The third BioFruit Congress examines new developments in the world of organic fruit & vegetables
The big issues facing the future of the organic produce market were debated during the 3rd annual BioFruit Congress, which took place in three sessions over October 20-22. Held on FRUIT ATTRACTION LIVEConnect, the congress was organised by EUROFRESH DISTRIBUTION and IFEMA in collaboration with FiBL, PROEXPORT, ZERYA & CAERM. Issues covered included the latest developments in the EU market, shifting consumer priorities and how cooperation between organic breeders and retailers has benefits throughout the organic value chain.
SESSION ONE: Latest trends and strategies in the EU, demand in China
On Tuesday October 20, and following an introduction from FRUIT ATTRACTION director Raúl Calleja, EUROFRESH DISTRIBUTION editor Pierre Escodo kicked off the first session of the BioFruit Congress by welcoming the over 300 participants in the first online edition of the congress, noting it was a similar number to the earlier editions held at IFEMA in Madrid. Escodo said one of the objectives of the congress was to examine emerging sustainable product labels – going beyond organic – which many consumers now seek. In an overview of the organic market, Escodo said consumption of organic produce rose during Covid-19 lockdowns in Europe and many retailers expect at least some of that increase to be enduring.
The EU green deal and Farm-to-Fork strategy
Next up, Juri Mara, a DG Agri market officer in the EUROPEAN COMMISSION (EC)’s horticulture unit, spoke about the EU Farm to Fork Strategy, explaining that it is at the heart of the overarching European Green Deal, which aims to make Europe the first climate-neutral continent by 2050. Mara said one of the four pillars of the strategy is the ambitious objective of having at least 25% of the EU’s agricultural land under organic farming by 2030. On that subject, he also invited the audience to participate in an open consultation (running until the end of November) and provide feedback to the EC on preparation of the future Action Plan (2021-2026) on organic farming. “In a nutshell, the and Farm-to-Fork strategy is for healthy people, a healthy society and a healthy planet, and it’s down to all of us,” he said.
Changing consumer demands on how to signal sustainability
Organic food has outperformed compared to overall food sales in Western Europe since 2012, said EUROMONITOR INTERNATIONAL food analyst Tea Thaning. But she signalled an important shift in consumer response to the different labels used to communicate sustainability, and differences across regions. For instance, the top two product claims for juice in Western Europe in 2019 were vegan and organic, while in the US they were organic and gluten free and vegan was not even in the top five. She also stressed that: “Covid-19 has accelerated consumer interest in and scrutiny of supply chain transparency.” Thaning said two main points to drive home are the increasing diversification of claims and shifting priorities among consumers, and the need for tangible information and clarity around consumer products. The pandemic will have a persisting impact on consumer behaviour and provides opportunities for the use of a vast range of functional claims in relation to food and drinks, but: “The market is fragmenting and it’s becoming harder to know what will appeal to whom and who your consumer is,” she warned.
Pandemic has also fuelled organic food interest in China
The coronavirus has made Chinese consumers even more sensitive about food safety and boosted sales of high quality and organic products, said Sophia Yan Xue, head of international procurement at CHUNBO. Due to the limited availability and cost of organic food in China, sometimes organic products are twice the price of conventional, she said. Nevertheless, from January to August, sales of organic products on Chunbo were up 7.2% on the same period in 2019. Moreover, organic vegetables – which account for nearly half of all sales of organic products by Chunbo this year – are up nearly 9.6% YoY, she said. But:
“For Chinese consumers and retailers, we have problems buying organic products, especially organic produce from abroad. Very few organic foods from abroad can be found on the Chinese market because China has its own organic certification system and very few exporters have made the effort to expand to the Chinese market,” Yan Xue said. New Zealand and China, however, have signed a mutual recognition protocol for organic certification. Exporters from New Zealand have made efforts and invested in expansion in China’s organic produce market and the data for the past few years shows a good return on this, she said. Overall, she believes there is “great potential for organic food in China with a simplified organic food certification system and increasing recognition of organic food by consumers.”
Diversification of organic products and channels – examples of Spanish success
The first session of the BioFruit Congress wrapped up with presentations from three Spanish companies on how they have courted success in the organics arena.
- Almería-based organic grower BIOSABOR was founded in 2008 and initially grew only the Rama tomato but when it added in other organic varieties as from 2013-14, particularly cherry, its sales turnover took off much faster than its production volume. BIOSABOR CEO Francisco Belmonte said this was because the firm invested in organic varieties that are harder to grow but that satisfy consumer hunger for tasty tomatoes. After first adding in the Angelle, BIOSABOR now also grows varieties including Adora, Piccolo, Tomazur and Sorrentino, as well as the Pimiento Palermo.
- Formed in 2007, Murcia’s CAMPOSEVEN has gradually transformed since 2014 from being primarily a conventional grower to now growing the lion’s share of its fruit and vegetable production volume under biodynamic methods, “in order to look after the health of people and the environment”, said CEO Adolfo Garcia. Germany is by far its main export market, followed by France and Switzerland. CAMPOSEVEN has diversified by also selling organic and biodynamic produce online through its Freshvana offshoot and, as part of its commitment to innovation, it partners with the Polytechnic University of Madrid in research company Plant Response Biotech.
- Organic producer and exporter HACIENDASBIO says it is thanks to its value-adding that its sales revenue has almost doubled since 2017 to an expected €49 million for 2020. CEO Paco Casallo said the firm does all its farming itself, so it can do it to its own high standards, allowing it to differentiate on quality.
“We measure quality in details like the width of a pepper wall and the length of its shelf life, the kind of criteria that really make a product stand out in a store or when consumed, and that deliver what the market is looking for,” he said. The firm has 36 farms, all biodynamic, across 7 regions in Spain, with just over 1,000 ha in use and another 1400 ha lying fallow at the moment. “We’ve built a product range with long seasons across various regions in order to be the leaders in this attention to product quality,” Casallo said. HaciendasBio also has an automated packhouse 4.0 and uses blockchain to ensure the integrity of information, for example, “we can reliably state on a product label who harvested it and where and how it was cultivated.”
SESSION TWO: What else are consumers seeking in regard to sustainability today?
Setting the scene for the second session, on October 21, EUROFRESH DISTRIBUTION editor Pierre Escodo provided examples of how retailers are responding to current consumer demand for sustainability. He said Auchan, for instance, has a responsible sourcing policy and was one of France’s zero residue pioneers and has 60 such fruit and vegetable items. It also uses blockchain technology in 8 countries, “so customers can trace their food they purchase back to the farm.” Escodo said as well as being a leader among “socially engaged” retailers, Colruyt has an organic range, BioPlanet, while in Spain, EL CORTE INGLÉS has the largest organic assortment, including 200 fruit and vegetable items, and in the UAE, organic items account for 10% of SPINNEYS’ sales – double the the 5% average in European stores.
Also meeting demand for more sustainable products: no-residue labels
ZERYA director Javier Arizmendi also noted that demand for differentiated products, particularly those with quality marks and labels, has been increasing in recent years. Zerya is one such label and is not organic certification but a guarantee that a product of conventional agriculture is free of pesticide residues, while also communicating that it is innocuous and the result of responsible production, he said. One of the countries leading the way in ‘no pesticide residue’ initiatives is France: “All retailers in France have this category on their shelves in some way,” Arizmendi said. He also stressed the importance of labels engaging with consumers and said there are significant differences in how this occurs even within Europe. “There are consumers who are eager to receive information, like Scandinavian or Swiss consumers, who are very good at processing it, and there are consumers who tend to do it in an emotional way, like the Mediterranean consumers in Spain or Italy, while it’s a combination of both in France and Central Europe, and there some other consumers who are very influenced by trends or media, like in the UK,” he said. “We need to focus on the drivers of every consumer around the world and make sure that the messages we are elaborating are clear enough for these consumers to engage with.” This is particularly important now, with a poll of Europeans during the northern summer showing,
“After Covid, 79% on average are looking for CSR criteria in the products that they are buying,” he said.
Carbon neutral brand BE CLIMATE delivers clear messaging, transparency
What if a fruit brand could assist in achieving both climate and revenue targets? A year ago, Hamburg-based Port International GmbH introduced just such a brand, BE CLIMATE, the first carbon neutral fruit brand in the world. Managing Director Mike Port said the brand was born of a desire to reduce emissions and make the world a better place for future generations, and aims to provide what consumers want – clear messaging and transparency on sustainability. An example of the latter is the way it calculates its CO2 footprint: “It’s very important for us to use mainly primary data, not from statistical banks, but checking all individual steps where emissions occur. It’s quite sophisticated and time intensive but it’s what we think is necessary for a serious project,” he said. In January, Belgian retailer Delhaize replaced its then premium banana line with BE CLIMATE bananas and Port said their sales volume in 2020 has exceeded that of the previous brand, showing “customers will switch to more sustainable bananas when given the choice.” BE CLIMATE also has climate neutral strawberries, blueberries, and clementines, with more products in the pipeline. Port and its partners along the supply chain have carbon reduction projects across eight categories: wind power, solar power, water treatment, energy efficiency, greening, recycling, fuel saving and E-drive, Port also said.
The case for going beyond organic
LEHMANN NATUR sees permaculture as a necessary step beyond organics. “In times of climate change…we need more than just ‘organic’, we need sustainable agriculture that supports soil fertility, biodiversity and preservation of natural resources,” said Didier Fleury, business development manager for the northwestern Germany-based organic fruit and vegetable supplier. Fleury explained permaculture as a holistic approach to life and the most natural way to grow produce. Beyond Germany, the firm also owns about 200ha in Huelva, Spain, which it uses not just to apply permaculture but to teach it. “It’s very important to us to help producers in this conversion,” he said, “especially given “80% of production worldwide is still conventional.” As for demand in Germany, one of the countries leading the push for more natural production, 19% of fruit and vegetables sold there are organic, of which 8% is permaculture-demeter. “It’s still low because the volume is really huge and there is a conversion time”, Fleury said. Growing the market for permaculture will depend greatly on making it affordable for more consumers, he stressed. Tests in various German supermarkets show that when the price of such produce is not more than 25% above conventional, then the market share goes from 15% to 30% and sometimes 40%, which means there is a high level of customer willingness to buy more natural, tastier produce but the price is sometimes a barrier, he said. In the case of ginger, retailers have found that when they offer only organic, and combine it with very focused marketing, the volume increases and the price comes down. But retailers need to work a different way with the producers and agree on 1-2 prices a year, as the current weekly price system can’t work for organic growers, he said. Also, in supermarkets, organic tomatoes are usually twice the price of conventional ones, and that’s not the case in production. “Across the whole chain there is a lot of opportunity to drop the price of organic…such as in the areas of packaging, logistics and waste at the end of the chain,” he said.
SESSION THREE: The case for cooperation between breeders and retailers
How organic breeding adds value to the food chain
“The benefits of organic breeding span the whole value chain,” said FiBL Europe plant breeding expert Mariateresa Lazzaro, opening the third session of the congress. “Organic breeding delivers cultivars that are reproducible, robust, yield stable, locally adapted and tasteful for organic production,” she said. However organic plant breeding needs to be strongly promoted, which requires funding. Lazzaro gave examples of ongoing small-scale value-chain based collaborations for securing such funds (e.g. the Fair-Breeding® and Organic Sunflower Seed initiatives) and proposed a cross-sector funding pool strategy to boost organic breeding. A flat rate of 0.1-0.2% of total organic market turnover at point of sale has been proposed for promoting collaboration across the value-chain to achieve the objective of organic products from the start (Engagement.Biobreeding project). “Integrating organic breeding into value-chain partnerships will ensure the integrity of the organic products of tomorrow and strengthen consumer confidence,” she said.
Retailer EcorNaturaSì works closely with farmers to ensure the best for them, and consumers
“The products we distribute must contribute to improving human health – both consumers and producers – as well as the well-being of the soil and the environment in which we live.” That’s the mission of Italian organic and biodynamic grower and retailer ECORNATURASÌ, said its supermarket chain manager Carlo Murer.
EcorNaturaSì has over 70 stores in Italy and 2 in Madrid and boasts over 4,000 organic products. It owns 2 farms but also works with over 300 producers in Italy (and some in Spain), with production over 7,000 ha in Italy alone, and controls production supply chains for bananas in Colombia; pears, garlic and onions in Argentina; and ginger and turmeric in Peru.
“Price is not the key concern when we select a farm, it is the quality of and the type of farming,” he said. And a sign of consumer trust in the chain is the fact that it saw a 14% increase in sales during lockdown. “When people need to feel safe they come to our shop,” Murer said. Although retail prices for organic fresh produce are above those for conventional, the true cost of conventional production is actually much higher, he said.
The need for organic veg varieties that free from cell-fusion breeding
A big problem for organic growers is knowing if seeds result from a method known as cell fusion and obtaining ones that do not. So said biologist Holger Scharpenberg, who handles the subject of organic plant breeding for Germany’s Bundesverband Naturkost Naturwaren (BNN), an association representing the organic food sector’s interests. He said while several organic farming associations do not allow varieties produced with the help of cell fusion to be sold as ‘organic’, the EU organic regulation does and imposes no labelling requirement regarding it.
“This is a big problem, and furthermore, the market of brassicas and chicory is dominated by cell fusion-derived CMS (cytoplasmic male sterility) hybrids.” CMS uses methods “that are not genetic engineering but similar to it,” he said. “The proportion of hybrids in Germany’s certified organic agriculture is between 65% and 100%, it depends on the type of vegetable, and in the end, organic breeding often reaches a dead end with increasing uncertainty.”
The BNN is thus lobbying for mandatory labeling of the methods used in plant breeding and in the meantime is helping the organic sector in two key ways, one being the publication of a list of all available varieties of sugar loaf, chicory, cabbage and radicchio types that are cell fusion-free. The second is a concrete breeding-project to develop cell fusion-free varieties as an alternative to CMS hybrids. The latter has involved cooperation from Germany’s vegetable wholesalers and the donation of a small percentage of annual turnover to help fund it. Seeds are already available for three new varieties – Rasmus (broccoli), Etardo (chicory) and Cleopha (cucumber). And by 2022, a further nine varieties should be market ready, including a yellow-fruited courgette and a cauliflower called Selma Grando, Scharpenberg said.
New organic varieties and brands meeting consumer demands
VITALIS Organic Seeds regional sales director Christof Flörchinger started with a look at what’s driving consumer food choices today. A desire for taste, shared experiences, and for healthy, nutritious food that has been produced fairly are key factors, as is the fact people have less time to cook and are snacking more, he said. Understanding such trends could help boost organic food sales in the European market, which has considerable scope to grow given its value of €37 billion is well below global leader the US’s €47 billion, according to AMI FiBL 2017-18 figures Flörchinger shared. He went on to list the hottest issues in consumer demand, which include reduction of waste and plastic, and foods that are organic, non-GMO, pesticide-free, flavoursome and nutritious. “Organic production starts with organic seeds,” he said, so VITALIS has bred new organic varieties and brands addressing these trends. Among them are greenCumbers, which are cucumbers with genetics giving them longer shelf life (thus reducing waste) without the need for plastic wrapping, and the Orange Summer F1 pumpkin, which ticks off many consumer desires with its excellent taste, suitability for a wide variety or production zones, and good yield and storage.
“The sweetness index of Orange Summer F1 is much higher than standard pumpkins,” and “its sugar content is even higher three months after harvest,” Flörchinger said. Also new is the Tribelli pepper range, catering to consumer demand for food that is enjoyable and easy to eat. Flörchinger’s advice to organic suppliers is to offer products “with special traits you can really make a story out of.”