Analysis of socio-economic aspects of local and national organic farming markets; final report for Defra

The purpose of this study was to take a fresh look at the nature of organic production, consumption and marketing in England and Wales in order to better assess its current and likely contribution to rural development and its ability to meet consumer expectations. Based on a mixed methodological approach the study consulted with 2,300 individuals to reveal a complex and multi-dimensional sector with a highly committed consumer base. The research aimed to describe and account for: (1)The socio-economic impacts of the organic farm supply chains on rural development; (2)The extent to which organic food delivers consumer expectations; and (3) The barriers affecting conversion to organic farming and expansion of existing organic farms. The research reported here is arguably one of the most integrated studies of organic consumption, production and marketing conducted to date. It throws new light on the nature of organic consumption, underlining both the on-going commitment of the majority of committed organic consumers and the gap in perceptions, degrees of ‘brand trust’ and price sensitivity between this group and the majority of consumers who rarely or never buy organic. While this degree of commitment suggests that recent declines in organic consumption may not be sustained and will soon hit a floor, this finding also points to difficulties, particularly in a time of recession, in enrolling new consumers into organic networks, particularly via the direct marketing channels that smaller producers are more likely to depend on. This group of producers, locally embedded and linked to consumers via short supply chains, fulfil the expectations of many organic consumers and exemplify the idea of alternative food producers. Managed by self selecting, entrepreneurial farmers, these organic producers make a valuable contribution towards employment and income generation within the local rural economy. As our broader analysis of food chains and multiplier effects across the regional and national rural economy shows, however, it is the large scale producers, concerned with the production of bulk commodities and integrated into long supply chains, that inevitably account for the main rural employment and income benefits of the organic sector, if measured in aggregate terms. While there is a good case to be made for the rural development benefits of organic farming, it is important to recognise these scale effects and their geographically uneven distribution in any policy assessment.