Organic product export expected to surge

New Delhi: Export of organically made products, both food and nonfood, is likely to grow threefold in the four years to 2020, following the government's relaxation on quota limits.

According to the Agricultural & Processed Food Products Export Development Authority (Apeda), Indian farmers produced around 1.35 million tonnes (mt) of certified organic products in 2015-16 which include all varieties of food products namely sugarcane. Of this, export was 263,687 tonnes, worth $298 million (~1,900 crore).

Through a notification dated April 19, the Directorate General of Foreign Trade liberalised the quantitative restrictions on export of such products.

“Perhaps the government had imposed such restrictions for ensuring food security at home. But, these were only discouraging farmers from intensifying work on organic products. We, therefore, had urged the government to liberalise the restrictions,” said Manoj Menon, executive director of Indian Competence Centre for Organic Agriculture, a Bengalurubased network.

It believes the overall market of ~4,000 crore under the organic value chain would hit ~10,000 to 12,000 crore by 2020, with similar increase in export.

While export of organic wheat, non-basmati rice, edible oils and sugar have been exempted from all annual quantitative ceilings with immediate effect, those on pulses and lentils has been increased from 10,000 tonnes to 50,000 tonnes.

Farmer export is largely to Europe, Canada and West Asia. Oilseeds were half of India’s overall organic export, followed by processed food products at 25 per cent.

“Farmers tend to see low productivity and thereby low income for at least three years if they switch, from conventional or hybrid farming. Since organic farming does not use chemicals and fertiliser, the only way farmers can be compensated is through premiums for their produce. In fact, Indian organic products like tea, vegetables and pulses fetch much higher premium from markets abroad than conventional and hybrid products there,” said a senior industry official. The difference is up to 100 per cent.

With around 50 per cent of market share, America is the biggest market for global organic produce, worth $80 billion. The area under organic certification in India was 5.71 million hectares in 201516. Of this, about a fourth (1.49 million hectares) was cultivated area and the rest (4.22 million hectares) came under forest and wild areas, used for collection of minor forest produce.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.