WA Organics Industry: Opportunities, Challenges and Options

    Step 1

    1-on-1 interviews

    Interviews with industry operators are largely completed. These are a core input to this project.

    However, if you think its important for us to hear your views, please still contact and we can arrange an interview.

    Step 2.

    Business survey

    We can't interview everyone in the industry, so all organic and bio-dynamic operators in WA will  receive business survey from us.

    After consulting with industry leaders, we considered it would be better to have one large survey rather than two smaller surveys. These will be distributed soon.

    This survey will ask everyone a standard set of questions about:

    • business details
      • questions to determine the size and nature of the WA organics industry
    • opinions
      • what motivates you to be an organic or bio-dynamic farmer or processor
      • the things that currently constrain your business
      • things that you would like to see improved

    We will ask different questions and in more detail in the 1-on-1 interviews. So its important that everyone also complete the survey.

    Confidentiality

    All information is confidential and will not be released to anyone else in an identifiable manner.

    The information we collect from you is treated as yours. If you want a copy, we will provide it. If you want us to delete it, we will.

    Step 3.

    Workshops

    We have learned quite a bit over the last month from our in-depth interviews with operators across the WA organic and biodynamic industry.

    The next step is to test our findings in sectoral workshops in coming weeks. We would appreciate the attendance of as many operators from each sector as possible to attend these webinars. We really want your feedback!

    Sector

    Date

    Time

    RSVP

    Wine making & viticulture

    Wed 20 October

    4.30pm

    Register

    Horticulture

    Mon 25 October

    4.30pm

    Register

    Broadacre—grain & meat

    Tue 26 October

    4.30pm

    Register

    Processors & retailers

    Wed 27 October

    4.30pm

    Register

    These webinars will be hosted on Microsoft Teams. For the best experience, download the app for your PC from Microsoft (link) or from your app store.

    You may also join the webinar by phone. Simply dial 08 6383 9050 and then enter the phone conference ID 369 533 822#

    Contact us

    Have concerns or just want to tell us something? Feel free to email us at WAorganics@policypartners.com.au or phone 0448 439334.

    About the project

    Policy Partnersw - WA Organics ProjectThe Western Australia Department of Primary Industries and Regional Development has commissioned Policy Partners to review the indicators of maturity and quality of the Organic Industry in WA compared with benchmarks in other States.

    Organic and biodynamic farming

    Organic and biodynamic farming methods aim to produce food using natural substances and processes, leading to an agricultural method with limited environmental impact. It encourages the use of farm-derived renewable resources, the enhancement of biological cycles within the farming system, the maintenance of biodiversity, the preservation of regional ecological balances, the maintenance and increase of soil fertility, and the responsible use and proper care of water. Additionally, organic and biodynamic farming rules encourage a high standard of animal welfare and require farmers to meet the specific behavioural needs of animals.

    Purpose of this project

    WA contributes 26 per cent of the total value of Australian agricultural production, but only contributes around 10 per cent to total Australian production of organic livestock, vegetable, fruit and grains. It also contributes around 14 per cent of eggs, 3 per cent of dairy, 10 per cent of sheep, and 5 per cent of beef.

    Consequently, organic and biodynamic production could be viewed as significantly underdeveloped in WA, when compared with the rest of Australia.

    Furthermore, Australian exports of organic products is growing at around 18 per cent annually. Consequently, WA may be missing out on significant growth potential for its agriculture industries.

    Policy Partners will be engaging with industry to consider the opportunities, challenges and options for development of the WA organics industry.

    Context

    Organic and biodynamic agriculture are production systems that sustain the health of soils, ecosystems and people. They rely on ecological processes, biodiversity and cycles adapted to local conditions, rather than the use of inputs with adverse effects. Organic and biodynamic agriculture combines tradition, innovation and science to benefit the shared environment and promote fair relationships and a good quality of life for all involved.

    Distribution of organic operators in WAThere are around 250 operators in Western Australia who have their production systems certified as organic or biodynamic. These producers are distributed across the State, but the vast majority of operators are located within the region bounded by Perth, Margaret River and Albany. They produce the full range of agricultural products, but using organic or biodynamic systems of production.

    In 2018, it is estimated that there was around 3½ million hectares in WA fully certified organic. This represents about 10 per cent of total agricultural land. A further 1 million hectares was in the process of conversion to organic (Australian Organic Market Report 2019).

    WA contributes around 10 per cent to total Australian production of organic livestock, vegetable, fruit and grains. It also contributes around 14 per cent of eggs, 3 per cent of dairy, 10 per cent of sheep, and only 5 per cent of beef (Australian Organic Market Report 2019). In comparison, WA contributes 26 per cent of the total value of Australian agricultural production (Australian Bureau of Statistics, Value of Agricultural Commodities Produced, Australia, 2018-19).

    Organic products grown and manufactured in Australia are exported to 61 countries, with new markets opening up in South America, Oceania, Africa, the Middle East and Europe. Key export markets for Australian organic food are the United States, Europe, China (including Hong Kong) and the Republic of Korea. Exports of organic products have been growing strongly, with tonnages up 13 per cent in 2018 (Australian Organic Market Report 2019).

    So organic production could be viewed as significantly underdeveloped in WA, when compared with the rest of Australia. And consequently, WA is missing out on significant growth potential for its agriculture industries.

    Challenges

    Anecdotal feedback from organic and biodynamic producers in WA indicates that they face significant disadvantages in comparison with conventional producers in the State, but also in comparison with organic producers in other States.

    • WA has a relatively small domestic market and locational disadvantages in respect of supplying the larger population centres on Australia’s eastern coast.
    • The supply chain for many organic products is relatively undeveloped, particularly for many broadacre products. There are significant problems relating to lack of scale in the handling of grains, for example.
    • The lack of scale also aggravates problems with poor continuity in supply of produce.
    • There is a lack of agglomeration benefits, exacerbated by the vast area of the State and a relative focus on broadacre agriculture. In addition, support networks are very difficult to maintain.
    • The costs of conversion to organic production are significant, and there is no premium in the price received during the long period of conversion. The premium received for organic products after conversion is often not sufficient to compensate for the higher production costs and the conversion period. Consequently, organic production is often adopted for philosophical or lifestyle reasons, rather than for commercial reasons.
    • A GMO contamination court case (WA Supreme Court 2014, Marsh v Baxter) denied compensation for an organic grain producer whose certification was revoked when his crop was found to have been contaminated by GMO canola from a neighbouring farm. While the issues are complex, the regulatory and legal frameworks were seen by organic producers and potential converters as not being supportive, and significantly elevated the perceived risks of organic production.

    Some of the challenges facing the WA organic sector could be characterised as similar to those facing conventional producers, but the issues are more intense due to the lack of scale, and there are also additional sector specific issues.

    Opportunities

    DPIRD has commissioned several substantive reports in the area of premium products and market opportunities. The organic sector is not covered explicitly in these reports, but is acknowledged as one being one premium market with significantly marketing opportunities. These good quality reports provide a useful base from which to consider the implications and challenges for the organic sector specifically.

    Our approach

    This DPIRD project is seeking a consolidated understanding and quantification of the potential opportunities for growth of organic production and processing in WA based on specific competitive advantage and industry profile.

    Ultimately, we view the question as being about how the WA Government can support the organic sector to succeed in harnessing the available market opportunities, and what strategies the industry can itself adopt to succeed.

    Synthesis of evidence, analysis, expert opinion, and producer perspectives will underpin this project.

    Our report will focus on the insights attained from stakeholders and a strategy for improved sector performance.

    Engagement

    Stakeholder engagement will occur once the Covid situation becomes settled, and will include regional workshops and video conferences, targeted interviews with key players, and surveys.

    We are engaging with the WA organic industry with assistance from the industry associations in WA - COBWA and OAWA.

     

     

    These are the themes that we are researching during our project.

    The themes aren't exhaustive. As new issues come to light, we will add them as themes to investigate.

    If you are making a written submission, you may like to address these themes.

    If you are being interviewed, these are the types of questions we may ask you (but each interview is tailored to the person being interviewed).

    Experiences with organic and biodynamic production

    • How long have you been farming / producing
    • For how much of that time have you been organic / biodynamic
    • What was your motivation / what still motivates you
    • How did you find the conversion process
    • Dealing with nutrient deficiency - nitrogen / phosphorous
    • Dealing with weeds and pests - experience with integrated weed & pest management
    • If biodynamic, what is your view of the relationship with organic
    • Do you have any regrets about being an organic / biodynamic producer
    • Is your financial profitability higher compared with non-organic

    Production experience

    • Where does your production go (consumer ready/export/processors)
    • How close to maximum capacity do you operate
    • How much production is not sold / sources of wastage
    • How could collaboration (industry or government) alleviate this

    Constraints facing the business

    • Consumer demand
    • Farm gate prices
    • Export markets
    • Industry peak body support
    • Industry regulation
    • Certifier
    • Agronomist
    • Research & Development Corporation
    • Competition from organic operators / non-organic operators
    • Proximity to similar producer / transport / suppliers

    Enablers needed by the business

    • Consumer demand
    • Farm gate prices
    • Export markets
    • Industry peak body support
    • Industry regulation
    • Certifier
    • Agronomist
    • Research & Development Corporation
    • Collaboration with organic operators / non-organic operators
    • Proximity to similar producer / transport / suppliers

    Experience with the supply chain

    • high level of vertical integration of WA farms
    • on-farm processing
    • value-adding processes
    • distribution arrangements
    • connection with retail

    Any new opportunities for organic production in WA

    • supply chain bottlenecks to overcome
    • lack of processors / on-farm processing
    • collaboration between organic operators
    • export opportunities
    • supermarket opportunities

    Experience with supermarkets

    • deal directly or through a distributor
    • how to satisfy expected quality / reliability / quantity
    • any wastage due to this arrangement
    • packaging
    • shelf space
    • retail pricing / product price / margins
    • what is the potential for substitution of imports from overseas / other States

    Experience with exporting

    • export logistics
      • dealing directly / Australian handler / export country distributor
      • satisfying expected quality / reliability / quantity
      • transport / handling / logistic problems
      • dealing with importing country regulatory requirements
      • packaging
      • shelf space
      • retail pricing / product pricing / margins
    • strategy
      • engaging export-related service providers
      • have an export marketing plan with defined targets and strategies
      • reliable and up-to-date research about target markets
      • current export markets
      • market access issues
      • which markets to target / where does market intelligence come from
    • production issues
      • staff dedicated to exporting / proportion of staff time devoted
      • any wastage due to exporting
      • exports turnover (proportion of total turnover)

    Governments as constraints or enablers of business growth and industry growth

    • how does WA Government enable your business
      • access to grant programs
      • supportive regulations
      • export facilitation / market access assistance
      • information services
      • agronomy services
    • how does the Australian Government enable your business
    • how do governments act as constraints on your business
      • WA Government
      • Australian Government
    • what is your experience with DPIRD

    Sustainability

    Do you think there is a significant difference between:

    • organic and regenerative
    • organic and sustainable
    • organic and biodynamic

    Register

    Register your details on our mailing list for this project. We will keep you informed about workshops, our progress and reports.

    You can also lodge a submission for us to consider, submit an article or report for us to review, or simply leave us a message.

    Further information

    Further information will be available on this website as it becomes available. We will also provide updates during the project to our mailing list.

    If you would like to contact us about the project, you can also email us or phone Tony Webster on 0448-439334.