The organic industry is currently experiencing the most significant regulatory discussion since the national standard was established 20 years ago. Niki Ford, CEO of Australian Organic Limited, explains.
Australia’s certified organic sector contributes over $2 billion to the national economy each year and continues to grow at a rapid pace as consumers make conscious choices to improve their health and well-being, while taking into account the long-term sustainability of the planet.
This dynamic sector produces fresh fruits and vegetables, animal products, honey, pantry items, wine, beverages, cosmetics, skin care and pet food, among others, and covers supply chains from production to manufacturing and retail outlets.
The reach of organic across the food and lifestyle segments, both domestically and internationally, is expanding, but the current absence of a unified and legal definition of ‘organic’ in Australia , and weak requirements surrounding labeling a product as “organic”, sows confusion and mistrust. for buyers and undermines trust.
Additionally, without a mandatory national standard, Australian exporters face incredible bureaucracy and economic burden as they must meet secondary organic standard requirements for each country they wish to trade in, adding additional operational costs. every year.
Good start, stagnant present
Australian Organic Limited (AOL), the leading body in the organic sector, is committed to working with the Australian Government to put in place a regulatory process that is fit for purpose and compliant with export requirements.
The organic industry is currently in the process of the most significant regulatory discussion since the National Standard for Organic and Biodynamic Products (the National Standard) was introduced in 1992, imposing mandatory requirements for Australian organic or biodynamic products. intended for export.
The Australian government published a second edition of the national standard in 1998, and since its inception, the national standard has provided the organic industry with a framework that sets out comprehensive requirements for production, processing, supply chains, labeling and imports before a product can be certified organic.
In Australia, there are six recognized accredited certification bodies that can confirm that organic operators meet the national standard to achieve organic certification, with the operation undergoing rigorous audits each year to maintain its certification.
While the national standard was, and still is, a world-leading document requiring products claiming to be organic to be certified before they can be exported, its biggest shortcoming was that it was not made mandatory for domestic sales. of organic products.
This means that there are currently no mandatory standard requirements or regulations that operators must meet – across production, processing, supply chains and even labeling – in order to sell products in Australia that claim be organic.
However, over 3,000 operators in Australia voluntarily adhere to the framework set out in the national standard for their domestic sales, recognizing that organic certification adds credibility to their product and helps build trust with consumers.
As demand for organic products has continued to grow, it has become clear that the lack of national regulation poses three main problems for Australian organic operators:
1. Consumer confidence
In the absence of a mandatory national standard for the use of the term ‘organic’, it is not necessary for an operator to be certified to sell organic products in Australia. This means that non-certified operators can make organic claims on packaging and marketing without obtaining certification.
Last year, the Australian Organic Market Report found that 31% of shoppers who had purchased an organic product in the previous year thought they had been misled by organic claims on the product’s packaging.
National regulations will ensure that all organic claims on product labeling are genuine and provide consumers with greater confidence when choosing to purchase organic products.
2. Operator credibility
Obtaining organic certification requires a significant commitment from operators both commercially and systematically.
Due to the lack of national regulations, non-certified operators claiming to be organic may use chemicals or practices that are not permitted by organic standards, but they still sell their product at a premium. This undermines the credibility of operators who do the right thing and then spend more time on education and awareness instead of developing their markets.
3. Market access
Through the National Standard, Australia has government-to-government (equivalency) agreements with various countries, including the European Union, Japan and Taiwan, but without a mandatory National Standard, key trading partners such that the United States, Canada and Korea will not. recognize Australia’s current domestic framework through equivalence agreements, as domestic market requirements are not compatible with export market requirements.
Without these agreements, producers are forced to enter into agreements with different certifiers and pay separate fees to comply with the specific regulations of each country to which they export.
A mandatory national standard will provide organic producers with much-needed efficiency and certainty, helping them to be more competitive in export markets.
Although there are many national regulatory options, AOL’s recommendation is to legislate the National Standard at the national level as the best way forward given that it is already widely used and understood by many Australian organic operators. In addition, our current trading framework is based on the standard held by the Australian government.
Implementing the national standard at the national level will solve the three main problems facing the organic industry: consumer confidence, operator credibility and market access.
Path to regulation
Since February 2019, AOL has been working with the Australian government, relevant departments and agencies, and industry stakeholders to advocate for national regulation of the organic industry.
The first major step towards national regulation was taken in December 2020, with the creation of the Organic Industry Advisory Group (OIAG), made up of producers and organic industry stakeholders. The BIAG met regularly in the first six months of 2021, with a significant majority identifying legislation as the preferred option for national regulation.
Since that time, a formal consultation process involving the GCOI, as well as industry and consumers, has taken place. This has included public consultation via business and consumer surveys and roundtables with organic industry and border stakeholders.
In February 2022, a Regulatory Impact Assessment process was announced, allowing stakeholders to comment on proposed regulatory options.
A report compiling responses to the consultation process is being finalized by the Federal Ministry of Agriculture, Water and Environment, but as the federal elections have now been called, all ministries are in interim mode. and the results should not be published. until later this year.
The steps taken so far are positive for Australia’s organic industry, as well as the many consumers who are actively seeking a lifestyle supported by genuine, genuine organic products.
On behalf of its members, AOL looks forward to the recommendations and successful implementation of national regulations for the organic industry.
In the absence of a mandatory national standard, AOL strongly encourages consumers to check the product label for organic certification. The “Bud” certification logo is the most trusted organic logo in Australia. It is recognized by 62% of shoppers and can be found on over 32,000 products in supermarkets, bottle shops and local farmers markets.
More information on domestic regulation of the organic industry is available at austorganic.com/industry/domestic-regulation.