5 Analysis of ten organic product markets in Europe in 2001
5.2 The organic potato market
5.2.7 Prices for organic potatoes
Farmer prices for organic potatoes are presented in Figure 5-15. All investigated countries reported farmer prices with the exception of France and Portugal. Ireland was the EU country with the highest farmer price. This might be explained by the fact that Ireland strongly relies on imports of organic potatoes. The degree of self-sufficiency for organic potatoes was only 61 percent in 2001. However, in the United Kingdom the degree of self-sufficiency was similarly low; nevertheless the farmer price reported from this country was much lower than that surveyed in Ireland. It is striking that the southern European countries Spain, Greece and Italy reported farmer prices more than 20 percent above the EU average of 32 €/100 kg. In these countries, a broad part of potato production was early potatoes which were sold at higher prices than late potatoes. Farmer prices more than 20 percent below the EU average were reported from Germany, Denmark and the Netherlands which are typical potato producing and consuming countries. Germany and Denmark were net exporters for organic potatoes in 2001.
Figure 5-15 Farmer prices for organic and conventional potatoes in €/100 kg in 2001
70 64
55
44
40 39 35
32 32
26 25 24
21 32
80
26 72
59
0 10 20 30 40 50 60 70 80 90
IE GR IT FI LU ES AT SE UK BE DE DK NL EU SI CZ CH NO
Organic farmer price Conventional farmer price --- = 20% above or below the EU average
The organic potato market
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The farmer price premiums for organic potatoes are shown in Figure 5-16. The lowest price premiums were obtained by Sweden, Luxembourg and Ireland with 71 to 75 percent, whereas the highest price premiums were registered in Slovenia, where 100 percent of the domestic organic potato production was sold directly to consumers, and in Italy and Austria with nearly 300 percent. In 2001, the same EU average farmer price for organic potatoes, 32 €/100kg, was obtained as in the year 2000. However, in the year 2000 there was an above average harvest of potatoes and therefore the conventional potato prices were extremely low. This led to a high price premium for organic potatoes over conventional potatoes of 257 percent. In contrast to the conventional price for potatoes, the organic price does not vary much from year to year, regardless of whether it was an extremely good or bad harvest. In 2001 the total potato harvest of the EU was only 88 percent of the EU harvest in 2000. Therefore farmer prices for conventional potatoes were clearly higher than in 2000 and this translated into the lower price premium for organic potatoes in 2001 in comparison to 2000.
Figure 5-16 Farmer price premiums for organic over conventional potato prices in percent in 2001
293 285
220 153
125 110 102
92 90 88
75 74 71
166 586
80 144
61
0 100 200 300 400 500 600
IT AT GR DE DK NL FI BE UK ES IE LU SE EU SI CZ CH NO
--- = 20% above or below the EU average
The organic potato market
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In Table 5-5 the consumer prices for organic potatoes in the year 2001 are presented. The EU average price for potatoes was 1.44 €/kg. Organic potatoes were the most expensive in Denmark and the United Kingdom. In Finland, the Netherlands and Sweden potatoes were more than 20 percent cheaper than the EU average price. Comparing organic farmer and consumer prices, it does not necessarily follow that in a country with high farmer prices the consumer price would also be above the EU average price. In Finland, for example, the opposite occurred. Finnish organic potatoes were the cheapest in the entire EU in 2001 despite high organic producer prices.
Table 5-5 Consumer prices for organic potatoes in €/kg in 2001
Country Potatoes
EU countries
AT 1.28
BE 1.56
DE 1.27 1
DK 1.74 t
ES nd
FI 0.91 u
FR 1.60
GR 1.17
IE 1.69
IT 1.58
LU 1.39
NL 1.13 u
PT 1.46
SE 0.97 u
UK 1.87 t
Weighted
EU average2 1.44
Accession countries
CZ 0.44
SI 0.18
EFTA countries
CH 2.42
NO 2.46
t = more than 20% above the EU average u = more than 20% below the EU average
1 Figure from the Zentrale Markt- und Preisberichtstelle ZMP
2 Weighted by organic consumption
The organic potato market
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Table 5-6 shows the consumer price premiums for organic over conventional potato prices.
On average, organic potatoes were almost twice as expensive as conventional potatoes in the fifteen EU countries in 2001. However, the surveyed values for the individual countries showed a large variation from one percent in the United Kingdom up to 273 percent in the Netherlands.
Table 5-6 Consumer price premiums for organic potatoes in percent in 2001
Country Potatoes
EU countries
AT 34 u
BE 105
DE 143 1t
DK 13 u
ES nd
FI 99
FR 61 u
GR 122 t
IE 11 u
IT 54 u
LU 64 u
NL 273 t
PT 124 t
SE 71 u
UK 1 u
Weighted
EU average2 91
Accession countries
CZ 26
SI 33
EFTA countries
CH 104
NO 39
t = more than 20% above the EU average u = more than 20% below the EU average
1 Figure from the Zentrale Markt- und Preisberichtstelle ZMP
2 Weighted by organic consumption
Especially low consumer price premiums for organic potatoes were surveyed in the United Kingdom, Ireland and Denmark. In the United Kingdom and in Ireland the import shares for both organic and conventional potatoes were high (see chapter 5.2.5 and BMVEL 2005, p.
479). Imported conventional potatoes were expensive due to the transport costs, and therefore it was not possible to sell organic potatoes with a high price premium. A large difference between the conventional and the organic consumer price of such a mass product would not have been accepted by consumers. A third reason influencing the price premiums of organic over conventional potato prices is the importance of different sales channels. In the United Kingdom, more than 70 percent of the organic potato sales refer to general food shops, where the price difference between organic and conventional products are in general lower than in other sales channels. Especially high consumer price premiums were reported from the
The organic potato market
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Netherlands, Germany, Portugal and Greece. In Germany, this can be explained by the fact that less than 40 percent of all organic potato sales fell upon general food shops, whereas the largest part was sold in organic food shops or directly from farmers. In Portugal and Greece the domestic sales of organic products were still very limited in 2001.
Looking at the consumer price premium for organic potatoes in Finland, this was slightly above the EU average price premium. In Table 5-5 a very low consumer price for Finnish organic potatoes was presented. Although this price was the lowest among all EU countries, it was still twice as high as the price for conventional potatoes in Finland. Therefore, the low consumer price for organic potatoes in Finland can be seen as a consequence of very low consumer prices for conventional potatoes in this country. If Finnish organic potatoes were more expensive, the difference to the conventional potato price would have been too large.
The high organic price premium over the conventional price would have acted as a deterrent to consumers.
The organic vegetable market
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