Every year I look forward to the month of September at my local farmers’ market. Tomatoes are their ripest. Apples are their juiciest. And you might even be able to snag the last peaches of summer. Almost all of this delicious produce is organically grown at small farms from surrounding areas—a fact I love. But admittedly, buying produce at the farmers’ market is an exception to my normal food buying habits.
While it’s nostalgic to believe that organic produce is sold mostly from local stands, organic agriculture is now big business. In May of this year, the Organic Trade Association announced that U.S. sales of organic products—which include produce, eggs, milk, packaged foods and clothing—reached a record high of $43.3 billion in 2015, up a whopping 11 percent from the year before. For a relatively young category (national organic standards weren’t officially implemented until 2002), this is remarkable growth that represents Americans’ rising interest in caring about where their food comes from.
But let’s not sugarcoat it: Organic groceries can be darn expensive. Although you may be able to find the rogue organic fruit, vegetable or grain that’s a few cents cheaper than conventional versions, products that carry the USDA Organic label typically fetch a heftier price. One Consumer Reports study found that, on average, organic foods are 47 percent more expensive than conventional, although these prices greatly vacillate. Organic baby carrots could cost the same amount as nonorganic baby carrots, for instance, but organic items like butter, strawberries and zucchini are priced significantly higher.
In recent years, however, the gap between organic and conventional price differences has been shrinking. A USDA study found that between 2004 and 2010 prices for organic spinach, canned beans, granola and coffee fell. Organic spinach in particular was cost-effective, as it fetched just a 7 percent premium—a boon for those who eat like Popeye.
So what’s the deal? What dictates organics’ price? And what are natural brands doing to lower prices to make organic foods accessible to all?
Transitional challenges
One reason organic procures a markedly higher price is because of simple demand market forces. While sales of organic products have skyrocketed over the past few years, the number of farms that transitioned from conventional to organic is still paltry. Nearly 5 percent of all the nation’s food sales are certified organic, but acreage devoted to organic agriculture is less than 1 percent of total U.S. farmland.That’s a lot of organic kale chips from a small amount of farms, hence their $6 price tag.
But if farmers can earn a decent premium on their crops, why aren’t more conventional farms switching to organic methods?
For starters, it’s a difficult process. It’s expensive to establish organic infrastructure, and more importantly, farms must endure a three-year transitional period before crops are even considered organic—a time period that can enhance nutrient cycling, enrich soil life and restore soil organic matter and water-holding capacity (great!), but also cause an initial lower yield (bad!)—according to the Rodale Institute, which conducted a 30-year organic study.
Plus, because the organic certification prohibits the use of powerful, synthetic pesticides or herbicides, crops are initially placed at a greater risk for weeds and insect infestations.
Get all that? Not only must food producers transitioning to organic alter the way in which they farm, they also won’t reap the rewards of an organic premium for three years. During the transition period, farmers bear a financial loss.
Recently, organic farmers (and conventional farmers who hope to transition to organic) have started receiving support from natural food companies that have vested interest in encouraging organic agriculture. In May, the cereal brand Kashi announced support of leading organic certifier Quality Assurance International (QAI) to launch “Certified Transitional,” a certification label that recognizes crops grown on farmland in the process of transitioning from conventional to organic practices. “Our research has shown many consumers want to support increasing organic acreage in the United States and are interested in understanding the role transitional products play,” says Nicole Nestojko, Kashi’s senior director of supply chain and sustainability. “With a mark and official Certified Transitional protocol, consumers who would support the transition to more organics can do so and be assured that the proper checks are in place.” Nestojko adds that Kashi launched a new cereal featuring the first Certified Transitional wheat, which commanded a slightly higher price than Kashi’s conventionally grown cereal to “help farmers recoup the investments they must make to switch to organic practices.”
How to widen the organic supply
Thankfully, myriad organic brands finally understand that in order to provide the products a growing amount of American households want, they’ll need to support organic farmers.
One tactic to get more growers into organics: services that make it easier for young people to buy farms (and equipment and operational infrastructure necessary for farming, like tractors). The average age of farmers in the United States is 58.3 years old, and without a steady stream of younger people taking over, the art and science of organic agriculture could suffer.
But unless you have a family farm passed down to you from a relative, simply obtaining the land to farm on is a huge limiting factor—especially because young people are often saddled with student loan debts.
But relief for young organic farmers may be coming soon. In 2015 Clif Bar and the National Young Farmers Coalition together launched a campaign to pass a law designed to forgive the balance of student loans for farmers who make ten years of income-driven student loan payments (similar to the system in place for those who work in the nonprofit sector). If such a law passes, it may incentivize recent college grads to pursue farming as a profession.
Nature’s Path has also done excellent work to propel organic forward by purchasing more than 6,000 acres of organic farmland in Montana and Saskatchewan, Canada, to serve as a vertically integrated organic farm-to-manufacturer model. “Although we are thrilled to see that this land grows 5 percent of the organic supply for our products, the real win for us is the partnerships we have formed with our farmers,” says Arjan Stephens, executive vice president of sales and marketing for Nature’s Path. “Through a cooperative model, our skilled organic farmers work Nature’s Path acreage along with their own. They get two-thirds of the crop, we get one-third and then we offer to buy their crop at market rates.”
Likewise, even large food corporations are launching initiatives to widen organic supply. In March, General Mills said it would work to double its organic acreage from which it sources ingredients, citing that by 2019, it would support a whopping 250,000 acres of organic farmland. Making good on that promise, the brand later announced a partnership with the dairy mavens at Organic Valley, a company that supports a co-op of 1,800 organic dairy family farmers. Clif Bar, Nature’s Path and General Mills are dead set on increasing organic ingredient supply to make organics more affordable. “We believe everyone should have access to organic food regardless of their income,” says Stephens. “By having this greater vision in mind, we work with farmers and our industry to increase organic farmland, as well as work with retailers to educate them on increasing consumer desire for organics.”
