The supply chain and conversion to organic farming in Belgium or the story of the egg and the chicken

Summary

Organic products form a growing segment of the food market. Recent estimates speak about market shares between 1 to 4.25 per cent. In Belgium the share is only 1 per cent, but the market is growing exponentially. Organic farmers in Belgium often have to sell their products as conventional products because of non-efficient marketing systems. Marketing problems are also mentioned as one of the main reasons by conventional farmers for not converting. Most conventional farmers are not only rather sceptical about the long-term perspectives of getting a price premium for organic products, but consider the organisation of the supply chain as one of the main sources of uncertainty and therefore as a constraint for conversion. Therefore more efforts should be made to organise the supply chain for organic products. The problem seems to be that of the egg and the chicken: for a cost-effective supply chain a condition is to have enough producers, while for a lot of producers a cost-effective swupply chain seems to be a necessary condition to convert, mainly because of high transaction costs linked to non-efficient marketing.