Going green and eating cleanly are as popular as ever in Germany, like the United States and several other countries throughout the world. Demand for organic products in Germany is on the rise and increased by nearly 10 percent in 2011. Local producers are having trouble meeting this rapid rise in demand, causing a heavy reliance on imports from markets across the globe. Looking toward the future, assuming this growth in demand will sustain, how is the German market going to react? Will Germany continue to rely on imports, or become more active in growing and distributing these products domestically?
Currently, approximately 1 in 5 Germans shops for organic products at least once a week. Last year, a staggering $8.5 billion was spent in this market. For these consumers, the products coming off of the shelves are most likely not German. For certain vegetables, such as carrots, for example, around 50% have been imported. While surprisingly, around 80% of peppers and tomatoes are imports.
Importing organic foods seems to be a route with much less difficulty than producing one's own products. The German Federal Ministry of Food, Agriculture and Consumer Protection's website lists several standards that must be met in order for products to be sold as organic. These standards are set by the EU, which "prescribes exactly how producers and processors have to produce their commodities and which substances they may use in the process (bmelv.de)." Trading organic products with countries outside of the EU is even more difficult, as each country is required to have "compliant and equivalent regulations regarding production rules and inspection measures." For countries attempting to break into this market, such as China, strict scrutiny as a result of recent food scandals is inevitable. While the EU does its best to protect consumers from deception, some countries have slipped through the cracks. Some say Chinese merchants can simply purchase an organic food certification, while some suppliers in Italy recently exported approximately $285 million worth of products with false organic food certifications.
Quality assurance is extremely important in the organic products market, as the entire market depends on consumer demand. If consumers cannot trust the products in which they wish to purchase, they will simply stop demanding them. By becoming more active producers of organic products and fostering trade within the EU, the German government can assure consumers, with confidence, that the products being delivered are in fact 100% organic.
It appears as though the German government is taking both of these actions and increasing its share in the organic products market. Countries from within and outside of the EU attended the Global Organic Market Access (GOMA) conference earlier this year, which focused on harmonization and equivalence in organic agriculture to continue to lower barriers to trade. Moreover, regional cooperation with respect to intra-regional trade was emphasized. Organic products have also been exposed through the annual BioTech Fair, which was held in Nuremberg in February. Over 2,400 exhibitors from 83 nations were expected to attend and interact with the 50,000 traders and specialists. Aside from the expos and conferences like the ones previously discussed, which are helping with the idea of increasing more regulated and monitored trade, data from the German Federal Ministry of Food, Agriculture and Consumer Protection's website shows the significant increase of organic farmland in Germany from 1996 to 2010. In those 14 years alone, the land devoted to organic agriculture increased by about 600,000 hectares. Germany's Agriculture Minister, Ilse Aigner, has asked farmers to react to this significant domestic demand for organic products by increasing production.
It seems that the German government and people are taking the necessary steps to meet the rising demand for organic products. Because demand is so large, relying on imports or domestic production alone would not suffice. A healthy combination of both strategies, which Germany is currently implementing, should be beneficial to both the consumers and those participants in this market.