MODULE 1

INTRODUCTION TO ORGANIC AGRICULTURE

Coverage:
1.1 Key Concepts in Organic Agriculture
− What does ‘organic agriculture’ mean?
− Principles of organic agriculture
− Key drivers of organic farming
− Scope of organic production
− Organic Farming and the Sustainable Development Goals
− Benefits and disadvantages of organic Farming
− Dos’ and Don’ts in organic farming
1.2 Organic Value Proposition
− What are the meanings of value proposition?
− Where to start for value proposition development
− Steps in development of a value proposition
− Application of value proposition concept in organic agribusiness
1.3 Salient Facts about Global Organic Agriculture
1.4 Challenges in Organic Farming and Measure to Resolve Them
1.5 Key Takeaways

In this course organic production, organic agriculture, and organic farming are used
interchangeably as synonyms.

1.1 KEY CONCEPTS IN ORGANIC AGRICULTURE

This section covers the following:

− What does ‘organic agriculture’ mean?
− Principles of organic agriculture
− Key drivers of organic farming
− Scope of organic production
− Organic Farming and the Sustainable Development Goals (SDGs)
− Benefits and Disadvantages of Organic Farming
− Dos’ and Don’ts in Organic Farming

1.1.1 WHAT DOES “ORGANIC AGRICULTURE” MEAN?

There are many explanations and definitions for organic agriculture (synonym: organic farming).
However, all converge to state that it is a system that: 1) relies on ecosystem management rather
than external agricultural inputs; 2) considers potential environmental and social impacts by
eliminating the use of synthetic inputs, which are replaced with site-specific management practices

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that maintain and increase long-term soil fertility and prevent pest and diseases. Examples of the
synthetic inputs include synthetic fertilizers and pesticides, veterinary drugs, genetically modified
seeds and breeds, preservatives, additives and irradiation.

According to the FAO/WHO Codex Alimentarius Commission [1], "Organic agriculture is a

holistic production management system which promotes and enhances agroecosystem health,
including biodiversity, biological cycles, and soil biological activity. It emphasizes the use of
management practices in preference to the use of off-farm inputs, taking into account that regional
conditions require locally adapted systems. This is accomplished by using, where possible,
agronomic, biological, and mechanical methods, as opposed to using synthetic materials, to fulfil
any specific function within the system."

IFOAM – Organics International [2] defined organic agriculture as: “A production system that
sustains the health of soils, ecosystems and people. It relies on ecological processes, biodiversity
and cycles adapted to local conditions, rather than the use of inputs with adverse effects. Organic
Agriculture combines tradition, innovation and science to benefit the shared environment and
promote fair relationships and a good quality of life for all involved."

1.1.2 PRINCIPLES OF ORGANIC AGRICULTURE

Organic agriculture is based on four fundamental principles (4Ps), which express the contribution
that Organic Agriculture can make to the world and inspire the organic movement worldwide in
its full diversity. For detail of these principles please refer to the website of the IFOAM – Organics
International [3].
P1. The Principle of Health
Organic Agriculture should sustain and enhance the health of soil, plant, animal, human and planet
as one and indivisible.
P2. The Principle of Ecology
Organic Agriculture should be based on living ecological systems and cycles, work with them,
emulate them and help sustain them.
P3. The Principle of Fairness
Organic Agriculture should build on relationships that ensure fairness regarding the common
environment and life opportunities
P4. The Principle of Care
Organic Agriculture should be managed in a precautionary and responsible manner to protect the
health and well-being of current and future generations and the environment.

1.1.3 KEY DRIVERS OF ORGANIC FARMING

There are three key drivers of the organic agriculture growth:

i. Consumer or market: Consumers are becoming increasingly conscious for safe and healthy
food. They like to take a well-informed decision on how their food is produced, processed,
handled and marketed, and thereby have strong influence on organic production.
ii. Service: Organic farming provides different environmental services such as building
healthy soils, conserving soil and water resources, mitigating climate change, and
promoting biodiversity, among others. In some regions like the European Union (EU),

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 subsidies for organic agriculture are available to generate environmental goods and
services, such as reducing groundwater pollution or creating a more biologically diverse
landscape.
iii. Farmer: Many farmers are recognizing the importance of long-term sustainability in
agriculture. They consider that conventional agriculture is unsustainable and have
developed alternative methods of production (e.g. organic farming) to improve their family
health, farm economies and/or self-reliance, and overall farming sustainability.

1.1.4 SCOPE OF ORGANIC PRODUCTION

The term organic can apply to the following categories of products [4]:
i. Agricultural commodities (unprocessed products): fruits, vegetables, mushrooms, cereal
grains, legumes, nuts, cotton, flowers, ornamental plants, animals, eggs, or milk, meats,
poultry;
ii. Processed products for human consumption: dairy products like cheese, bread or
instantaneous meals;
iii. Livestock/animal feed like organic soy cakes, organic cotton cake; and
iv. Materials for vegetative reproduction and seeds.

1.1.5 ORGANIC FARMING AND THE SUSTAINABLE DEVELOPMENT GOALS (SDGS)

Organic agriculture is a way of farming sustainably. It has proven to be a means to achieve the
SDGs set by the United Nations in 2015 to guide its 2030 Agenda for Sustainable Development,
which was adopted by all United Nations Member States in 2015. Organic agriculture touches on
almost all the SDGs, especially it contributes to ensuring food and nutrition security (SDG 2: Zero
Hunger), sustainable food production and consumption (SDG 12: Responsible Production and
Consumption), tackling climate change (SDG 13: Climate Action), and halting biodiversity loss
(SDG 15: Life on Land), to name a few.

1.1.6 BENEFITS AND DISADVANTAGES OF ORGANIC FARMING

Organic farming, a form of sustainable agriculture, is experiencing phenomenal growth worldwide

because it provides multiple goods and services for the society. However, there are some
disadvantages associated with organic farming.

Salient benefits and disadvantages of organic farming are listed below.

a. Benefits
i. Produces products free from residues of dangerous and scary synthetic chemicals;
ii. Contributes to human health;
iii. Conserves the natural resource base such as land, water and biodiversity;
iv. Reduces environmental pollution.
v. Eliminates the threat for customers about genetically modified foods;
vi. Improves soil fertility and soil productivity;
vii. Enable farmers to prepare their own fertilizers at their farm using farm resources through
composting, green manuring, vermiculture, and cover cropping;

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viii. Farmers can reduce their production costs because they do not need to buy expensive
synthetic chemicals, fertilizers and pesticides;
ix. Increases natural resistance to insect pests and disease;
x. Allows for more specialization opportunities for farmers;
xi. Provides healthier working environment for farmers; and
xii. Organic farming can be practiced in any country, geographic location or growing season.

Overall the organic farming processes store carbon within soil, reduce energy requirements, and
limit the need for inputs based on fossil fuels.

b. Disadvantages
i. In general, no subsidies offered for organic farmers to deal with the risks associated with
climate change impacts or crop failure;
ii. Adds to the farmers’ physical work due to increasing number of manual farm operations.
For example, such as pulling weeds by hand because the use of synthetic chemical
fertilizers and pesticides is not allowed in organic farming;
iii. Organic food is more expensive. Yields of organic farming are generally lower than those
of conventional farming. This means higher operating costs and therefore higher selling
prices;
iv. Organic farmers must have specific knowledge about localized growing systems because
organic farming is heavily reliant on the indigenous skills, knowledge, and wisdom of the
individual farmer;
v. Organic products face unique marketing challenges. In general, their retail price is higher
than the selling prices of traditional products, and hence organic products cannot compete
with traditional ones; and
vi. For labeling a product as ‘organic’ the organic farms and foods must go through a rigorous
certification process, which often involve high certification fee.
vii. Organic products generally spoil faster. Conventional foods are treated with waxes or
preservatives to maintain their freshness during the shipping process. Organic foods cannot
receive the same treatments.

1.1.7 ‘DOS’ AND ‘DON’TS’ IN ORGANIC FARMING

Some of the most common Dos and Don’ts of organic farming [4] are listed below:

a. Dos

i. A transition period is required for the conversion of a conventional farm into a certified
organic farm. This period depends on the type of production, but it usually takes up to three
years;
ii. Contrary to the popular notion, fertilizers and/or pesticides at their “natural origin”1 are
allowed;
iii. Recycle all organic waste;
iv. Crop rotation to improve soil regeneration;
v. Pest control by biological agents;
vi. Rear organic livestock without the routine use of antibiotics and without the use of growth
hormones;

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 vii. Adopt extensive breeding with organic food and give priority to alternative medicines and
preventions;
viii. Ensure animal welfare (soil surfaces must be habitable, there must be outdoor courses and
grazing, prohibition of breeding above the ground);
ix. Respect for the environment and preservation of natural resources; and
x. Maintenance and development of biodiversity (cultivation and breeding of various species,
maintaining or planting hedges).

Don’ts

i. No use of “synthetic1” chemicals. For example, synthetic chemical fertilizers, pesticides,

and herbicides; veterinary drugs; preservatives; and additives;
ii. No use of irradiation; and
iii. No use of genetically modified organisms (GMOs) such as genetically modified seeds and
breeds.
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The difference between organic and conventional agriculture lies in the origin of the inputs (fertilizers and pesticides)
used. In organic farming, pesticides and fertilizers must be of “natural origin”, i.e., they must be products that can be
found in natural materials, such as mineral copper sulfate. However, in conventional agriculture, they can be synthetic,
i.e., manufactured in laboratories. For example, copper sulfate is a pesticide used in organic farming in the wine
industry. In total, there are several hundred pesticides and fertilizers authorized in organic farming, which are listed
in annexes I and II of the EC Regulation No. 889/2008.

1.2 ORGANIC VALUE PROPOSITION

This section briefly explains the followings:

− Meanings of value proposition (VP)

− Salient points to be considered when developing a VP
− Steps in development of VP
− Organic value proposition

1.2.1 WHAT ARE THE MEANINGS OF VALUE PROPOSITION [5, 6]?

A VP is a short speech (e.g., audio/video message of around thirty seconds) or a statement stating
the specific value a product or service provides to a target market or prospect customers. Firms
may develop different value propositions for different groups of customers. The VP shows why the
product or service is superior to competing offers and why the customer should buy it or why a
firm should hire you.

Developing and promoting an effective VP is critical to building a strong business and brand.

A VP is a clear statement that offers three things to prospect customers in the hope they recognize
the product value:

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 i. Relevancy: Explain how your product solves customers' problems or improves their
situation.
ii. Quantified value: Deliver specific benefits.
iii. Differentiation: Tell the ideal customer why they should buy from you and not from the
competition.
Remember also the following points when developing a VP:

i. A VP is a promise of value to be delivered. It’s the primary reason a prospect customer

should buy from you. It’s also the first thing that determines whether people will bother
about your product. The right VP can be a huge boost to your business. It can improve your
customer lifetime value.
i. A VP needs to be in the language your customers use to describe your offering and how
they benefit from it. To come up with the right language, you will need to interview your
customers or use social media to find it out.
ii. A VP isn’t a slogan or a catch phrase, or a positioning statement, rather it is usually a
block of text (a headline, sub-headline, and one paragraph of text) with a visual (photo,
image, graphics). There is no one right way to go about it.

Details on VP including how to develop the right VP and the best examples of VP are available
in the blog of Peep Laja [5] and Neil Kokemuller [ 6].

1.2.2 WHERE TO START FOR VALUE PROPOSITION DEVELOPMENT [5, 6]

Always start from your customer’s shoes. You probably started your business because it was
something you had a passion for. The things that get you excited aren’t necessarily the things that
get your customers excited.

The first thing you need to do is identify your ideal customer. And keep in mind that your customer
might not be the end user. If you are running a daycare for example, your customer is the parent,
but the end user is a child. It’s important to understand your frame of reference.

1.2.3 STEPS IN DEVELOPMENT OF A VALUE PROPOSITION [5].

Three steps in development of a value proposition are given below:

Step 1. Identify your opportunity/identify the customer’s problem

It is critical to identify your opportunity or in other words identify the customer’s problem.

Former Harvard marketing professor Theodore Levitt said, “People don’t want to buy a
quarter-inch drill. They want a quarter-inch hole.”

For example, you have an organic vineyard/vine shop. I have been told by more than one
vine-shop owner that 2/3 or more of sales come from on-site purchases. This tells you people
aren’t buying convenience or even organic vine, they’re buying an experience. The value
these businesses deliver is experiential, i.e. they provide a place for friends to connect while
relaxing and enjoying a cup of vine.

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Step 2. Make a list of benefits you offer
There is a difference between features and benefits. Features are specific attributes of your
business. Benefits are why features matter.
The benefits are the value you provide or the way you solve your customer's problem.

Example to differentiate feature from benefit:

Vineyard Wedding Venue
Feature: 100-hectare vineyard
Benefit: Private setting for your wedding

Step 3. Differentiate
We live in a world where people are terribly busy. They want answers without spending
much time. They want simple solutions to their problems. Don’t expect your prospective
customers to understand how you’re different unless you tell them.

Tiffany’s isn’t the least expensive jewelry and Apple doesn’t have the largest selection of
products - but these companies are successful because they focus on benefits - the motivation
behind making the purchase.

1.2.4 APPLICATION OF VALUE PROPOSITION CONCEPT IN ORGANIC AGRIBUSINESS

The concept of a value proposition is applicable in case of organic agribusiness and organic
brand like any other business and brand.

Examples:
− All our products are purely organic
− No pesticides or added growth hormones are used
− Grown with natural fertilizers (manure, compost)
− Pests are controlled using natural methods (birds, insects, traps) and naturally-derived
pesticides
− Livestock are given all organic, hormone- and GMO-free feed.
− Milk is obtained from cows that are fed upon red clover (anti-oxygen nutrient that fights
against cancer) and are bred in an environment that is good for animals, planet and farmers.
− We follow the principle of open range.
− No GMO’s or cloning is practiced.

With its third-party verification of quality and purity, certified organic holds value in the
marketplace and may command great prices as a result.

1.3 SALIENT FACTS ABOUT GLOBAL ORGANIC AGRICULTURE

The 20th edition of the study “The World of Organic Agriculture” published by the Research
Institute of Organic Agriculture (FiBL) and IFOAM – Organics International [7] shows a
continuation of the positive trend in global organics seen in past years. This publication presents

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data and information from 181 countries from the year 2017. The data represent certified organic
land/area that are already fully certified as well as land under conversion from tradition farming to
organic farming because many data sources do not separate or exclude the land/area under
conversion.

Key indicators of the global organic farming are given in Table 1.

Table 1. Global organic market size, farmers’ number, and organic farmland area in 2017
[7]
Item Value Remarks
Number of countries with organic activities 181
Number of countries with organic regulations 93 93 countries had organic standards in
2016; 16 countries were in the process of
drafting legislation
No. of organic producers (an all-time high) 2.9 million India is at the top with 835,200 organic
farmers
Organic agricultural land* (an all-time high) 69.8 million ha Australia has the largest area of 35.6
(Record increase of million hectares
20% over 2016)
Organic share of total agricultural land 1.4% Liechtenstein is at the top with 37.9%,
followed by Samoa (37.6%), and Austria
(24%)
Size of global organic market USD97 billion United States is the leading market with 40
billion euros
Per capita consumption Global average Switzerland: USD 325 or Euros 288 Euros
not available Denmark: USD315 or 278 Euros
Sweden: USD268 or 237 Euros
USA: USD138 or 122 Euros

The global organic market continues to grow worldwide and has reached 97 billion US dollar:
The global organic market continues to grow worldwide. The market research company Ecovia
Intelligence estimates that the global market for organic food reached 97 billion US dollars in
2017.
The United States is the leading market with 40 billion euros, followed by Germany (10 billion
euros), France (7.9 billion euros), and China (7.6 billion euros). In 2017, many major markets
continued to show double-digit growth rates, and the French organic market grew by 18 percent.
The Swiss spent the most on organic food (288 Euros per capita in 2017). Denmark had the highest
organic market share (13.3 percent of the total food market).
The Swiss spent the most on organic food (288 Euros per capita). They are followed by the Danish
at 278 Euros per capita and the Swedish at 237 Euros per capita. Interestingly, USA citizens only
spent 122 Euros per capita on organic products, although their country has the largest organic
market.

Number of organic farmers worldwide is on rise:

Reports indicate that there are 2.9 million organic farmers globally, representing a 5 percent
increase in numbers over 2016.
For individual countries, large organic land area does not necessarily correlate to large numbers of
organic farmers. India continues to be the country with the highest number of producers (835,200),
followed by Uganda (210,352), Mexico (210,000), and Ethiopia (203,602).

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Organic farm land area is growing:
A total of 69.8 million hectares were organically managed worldwide at the end of 2017,
representing a growth of 20 percent or 11.7 million hectares over 2016, the largest growth ever
recorded. Distribution of organic agricultural land by region is presented in Table 2.
Table 2. Distribution of organic agricultural land by region in 2017 [7]

Organic Agriculture Land Area

Region
Million Percent increase
Percentage
Hectares over 2016

Oceana 35.9 51 NA

Europe 14.6 21 7.6

Latin America 8 11 7

Asia 6 9 30

North America 3.2 5 3

Africa 2.1 3 14

NA: Not Available

Australia has the largest organic agricultural area (35.6 million hectares), followed by
Argentina (3.4 million hectares), and China (3 million hectares). Due to the large area increase in
Australia, half of the global organic agricultural land is now in Oceania (35.9 million hectares).
Europe has the second largest area (21 percent; 14.6 million hectares), followed by Latin America
(11percent; 8 million hectares), and Asia (9 percent; 6 million hectares). The organic area
increased in all continents
Globally, 1.4 percent of the farmland is organic. It should be noted that Liechtenstein, Samoa,
and Austria – while they may not have the largest number of hectares under organic management
– nevertheless have the highest ratio of organic farmland to non-organic farmland within their
borders. The largest organic share of total farmland is in Liechtenstein (37.9 percent), followed
by Samoa (37.6 percent), and Austria (24 percent). Ten percent or more of the farmland is organic
in fourteen countries.
Ten percent or more of the world’s farmland is organic in fourteen countries.
World’s organic agricultural land use in 2017
The world’s organic agricultural land is used for different purposes around the world (Table 3).
Table 3. World’s organic agricultural land use in 2017 [7]

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 Type of Organic Land Use Million Hectares
Grassland (majority grassland is situated in Australia) 48.2
Arable land (land under crop cultivation) 12.1
Permanent cropland (primarily grow coffee, olives, nuts, coconut, and grapes) 4.9
Organic wild collection (situated predominantly within Europe (Finland) and
41
Africa (Tanzania and Zambia)

1.4 CHALLENGES IN ORGANIC FARMING AND MEASURES TO RESOLVE THEM

Though organic farming is growing, but it faces many challenges [7, 8]. There is need to take
actions to address those challenges. A list of challenges and measures to resolve them is given
below.

1.4.1 CHALLENGES
Main challenges in the process for pursuing organic farming can be grouped as for producers, for
processors, and for consumers.

For Producers:
i. Certification process faces issues like high certification costs, lengthy procedures,
international validity, inadequate certifying agencies and insufficient supporting
infrastructure facilities for verification.
ii. There is also a gap in the understanding of the certification standards and labeling
iii. Lack of standardization for the certification of different organic commodities
iv. Lack of incentives for farmers who shoulder high cost of transition from conventional
farming to organic farming and harvest lower yields of organic production
v. Lack of standardized organic agriculture inputs and subsidy on organic inputs
vi. Lack of organic cultivation research and extension

For Processors:
i. Supply chain issues: Many farmers are apprehensive of organic farming since it involves
high production costs. The emphasis on collection, transportation and storage of fresh
organic produce is very high. Due to relatively low volumes, the marketing and
distribution chain of organic food products is relatively inefficient, and the costs involved
are very high.
ii. Low global competitiveness: Many developing countries find it difficult to increase their
share in the global organic food export market due to low quality and safety standards of
organic products
iii. Branding and packaging: Lack of proper branding and packaging due to absence of
regulation on labelling standards.

For Consumers:
i. Lack of awareness among consumers of the health benefits of organic food products.
ii. The higher cost of organic food products than that of conventional food items.
iii. Limited availability of organic food products in the market
iv. Lack of transparency in the organic value chains

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1.4.2 MEASURES
i. Promoting local businesses and brands
ii. Targeting organics as creator of local jobs
iii. Improving advisory and extension services for organics
iv. Funding for training and research
v. Simplifying the certification process
vi. Reducing certification costs
vii. Subsidizing certification costs
viii. Enhancing organic farmers’ access to finance
ix. Building safe reliable organic supply chains
x. Creating awareness among consumers on the importance of organics.

Credible certification of organics to comply with the stringent organic standards and regulations
of the import countries will be required to access their markets and sell organic products on
premium prices. Governments of developing countries should consider subsidizing certification
fees and/or reducing certification costs for organic producers, a vast majority of whom are
smallholders and resource poor.

A favorable policy environment, reliable standards and regulations, and transparency remain
the key factors for future success.

1.5 KEY TAKEAWAYS

a. Global organic industry is expanding in terms of organic agricultural land area, number of
organic producers, number of countries with organic activities, and organic market size.
b. There are many economic, social, health, and environmental benefits of organic
agriculture.
c. Organic agriculture touches upon all the United Nations SDGs, especially it contributes to
achieving SDG 2, SDG 12, SDG 13, and SDG 15.
d. Developing and promoting an effective organic value proposition is critical to building a
strong organic agribusiness and brand.
e. Organic farming can be practiced in all regions and all seasons worldwide.
f. There are many challenges in exploiting the full potential of organic agriculture and organic
agribusiness. Many of those challenges can however be resolved through adopting
appropriate measures.
g. Credible certification of organics is required for selling products on premium prices and
greater access to the global organic markets.
h. A favorable policy environment, reliable regulations and standards, and transparency
remain the key factors for future success.

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REFERENCES

1. FAO-The Codex Alimentarius Commission (2007), Guidelines for the Production,

Processing, Labelling and Marketing of Organically Produced Foods, 3rd ed. Codex
Alimentarius Commission, Joint FAO/WHO Food Standards Programme.
http://www.fao.org/3/a1385e/a1385e00.htm
2. IFOAM – Organics International (2005), Organic Agriculture – Our Definition.
https://www.ifoam.bio/en/organic-landmarks/definition-organic-agriculture
3. IFOAM – Organics International. Principles of Organic Agriculture brochure.
https://www.ifoam.bio/en/organic-landmarks/principles-organic-agriculture
4. e-CSR (2017), Organic farming: definition, standards, benefits. https://e-
csr.net/definitions/organic-farming-definition-examples
5. Laja, P. (2019), How to Create a Unique Value Proposition (with Examples).
https://conversionxl.com/blog/value-proposition-examples-how-to-create/ (Accessed on 23
July 2019)
6. Neil Kokemuller (2019) Developing an Effective Value Proposition.
https://smallbusiness.chron.com/developing-effective-value-proposition-64676.html
7. Willer, H. and J. Lernoud (eds) (2019), The World of Organic Agriculture. The 20th edition.
Published by the Research Institute of Organic Agriculture (FiBL), Frick, Switzerland; and
International Federation of Organic Agriculture Movements (IFOAM) – Organics
International, Bonn. https://www.ifoam.bio/en/news/2019/02/13/world-organic-agriculture-
2019
8. ASSOCHAM and EY (2018), The Indian Organic Market: A New Paradigm in Agriculture. A
joint publication of the ASSOCHAM and Ernst & Young LLP (EY), published in India. All
rights reserved with Ernst & Young LLP(EY). https://www.indiaretailing.com/tag/the-indian-
organic-market-a-new-paradigm-in-agriculture/ Ernst & Young LLP.

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