Natural on the Coat-tails of Organic Mar 5, 2011

Transcription

1 Natural on the Coat-tails of Organic Mar 5, 2011 Dag Falck Organic Program Manager Nature s s Path Foods Inc. dfalck@naturespath.com

2 Organic is in a race Organic is in the lead, fair trade and Non GMO is closing in, while local and pesticide free is lumbering just ahead of kosher. But who is this, a fast and sneaky runnersomeone we haven t paid enough attention to yet, - Natural - coming up and fast is he overtaking organic? This is going to be a close race

3 Organic Movement Response to a problem Ideals Action Certification Protect health of Farmer and Eaters Protect health of Environment

4 Canadian Organic Regime CFIA-AAFC COO 6 FTE s Accreditors Organic Federation of Canada $ 0.56 mil Certifiers (CB) ORGANIC ROUND- TABLE Organic Products Regulation FARMERS PRODUCERS $ 0.36 mil CGSB Standard & PSL (Technical committee) $ per

5 Canadian Organic Regime Private sector and Provinces: Accreditors Organic Agriculture Centre of Canada Certifiers (CB) Canadian Organic Growers Canadian OTA Canadian Health Food Association FARMERS PRODUCERS Provincial Programs

6 Natural Label No Movement No Standard Poor Definitions No Ideals or Goals

7 Natural Label The Canadian Food Inspection Agency Guide to Food Labelling and Advertising, section 4.7, states: "Nature", "natural", "Mother Nature", "Nature's Way" are terms often misused on labels and in advertisements. Advertisements should not convey the impression that "Nature" has, by some miraculous process, made some foods nutritionally superior to others or has engineered some foods specially to take care of human needs. Some consumers may consider foods described as "natural" of greater worth than foods not so described.

8 Confusion Eaters Consumers should know that agricultural ingredients used in a finished Natural product are and cost exactly the same as ingredients in a conventional product

9 Only about a half percent of all farmland in North America is dedicated to organic crops. In 2008 NATURE S PATH bought 2,240 ACRES adjacent to organic farmers to increase organic acreage and to secure organic supply. Soft White Wheat

10 Hartman Group report reveals significant confusion

11 The Confusion Equals: Eater/Consumer deception increased environmental contamination financial loss to organic farmers

12 Checking peas for nitrogen fixing nodules

13 Consumer Deception CBC: Almost half of Canadians believe it is more important a food be labelled natural than organic, even though organic foods are more heavily regulated, a new survey suggests. product- safety.html#ixzz0ppcztelx

14 Helpful Eaters need this information!

15 Increased Environmental Contamination Tons of chemical fertilizer used: pounds/year/acre of synthetic fertilizers (produced with fossil fuel) US: National Agricultural Statistics Service USDA, 2000 Canada: Table 30 A of International Fertilizer Development Center's report, North America Fertilizer Situation, November Nature s Path saved 13.5 million pounds of fertilizer in 2008

16 Increased Environmental Contamination Tons of toxic pesticide used: 5.4 pounds/year/acre of the active ingredient in pesticides US: May 2001 Agricultural Chemical Usage 2000 Field Crops Summary, National Agricultural Statistics Service. Canada: Fact-sheet Pesticides Alberta Department of Environment, Oct 2001 Nature s Path saved 185,000 pounds of pesticides in 2008

17 Increased Environmental Contamination Over 23 years, there s been a 15 to 28% increase in soil carbon in organic systems, with virtually no increase in non-organic systems. The Rodale Institute Farming Systems Trial (FST)

18 Dollar Growth Rate for Natural Products Surpassed Organic Products Growth Rate in Dec 2008 in Natural Supermarkets The natural products growth rate has continued to exceed organic growth rate since Dec 2008 through today with the exception of one period (June 2010). 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 4WE 2008-Jan-26 4WE 2008-Feb-23 4WE 2008-Mar-22 4WE 2008-Apr-19 4WE 2008-May-17 4WE 2008-Jun-14 4WE 2008-Jul-12 4WE 2008-Aug-09 4WE 2008-Sep-06 4WE 2008-Oct-04 4WE 2008-Nov-01 4WE 2008-Nov-29 4WE 2008-Dec-27 4WE 2009-Jan-24 4WE 2009-Feb-21 4WE 2009-Mar-21 4WE 2009-Apr-18 4WE 2009-May-16 4WE 2009-Jun-13 4WE 2009-Jul-11 4WE 2009-Aug-08 4WE 2009-Sep-05 4WE 2009-Oct-03 4WE 2009-Oct-31 4WE 2009-Nov-28 4WE 2009-Dec-26 4WE 2010-Jan-23 4WE 2010-Feb-20 4WE 2010-Mar-20 4WE 2010-Apr-17 4WE 2010-May-15 4WE 2010-Jun-12 4WE 2010-Jul-10 4WE 2010-Aug-07 4WE 2010-Sep-04 RECESSION START $ % Grow th Rate % Organic vs Natural TTL NATURAL FROZ GROC PROD & REF TTL % ORGANIC FROZ GROC PROD & REF Source: SPINSscan Natural TUS 2008 through 9/4/10; Natural=items with no organic content; organic=95%-100% organic Departments included: Frozen, Grocery, Packaged Produce and Refrigerated

19 Unit Growth Has Increased For Both Natural And Organic Products in 2010 in FDM Despite sluggish $ growth figures, organic volume growth started positive volume growth recovery in October 09 Natural has been growing single digits since March 09 The gap between natural and organic growth is diminishing 20.0% 15.0% 10.0% Unit % Grow th Rate % Organic vs Natural 5.0% 0.0% (5.0%) (10.0%) 4WE 01/26/08 4WE 02/23/08 4WE 03/22/08 4WE 04/19/08 4WE 05/17/08 4WE 06/14/08 4WE 07/12/08 4WE 08/09/08 4WE 09/06/08 4WE 10/04/08 4WE 11/01/08 4WE 11/29/08 4WE 12/27/08 4WE 01/24/09 4WE 02/21/09 4WE 03/21/09 4WE 04/18/09 4WE 05/16/09 4WE 06/13/09 4WE 07/11/09 4WE 08/08/09 4WE 09/05/09 4WE 10/03/09 4WE 10/31/09 4WE 11/28/09 4WE 12/26/09 4WE 01/23/10 4WE 02/20/10 4WE 03/20/10 4WE 04/17/10 4WE 05/15/10 4WE 06/12/10 4WE 07/10/10 4WE 08/07/10 4WE 09/04/10 RECESSION START TTL NATURAL FROZ GROC PROD & REF TTL % ORGANIC FROZ GROC PROD & REF (Food Drug Mass, Natural and Organic products) Source: SPINSscan Conventional TUS FDM Combined through 9/4/10; Natural=items with no organic content; organic=95%-100% organic Departments included: Frozen, Grocery, Packaged Produce and Refrigerated

20 Natural Stepping Stones Good companies supporting organic missions Versus Companies focused on profit at the cost of the Organic mission riding the coat tails of the organic success.

21 Ben & Jerry's (owned by Unilever) Sept. 27, 2010 One company took the stand to remove ALL NATURAL from their label. But the product is still labelled All Natural. They were pressured by a health advocacy group: The Center for Science in the Public Interest Product contains alkalized cocoa, corn syrup, hydrogenated oil or other ingredients that are not natural.

22 CONCLUSION: Natural should be Organic People already thinks it is There is no reasonable step between Conventional and Organic

23 What Organic Farmers Can Do Don t t lend strength to a bogus claim Don t t allow natural to compete with your product Tell your organizations to demand - Natural become Organic

24 Organic Business Realities Conventional Markets Transportation costs Currency impacts price Competing Countries Production Government policy Government policy Consumer Confusion and the Substitution of Organics by NATURAL

25 Threat of Threat of Substitution

26 Organic United Kingdom Campaign a mixture of PR, advertising and on line promotion. Steering Group comprised of Key Organizations representing Farmers, Certifiers, Retailers, and Manufacturers. Goal 15% per annum growth in organic sales following the three year campaign. Learn more at:

27 Organic United Kingdom

28 Organic United Kingdom More Natural food When it comes to organic, you know exactly what s in your food. GM crops and ingredients are banned in organic farming as are hydrogenated fats, artificial pesticides and it does not allow aspartame, tartrazine and monosodium glutamate to be used. Put simply organic food is a more natural choice.

29 COTA is targeting consumers launched in U.S., COTA considering an optimized Canadian campaign to target natural & eco launched in Canada to provide consumer basic info on Canada Organic, standards, etc. launched October 2010 to promote and celebrate organics in Canada, 250 partners across Canada Globe and Mail special report published nationally to market organic

30 COTA - Addressing the Natural issue COTA developed Natural White Paper with market data, consumer surveys, farmer and processor perspectives, and regulatory information Contact COTA : Matt Holmes / mholmes@ota.com

31 What You Need to Do Farmers need to be a part of the solution, BECOME VOCAL! Speak to your MLA and MP