Costco's planned opening in New Zealand is an opportunity for that nation’s organic food producers to break into the US market using the giant retailer's distribution network.
The US has the largest market for organic produce globally, and it's growing rapidly. But with just one percent of US farmland dedicated to organic production there is a gap between demand and supply, said Robyn O'Brien of rePlant Capital, a US company that funds cash-strapped US farmers to convert to organic production.
New Zealand's organic producers have an opportunity to step in and supply the US market, and Costco's recent announcement that it would open a store in Auckland could be one way in, she said.
"I understand that there would be mixed feelings about a large US retailer coming into New Zealand. But it's the largest organic distributor in the US and I think it does present an enormous opportunity. Whether we like it or not we are now part of this global pact.”
There is money to be made in organic exports, she stated last week. In particular, she urged New Zealand to adopt organic standards, especially for export, and said organic farmers need to wake up to the huge market for their produce in the US.
"Eighty percent of US consumers are trying something organic every single day. Seventy-five per cent of our categories in the grocery stores are providing organic choice," she said.
Food Safety Minister Damien O'Connor said that following consultation, a bill was being developed. It was likely to be introduced in the second half of the year, before going to a select committee. O'Connor told Stuff in May that the development of an export standard was paramount to provide certainty to trading partners, and he wanted to see the country positioned as a premium organic producer in the international market place.
According to the Organic Exporters Association, New Zealand exports $140 million worth of fruit and vegetables.