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Organic foods are made in a manner that fulfills organic principles set by the national governments and worldwide organizations. Organic production is a system that is operated in accordance to the 1990’s Organic Foods Production Act (OFPA) and rules in the Code of Federal Regulation’s Title 7, section 205 to take action to site-specific conditions by incorporating cultural, mechanical and biological practices that promote cycling of resources preserve biodiversity and promote ecological balance. Myles, et al (2009) asserts that agriculture can be described as organic for the vast majority of human history in the 20thC alone before huge new supply of synthetic chemicals was introduced in the food supply.
Conventional is therefore the name given to the more recent production technique. The application of conventional non-organic pesticide is precluded under organic production. Nevertheless, certain sprays and material that meet organic principles are permitted in the production of organic food in contrary to popular belief. Livestock ought to be reared with regular access to pasture and in absence of routine application of growth hormones or antibiotics in order to be involved in organic production. Organic produce might not be genetically modified in most countries. It has been proposed that the use of nanotechnology to food and agriculture is a further technology that is supposed to be eliminated from certified organic foods. The first organic certifier to implement a nano-exclusion was the Soli Association (UK).
Organic food production is an industry that is regulated heavily, different from private gardening. The European Union, Canada, United States, Japan, among many other countries need producers so as to get special certification so as to market food as organic in their borders. Some chemicals and pesticides are allowed to be used by most certifications thus consumers are supposed to know the standards for qualifying as organic within their respective locales (Rollin, 1998).
Organic firms have been very small family-run operations historically, thus being reason as to why organic food was once the only available in small famers’ markets or stores. Nevertheless, organic food production has had development rate of approximately 20% a year since the early 1990s far a head of the rest of the food industry in both third world countries and developed countries. Organic food accounts for 1-2% of food sold internationally as of April 2008.
Marketing environment forces that affect organic food products
Lack of markets
With the invention of genetically modified foods, organic food products have been encountering stiff competition on markets with many people preferring genetically modified foods. Organic food products have less market both locally and internationally with strict laws implemented to govern production and marketing of these products. Unlike other products in food and agriculture industry, livestock have not been included in organic foods while there are livestock raised free from spraying and other chemicals and feeds on green pasture (Jonathan, 2009).
Despite the fact that there is shortage of markets for organic food products across the world, strict rules and regulations are still being implemented to restrict and govern conditions under which organic food products are produced and marketed. For instance, producers of organic foods ought to comply with the new EU Council Regulation 834/2007 that was implemented on 1st January 2009 so as to access Germany and European organic markets. The ancient regulation EU 2092/914 was replaced by this new directive an outlines the complete set of objectives, standards, and basic laws for organic food production, processing, labeling and marketing as well as import laws for developing countries’ organic products. Regulation (EC) no. 889/20082 and (EC) No. 1235/20083 have outlined the rules on the implementation of the new directive. As a result, this has restricted producers of organic food products to expand their business and production. This is because they are not sure of market prices and laws implemented (Rollin, 1998).
Organic food products have faced stiff competition from inorganic food products thus forcing producer of organic food products to start incorporating inorganic production techniques in their production process. With the use of fertilizers, genetic engineering, pesticides and insecticide, there is faster growth and early maturity of food crops and livestock. As a result this has posed a great threat and competition to organic food products which takes long time to mature. In inorganic food production, production cost is low thus market price going low this has forced organic producers to sell their products at lower prices so as to compete favorably with their competitors. When they feel like incurring losses or competition getting stiffer, organic food producers usually change to inorganic food production thus affecting the entire industry negatively (Rollin, 1998).
Strategies to overcome threats
Jonathan (2009) affirms that in order to overcome the above problems and threats, the industry is supposed to create more markets across the world for organic food products. It should ensure that organic food producers in both developed and developing countries have ability to export and import raw materials and products faster and with ease. Governmental and agricultural organization should also ensure that laws governing production and selling of organic food products are favorable and giving room for expansion of the production. They should not implement laws that might end up discouraging producers from further production.
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Jonathan (2009), further states in order to compete effectively on the market, organic food producers should produce high quality product and incorporate proper organic farming techniques such as watering and use of composite manure. They should also form groups and association so as to increase their bargaining power. They should also carryout research in regard to market prices, cost of raw materials, import and export rate s as to be in a good position of coming up with a price that will see them earning profits while competing effectively at the same time.