Top Editors ... Sourcing Ethical & Organic Ingredients

Title: Sourcing Ethical & Organic Ingredients
Date: 22/01/2007
Autor: By Lynda Searby

Developing ethical products might seem like a fail-safe growth strategy,
but sourcing certified ingredients is easier said than done.

Only a decade ago, ethical food and drink products were viewed as the domain of a left-wing, sandalwearing
minority. Today, jokes about kaftans and tree-hugging are as dated as big shoulder pads and real fur coats. Everybody wants to be seen to be an ethical shopper. This sea-change in attitudes towards ethical products is borne out by market data for the two categories that have emerged as the most prominent: organic and fairtrade products.
According to the Fairtrade Foundation, global sales of fairtrade certified products topped the €1.1 billion mark in 2005 – an increase of 37% from 2004. The USA and the UK are leading the fairtrade crusade, with markets worth € 344 million and € 277 million respectively, but other countries are experiencing exponential year on year growth, notably Australia/New Zealand (178%), Canada (99%), Finland (73%), Sweden (69%) and Austria (62%).
The absence of a pan-European organic certification body makes it harder to get a clear consensus on the size of the organic food and drink market. UK organic certification body, the Soil Association, estimated the global market for organic food and drink at £16.7 billion (€24.2 billion) in 2005, while the just-food report 2006 Global market review of the whole, natural, organic and ethical food markets valued it at US$36.7 billion. Within Europe, Germany is the largest market for organic products, followed closely by the fast-growing UK market, which is worth £ 1.6 billion
(€ 2.2 billion) and expanding by 30% annually (source: Soil Association).
Given that overall food industry growth in most European markets is somewhere between 2 and 6%, the ripe ethical food and drink market offers rich pickings for food manufacturers.
If only it were that straightforward. One barrier which is thwarting the new product development efforts of some manufacturers is securing fairtrade or organic certified ingredients in large enough quantities. Ben and Jerry’s,
for example, has just replaced its regular vanilla ice cream with a fairtrade version in the UK, The Netherlands and
Belgium, and admits that tracking down enough fairtrade certified vanilla was a problem.
“Finding the vanilla with the right flavour profile and in sufficient quantities was very challenging,” said the company’s co-founder, Jerry Greenfield. Ben and Jerry’s eventually found Eco-Agri Research Foundation, a non-profit
development organisation in India, which was working towards fairtrade certification.
Twenty per cent of the product’s ingredients are sourced from certified producer organisations. Besides the vanilla, Ben and Jerry’s uses fairtrade sugar sourced from the Manduvira Co-op in Paraguay. Ben and Jerry’s had hoped to launch the product in the USA as well as Europe, but there simply wasn’t enough vanilla to do this.
Despite these setbacks, Greenfield sees this as the beginning of a bigger commitment to obtaining fairtrade
certification where possible, and hints at plans to convert two other Ben and Jerry’s flavours in 2007. He does, however, recognise that some products could prove more difficult than others to convert.
“Ben and Jerry’s is an ice cream famous for its big chunks of cookie dough, chocolate fudge brownie and caramel fudgy swirls. Fairtrade conversion for these is much more complicated due to the more composite ingredients,” said Mr Greenfield. This observation is backed up by Day Chocolate, which produces fairtrade products under the Divine brand for sale in the UK, the USA, Canada and Scandinavia.
Since its launch in 1998, the Divine range has grown to include over 15 lines, including drinking chocolate, dinner mints, cocoa, chocolate bars and seasonal products. Each product contains between 24 and 85% fairtrade ingredients. Cocoa is bought from the Kuapa Kokoo cocoa farmers’ co-operative in Ghana; Brazil nuts are
sourced from Candela, Peru, sugar comes from Kasinthula in Malawi; and mangoes and apricots are bought from UK wholesaler Tropical Wholefoods.
Day Chocolate’s head of communications, Charlotte Borger, said: “Those ingredients suppliers we are already using are good, but it is still difficult to source other fairtrade ingredients – processed or semi-processed ingredients in particular.”
With organic ingredients, supply issues are exacerbated by the time lag between a grower deciding to convert to organic, and that ingredient becoming commercially available.
Danish ingredients giant Danisco has been producing organic sugar for the Nordic countries for over a decade. The company’s vice president of corporate sustainable development, Søren Vogelsang, explained what is involved in bringing organic sugar to market.
“For a farmer or grower, it takes a minimum of two years to convert to organic production. Once we [the ingredient
producer] have the organic sugar beet, we have to produce sugar for three years before we can be sure that the conventional sugar is out of the system. The shift from producing normal sugar to producing organic sugar costs us and the farmers a lot of money.”
Although demand for organic sugar outstrips supply, only 1% of the sugar beet plantations in Scandinavia is given over to organic farming. It’s a classic ‘chicken and egg’ situation: unless demand can be guaranteed, farmers and ingredient producers are not prepared to convert to organic production – and who can blamethem?
However, the situation is not necessarily as bleak as it sounds. In some cases, the organic ingredients do already exist – they just haven’t been discovered.
“In some developing countries the farmers are so poor they cannot afford to buy pesticides and fertilisers, so the ingredients are already organic,” says Mr Vogelsang.
“You just have to prove it.” If a farmer can’t afford pesticides, it’s unlikely he will be able to afford organic
accreditation, so it often falls to the ingredient supplier to pay for certification. Simon Wright, a UK-based ethical foods
consultant, believes that ultimately, forward planning can circumvent most organic ingredient supply issues. “It’s a scale thing,” he says. “If you come from a standing start and you want large quantities you’re going to struggle. But if you plan in advance or start off on a small scale, you’ll probably be OK.”
That may be so, but food manufacturers marketing products internationally can’t necessarily afford to take that chance.
German fruit-based beverage market leader Capri Sonne, for example, has not gone down the organic route, because it says: “An international brand such as fruit juice drink Capri-Sun cannot process its fruits from
organic cultivation, as the high quantities needed cannot be ensured and the quality differs too much.”
Instead, this year Capri Sonne decided to plough its own ethical furrow, pledging to use only fruits from controlled integrated fruit production.
Explaining what is meant by controlled integrated production, the company’s managing director, Carsten Kaisig, said:
“This cultivation method is regulated according to several basic principles: the use of biological and biotechnological pest and disease management, the preservation and promotion of long-term soil fertility, the protection of flora and fauna, and quality control.”
Communicating this to an audience that has only just got to grips with fairtrade might sound like an uphill struggle, but in a world where food producers are increasingly being judged on their ethics, and certified ingredients are hard to come by, what is the alternative?