Organic Certification as a Value Addition Tool for Market Access of

Natural Products

PRESENTATION BYJack Juma & Samuel Ndungu

Kenya Organic Agriculture Network (KOAN)

ABOUT KOAN• KOAN founded in 2004, as a national co-

ordinating body, representative of the organic sector in Kenya

• KOAN’s main role is to coordinate, facilitate and provide leadership and professional services to all its members and other stakeholders in the Kenyan organic sector.

ABOUT KOAN: What We do

• Facilitate provision of technical advisory services in the areas of production, certification and marketing.

• Coordinate organic certification and inspection services acceptable at both the national and international levels

• Create public awareness on the benefits of organic agriculture.

• Coordinate, harmonize and facilitate a unified training programme in organic agriculture in Kenya.

Why organic in natural products?

‘ Holistic sustainability is the primary focus of organic agriculture. The organic agriculture principles of health, ecology, care and fairness clearly define this.

Sustainable wild harvest of materials for the food, body care, flavouring, fragrance and nutraceutical markets of the West can provide income generation to alleviate rural poverty in remote and economical depressed regions.

The implementation of organic and sustainable harvest standards, with targeted fair-trade orientated marketing, can assist in securing the socio-economic stability of rural communities and the natural environment’.

Organic standards

• Organic standards have been used to create agreement on what ‘organic’ claim on

a product means.• Regional groups of organic farmers and

their supporters began developing organic standards as early as 1940s.

• Currently there are hundreds of private standards worldwide

Organic standards

• More than 60 countries have come up with organic standards as technical regulation.

• Today IFOAM basic standards and CODEX alimentarius guidelines for organically produced foods provide the base for both private standards and national regulations.

• East Africa Organic Product Standards have been developed and gazetted through bureau of standards in East Africa. It is a step towards negotiating for equivalence with other international standards e.g. EU

New trends

• Standards are going beyond quality to responsibility requirement, hence social standards gaining prominence

• Wild harvested standards are equally increasingly being developed as either part organic, social e.g. fair wild standards or own distinct standards such as FSC standard.

• There are also specific standard requirements for certain wild harvested products e.g. honey

• Regional/ National standards are being formed from the international guidelines to make standards more relevant

Organic Certification

• Organic certification improves market access and competitiveness for products.

Organic certification enhances smallholder organization and management of farmer

associations

Organic certification is used as a tool for accessing niche markets.

Is used as a Quality management tool

Risk Analysis in the Product Flow

Farmer harvests

Drying at farm Packing/Storage at farm

Transportation to warehouse

Collection(Procurement)

Transport of product to collection centre by farmer

Warehouse: storage & consolidation (combination in bigger lots)

Processing & packing

Export: transport, packing of container

15-23

Due to inbuilt traceability, organic certification leads to consumers’ trust in organic production

system and products

Organic Agriculture ensures sustainability

The Internal Control System

Internal Control System (ICS)• Binding committment of farmers to adhere to organic

standard• Internal inspection and field advise for farmers• Internal approval and handling of noncompliances• Documentation of farmer and farm data• Product flow control

Farmers in the organic project

Note:

• Cost of individual certification disproportionally high in relation to sales value.

• Homogenity of members (location, production system, size of holding).

• In principle, only small farmers (by local standards); larger farms can belong to group but must always be inspected externally each year.

• Usually common marketing system

Record Keeping is critical

• Rich Botanical Resources

• Unique environmental benefits – biodiversity, habitat preservation

• Development of natural products will mitigate climate change and assist communities to devise risk management techniques.

• Number of supportive initiatives within the government, NGO and commercial sectors

All collection areas are mapped

Types of Smallholder Projects

Cooperativeor Farmers Associationoperates ICS

ProcessorExporter

operates ICS

Contract Production

Opportunities in the Domestic market: Farmers markets.

Organic farmers market

• Since January 09 every end-month Saturday

Retail Outlets:

Restaurants

5/19/2009 25

Trends in Organic agriculture: Markets

• “Organic is a niche, but a very profitable niche. Give consumers what they truly want/need and they will dig deeply into their pockets”

Jerry Dryer, J/D/G Consulting, in "Organic Lessons," Prepared Foods, January 2003 www.preparedfoods.com/archives/2003/2003_1/0103organic.htm.

• Global market for organic food and beverages hit 23m USD in 2002

• This was a 10% increase over the previous year

Organic sector growth rate in the EU

• 1989-1991 107%• 1992-1994 60%

• 1995-1997 70%

27

Distribution of Global Organic Agricultural Land by Continent 2008

Africa1%

Oceania42%

North America7%Asia

10%

Latin America16%

Europe24%

Source: FiBL/IFOAM Survey 2008

28

Organic Farms by Continent 2006

North America2%

Asia13%

Africa24%

Europe28%

Latin America32%

Oceania1%

Source: FiBL/IFOAM Survey 2008

29

Organic Agriculture Worldwide 2006EU reg JASNOP

China India M. EastCanada

E. Africa

S. Africa

Australia

Australia

30

Global market growth for organic food & drinks

• Global demand growing with sales increasing by over 5 billion US $

• International sales in 2006: 38.6 billion US $

• Consumer demand concentrate in North America and Europe

Europe52%

North America45%

Other3%

Source: Organic M onitor/Sahota 2008

5/19/2009 31

What are the opportunities?

• Wild HarvestsThese could include the following• Honey and beeswax• Gums and resins• Fruits e.g. mangoes• Medicinal crops e.g. Aloe Vera• Oils crops/trees including: Kigeria

(Sausage Tree/Muratina), baobab

Opportunities cont’d

• Indigenous fruits are important source of sugar, oils, minerals and vitamins and are known to play important role in food nutrition

• Vitamin C content in Sclerocarya birrea (Marula) is 5 times that in Citrus spp.

• Despite the documented benefits of fruits, FAOSTAT 2002 database portrays East Africa to be far below this target (200g/person/day) with an average consumption of 36 g/person/day.

5/19/2009 33

Opportunities

• Herbs and spices including African Birds Eye, paprika

• Livestock products: fisheries, game meat?

• The local market demand is growing

Naturallyafrican branding?