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Leonie Dendler and Paul Dewick
GRF SPaC conference
Fudan University
09.06.2014
Institutionalisation of organic labelling in the People’s Republic of China
Overview
1. Background
2. Empirical Base
3. Theoretical Framework
4. Preliminary Findings
5. Preliminary Conclusion
Background
Product Labelling in China
• China has become increasingly involved in a movement towards more Sustainable Consumption and Production.
• Product labelling has been a prominent part of that movement.
Organic Labelling in China
• China is on 3rd position in terms of total organic agricultural land (Lernoud et al. 2013).
• Organic the fastest growing sector of Chinese agricultural production (Ken Research 2013).
• However, organic sector still in “early infancy” (Thøgersen and Zhou 2012) comprising less than 1% of agricultural land in China.
• Differences across supply chains!
Focus on potato and dairy.
Potato versus Dairy Supply Chain
• Dairy • Growing consumption of a variety of processed products. • Powerful position for manufacturers. • Little role for retailers. • Increasing vertical and horizontal integration on farm and
manufacturer level following the 2008 melamine scandal. • Import over export.
• Potato • Growing consumption mainly in fresh form. • ~10% used for processing (mainly starch) (Hermansen et al. 2012). • Slightly greater (growing) role for (large) retailers and quick service
restaurants (Mc Donald etc.). • China is the world largest potato producer and consumer with
production across the whole country mainly from small scale farms on marginal land (Scott et al. 2012; Meador et al. 2013).
• (Small) import of processed and (modest) export of fresh potatoes (mainly to Malaysia, Vietnam, Russia; Japan for FFF).
Empirics
Empirics
• Secondary literature review (Jan 13 – Mar 14).
• Documentary analysis (Jan 13 – Mar 14).
• Several site and fair visits and participation in relevant events (Mar 13 - Mar 14).
• Over 45 interviews with governmental, production, manufacturing, retail, certification and university experts (April 13-Mar 14).
Theoretical Framework
Theoretical Framework
Media NGO
Government
Professional Buyer
Civil Societal Groups
Individual Consumer
Primary Production
Manufacturing
Trade & Transport
Retail
Norm
a&ve, Pragm
a&c &
Rela&
onal Legi&macy
Norm
a&ve, Pragm
a&c &
Rela&
onal Legi&macy
• Traditional • Charisma • Regulatory • Knowledge • Procedural • Consequential Supply
relations
Consumer relations
• Traditional • Charisma • Regulatory • Knowledge • Procedural • Consequential
Institutionalization Commonalities and Differences
Traditional and regulatory legitimacy
• Alignment legally enforced for all products using the word organic and the mark of China Organic Product Certification in dairy and potato.
• Some (limited) promotion amongst consumers and governmental employees for dairy and potato.
• Some coercion of primary producers for dairy and potato.
• Some alignment of (partly) governmental primary producers in dairy and potato.
Some support on national governmental level (e.g. integration into promotional scheme) but generally comparatively lower support.
Consequential legitimacy
Consumers
• Negative price barriers. • Positive Food Safety and health concerns (more important than
environmental protection) in reaction to food scandals and pesticide discourse.
• Greater discursive prominence of food safety issues in dairy.
• Health value and social “status” greater in dairy facilitated by major dairy manufacturers.
Manufacturers
• High certification costs (single ingredient certification) • Dairy: high perceived consumer demand and WTP especially after melamine scandal. • Potato: Limited coercive pressure by export and domestic retailers and perceived consumer demand.
Consequential legitimacy
Retailers • Perceived consumer demand and WTP for traceable products for
both potato and dairy. • Some coercive pressure by NGOs (e.g. Greenpeace) especially
for potato. • Coercive pressure by manufacturers in dairy.
Primary Producers • A lot of (depending on farm structure) negative consequences
associated with the support of organic certification (costs, knowledge barriers, yield decreases, suitable land access etc.).
• Support needs to be ensured through other dynamics • Knowledge transfer, subsidies etc.. by governmental
organisations, NGOs, Universities, manufacturers, retailers… • Income gains and market access. • Coercive pressure by manufacturers in the dairy SC. • Limited coercive pressure by retailers in the potato SC.
Procedural legitimacy • Criticism for inconsistent and partially astringent
standard interpretation. • False certification.
Standard restructuring • zero-tolerance of residues; • prohibition of parallel planting in one-year crop; • need for certifiers to inspect each crop of each variety; • need to inspect each farm within cooperative groups; • assignment of authentication codes for each product.
Increased certification control
• Criticism for too strict standards and certification. • Continuous procedural problems.
Call for greater consumer participation. Additional call for greater farming participation
through cooperatives.
Preliminary Conclusion
• Both SC face procedural as well consequential barriers. demands for participatory procedural restructurings. • Powerful position of branded manufacturers coupled with
high discursive prominence of food safety issues and “special” role of dairy products facilitated the diffusion of organic certification in the dairy PCS.
• Diffusion of organic certification in the potato PCS inhibited by lack of “key legitimacy” actors and lower discursive consequential attention.
• Product labelling organizers should take alternative routes (and their differences across supply chains) into account!
• Theoretically, the findings re-iterate the importance of power issues in institutionalisation processes (and their potential implications!).
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