Europe-US partnership creates huge new market for organic foods

It may not be a victory for local food activists, but a new deal brokered last week between the US and the European Union marks a big step forward for expanding organic agriculture.

Under a deal announced last Wednesday by trade representatives for each region, products certified as organic by either the US Department of Agriculture or the EU's Agriculture and Regional Development department are authorised for sale in either Europe or the US.

"To help reduce paperwork and expenses, the arrangement is simple in its aim: it recognises that the EU and the US have credible organic certification systems and that we share common perspectives about what constitutes the production of organic products," wrote Dacian Cioloş, the EU's agriculture commissioner, and Kathleen Merrigan, the USDA's deputy secretary, in an op-ed in the Guardian.

The arrangement further opens up the world's two largest markets for organic foods, which are together valued at about $50bn, according to the US Organic Trade Association. Prior to the new trade deal, organic growers and producers needed a second certification in order to sell their goods in the overseas market.

"This monumental agreement will further create jobs in the already growing and healthy US organic sector, spark additional market growth, and be mutually beneficial to farmers both in the United States and European Union as well as to consumers who choose organic products," Christine Bushway, Executive Director and CEO of the OTA, said in a statement. "Equivalence with the EU will be an historic game changer."

Organic foods are definitely a hot commodity in recent years, growing at a steady clip over the last decade and far outpacing growth in conventional food sales. In research conducted for our 2012 State of Green Business Report, GreenBiz found that while sales of certified organic food grew by nearly eight per cent in 2010 over 2009 figures, overall food sales grew by just 0.6 per cent in the US.

Grocery retailers are embracing organic foods as a possible lifeline out of the recession as well. Last September, the Food Marketing Institute released a study showing that organic and locally sourced foods was one of the most promising trends in supermarkets in 2011.

And at the same time, research from the Organic Farming Research Foundation explored the job-creation benefits of organic farming, finding a similar pace of job growth as the OTA found in sales growth: after years of growing at an annual pace of 19 per cent, organic agriculture grew by eight per cent in 2010, while conventional farms grew by just one per cent.

The new trade agreement will no doubt accelerate that growth. US Senator Patrick Leahy, who was instrumental in the creation of the original US organic standards in 1990, issued a statement last week applauding the deal.

"This is another milestone for organic agriculture. Most of all this is a boost for smaller organic producers, so that exporting our products is all about high American quality and variety and not about paperwork," Leahy wrote. "Easier access, less bureaucracy and lower costs will help our growing organic industry compete and gain market share on European shelves, creating jobs here at home."

As with all issues pertaining to food, there will be debate over the fundamental merits of this agreement - for instance, whether it is better to promote organic agriculture over local foods. But for now, expanding the reach and speeding the growth of organic foods offers a chance for the industry to gain more clout in Washington, which will be important as the discussion turns to the next version of the Farm Bill, planned for 2012.

This article first appeared at GreenBiz.com