Safety and Practice for Organic Food

Safety and Practice for Organic Food covers current food safety issues and trends. It provides detailed information on all organic and pasture practices including produce-only, farm-animal-only or integrated crop-livestock farming, as well as the impact of these practices on food safety and foodborne infections. The book explores food products that organic, integrated and traditional farming systems are contributing to consumers. As the demand for organic food products grows faster than ever, this book discusses current and improved practices for safer products. Moreover, the book explores progressive directions, such as the application of next-generation sequencing and genomics to aid in the understanding of the microbial ecology of the agro-environment and how farmer education can contribute to sustainable and safe food. Safety and Practice for Organic Food is a unique source of organic agricultural practices and food production for researchers, academics and professionals at agriculture-based universities and colleges who are involved in food science, animal sciences including poultry science, food safety, food microbiology, plant science and agricultural extension. This book is also an excellent source of information for regulators and federal government officials (USDA, FDA, EPA) and the food processing industry.

• Discusses limitations in pre-harvest and post-harvest level practices with specific information on risk and bio-security of existing organic production systems
• Explores policies and guidelines for organic food production and future directions for safer and more sustainable management
• Presents microbial and other biological hazards at pre-harvest and post-harvest levels

• Language: English
• Publisher: Academic Press
• Release date: Jun 6, 2019
• ISBN: 9780128120613

Book preview

China

Section A

Organic Food Products, Diverse Production Practices, and Policies

Chapter 1

The Growing Market of Organic Foods: Impact on the US and Global Economy

Mengfei Peng    Department of Animal and Avian Sciences, University of Maryland, College Park, MD, United States

Biological Sciences Program—Molecular and Cellular Biology Concentration, University of Maryland, College Park, MD, United States

Abstract

Organic farming encompasses the ideals of conserving biodiversity, ecological balance, and protection of agricultural resources during crop production operations. Due to multiple societal concerns about food safety, animal welfare, and environmental issues, consumers’ demand for organic food products is quickly growing. The increase in popularity of organic agriculture and products is driven by both market demand and federal subsidies and has proven to be economically profitable both locally and globally due to trade and job opportunities associated with it. Despite the unrelieved economic crisis, the remarkable demand for organic foods and the systematic development of the organic farming industry in European and North American countries have driven them to the mainstream in both domestic and global organic trades. Despite the challenges of organic foods, such as unbalance in supply-demand, food inflation, and lack of certifications, it is still promising that the organic food market could keep aggressively expanding.

Keywords

Organic food; Organic farming; Organic industry; Consumer demand; Market sale; Global trade; Economy

Outline

1Introduction

2The Growing Consumption Demand on Organic Foods

2.1Role of Knowledge on Transition of Consumers’ Altitudes Toward Organic Foods

2.2The Fact of a Growing Trend in Organic Purchasing

3Production and Market Expansion of Global Organic Food Industry

3.1The United States

3.2Europe

3.3Asia

3.4Oceania

3.5Other Developing Regions

4Significant Organic Impact on Local and Global Economy

4.1Organic Food Industry in Creation of US Job Market

4.2Higher Cost and Price of Organic Products

4.3The US Organic Trade on Economy

5Challenges and Future Directions

6Conclusion

References

1 Introduction

Organic agriculture has been systematically developed over the last 70 year since the 1940s when J.I. Rodale, the father of modern organic farming movement, founded the first research institute for organic farming and gardening. Apparently, the recent market expansion of organic food products has been fueled by research as well as consumer demand. The amount of organic research funding, the number of certified cost-share operations, and other organic expanding programs and services have dramatically increased since 2000. Simultaneously, the national organic program (NOP) and standards, the federal regulatory framework governing organic food products, were sealed and published in the Federal Register (2000). As a matter of fact, research and policy initiatives by government, for example, the United States Department of Agriculture (USDA), has served as a crucial factor in enabling the adoption and maturation of new farming technologies and systems. On the other hand, the enlargement of the organic market is also driven by a growing demand from consumers with concerns about conventional food safety, personal health, and environmental contamination issues (Kearney, 2010). Annual double-digit consumer climb in the certification of organic food products has provided US farmers opportunities in organic agricultural and marketing across a variety range of products, although organic products still have considerable price premiums over traditional food products in market sales (Baudry et al., 2017).

Consequently, US organic sales reached a significant milestone in 2015 with total product sales hitting $43.3 billion, which amounts to an 11% increased compared to 2014 (Jaenicke and Demko, 2017a). Organic product sales account for approximately 5% of all food sold in the United States, which had a 1% increase over the value in 2012. Specifically, certain much weightier shares were found in consumers’ lifestyle product categories. For instance, organic produce (especially fresh juices and drinks) and dairy products are the biggest organic food categories driving the market, and they together account for more than 50% of the total organic product sales (Greene and Dimitri, 2002). Moreover, as the fastest growing sector of the US food industry, organic agricultural hotspots in the northeastern, north central, and western United States also lowers the county's poverty levels by at least 1.35%, notably improving the median household annual income by more than $2000, which is a much greater rate than traditional agricultural systems (Jaenicke and Demko, 2017b).

Apart from the United States, Germany, France, China, Switzerland, Luxembourg, etc. also contribute to global sales of organic food products. According to Willer (2017a), global organic sales climbed over $80 billion in 2015, and more than 90 countries worldwide now systematically develop organic regulations. More than 2.3 million farms and producers are becoming involved in organic production and marketing from 172 countries, among which India, Uganda, and Mexico stand out in numbers of producers, whereas Australia, Argentina, and the United States stand out in terms of agricultural area (Willer, 2017a), although worldwide certified organic farmland remains at less than 2% of the total farmland under production. Specifically, in Europe and Oceania, governments in most countries including Denmark, Italy, Switzerland, Ukraine, Australia, and New Zealand have promoted a quick switch from conventional food production systems to organic systems, further lowering organic products’ prices to support the development and expansion of the organic market. However, for Asian countries, the consumption of organic foods and drinks is rising rapidly, whereas organic mass production is still limited; its system as well as the market is not mature enough. Therefore the imbalance between demand and supply stimulated the expansion of organic imports such as dairy and meat products from Europe, Australia, and the United States (Jaenicke and Demko, 2017c).

In consideration of the increased health concerns about pesticides, antibiotics, and genetic modification applied in food products, as well as the burgeoning popularity of organic agricultural production based on scientific research, perceived health benefits, and government encouragement, consumers are keeping their minds open and demanding to purchase organic foods (Jaenicke and Demko, 2017d). Correspondingly, demand, production, and the market act as a triangle that support each other and together improve the whole organic system. According to a report from FMCG and Retail (2013), the organic food market in the United States is predicted to grow at the Compound Annual Growth Rate of around 14% from 2014 to 2018. In this chapter, we will address the expanding research and certification of organic foods, the growing consumption demand accompanying extended organic production, and finally the impact of organic market expansion on the US and global economy.

2 The Growing Consumption Demand on Organic Foods

During recent years, studies and investigations have been focused on purchasing demand and buying habits of organic foods. Although detailed results and outcomes from this research vary, the key conclusion is definite: there is an accelerated growing trend in organic demand and purchasing. Consumers nowadays take societal issues such as health concerns, environmental protection, and food safety into their buying considerations, which has induced the quick development of green and organic markets regardless of the established higher price premiums of organic products in the marketplace (Bhattacharya and Sen, 2004; Moisander, 2007; Groening et al., 2009; Pagiaslis and Krystallis-Krontalis, 2014; Nielsen, 2015). Moreover, organic food products have shifted from serving as an exotic and decadent dining option for a small percentage of people to becoming a more commonplace option for a majority of US households.

2.1 Role of Knowledge on Transition of Consumers’ Altitudes Toward Organic Foods

On behalf of the rapid development of organic food culture, and with concerns about traditional farming system on human health, environmental sustainability, and animal welfare, there is a pervasive public belief that organic food products are more nutritious, safe, and tasty (White and Duram, 2013). Stimulated by the organic food industry, the organic labels in the market nowadays are symbols of foods that are healthful and nutrient-dense (Magkos et al., 2006). The higher prices and smaller scale of organic production have led to consumers considering organic foods as superior products, although there is little scientific and direct evidence proving their superiority in nutrition, taste, or any other health-promoting benefits (Dangour et al., 2009; Schuldt and Schwarz, 2010; Blair, 2012).

Negative factors including soaring prices, consumer's lack of confidence, and ineffective marketing also influence the attitudes of consumers toward purchasing organic products (Tsakiridou et al., 2008; Aertsens et al., 2009; Ngobo, 2011; Akehurst et al., 2012; Bickart and Ruth, 2012; Tucker et al., 2012; Gleim et al., 2013; Atkinson and Rosenthal, 2014). However, healthy eating remains the top priority among current consumers and plays a significant role in overshadowing the previously described negative connotations associated with organic foods (Akehurst et al., 2012; Nielsen, 2015; Van Doorn and Verhoef, 2015; Hidalgo-Baz et al., 2017). In general, potential influence of environmental protection, health benefits, better taste, and satiety orientations, combined with common knowledge about organic products, determined consumers’ decisions in selecting organic foods and their willingness to pay higher prices (Barnes et al., 2009).

2.1.1 Biodiversity and Wildlife Welfare

As the core principle of organic production, natural resources and biodiversity conservation could highlight the organic ideal (USDA, 2016). Despite concerns about food safety, consumers also care about environmental issues. Organic production, by utilizing sympathetic management of noncropped habitats, restricting synthetic pesticides/fertilizers, and applying a mixed farming system, offers multiple benefits to the environment and wildlife (Hole et al., 2005; Fließbach et al., 2006). Such advantages include the conservation of biodiversity, improving soil quality, attracting beneficial insects by weed species, stimulating pollination, and providing habitats for birds and small mammals (Van Elsen, 2000; Perrings et al., 2006). Apart from birds and small mammals, organic farms have approximately 30% higher species diversity such as spiders, earthworms, beetles, butterflies, and soil microbes than conventional farms (Bengtsston et al., 2005; Gabriel et al., 2006). Specifically, the rich soil microbiome of organic farms has been suggested to assist in the higher yields of organic plots by breaking down soil chemicals, plant matter, and animal wastes into beneficial nutrients (Fließbach et al., 2006; Horne and Page, 2008).

2.1.2 Consumer Safety

The most substantial differences between conventional food products and organic food products lie in the diversified substances utilized in traditional food production systems, which are prohibited in organic systems. In general, organic standards by NOP only allow the use of naturally occurring substances, and synthetic items such as pesticides, antibiotics, hormones, synthetic fertilizers, growth regulators, and genetically modified organisms are strictly restricted (Paull, 2011a; USDA, 2012). Therefore in theory, organic food products are supposed to contain fewer artificial ingredients, such as pesticide and antibiotic residues and food preservatives, than their conventional food counterparts, and this is where the most positive perception comes from among organic purchasers (Peng et al., 2014; Salaheen et al., 2014).

Organic food products properly relieve the concerns of artificial residues of consumers as well as farmers. For instance, farmers do not have to worry about the serious adverse health effects induced by massive exposure to pesticides; consumers could entirely avoid the acute toxicity caused by food contamination with pesticides. However, little scientific evidence can sufficiently support that organic foods are safer because the variable nature of food production systems and handling processes complicate the study and data generation (Blair, 2012; Smith-Spangler et al., 2012). As a matter of fact, in terms of organic food microbiological safety, multiple reports have claimed that organic food consumption is connected with an increased risk of bacterial contamination (Bourn and Prescott, 2002; Magkos et al., 2006). The increase in outbreaks of foodborne bacteria might not be particularly linked with organic food production, whereas the application of manure fertilizer and restricted use of antibiotics are among the biggest risk-inducing factors (Peng et al., 2016, 2018; Salaheen et al., 2016, 2017; Teramoto et al., 2016).

2.1.3 Nutritional Value

Variations in cultural season/weather, crop fertilizer/pesticide treatments, soil composition, and transportation/storage conditions all have an influence on the chemical composition of organic foods, which causes a difference in nutrient values between organic and conventional food products (Barański et al., 2014, 2017). As organic foods become more and more popular, people prefer to purchase these food products as a healthier option. However, it is still too early to draw a final conclusion, as scientists have found no consistent results in field research.

Several negative or neutral results may refute the claim previously mentioned by some market drivers such as print media and social media, but it is uncertain if they will have an impact on the popularity of organic foods among current consumers who have already accepted that organic equals nutritious. The 2009 systematic review found only insignificant lower nitrogen and higher phosphorus content in organic produce, but no difference in content of vitamin C and major elements, including calcium, copper, iron, magnesium, potassium, and sodium, compared with traditionally grown produce (Smith-Spangler et al., 2012). The 2012 scientific survey failed to find notable differences in vitamins (such as ascorbic acid, beta-carotene, alpha-tocopherol, and retinol), proteins, or fat content between organic and conventional animal products and produce (Hunter et al., 2011; Smith-Spangler et al., 2012). Finally, the 2016 metaanalysis found that, although organic meat and milk products had significantly higher levels of overall and n-3 polyunsaturated fatty acids, they contained only comparable or even slightly lower content of saturated and monounsaturated fat (Srednicka-Tober et al., 2016a,b).

2.1.4 Hedonic Orientations

As indicated by some previous research (McEachern and McClean, 2002; Cervellon and Carey, 2014), a vast group of consumers perceive that organic food products could provide a better visual appearance, scent, and taste. To be specific, McEachern and McClean (2002) suggested that consumers were more willing to link a perception of better flavor with organic products, because this notion served as the primary factor in organic purchasing. Recently, Cervellon and Carey (2014) also pointed out that, in postpurchase assessments, most consumers evaluated the hedonic attributes such as visual appearance, scent, or texture more positively instead of the price, despite the fact that no convincing evidence shows organic foods taste better than traditional food counterparts.

Blair (2012) presented one suggestion that some organic fruits are normally drier than conventionally grown fruits due to their difference in farming environments and irrigation systems. Therefore the slightly drier organic fruits might provide consumers with a more intensive flavor due to a higher concentration of their flavoring components (Blair, 2012). Furthermore, ripeness of picked fruits always has an influence on taste. For example, organic bananas are usually harvested unripe, and then they are rapidly induced to ripen once shipped into the market with propylene or ethylene exposure, which might alter the flavor as well as texture (Magkos et al., 2003; Hunter et al., 2011; Smith-Spangler et al., 2012).

2.2 The Fact of a Growing Trend in Organic Purchasing

The Organic Trade Association (OTA) has revealed that more than 75 million US Millennials now prefer organic foods, accounting for approximately 52% of all US organic buyers. These buyers also encourage their families to do so. The biggest organic purchaser group in the United States is 18- to 34-year-old parents (Jaenicke and Demko, 2017d). Nielsen (2015) conducted a nationwide comprehensive study from 2015 to 2016. Common organic food products were found in kitchens of most American households across the country, including both urban and rural areas. In this state-by-state representative study, 82.3% of 100,000 households participated in organic food purchasing, and their 2016 purchasing behaviors grew by 3.4% compared to the previous year.

According to Nielsen's study, most US households buy organic products on a regular basis, and the ratio of organic purchasing is variable but ranges from 69% to 92% (Fig. 1). Washington, Oregon, Arizona, California, Colorado, and Wyoming rank as the top six states in household organic purchasing with more than 90% organic purchasing. Moreover, North Dakota, Rhode Island, Wyoming, South Dakota, and Wisconsin are the top five states showing the biggest rise in household organic purchasing with a 14.2%, 12.3%, 10.8%, 10.0%, and 9.1% increase, respectively, when compared with previously reported organic purchases (Nielsen, 2015).

Fig. 1 The US household's organic purchasing ratio during years 2015–16.

As a matter of fact, back in 2000–01, several industry groups investigated the preferences for organic foods of consumers and found that organic products had already started to become popular among US shoppers. It was reported by The Nutrition Business Journal (NBJ) that 11% of consumers purchased organic food in 2000; the Hartman Group reported 3% of consumers regularly bought organic food products in 2000; and furthermore, in 2001, 63% of respondent shoppers occasionally and 57% purchasers continually purchased organics for at least 3 years, according to the Walnut Group (NBJ, 2004, 2010).

These significant findings display the importance and popularity of organic food products among US households, and that organic food has become the consuming diet trend of a majority of the US families. As Laura Batcha, CEO and Executive Director of OTA, pointed out, organics are expected to lead a healthy trend and keep leading it stronger and longer in the future.

3 Production and Market Expansion of Global Organic Food Industry

Despite decelerated growing of the global economy, the global organic industry and market sales are steadily and gradually rising (Greene and Dimitri, 2002; Cunha and Pinto de Moura, 2004). Although organic farm practices are becoming attractive and trendy all over the world, the main demand for organic food products comes from North America and Europe. The organic markets of these two continents account for approximately 96% of the entire global organic market (Jaenicke and Demko, 2017a). The rapid growing demand leads to highly focused, massive production, and further induces greater supply than the actual demand. As a matter of fact, oversupply has already existed in European organic markets, and the consistency between supply and demand will be unbalanced in the long term. Based on data from Forschungsinstitut für biologischen Landbau (FiBL), Figs. 2–4 in this chapter show the global organic agricultural farmland sizes, producers, and retail sales in 2015 (Willer, 2017a,b).

Fig. 2 Distribution and growth of global organic agricultural farmland for 2015.

Fig. 3 Distribution and major regions of global organic producers for 2015.

Fig. 4 Global retail sales share of organic food products for 2015.

3.1 The United States

In the United States, organic food is one of the fastest growing agricultural industries, and the size of its domestic organic food market is gradually expanding (FMCG and Retail, 2013, 2015). As the variety of organic food products grows, the ways of selling organic foods has also become varied. Nowadays, people can purchase almost all kinds of organic food products, even from nonorganic food sales channels, and organic cereals, fruits, vegetables, wines, syrup, nuts, and spices markets have already been developed well in a proper scale. Also, organic tomato sauce, oil, cereals, and frozen vegetables are among the relatively rapid-developing categories of organic products (Jaenicke and Demko, 2015a, 2017d). In the field of organic agriculture and marketing, the fastest expanding products might be organic eggs, milk, yogurt, cheese, and other series of dairy products (Willer, 2017a). Due to the increasing request for vitamin production and food ingredients, the market growth rate of organic Chinese herbal medicines, either wild or artificial, is expeditious. At the same time, the market for organic cotton is also expanding because of rising public demand for organic cotton-processed clothes, bedding, and other products (Winter and Davis, 2006; Crowder and Reganold, 2015; Jaenicke and Demko, 2017a).

Since the beginning of organic food retail more than 3 decades ago, fresh vegetables and fruits have remained at the top of organic food sales (NBJ, 2004, 2010). To be specific, in 2012, produce accounted for 43% of the total US organic food sales, which was followed by dairy products (15%), packaged and specially processed foods (15%), beverages (11%), bread and grains (9%), snacks (5%), meat products (3%), and condiments (3%) (NBJ, 2004, 2010).

According to OTA statistics, the vast majority of organic food (93% of total organic sales) is mainly sold through traditional or natural food supermarkets and chain stores, whereas the other 7% is sold through direct marketing channels such as farmers’ markets, restaurants, and nonretail markets (Jaenicke and Demko, 2017a). According to a USDA follow-up survey, the number of US agricultural chain markets was 1755 in 1994, but this number reached 8144 in 2013, which was a 5-time increase compared with 9 years ago (Jaenicke and Demko, 2015a).

The rapid development of organic agriculture in the United States was stimulated by the burgeoning demand for organic products from the European and Japanese organic markets (Winter and Davis, 2006; Crowder and Reganold, 2015; Lernoud and Willer, 2017). Although the United States is a major producer of organic agricultural products, the local organic food industry still relies on imports, especially from Latin America, Africa, Europe, and Australia. A lot of organic fruits, vegetables, meat, beans, seeds, vanilla, seasonings, and other food ingredients are imported annually to the United States (Jaenicke and Demko, 2015b, 2017c). Moreover, Latin America remains a major supplier of organic products in North America. For specific instance, 25%–40% of the US organic consumption of all vegetables and fruits depends on imports, and more than half of its imported organic products are from Mexico (Jaenicke and Demko, 2015a). According to the research report, the best potential market for organic foods that producers have yet to capitalize on demand are products like coffee, tea, cocoa, flavors, tropical fruits, and vegetables for export-oriented countries where the local producers are not willing or have failed to produce. In addition to the supply of the off-season market of fruits and vegetables in these countries, US organic export could also supply on-season organic fruits, vegetables, and other food products that are in short local supply (Jaenicke and Demko, 2015b; Lernoud and Willer, 2017).

In the near future, it could be imagined that the US organic market could keep expanding by 20% or more per year. The import demand for organic food is likely to grow continually, and the US organic market is predicted to gradually develop from an insignificant position to the mainstream of both domestic and worldwide trade (FMCG and Retail, 2013, 2015).

3.2 Europe

European organic food production not only remains in the world's leading position but also introduced the world's largest organic food consumer market. According to the International Trade Center report, in 2001 the European organic food and beverage sales value was around $12 billion (Lernoud and Willer, 2017). Among European countries, Germany is the largest organic food consumer market, which accounts for more than one-third of the European organic food sales across the world, ranking second after the United States. In addition to Germany, other European countries with substantial organic food consumption and sales include France, the United Kingdom, the Netherlands, Switzerland, Denmark, and Italy (Willer, 2017b). In most markets, the share of organic food sales compared to the total value of food sales is about 1%, which is expected to rise to 5%–10% within the next few years (Willer, 2017b).

The entire European organic food market is composed of 37% organic cereal products, 11% organic dairy products, 11% organic meat, and 41% all other organic products (Willer, 2017b). However, the exact values or weights vary among different European countries. For instance, the French organic food market was formed with 42% organic cereals, 25% organic fruits and vegetables, 2% organic wine, and 3% organic poultry meat products; whereas, in the UK food market, organic fruit and vegetables accounted for 54%, organic cereals accounted for 14%, and organic dairy products accounted for 7%. Yet for the organic food market in Denmark, organic dairy products accounted for as high as 45%, whereas organic fruits and vegetables only accounted for 17% (Lernoud and Willer, 2017; Willer, 2017a,b).

European countries have laid the foundation for the development of organic trade by undergoing massive organic agricultural production. The main suppliers of organic markets in Europe are domestic producers, especially for dairy products, vegetables, fruits, and meat (Willer, 2017a). For France, Spain, Italy, Portugal, and the Netherlands, the exports of organic food products are greater than imports, yet the reverse case applies for Germany, the United Kingdom, and Denmark, among which 60%–70% of the organic food sales value of the United Kingdom depends on imports, and the value for Germany is about 50% (Willer, 2017b). There are still many kinds of food products, especially dry foods, that European countries do not produce or process, so they rely on imports from other countries around the world, including developing countries (Lernoud and Willer, 2017). Argentina is one of the main exporters of organic food to Europe, accounting for more than 70% of total imports in the European organic markets (Lernoud and Willer, 2017). The European organic traders are working closely with companies in North America and Africa to facilitate the domestic translation from traditional farming to organic farming. Furthermore, promoted by the growing demand for organic products, European traders are also continually seeking potential sources of organic products, which include coffee, tea, cereals, nuts, dried fruits, oilseeds, spices, sugar, etc. (Lernoud and Willer, 2017; Willer, 2017a,b).

3.3 Asia

Asian organic markets and trade are stably growing, but they could be ranked and distinguished based on the production and consumption levels of organic food products (Paull, 2011a). The overwhelming majority of organic products sales are observed in wealthy countries or regions, such as Japan, Korea, Malaysia, Singapore, and China (including Taiwan and Hong Kong). However, local production of organic food products accounts for only a small share, whereas a large part of organic foods, especially processed foods, are imported from organic-productive countries and regions like Australia, Europe, and the United States (Willer, 2017a).

Organic food industries in Asian countries could be categorized as export-oriented and demand-oriented (Cunha and Pinto de Moura, 2004). Several countries, including the Philippines, Indonesia, Sri Lanka, and Vietnam, with little or negative domestic organic desires, directed their cultivation of organic crops for only export. However, there are some other countries where their organic crop cultivation is now designed to meet the demand of domestic markets. For example, India, China, and Thailand used to be traditional export-oriented countries but are undergoing the transition to demand-orientation in recent times due to their own ever-increasing domestic demands. For such categories, the rapid development of their organic markets directly caused the large expansion of the organic food retailers (Paull, 2011a,b).

Organic foods in Asia are heading for mainstream retailers, and recently organic food products have been on sale in large supermarkets, especially in prosperous cities. Unfortunately, as a junior member in organic markets, Asian countries lack fully established organic product standards, which impedes their development of organic product trade, to some extent (FMCG and Retail, 2015). Only a few Asian countries, such as Japan and China, have mandatory organic agriculture and food standards, whereas most Asian countries still do not have national or organic industrial standards, which makes it difficult for Asian domestic consumers to identify legitimate organic products on the market (Motomura, 2013; Chandran and Eunice, 2015).

The Japanese Organic Agriculture Association initially introduced standards for organic agricultural production as early as in 1993, and it stimulated the development of organic agriculture by encouraging both organic production and consumption activities in substantial groups such as local governments and multiple agricultural associations (Motomura, 2013). At present, Japanese organic agriculture production accounts for more than 30% of the total national agricultural production, providing people with more than 130 kinds of organic foods, among which more than 40 kinds are exported to Europe and the United States (Jaenicke and Demko, 2017a). The main sales of organic food products include processed soy products, especially soy sauce, frozen vegetables, fruit beverages, edible vegetable oil, tea, coffee, spices, rice, etc. From the point of view of Japanese market scale, Japanese organic food markets have dramatically expanded since 1995, and its organic food sales are growing speedily with an average annual growth rate of more than 10% (Motomura, 2013). It was predicted that, in the near future, Japan would become the largest organic food sales market in the world.

As the fourth largest domestic organic market in the world, counting organically managed land, the volume of production, and organic consumption, Chinese organic food still only made up about 1%–1.5% of the entire Chinese food market in 2015 (Chandran and Eunice, 2015). According to the market report, approximately 10 million tons of organic goods were produced in China during 2013, among which 70% are provided to the domestic market whereas the remaining 30% is exported. Moreover, more than 1% (3.5 million hectares) of the total agricultural land in China was utilized and focused on organic production, especially concentrated in northeastern China and the coast (Chen, 2014; Willer, 2017a). Chinese organic exports, as a proportion of total sales, have increased by 19.5% reaching $250 million over the last 5 years (Chandran and Eunice, 2015). Among all export sales, around $195 million worth of business is derived from the top 10 countries including the United States, Germany, Netherlands, Canada, Japan, Switzerland, Belgium, the United Kingdom, and France (Chen, 2014). With $67 million in sales, soy and other bean products ranks first in worldwide export products, followed by tea, fruits, nuts, and vegetables, each generating about $22 million in sales. Therefore it is reasonably forecasted that, by 2020, China will potentially become the leading organic producer across the entire world. Moreover, the organic agricultural land will be composed of 1.2%–1.5% of total agricultural land, and the share of domestic and export organic food market will reach up to 3% and 1%–1.5%, respectively (Harney, 2014).

3.4 Oceania

The organic markets of Australia, New Zealand, and the Pacific Islands are relatively small (Cunha and Pinto de Moura, 2004). Although the area of Oceania organic agricultural land accounts for more than 40% of the entire organic agricultural land in the world, its organic food sales share is less than 2% of worldwide sales. Nevertheless, both Australia and New Zealand are crucial countries for the production, consumption, and most importantly export of organic food products. A huge quantity of organic beef, lamb, wool, kiwi, wine, apples, pears, and vegetables are exported to Asian as well as European and North American countries every year. Moreover, being encouraged and stimulated by the Pacific Organic and Ethical Trade Community, the domestic organic markets of the Pacific Islands have continually grown from undeveloped and even nonexistent moving toward the goals articulated in the Strategic Plan 2013–2017 (Willer, 2017a).

3.5 Other Developing Regions

The enormous and continually increasing demand for organic food, coupled with limited domestic organic production, has resulted in the reliance of western developed countries on imported organic goods (Cunha and Pinto de Moura, 2004). With a 20%–50% higher price premium on organic food products than conventional foods, international trade in organic foods is becoming more and more attractive for developing countries, as these countries may gain profits in a much efficient way. For instance, the export sale of organic food products (mainly fresh fruits and early-seasoned vegetables) in Israel accounts for 2%–3% of the total agricultural exports. Turkish figs, nuts, and dried fruits; Moroccan oranges; Indian tea; and bananas from Western Indian and Caribbean islands are also frequently exported to Europe and North America (Willer, 2017a).

Although both organic food production and market development in developing countries are still in their infancy, they might have a brilliant future following the fierce momentum. Such example countries include Brazil, Chile, and Peru in Latin America; India, Indonesia, and Nepal in South Asia; and Kenya and Mauritius in Africa (Willer, 2017a).

4 Significant Organic Impact on Local and Global Economy

Organically produced foods have become a popular option among consumers. It is undeniable that environment and food industry economics are tightly connected. The organic terminology and application are not only fulfilling the rapidly increasing demand of consumers but also offering job opportunities and intensively stimulating local and global economies.

4.1 Organic Food Industry in Creation of US Job Market

The production transition from conventional agricultural methods to organic agricultural systems provides a contemporary job market in the United States. According to the recent economic study conducted by OTA's Policy Conference, the US organic food industry has generated more than 500,000 domestic jobs during 2010, and for the first time, sales of the US organic market in the same year have surpassed $31 billion (Jaenicke and Demko, 2017b).

The OTA's 2011 and 2012 Organic Industry Survey both directly and indirectly investigated organic-induced impacts on job markets throughout the United States by comparing them with parallel outcomes that would have occurred from the same amount of food sales generated by conventional food production and marketing systems (Haumann, 2012). With the analysis based on different food categories, including meat products, dairy products, produce, beverages, breads and grains, sauces and condiments, snacks, packaged and prepared foods, etc., the OTA estimated that, for every $1 billion organic retail sales, 21,000 more new jobs were established throughout the US economy. In comparison with the traditional food industry where products from conventional farm systems are merely ingredients, the utilization of organically produced ingredients had a momentous economic impact by creating 21% more positions in job market. Furthermore, organic farms hire an average of 61 employees per year in the United States, compared to 28 per year on conventional farms. Organic farms also offer more opportunities to seasonal workers than conventional farms. According to the 2011 report Organic farming for health and prosperity, 96% of organic operations in the United States maintained or raised their employment levels under the support of the federal government, making the most of their economic potentials (Haumann, 2012; Jaenicke and Demko, 2017b).

4.2 Higher Cost and Price of Organic Products

Organic food products typically cost 10%–40% more than similar traditional food products for market price (Winter and Davis, 2006). According to Kathleen Elkins, a US inside-business writer who investigated the Whole Foods supermarket located near Manhattan residence areas in New York, customers would annually spend $26 more on 1 pound of strawberries; $10 more on 1 pound of bananas; $26 more on 1 pound of peaches; $26 more on 1 pound of onions; $26 more on each cantaloupe; $45 more on each avocado; $52 more on 1 pound of tomatoes; $110 more on 0.5 pound of pork bacon; $105 more on 4 pounds of chicken; $95 more on 1 dozen eggs; $25 more on 1 pound of bread; $70 more on 8 oz of crackers; $20 more on a can of black beans; $130 more on a jar of peanut butter; $365 more on a jar of almond butter; and $135 more on 1 gal of milk on organic compared to conventional products, if they buy such items once a week (Elkins, 2015). Although Elkin's investigation is not enough to represent all organic food industry prices in the United States, it was reported that the average price of organic food is usually more than 25% higher than nonorganic food products (Kremen et al., 2004; Winter and Davis, 2006; Kowitt, 2015). Based on the consumer reports collected from select grocers, including Amazon Fresh, Fresh Direct, Harris Teeter, Peapod, Price Chopper, Safeway, Walmart, and Whole Foods, comparing organic goods in the market basket with their conventional counterparts, identical food items as well as the entire assortment were chosen for their average premium comparison (Table 1) (Kremen et al., 2004; Winter and Davis, 2006; Kowitt, 2015).

Table 1

Consumers of organic foods spend more on food products due to multiple factors such as substituting human labor and intensive management for chemical-clean production, overwhelming demand over supply, higher cost of organic fertilizers, sophisticated crop rotations, additional cost for postharvest handling, extra cost for organic certification, shorter storage time and shelf life of organic foods, extra cost for organic livestock welfare, and extra manpower, time, and patience required in organic production (Pretty et al., 2005; Magkos et al., 2006; Blair, 2012; Baudry et al., 2017).

4.3 The US Organic Trade on Economy

As the largest organic market across the world, the United States represents more than 50% of the global consumer sales for organic food products. The continuous growing and maturation of the global organic industry has resulted in the increased importance of global organic trade with the United States. More than 179 countries are actively associated with organic food product production, and they are also linked with more than 2.4 million organic producers throughout the entire world (Willer, 2017a).

From 2011 to 2016, the United States exported organic food products to more than 100 different countries worldwide, with export values around $505 million annually and a total $3.03 billion for 6 years (Jaenicke and Demko, 2017c). Canada and Mexico, as the major recipients, accounted for more than 75% of US organic exports and produced $247 million and $134 million annual export values for the United States, respectively. Except for Canada and Mexico, countries including Japan, China, Australia, South Korea, United Arab Emirates, etc. were among the other 20 top recipients of US organic exports who imported an average of more than $5 million US organic food products per year, and all together accounted for more than 97% of total US organic exports (Jaenicke and Demko, 2015a,b, 2017c).

Similarly, during 2013–16, the United States imported organic food products from at least 100 different countries across the world. The market for organic produce in the United States was even larger than its exports. The United States generated an average $1.5 billion of organic imports value, thus a total $5.9 billion value for the 4 years (Jaenicke and Demko, 2017c). The top organic import source country was Mexico who produced $144 million import share for the United States, accounting for approximately 10% of the entire annual value. Italy with an annual $137 million and Peru with $101 million import contributed to the United States following Mexico as the second and third most organic import organic sources (Jaenicke and Demko, 2015a,b, 2017c). Table 2 shows the top countries that the United States has both exported and imported the most organic food products since 2013 (Jaenicke and Demko, 2017c).

Table 2

5 Challenges and Future Directions

The growth of the global organic food market is tightly connected with the shape of world economy. Despite the fact that the consumer demand for organic products continues to increase, the market growth rate has declined slightly since 2008. Taking the impact of European debt crisis and the US financial cliff into consideration, the future of the global economy is entirely uncertain. Therefore the recent advancement of the organic market might be relatively slowed down (Hamzaoui-Essoussi and Zahaf, 2012).

The downturn in market expansion has brought many challenges, the most important of which is the disequilibrium between organic food industry supply and consumer demand (Kearney, 2010). Organic crops are produced all over the world, with the demand concentrated mainly in European and North American regions. Along with the slowdown of economies in European and North American markets, the oversupply of organic food products will have big impacts on organic farmers and suppliers in Africa, Asia, and Latin America. If organic producers transfer back to conventional cultivation due to limited domestic demand, they will experience a new round of supply shortages when Europe and North America recover from the shadow of economic crisis (Kowitt, 2015).

Food inflation is another major challenge for the organic industry (Winter and Davis, 2006). In the United States, Russia, and Latin America, poor agricultural outcomes have led to a new round of raising food prices. Based on the original higher price premium of organic products, the rise in food prices impedes farmers’ shift from traditional cultivation to organic production. On the other hand, the growing popularity of biofuel crops is also competing with food crops for land resources, which also induces higher food prices (Kremen et al., 2004; Pretty et al., 2005).

Standards and certification are still a continuing challenge. The current lack of harmonized standards remains an obstacle to global trade of organic food products. The United States-European agreement on mutual recognition of organic agriculture implemented in July 2012 is committed to stimulating interregional trade for organic products. However, organic products certified by other regions do not apply to this valuable agreement (Hamzaoui-Essoussi and Zahaf, 2012). In Asia, an increased number of countries have already developed or started to develop organic standards, whereas these standards do not have mutual recognition, and the organic crops’ requirement for multiple certification is still not well resolved (Hamzaoui-Essoussi and Zahaf, 2012). All of these problems have discouraged certain farmers and producers from organic agriculture and