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Why is organic food more expensive, and when will it change?

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Organic food is generally more expensive than intensively-farmed food. Ysanne Spevack investigates why we pay more for foods grown without chemicals, and when they will get cheaper.

Organic food is better for you and your family. It contains more vitamins, minerals, enzymes and taste than intensively­farmed produce. It is also free from insecticides, pesticides, growth hormones, antibiotics, fertilisers and a whole host of other toxic artificial additives, flavourings, colourings and preservatives. So if it contains less added chemicals, why does it cost more?

At first glance, you might expect organic food to cost less to produce than foods with added extras. However, it’s a lot more complex than that. The main reason that intensively farmed foods are cheaper to buy in the shops is that you are paying for them in your taxes. Agro­chemical agriculture is heavily subsidised by the taxpayer through the government, whereas organic farming receives no subsidies at all. This ludicrous situation dates back to the aftermath of World War II. The governments of the day needed to ensure that the severe food shortages of the war never happened again. Starvation and famine in Europe urgently needed to be protected against, and the new chemical technologies of the 1950′s seemed like a gift. One of the first things that the united European governments did was to encourage an abundance of foods by subsidising the use of chemicals in farming.

The thinking behind subsidies was optimistic and heartfelt, but became increasingly outdated and defunct as time marched on. The huge rotting surpluses of food since the 1970′s has confirmed that production from intensive farming is not working. The butter mountains, wine lakes, wasted fresh produce and uneaten meat products of the last thirty years are a testament to outmoded laws and inability to change. Europe has been in a legal deadlock for decades, stifled by the mammoth amount of paperwork needed to fix the current unworkable situation. And now that more and more people want to go organic, the need to modify the way that subsidies are distributed has never been more urgent.

Another crucial reason why organic food is more expensive to buy than intensively-­farmed food is that agro­chemicals are designed to make food cheaper to produce. Agro­chemicals were not developed with nutrition, taste or the ecology in mind. The chemical designers’ remit was to make mass production of food cheaper. End of story. So what we get is a cheap but inferior product. Given the choice of buying an organic apple or an intensively produced apple, and I know which one I’d prefer any day. I may have to pay up to 5p more for the organic apple, but it will be juicier, have a more appetising texture and aroma, and will generally be more tasty. It will be packed with up to 60% more vitamins, minerals, enzymes and trace nutrients, and be free from a cocktail of up to 40 different chemicals, waxes and insecticides. It will be an interesting variety, produced by a farmer committed to fine food, and it will have left the tree in a meadow with healthy soil and filled with a diversity of butterflies, lady birds, birds and countryside wildlife. So my extra 5p will have been well spent, ‘cos me and my home planet are worth it!

Michael van Straten is a leading organic broadcaster and writer, as well as one of Organic magazine’s resident experts. He agrees that we need to think hard before choosing an intensively produced product over an organic product simply because of cost.

If you look at crops like coffee, cotton and tobacco, these are the most heavily sprayed and toxically damaged crops in the world. Yet those toxins don’t directly bother us as consumers, because we don’t get them. It’s the actual workers in the fields that suffer. It’s a nightmare, it’s just morally reprehensible that we should allow that to go on. Let’s take the situation in Zimbabwe. 10% of the population of Zimbabwe own 90% of the land, and it’s mostly tobacco farms. They couldn’t care less about the living conditions of their workers. They’ve had all sorts of genetic problems, fertility and conception problems, skin problems, high cancer incidences. Don’t you think that it’s worth paying a little bit more for organic produce?

So that’s the facts to date. Like it or lump it, organic food costs a bit more, and it’s definitely worth the extra. But this is where the story gets more complex. Because there are experts that say that organic food is actually cheaper to produce than intensively farmed foods. Sounds crazy? Well read on…

Professor Jules Pretty is professor for Environment and Society at Essex University. He has been looking at the hidden costs of intensive farming for many years.

The consumer pays three times when they buy intensively farmed food. Firstly, they pay at the shop till. Next, they pay for the same food through their taxes, as modern farming is subsidised through the tax system. Thirdly, the consumer pays again to clean up the damage to the environment caused during the growing and the raising of the food.

Farming subsidies cost the UK taxpayer about £3 billion pounds every year. We then spend an estimated £2.3 billion every year cleaning up the ecosystem. The expenses for the aftermath of agro­chemicals are far reaching. The government spends £120 million of taxpayers’ money every year just to clean up pesticide residues from farming which pollute our water. These are effectively hidden subsidies from water consumers to polluters.

“The UK pesticide market is currently worth about £500 million every year. It is extraordinary that the cost of removing pesticides from drinking water amounts to a quarter of the market value — some £120 million annually,” says Professor Pretty.

Then there are the hidden costs to the nation, such as the BSE crisis. There were no cases in the UK of BSE in any organic farms. Although the current foot and mouth crisis can effect any kind of farm due to its wind­born nature, BSE was exclusively a problem only in intensive farms. The cost to the NHS for treating agro­chemical related problems is also fiendishly difficult to calculate. However, exponentially rising cases of asthma, cancers, heart disease and dietary disorders almost certainly have a link to poor diet, increased pollution and intensive farming techniques. Then there are the costs to wildlife, whose natural habitats are destroyed by intensive agriculture.

Craig Sams is the founder of Whole Earth Foods and co­founder of Green and Black’s chocolate. An organic campaigner of many years, Craig has recently been translating Professor Pretty’s findings into market place terms.

Subsidies work out at about 40 pence in every pound spent on food, giving an extra cost of 86 pence on every pound charged on your supermarket bill. This cost of food is paid through the taxation system. Organic farmers earn lower subsidies because they grow rotation crops that don’t maximise subsidy income. They cost society about 25 pence in every pound. Their externalised costs are a fraction of the 46 pence that Professor Pretty’s team calculate. You could even say that they are net contributors to the asset side of the national balance sheet by improving the land. When you cost in the real cost of industrial agriculture and take away the subsidies that favour the wrong use of resources, you end up with a situation where, if it were in the real world, organic food would actually cost less than conventional.

Instead of spending £5.3 billion every year to artificially prop up the current intensive agro­chemical system, we could be moving towards a modern alternative which produces better food at a lesser cost. The Soil Association has calculated that if we spend £1.2 billion every year for the next five years, we can convert all of the agro­chemical farms in the UK to organic farming methods. This represents a huge financial saving of over £20 billion pounds which could be made to British taxpayers over the next five years. It also means that the UK could theoretically grow a surplus of organic produce, exporting it to countries where demand outstrips supply of organics, just like the current situation here in the UK.

The general public is voting with their cash. More and more people are going organic, with 20% of all UK shoppers buying at least one organic product every week, mostly at their local supermarket. Prices for organic food have been falling dramatically over the last five years as more and more organic food is sold. All of the major supermarkets are competing for your organic custom, with own­brand organic products sitting on the shelf alongside established organic brands. Helen Browning is the owner of Eastbrook Farm, the UK’s leading organic meat farm. Helen warns that we should be on guard about asking for prices which are unreasonably low for the organic farming community.

We are in great danger of seeing the Walmart effect in action on Britain’s organic foods. I really am very worried indeed that we are going to see supermarkets fighting to reduce the price of organic food. That would make it even less profitable for organic farmers to remain in business. The Walmart effect has already made an impact on the UK organic food industry. It already means that supermarkets are importing organic products even when domestic products are available, and that’s likely to happen more and more. We’re trying to sell organic pork products from Eastbrook Farm to multiple retailers. It’s very difficult to compete on price with other countries like Denmark. Danish farmers are being subsidised to a much higher level than we are, and organic standards vary in different member states of the EU. We’re very much in danger of pushing our own organic farmers out of business in a few years time, and trampling the organic sector at this early stage. If we manage to achieve policy changes to the UK’s subsidy system, then these things won’t be quite such a big issue.

Laura Ampomah is the head of organic food at Sainsbury’s consumer PR department. She agrees with Helen that it is vital that we safeguard the future of organic farming by paying a little bit extra for organic food.

Sainsbury’s believes that is has an ethical responsibility to sell organic foods for their true costs. We recognise the real cost of organic production which is generally smaller scale and more labour intensive, sometimes with smaller crop yields. Farmers also have to convert their land to organic production over a period of time, and as organic farming relies on crop rotation, up to 25% of land may be left to lie fallow at any one time to increase natural soil fertility. Sainsbury’s stance is to be responsible and to avoid both profiteering or artificially subsidising the market. Instead of lowering prices which could threaten the livelihood of the farmers, Sainsbury’s is helping farmers to convert to organic production.

It is Sainsbury’s policy to reflect in the price to the customer, the extra costs involved in organic farming and production. Sainsbury’s does not make additional margins on organic foods — the ‘premium’ charged to the customer is in turn passed back through Sainsbury’s suppliers to the farmer. We do not believe it is beneficial to the long term development of organic foods to artificially lower the price or hide the true costs to our customers. Instead we are actively encouraging organic farming in Britain. As the organic market grows we believe prices will stabilise, but it would not be realistic to speculate on timings for this.

So, expect to continue paying a bit more for your organic food for some time to come. But let’s all live in hope that the powers that be listen up to Professor Pretty and the Soil Association so that we can all afford as much organic food as we want.

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