Rising cost of non-organic crops bodes well for organic ingredient providers

By Simon Pitman

- Last updated on GMT

Related tags: Soil association

The rising cost of chemical fertilizers is likely to give organic ingredients providers pricing advantages, the UK Soil Association says.

Not only are the fossil-based chemical fertilizers that conventional farmers use being discouraged, the fact that these fertilizers have undergone huge price increases is having a favourable impact on organic ingredient providers.

Increased cost of fossil based fertilizers

“Non-organic farmers are suffering as a result of huge increases in fossil based fertilizers, which has certainly had a clear influence on rising food prices in the UK,”​ said Sam Allen, spokesperson for the Soil Association.

“This will affect all ingredients providers and is likely to have a positive impact on organic ingredients providers, even in the personal care segment, making these ingredients more competitive”​ she added.

The Soil Association underlines the fact that in the course of the last year some chemical fertilizers have doubled in price, adding significantly to the price of farming conventionally produced crops.

Organic / non-organic price gap closing

As a consequence, the association points out that the price differential between organic and non-organic products is diminishing – or in some more extreme examples the difference is now non-existent.

In the face of economic volatility, this is likely to contribute favourably to organic personal care manufacturers as they will be more likely to benefit from cost advantages that will allow them to price their products competitively, an important factor considering the increasingly price sensitive conditions.

This week the Soil Association revealed that sales of organic health and beauty products in the UK rose by 69 per cent to £27m, despite the economic turmoil which hit in the last six months of the year.

The figures suggest, that despite tough retail conditions and the premium that consumers often have to pay for organic beauty products, consumers are remaining loyal to principles associated with ethical and environmentally responsible consumption patterns.

Related topics: Market Trends

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