Global demand for organic products is rising with increasing health consciousness
Melbourne, Australia (PRWEB) June 16, 2012
Organic farming is a blossoming industry. Global demand for organic products is rising with increasing health consciousness, growing concern for the environment, income growth and the increased convenience of organic food. Over the five years through 2011-12, Organic Farming industry revenue is expected to grow an average 11.6% per year. Industry revenue in 2011-12 is forecast to reach $503.8 million, a growth of 9.0% from the previous year. According to IBISWorld industry analyst Kiera Outlaw, “the industry's key products are fruit and vegetables at about 51.5% of total value, beef and poultry”.
Australia has the largest area of organic farmland in the world at 12 million hectares, with the vast majority of this land comprising large rangelands for organic cattle production. However, the Organic Farming industry is comprised mainly of small operators, which has contributed to difficulties in providing consistency in the quantity and quality of produce. Outlaw adds, “other dampeners to growth have been intermittent drought conditions over the past five years”. Despite this, over the five years through 2011-12, revenue in the industry has remained resilient. The industry will continue to grow strongly over the next five years, favoured by strong demand in domestic and export markets. Over this period, there will be increasing participation by supermarket chains in the organic market, downwards pressure on prices from growing economies of scale in production, and benefits from improvements in the certification of organic produce. Farm gate revenue growth will come from increased production rather than higher prices.
The low level of concentration in the Organic Farming industry corresponds with the low level of concentration in the agriculture sector in Australia generally. The level of concentration by segment varies, but falls once a segment has become established. For instance, the concentration in the well-developed vegetable segment is low, while the concentration in the very small aquaculture segment is higher due to the entry of few farms at this stage. The only major player in the industry is OBE Beef.
For more information, visit IBISWorld’s Organic Farming report in Australia industry page.
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IBISWorld industry Report Key Topics
The Organic Farming industry in Australia includes farms that primarily produce organic fruit and vegetables, grains, other crops or livestock. Organic farming does not involve the use of artificial chemicals, pesticides and fertilisers, or genetically modified organisms. This report focuses on organic producers who are certified organic by any of the organic certification organisations.
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Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.