North American organic produce update report

Organic produce premiums under pressure

In a recent Rabobank report, experts forecast that organic produce production will continue to increase, and for long-run opportunities to continue to exist in the space. Driven by consumer and retailer-centric demand forces and regulatory pressures that favor organic production, growers will have to continue to adapt to effectively take advantage of changes in the market.

Roland Fumasi, Senior Analyst Fresh Produce: “It is imperative that producers continue to adapt their production strategies. Organic produce availability has now become mainstream, which means that the organic produce market will continue to more closely resemble the traditionally-grown produce market. In short, price strength – or weakness – has/will become most heavily influenced by supply-side gaps and gluts.”

“Technological advances and continued changes/improvements in production practices/knowledge will help ensure long-run profitability for adaptive suppliers. Figuring out how to produce organically, at a unit cost that is similar to conventional production, is the elusive, but long-run goal.”

Source: research.rabobank.com


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