rather than follow "equivalent" rules, as at present, which allows some flexibility.
Waite stressed there were already 11 countries – such as the US and Japan – who had struck deals with the EU to prove that their organic standards were up to scratch and acceptable in general to the Commission.
Another potential benefit highlighted by Brussels is that under the new proposals, any business certified for making or selling organic products would no longer automatically be subject to an annual physical inspection of their processes and systems. Instead, such checks would be undertaken on a risk basis, focusing on companies where there may be problems. Waite explained: "Where someone has been working in organics for ten years and everything has been fine, controllers won’t have to visit each year. But they will go to premises where there's suspicion that something is going wrong. It's much more efficient."
The Commission claimed the proposals will benefit a sector where demand has been growing at 9% a year. It argues its reforms will simplify the system and make it "more transparent and less burdensome", said Waite. He added: "It will have a positive economic impact."
By contrast, he argued the current system "creates distortion of competition between operators" because national organic control systems have used the available exemptions in different ways, which damages the industry and consumers' confidence.
He said EU organic sales have grown four times over the last 10 years but the amount of land dedicated to organic food production in the EU has grown only twofold.
The proposal will now be debated by the European Parliament and the EU Council of Ministers. With such a complex proposal, a large number of amendments can be expected and one EU official suggested the process could take two years to complete.
EU food producers association Copa-Cogeca indicated it would be ready to lobby for changes, maybe including assistance for farms wanting to move to organic production. Secretary-General Pekka Pesonen said: "Without the ability to adapt gradually to organic production, it will put the breaks on the development of the sector." However, he supported considering controls throughout the supply chain. "The production process must therefore be looked at as a whole and not just the final product."
A spokesperson for FoodDrinkEurope, the representative body for Europe's food and drink manufacturers, said the proposal would be discussed by a specialist committee in future.
Companies: European Commission
Synopsis The report provides a review of the mergers and acquisitions (M&As), partnering deals, and agreements entered into by companies active in the global bakery & cereals market during May 2014. ...
Synopsis Using this report, marketers will effectively gain an insight into the latest happenings in the global spirits market throughout the month. The monthly report provides the reader with the to...
Using this report, marketers will effectively gain an insight into the latest happenings in the global dairy food market throughout the month. The monthly report provides the reader with the top-line ...
- How brands are eyeing their own retail presence
- Why Lactalis could move for Dairy Crest
- Who could swoop for Diamond Foods?
- Foodservice focus - all-day breakfast; concept NPD
- The consistent inconsistency of European promos
- Nestle, R&R Ice Cream in joint venture talks
- How the food industry is reacting to TPP
- China implements new safety regulations
- Unilever acquires Italian gelato group Grom
- Mondelez 'preparing to sell European cheese unit'
- Management briefing: just-food’s industry outlook for 2015
- Global Savory Snacks Market: Merger and Acquisitions August 2015
- Food and Beverage Coding and Marking Equipment: Market Outlook 2015-2019
- E-Grocery Market in India - Market Research 2015-2019
- Danone SA : Consumer Packaged Goods - Company Profile, SWOT & Financial Analysis