Assignment
Mini-case study:
organic farming Recent studies show that the organic food sector has great potential for expansion. Surveys show nearly 80% of consumers, traumatised by a series of food-contamination scandals, would buy organic produce if it cost the same as conventional food. British production falls well short of meeting that demand. Britain lies in only tenth place in terms of land given over to organic production, with less than 2%, compared with Liechtenstein's 17%, Austria's 8.4% and Switzerland's 7.8%. As a result, Britain imported about 75% of the £550m of organic food it consumed last year; much of that - humiliatingly - was root crops, cereals and dairy produce, all ideally suited to the British climate and soil. With the annual 40% growth rate in British sales of organic foods likely to continue, and every supermarket now offering a range of products, local farmers have, belatedly, been queuing up to fill that vacuum. Nevertheless, organic farmers are worried that recent attempts by supermarkets to drastically reduce the 25% premium on prices currently charged for organic products will be passed down the line to themselves. Many believe that if the price premium over nonorganic products disappears, then it will be uneconomic for the many small organic farmers to continue production. The pity is that in the long term, organic producers argue, organic farming could supply the mass market relatively cheaply. Yields will gradually increase as the size of organic farms increases, crop rotation kicks in and soil fertility rises. The gradual transformation of what is, in effect, a cottage industry into a serious commercial concern will allow economies of scale, both technical and non-technical. Steady government support, including aid that recognises the rural ‘stewardship' provided by organic farmers, would narrow the cost differences with conventional farming. Only when a certain critical mass has been attained - and many organic advocates believe it must wait until 30% of British land (currently 2%) and 20% of British food is organic - can organic farm prices be expected to fall of their own accord. Until that point, their message will be: please buy organic, but be prepared to pay for it.
Question
1. Why might the small scale organic farmer seek to grow larger? What opportunities and threats are posed to the organic farmer by large retailers reducing the prices of organic food?
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.