The Hague, September 2000
Policy Document on Organic Agriculture, 2001-2004
Annex: Status of organic agriculture in the
- The ambition
- Spearheads of policy
- Financial resources
The policy document on Food Production and
Rural Areas (Voedsel en Groen) focuses on the change
in thinking about the agricultural sector. It is not concerned solely
with primary agriculture, but with the whole chain from primary sector
to consumer. This agrifood complex is characterised by socially responsible
business practice, a high level of knowledge and innovative strength and
is thus a world market leader. A demand-centred approach is essential
since the agrifood complex is driven by the wishes of citizens and consumers.
The demand-centred approach is the key to this first follow-up to the
policy document on Food Production and the Rural Areas. Like other parts
of the agrifood complex, the organic chain faces the challenge of developing
over the coming decade into a sustainable sector as an integral part of
society competing independently in international markets, and setting
the standard in Europe.
Opting for a demand-centred approach has consequences for the role of
the parties involved. This Policy Document on organic agriculture, Een
biologische markt te winnen, fleshes out the role of central government
and the Ministry of Agriculture, Nature and Food Quality in particular,
in assisting the organic chain from 2001 to 2004 inclusive.
The organic sector has an excellent record
of socially responsible business practice: in all links of the chain,
organic production very largely meets our social requirements in terms
of environment, animal welfare and biodiversity, and plays a pioneering
role for the entire agrifood complex. There is growing demand for organic
produce. While total food sales in the European Union are stagnating,
sales of organic products are rising. Consumers are motivated not only
by social conscience, but also by the healthy and reliable image of organic
products. The certification of products and the method of production with
the EKO quality mark contribute to this image. Organic production appeals
to the standards and values of both consumers and producers: pride in
a product created with respect for our natural environment.
In its further development the organic
sector can count on the support of two significant pillars of the Dutch
agrifood complex: namely the great extent of available knowledge and the
agricultural trade. Available knowledge can be used and disseminated or
new knowledge can be developed in the short term. Organic agriculture
requires a different system of production and thus continually fuels innovation,
which can also be very important for mainstream agriculture. Partly because
of the far-reaching involvement of supermarket chains, this is an international
market. The Netherlands already enjoys a strong position in the international
market, and further reinforcement of trade will be essential in taking
advantage of the international potential of Dutch organic production.
However the organic chain also has some weaknesses. Despite the efforts
of the chain, supported by government initiatives, Dutch organic agriculture
occupies a fairly modest position in Europe. In 1999, for example, only
slightly over 1% of the total agricultural land area in the Netherlands
was used for organic production (Central Bureau of Statistics, CBS).
Source: Institute of Environmental Studies,
||Area of organic agriculture
(hectares) in 1998
|Percentage of total
agricultural land in 1998
per year (%), 1993-1998
The organic sector is moving from a pioneering
phase into an expansion phase. The major trigger of growth, market demand,
is already in place. However, growth is currently proceeding in fits and
starts. The chain is not yet performing well enough in terms of scale
and strength: scale great enough to generate sufficient demand, and strength
to continue to meet the high expectations of the consumers. Furthermore,
the chain seems hesitant: holding back instead of seeking the initiative,
at a time when market prospects are better than ever. Significant market
players are showing a readiness to invest in organic production. One example
is the supermarket trade association, the Centraal Bureau Levensmiddelenhandel
(CBL) [Dutch Association of Food Trade Organisations], that recently announced
that organic products would receive preferential treatment and special
promotion in the supermarkets.
Responsibility for investment in the future
lies with the organic chain itself. However, the combination of market
prospects on the one hand and the pioneering role of organics in the area
of social responsibility and innovative enterprise on the other justify
a policy of incentives to give a boost to the organic sector. We have
opted more emphatically than in the past four years for a demand-centred
approach: for business the market must be the guiding factor, the different
parts of the chain must capitalise on the market potential for organic
products. The prospects are good: there is an organic market waiting to
It would be a feather in the cap for the
Netherlands if 10% of available acreage was organic by the year 2010.
In international terms this would put the Netherlands in an excellent
position. To achieve this the acreage under organic farming would have
to increase by around 25% per year from 2001 onwards. Considering that
the annual average growth from 1993 to 1998 was 16%, some acceleration
is required. This cannot be achieved simply by government measures to
stimulate supply. The market players, including consumer and social organisations,
must rise to the challenge. The necessary acceleration can be brought
about through cooperation.
Strong growth in the area under organic
agriculture would mean that at the end of this decade:
- Dutch consumers will be among the top
European consumers of organic produce from retail, wholesale and catering
- the agrifood producers will have a number
of strong organic brands;
- Dutch agriculture, in its leading position
in production, technology and management, will also master the field
of organic production like no other;
- the sector will compete independently
on the international market;
- the Dutch agricultural knowledge complex
will make a significant contribution to knowledge and technology.
The market players have primary and joint
responsibility for these tasks. There is an important role to be played
by the retail, wholesale and catering trades. They form the link with
the consumer and, as the demand for organic products grows, they can exert
influence on the conversion process. The government hopes to accelerate
growth by providing a temporary impetus, with the emphasis on establishing
cooperation between market players. With this temporary stimulus the government
hopes to contribute to organic agriculture as a socially responsible and
innovative type of operation with effects for the entire agrifood complex.
The market prospects for organic agriculture
are good. However, a number of difficulties could hamper the desired acceleration
in growth. These can be summarised under three headings.
Difficulty: the chain does not operate
as well as possible
To have the greatest possible influence
on favourable market prospects chains need to work smoothly and professionally.
Market players must be able to cooperate with each other. At the moment
in the organic chain they are unsure how to find each other, do not trust
each other or are even entirely unknown to each other. As a result they
do not make adequate use of opportunities. In addition, existing institutions
can hinder the operation of the chain. It is striking that a number of
existing institutions are barely addressing organic agriculture, if at
all. It would be good if, for example, some of the commodity boards would
invest more in strengthening organic chains.
The result of the imperfect working of the
chain is that the supply and range of products is limited and unnecessary
costs are incurred, making the price to the consumer unnecessarily high.
Market prospects are good because there
is a large group of potential new consumers of organic products. However,
these new consumers are not being reached, because they require a different
approach to the often strongly ideologically motivated consumers who currently
buy organic products. The new consumers are concerned with the quality
of the product, but are particularly influenced by both the way it is
perceived and the availability of a wide range of products. The extra
cost of this quality product must not be too high compared with the price
of a conventionally produced product, particularly as conventional products
are produced in ever cleaner and more environmentally-friendly conditions.
The favourable market prospects have not
yet penetrated sufficiently far into the chain to make primary producers
more willing to switch to organic production. The reluctance to convert
has a number of causes. For many, the combination of a 2 - 3 year conversion
period with uncertainty about the medium term market situation is an important
consideration. In addition, conversion from mainstream to organic production
requires a major change in business management and philosophy. Organic
production involves different production methods, in turn requiring different
knowledge and skills and more work from the producers. It also involves
a higher degree of commercial risk, particularly in the initial years.
Furthermore many sectors are faced with a statutory conversion period
agreed at European level, causing a loss in income which is not offset
by any direct price compensation during the period when the produce cannot
yet be sold as organic. In certain sectors, such as pig farming, heavy
investment in housing units is needed to meet the new requirements.
Difficulty: living up to consumer confidence
Consumers are demanding ever-higher standards
of quality and production methods. This applies to all chains, but it
is particularly true of the organic chain, where consumers have high expectations.
Consumers increasingly ask for more information about the production process
and the traceability and origin of the raw materials. With organic products
consumers will want guarantees that the product is produced entirely organically.
This requires a reliable inspection and certification system within the
chain. Precisely because the organic chain is currently at an early stage
of development, there is an opportunity to close the chain properly.
European regulations (Regulation (EEC)
no. 2092/91) set out the requirements to be met by organic products and
production methods and also regulate the inspection process. These European
regulations permit limited use of conventional products in organic agriculture:
often for a limited period. Although this use is legally permissible,
in order to reinforce its image, the sector must strive for the most organic
production method possible. However, organic agriculture cannot currently
undertake to use only products of organic origin in the production process.
There are various reasons for this. For example, with organic starting
material and organic glasshouse horticulture it is not yet clear what
conditions the product or production methods must meet. The organic product
may not be sufficiently widely available, as is the case with, say, organic
fertiliser and crop protection products of natural origin. Finally, the
sector cannot entirely prevent products that do not belong in organic
agriculture from ending up in the process. Genetically modified organisms
(gmos) are an example of this. Under European regulations no use may be
made of gmos or derivative products in the organic chain. But this does
not automatically prevent gmos from finding their way into the organic
production process, for example, during transportation.
European regulations on organic production
methods are still being developed. On 24 August 2000 the rules for crop
production were supplemented with those for animal production. However,
in practice the rules - for example on organic glasshouse horticulture
- will have to be elaborated before we can really talk about European
harmonisation. The lack of full European harmonisation means that the
rules are still not entirely clear. As a result, organic products from
different EC member states cannot always be compared like for like.
The rising expectations of consumers go
further than the statutory regulations. In the coming years, organic agriculture
will be expected to adhere to reliable guarantees over a broader field.
The inspection and certification system will have to develop continually.
Transparency is a precondition for continuing consumer confidence.
Difficulty: lack of new knowledge and
inadequate dissemination of knowledge
Because it is a different system, organic
production methods require different knowledge and skills of all links
in the chain. Among primary producers in particular there is a real need
for new knowledge about organic production systems and techniques and
specific problems in operational management. This applies to the development
of business systems, starting material and crop protection methods of
natural origin, new forms of weed control, energy use in glasshouses and
labour-saving and labour-reducing techniques. Further professionalisation
of the chain will require joint development of knowledge, in which conventional
and organic businesses and the knowledge institutes collaborate more effectively
and benefit from each other's knowledge.
Gaining access to developed knowledge (including
experiential knowledge) is a problem for individual businesses. In this
context more intensive interaction between researchers, information services,
education, intermediaries and primary producers and better dissemination
and exchange of knowledge are essential and need extra attention. Finally,
when it comes to the driving force behind research, organic agriculture
takes too little responsibility for the formulation of research questions.
The role of the government is two-fold.
It is permanently responsible, under Regulation (EEC) no. 2092/91 among
others, for the enforcement of legislation and regulations and supervises
the inspection system. In addition, research, education, and provision
of information are important instruments of government policy.
However, because the organic chain faces
a number of difficulties in achieving the desired growth, the government
will also have a transitional role as a catalyst, inspiring the chain
to take initiatives to overcome the difficulties. Thus government contributes
to an economically sound and socially responsible production chain which
will be able to operate without government support in the short term.
This role will be a transitional one. It is ultimately up to the market
players to complete the task unaided.
Cooperation between all the parties is important.
In terms of policy it should be emphasised that not only the state but
also the provincial authorities stimulate organic agriculture. Other regional
authorities, such as the municipal councils and water boards, and social
organisations are also developing activities aimed at expanding organic
agriculture. The government heartily applauds these initiatives.
Platform Biologica is an umbrella organisation
for primary organic producers, the supply and processing industries, the
trade and retailers. In addition to promoting the interests of the sector,
Platform Biologica also has a role in relation to this Policy Document,
in closing the chain (including organic starting material, gmos), increasing
awareness of the regulations for and understanding of organic production
methods, and cooperation with the conventional sector. It can also fulfil
a role in private and public initiatives to stimulate organic agriculture.
Platform Biologica has performed a lot of important work in recent years.
As with other organisations, the Ministry of Agriculture, Nature and Food
Quality will opt for a market-centred approach. The funding of Platform
Biologica will be continued in 2001. Starting in 2002 the scale of funding
will be decided on a project-by-project basis depending on submitted and
approved project proposals.
Considering the nature of the difficulties
identified and the desired rapid growth in organic acreage, there is no
need for government policy to select particular areas and/or sectors in
the Netherlands. Businesses must choose what organic products to grow
and where. Government policy will be generic in nature. The demand-centred
approach is the main consideration and this will affect the choice of
The 1997-2000 Action Plan was aimed primarily
at supporting market development, improving quality and stimulating the
conversion of primary production. The time is now ripe for a new and different
orientation: the chain is the key factor and given favourable market prospects,
a demand-centred approach is appropriate. Considering the nature of the
problems, the government has opted for the following approach:
- synergy: cooperation between market players
enabling them to exploit favourable market prospects;
- quality and guarantees by closing the
- development and dissemination of knowledge.
In the next four years following this Policy
Document, policy will focus on the following spearheads.
I. The professionalisation of demand-centred
The purpose of this process is to make the
best possible use of market potential through cooperation between the
parties. It should result in stronger chains with a larger volume and
a wider range of organic products at lower prices, and with adequate prospects
for primary producers to convert to organic production methods.
II. Optimum transparency and closing the
- A framework agreement elaborated
in business plans
The Ministry will set up a Task force
for market development of organic agriculture with a limited number
of representatives from various links of the chain, including banks
and consumer and social organisations. The job of the task force will
be to catalogue the difficulties and designate solutions and objectives
in the various chains. To prepare for the task force, the Ministry
has already funded external research, in consultation with the CBL,
LTO Nederland (Dutch Federation of Agricultural and Horticultural
Organisations) and Platform Biologica, into problems and possible
approaches to solutions in a number of organic chains. The work of
the task force must culminate in the signing of a framework agreement.
In view of the willingness displayed by the market players, this should
be possible by the end of 2000.
This cooperation between the players
must subsequently lead to concrete business plans for the various
chains. These business plans must contain specific objectives and
binding agreements about the stimulation of the organic chains. The
business plan is the stage when the intentions expressed by the various
players are put into operation.
In the execution of the business plans,
the government will make a financial contribution on a project-by-project
basis, through the joint innovation programme and other measures,
to the development of concrete market activities. Such activities
might be, for example, in the fields of quality improvements, production
volumes, product innovations, clustering of businesses and logistics.
The funding will be limited to projects in which different market
players have an interest, projects which would not get off the ground
without an extra boost from the government, and which contribute to
achieving the objectives agreed in the business plans. The results
of the projects must also be of use to all parties.
By mid-2001 the business plans should be complete. This will be the
time to evaluate this part of the process: too few business plans,
or none at all, will lead to a reconsideration of the deployment of
government measures and funds. The implementation of the business
plans will be reviewed annually by the Ministry, and adjusted where
- Information and communication plan
The government has the task of providing
the public with objective information. By raising public awareness
about sustainable production, animal welfare and biodiversity, the
public, and thus the consumer, begins to appreciate the real value
of the product and will be more willing to pay a higher price for
it. The premium is paid because organic agriculture goes beyond the
statutory requirements applicable to conventional agriculture, and
incurs higher costs in production. Agriculture as a whole can benefit
from this process of increasing consumer awareness. An information
plan will be elaborated in which institutions such as the Voedingscentrum
Nederland (Netherlands Nutrition Centre) will provide the public with
objective information on sustainably produced products.
Communication with potential new consumers
is a challenge to be shared by the market players. A communication
plan linked to the framework agreement or the business plans is the
obvious direction to take. This communication plan must be aimed at
the consumer and the part of the chain serving the consumer (retail,
catering and wholesale trades), emphasising the promotion of organic
products. The main aim of the communication plan must be to win over
and retain new consumers.
Optimum transparency and closing the chain
are priorities for all players in the agrifood complex. The chains themselves
are responsible for this, and the aim is to provide guarantees and live
up to consumer expectations. Given the current stage of development of
the organic chain, there is now a good opportunity to build up a solid
and efficient system.
- Chain guarantee systems
Like other chains, the organic chain
must meet the relevant public health requirements and requirements
imposed by market players. The obvious approach is to link this to
the development of chain guarantee and certification systems in the
conventional agriculture sector. Where necessary a chain guarantee
system can be adapted to the organic production system. Transparency
is a precondition for consumer confidence. The entire production process
must be inspected at every step and must be traceable. The use of
the Hazards Analysis of Critical Control Points (HACCP) principle
throughout the chain is therefore desirable. The organic chain can
make use of its expertise in the field of certification for the EKO
- Closing the chain
Organic products have a high amenity
value. The products are known to consumers as being produced in a
natural and environmentally-friendly way without the use of pesticides
and gmos. However, the chain cannot currently guarantee that everything
is entirely organic. The chain is primarily responsible for this.
Given the issues specific to this chain, and the over-riding importance
of closing the chain, the government wishes to spur on the process.
Where necessary temporary assistance will be provided in the following
- Organic starting material
The Netherlands is highly respected
throughout the world in the field of the breeding and production
of starting material. The organic and breeding sectors must join
forces in the short term at European level to arrive at an adequate
and accepted definition of organic processing. They must specify
what methods are acceptable and how processing should be carried
out. Alliances between the conventional and organic sectors would
facilitate this. On completion of this first step, the processing
sector will receive transitional funding on the basis of initiatives
to be proposed by the business community. In addition, to provide
support, the research will be expressly aimed at increasing the
availability of organic starting material.
- Genetically modified organisms
Keeping the chain gmo-free concerns
not only organic agriculture but also all other chains seeking
gmo-free production. The chain itself is primarily responsible
for excluding gmos. The role of the government in respect of gmos
is set out in the Integral Policy Document on Biotechnology. The
government wishes to give consumers the opportunity to choose
between gm and gm-free products. For some years the Ministry has
provided support for a project concerned with the non-gm nature
of the organic chain. Following on from this project financial
support will be given to a joint initiative of the organic business
community aimed at the actual development of a gm-free organic
chain, and the necessary monitoring system. In this project cooperation
with other gm-free chains would be an advantage.
- Crop protection products of natural
Consumers will in future expect
the sector to keep the use of crop protection products permitted
under the regulations to a minimum. Prevention of pests and diseases
must take precedence. Policy on crop protection after 2000 will
be determined this autumn. The crop protection products of natural
origin required by the organic sector are subject to the same
requirement as the conventional products: that they are safe for
mankind and the environment. Work is currently underway nationally
and internationally to simplify the approval procedures for crop
protection products of natural origin and so reduce the costs
of evaluation. In addition the institution of a transitional incentive
fund for approval is being evaluated.
These actions combined with the
activities of the sector in these fields must be sufficient to
close the organic chain.
As announced in the policy document
on Food Production and Rural Areas (Voedsel en Groen) the government
will take a stronger interest in supervision of the inspection process.
In the Netherlands Skal (Stichting Keur Alternatief voortgebrachte
Landbouwprodukten) is currently responsible for the inspection of
organic production methods under the Landbouwkwaliteitsbesluit biologische
productiemethode (Agricultural Produce Quality Control Decree). The
role of the Ministry of Agriculture, Nature and Food Quality as the
Skal watchdog is currently being evaluated and adapted where necessary.
The same applies to the unique position of Skal in the Netherlands.
- Harmonisation of international
legislation and regulations on organic agriculture
In addition to its role as a driving
force and supervisory authority, the Ministry of Agriculture, Nature
and Food Quality has an important function to fulfil in the development
of European and international legislation and regulations. The debate
on standards for organic production is currently taking place mainly
in the European forum. For the Netherlands issues such as the import
of organic products from third countries, the rules for organic glasshouse
horticulture and starting material and the further elaboration of
gmo-free organic agriculture are of great importance. The sector is
being asked to make an active effort to indicate clearly the directions
it wants to develop. The object is optimum harmonisation of international
legislation and regulations. This must increase the transparency of
European rules for organic animal production
have been in force since 24 August 2000. These provide the opportunity
to supplement the European rules with national rules. The Ministry
of Agriculture, Nature and Food Quality has decided not to introduce
any additional national statutory regulations. Its argument is that
the European rules form the basic level and the 'bonus' - stricter
national standards - can be created in the market. The Ministry does
however wish to make a strong case in Brussels for a further round
of harmonisation between member states. Should additional harmonisation
prove impossible, cooperation will be sought in the European context
with other member states holding similar views.
III. Development and dissemination of
Knowledge is essential for tapping new markets,
developing new ways of reaching consumers and improving the environment
we live in. Development and dissemination of knowledge is essential in
all links of the chain: in growing, processing, sales and distribution.
The development and dissemination of knowledge
has in recent years contributed significantly to the growth of organic
agriculture. It will continue to be in demand in the coming years. Primary
producers in the process of conversion will want to know more about organic
production systems and techniques and specific difficulties in operational
management. By forging a link between organic and conventional research,
existing knowledge and infrastructure can be used. Organic agriculture
will have to strengthen its position within the current structure of research
control. Proper organisation of the research questions and contributions
to the realisation of the research will help to strengthen its position.
Examples of difficulties facing
primary producers in organic operational management:
- pests and diseases
- mechanical weed control
- use of energy and nutrient management
in the glasshouse
- soil and nutrient management
- mineralisation of organic fertilisers
- labour productivity
Wageningen University and Research Centre
(UR) has announced that it intends to put organic agriculture firmly on
the agenda. Within a foreseeable time Wageningen UR hopes to devote 10%
of its discretionary budget for research to organic agriculture. It is
also investigating the possibility of starting a new course in organic
agriculture. These initiatives on the part of Wageningen UR will strengthen
the development and dissemination of knowledge.
Research is not an end in itself. The dissemination
and transfer of knowledge are at least as important. Knowledge institutes
will have to make extra efforts through cooperation between researchers,
information services, education and intermediaries. The government will
continue to make a financial contribution to the dissemination of knowledge
for potential organic farmers. The emphasis here is on encouraging conversion
and improving organic enterprise skills.
In the educational world serious efforts
have been made to integrate organic agriculture into general courses.
This has laid the foundation for the broad introduction and dissemination
of organic agriculture in professional practice. This line will be continued
in subsequent years, among other things in the reform of agricultural
education. Financial assistance will be made available for this under
an innovation regulation for agricultural education. Courses on organic
agriculture for current producers also receive financial support so that
course fees can be kept down.
These actions in the field of research,
information and education, where the government has a traditional role,
will help to tackle the remaining knowledge gaps.
IV. Stimulating organic primary production:
transition from supply to demand-centred approach
Direct government support for the development
of organic agriculture is not the appropriate course for the future. Good
market prospects must provide the stimulus for farmers to convert to organic
production. The business plans referred to under the heading 'the professionalisation
of demand-centred chains' must in the short term provide primary producers
with sufficient guarantees to make the step from conventional to organic
methods. On the other hand the sector must be given some time to master
this demand-centred approach. The next few years will be a transitional
period: new instruments will be introduced to stimulate conversion, old
measures will be dismantled.
V. Other matters
- Guarantees for capital-intensive
Government guarantees reduce the risks
of investment in capital-intensive business systems. In terms of the
costs associated with conversion, pig farming has particularly high
start-up costs due to the necessary adaptation of the housing. Currently
under the Borgstellingsfonds (Agricultural Guarantee Fund) banks lend
money to farmers and growers with (partial) government guarantees
that the interest and amortisation payments will be honoured.
- Promoting conversion
In the 1997-2000 Plan of Action financial
support was available for the conversion of primary production to
organic in the vegetable sectors and dairy farming under the Regeling
Stimulering Biologische Productiemethode (Organic Production Financial
Incentives Scheme (RSBP)). Under this scheme the government contributed
to compensation for loss of income suffered as a result of the statutory
conversion period during which the primary producers produce organically
but cannot yet market their products as organic. In the last year
of the current Action Plan (2000) and the first year of this Policy
Document (2001), 65% of the loss of income is compensated by the government
under the Financial Incentives Scheme. The scheme will run for the
last time in 2002. The compensation for loss of income will then be
set at 50%. The scheme is non-selective in that it does not specify
which vegetable and dairy farming sectors may be eligible.
For a producer to make a considered
choice to convert to organic production it is vital to have a commercial
development plan drawn up by a competent body. Financial support will
be available to all sectors to help with the cost of compiling the
The new tax system, aimed in part at sustainable
development and promoting employment by a relative reduction in tax
on labour, gives a further boost to the development of organic agriculture.
In addition to existing instruments, including the regeling groenfinanciering
(rural areas funding scheme), the regeling willekeurig afschrijving
milieu-investeringen (accelerated depreciation scheme for environmental
investments) (VAMIL) and the energie-investeringsaftrek (energy investment
allowance) (EIA), new instruments have been developed such as the milieu-investeringsaftrek
(environmental investment allowance) (MIA) and the duurzame ondernemingsaftrek
(sustainable business allowance) (DOA). These new instruments give an
extra boost to the development of organic agriculture. The environmental
investment allowance has already been introduced and the sustainable
business allowance will come into force once approved by the European
Commission. The sustainable business allowance of 15,000 guilders will
be raised to 22,500 guilders commencing 2001.
Organic agriculture is labour-intensive
and often has seasonal labour peaks. This is not unique to organic
agriculture. Other primary sectors are also faced with labour shortages.
In addition, working conditions in agriculture and horticulture are
not (yet) regarded as attractive. Recruiting the necessary workers
can sometimes cause serious problems. The employment strategy is in
the first instance the responsibility of the producers themselves.
However, in its policy document 'Voedsel en Groen' (Food Production
and Rural Areas), the government announced that it would examine the
possibility of forming labour pools. This would facilitate a broad
deployment of labour not bound to a particular business which would
benefit organic agriculture. The research process will consider labour
saving in operational management by developing labour-saving techniques,
among other things.
- VAT rate for organic products
Based on the sixth EU directive on turnover
tax, zero-rating for organic products is not permitted in Europe.
In the Memorandum on various VAT issues of 14 June 2000 to the Standing
Finance Committee of the Lower House, the State Secretary of Finance
indicated that this would only be likely to succeed if other EU member
states would be prepared to support such a request from the Netherlands.
The Ministry of Finance is currently seeking the views of other member
states and will inform the House in due course of its progress.
The deployment of state funding depends
to a considerable extent on the will of the market players to set up joint
market-oriented projects. The section 'The professionalisation of demand-centred
chains' of this Policy Document will be evaluated for the first time
in mid-2001 and policy will be adjusted as necessary.
A conscious choice has been made not to
attach the deployment of financial resources to particular parts of the
chain. Deployment must be flexible to respond to the development of the
chain. Support for the development and dissemination of knowledge is an
exception to this rule.
The following amounts are available for
the implementation of the Policy Document on Organic Agriculture 2001-2004:
Financial statement (commitment in NLG
||Professionalisation of chain;
optimum transparency and closing of chain
||- information and educational courses
||Measures to stimulate the
conversion of the primary sector
||- business review
||Fiscal: sustainable business allowance**
||Based on project funding from public awareness budget.
||The structural part of the sustainable business
allowance for organic agriculture amounts to an annual 75 million
guilders and will be reached in 2015.
It is not known precisely how the other fiscal measures will affect
organic agriculture. The tax benefit of the green investment scheme
is currently estimated at over 10 million guilders per year.
In addition to the instruments described
above, organic agriculture can also benefit from other government subsidies,
such as the future Agricultural Innovation Fund.
New supplementary policy instruments and
amendments to existing instruments must be submitted to the European Commission
for approval before they are put into effect. Every effort will be made
to make the best possible use of opportunities for European co-financing
for new policy instruments.
During the lifetime of the Policy Document
the progress of the incentive schemes will be broadly monitored. An initial
part of the process, the development of business plans, will be evaluated
in 2001, following which, in 2004, a final evaluation will be carried
out and the results submitted to the House. The House will also receive
a progress report annually in May on the implementation of the Policy
Annex: Current status of organic agriculture
in the Netherlands
The Policy Document on Organic Agriculture
states that the organic sector has witnessed strong growth in recent years.
This is confirmed by the statistics given in this annex.
Consumption and retail
In general it may be concluded that both production and consumption of
organic products represent around 1% of total production and consumption
in the Netherlands. Yoghurt is a positive exception with a market share
of 2.6% in 1999. In other European countries organic products also account
for around 1% of food consumption. Notable exceptions are Germany (2.5%),
Denmark (3%) and Austria (5%). It is striking that the Netherlands imports
the majority of organic products from abroad. Of these imports, 80% are
re-exported. A proportion of Dutch production is also exported. The UK
in particular is a lucrative target market.
Source :N.M. van der Grijp, F. de Hond : Green supply chain initiatives
in the European food and retailing industry (1999) Institute for Environmental
Studies (VU Amsterdam); EKO-monitor, Platform Biologica
|The total retail turnover of organic
products in the Netherlands has risen steeply in recent years (in
Source: EKO-monitor, January 2000, Platform
The total food turnover in the Dutch retail
trade was 45.9 thousand million guilders in 1999, with organic products
accounting for 1.1%.
The number of points of sale has also risen
steeply. The number of supermarkets stocking over 15 organic products
increased from 70 in 1995 to over 4,000 in 1999. The number of wholefood
shops has also risen over the same period from 280 to over 400 and the
number of pre-purchase schemes (organic box schemes) has risen from 4,000
Currently 60% of consumers buy their organic produce in supermarkets,
30% in wholefood shops, and 15% direct from the farmer or from farmers
markets. Since a proportion of consumers buy from more than one outlet,
the total exceeds 100%.
Source: Evaluatie Plan van aanpak biologische landbouw 1997 - 1999 (Evaluation
of Organic Agriculture Action Plan 1997 - 1999)
Since 1996 the number of businesses in processing
and preparation of organic products has increased by 350. Currently 780
organic processors are registered in the Netherlands. These are industrial
and craft companies, importers and service companies.
Source: EKO-monitor, May 2000, Platform Biologica
Primary organic companies
In 1999 organic production methods were
applied in 1216 businesses (1.2% of the total number of primary producers).
Of these 280 companies were in transition. During the period of the Action
Plan (1996 to 1999 inclusive) the land devoted to organic agriculture
increased by more than 10,000 hectares, to 22,997 hectares (1.2% of total
agricultural land area).
CBS figures show that in the period 1996-1999, 61% of the increase in
land devoted to organic agriculture area was in dairy farming, 34% in
arable and 5% in horticulture.
Distribution of companies per sector in
|Other (incl. mushrooms and plant material)
|Source : EKO-monitor, January 2000,
Platform Biologica; Evaluatie Plan van aanpak biologische landbouw
1997 - 1999 (Evaluation of Organic Agriculture Action Plan 1997 -
The figures below relate to the development
of organic agriculture broken down into various sectors. Although the
same statistics are not available for all sectors, this still provides
a rough picture of the growth of organic agriculture.
|number of cattle farmers
|milk delivery (in millions of litres)
|percentage of total
Market share (as a percentage) of organic
dairy produce compared with total consumption of fresh dairy products:
Source: EKO-monitor, January 2000, Platform
|1998 (to end of 3rd quarter) :
|1999 (to end of 3rd quarter) :
At the end of 1999 there were 9,000 organic heavy baconer places and 1,200
sow places (35 farms) in the Netherlands. 23,000 organic pigs were slaughtered
in 1999. 4,000 organic pigs were imported over the same period.
Demand for pre-packed meat for supermarkets is rising steadily.
Source: EKO-monitor, May 2000, Platform Biologica
In May 2000 the organic poultry stock consisted of around 90,000 chickens.
This is around 0.5% of total egg production. Last year there were 50,000
Source: EKO-monitor, May 2000, Platform Biologica
Potatoes, vegetables and fruit (PVF)
According to the CBL the market share of organic potato, vegetable and
fruit products in supermarkets is currently around 5% and will rise to
Source: EKO-monitor, January 2000, Platform Biologica
From 1996 to 1999, the area under arable
crops grew from 5115 hectares to 6661 hectares, a rise of 30%. This growth
is mainly due to the increase in the amount of land devoted to fodder
crops (maize, alfalfa and cereals). The area under horticulture rose in
this period from 1086 to 1633 hectares, an increase of 50%.
The area of potatoes increased by 55 hectares
to 749 hectares between 1996 and 1998.
|total (May census)
|share (%) of total Dutch acreage
|Source: publication 'Biologische groeistuipen'(Organic
growing trends), March 2000, Rabobank Stafgroep Duurzame Ontwikkelingen
(Rabobank Sustainable Development Group)
||30-40 ton / week
|share (%) of total Dutch production
|Source: publication 'Biologische groeistuipen'(Organic
growing trends), March 2000, Rabobank Stafgroep Duurzame Ontwikkelingen
(Rabobank Sustainable Development Group)
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