Organic Food Labelling – Situation in Hong Kong?Prof. Wong W.C. Jonathan MHDirector, Hong Kong Organic Resource CentreHong Kong Baptist UniversityAmCham Luncheon Sept 2012 1
2 Presentation Outline• Hong Kong organic market situation• Consumers’ buying behavior & confidence level in organic products• Means to minimize consumer’ confusion on organic products• Need of organic food regulation• HKORC-Cert’s role in building trust on “Organic”
Global Market • Market Size (2010) US $59.1 billion • Market Growth 8% (YOY) 228% (2000) • Leading Regions Europe North America • Leading Markets USA, Germany France, UKReference: NutraCon 2012, presented by Amarjit Sahota
Hong Kong LocalProduce Production (2012 July)• Total No. of farms: – 2,500 (734 ha)• No. of Organic Farms: – 409 (24% of total farms)• No. of Certified Organic Farms: – 100• Farmland in the urban fringes• Local organic veggie production: – 4.5 tonnes per day (0.25% of local veggie consumption) (source: AFCD)
Increased Organic Food Supply 8 Organic Processing & Retailing sector is growing Gradual increase of operations involving in the handling, processing or selling of organic products. Over 300 Retail Outlets!
Frequency of Organic Purchase11 (HKORC Consumer Survey 2011 <Valid samples：365 >)
12 Reasons for Choosing Organic Meeting organic buyers’ needs Reasons for choosing OrganicSample Size：365HKORC Consumer Survey, 2011
Channels of Organic Products Sales in Hong Kong13 (HKORC Consumer Survey 2011 <Valid samples：365 >)
The Average Monthly Expenses on Organic Products In the past year, the % of organic buyers who spent over HKD500 on organic products increased from 9% to 16.2%. In the coming year, those who are willing to spend over HKD500 will be increased to 20.8%.14 (HKORC Consumer Survey 2011 <Valid samples：365 >)
Supermarkets, superstores & health food stores – Rice/Pasta • The labelling of rice/pasta products also has confusing claims. 16(HK Labelling Survey – Organic Veggies 2011 <Valid samples：724 >)
Foreign organic label we see on 17 imported products everyday
18 Wet Market Situation(HKORC HK Wet Market Survey ) Year
Who/What should consumers trust? 19 Certified vs Self-claimed Organic in Wet Markets 2012 Overall situation – Certified organic vs self-claimed organic - % of market vendors % of market vendors selling “organic” 7.0% vegetables Selling self-claimed organic veggies 20.6% Selling certified organic veggies Selling 76% 72.4% certified organic veggies <samples: 340> <samples: 93>• However, the % of self-claimed organic veggies (i.e. over 70%) was still high in 2012, similar to the results last year. (HKORC HK Wet Market Survey 2012)
Can we trust what we see? 20 FRAUD Case!!! 28 Jun 2011 Local Vendor selling fake Organic Crops Source: HKSAR Customs and Excise Department
Low Confidence Level on Products could Frighten Consumers Away21 (HKORC Consumer Survey 2011 <Valid samples：251 >)
22How to tackle this confidence issue?Let’s look at the experience of the overseas.
Means to Guarantee Organic • Third Party Certification • Participatory Guarantee Systems • CSA, Tei Kei, farmers markets, traditional systems etcReference: NutraCon 2012, presented by Andre Leu
Third Party Certification Third party certification systems involve producers being certified to a standard or several standards by a recognised certification body that checks that the producer is complying with the standard/standards.Reference: NutraCon 2012, presented by Andre Leu
Third Party Certification • 75+ countries with organic regulations of some type • Some standards only • Some, standards plus control of certification • Some regulate export but not domestic • Private organic standards and labeling • 400+ organic certification bodies worldwide, but little to no access to certification in some countries.Reference: NutraCon 2012, presented by Andre Leu
Other Guarantee:Participatory Guarantee Systems• Locally focused quality assurance systems for local markets.• Develop an internal control system to ensure that all the farmers in the group are adhering to accepted organic practices.• Normally involves a standard• A transparent peer review system to ensure that all the members are following the correct procedures.
Other Guarantee: Non Certified Systems• Farmer and consumer based cooperative marketing systems.• Well known examples are the Tei Kei system in Japan and Consumer Subscription Agriculture (CSA) in Europe and North America.• These systems work on a direct partnership between the consumers and the farmers.• The integrity is built on the transparency and strength of the relationship between the two groups.
Organic market regulation in Asia Certification by CB approved China by CNCA Certification by CB approved Japan by MAFF Japan Certification by CB approved by NAB India [pending notification of rules] South Korea Certification recognised by NAB Certification recognised by NAB or Taiwan Canada Certification recognised by Dept Malaysia of Agriculture Philippines Certification recognised by NAB Hong Kong No additional regulatory requirement Singapore IndonesiaNAB – National Accreditation BodyReference: NutraCon 2012, presented by Ong Kong Wai
Example – China• CB should be approved by CNCA and accredited by CNAS• Inspectors should be registered at CCAA• Only certified products can be labeled as organic• National organic label
Example – Singapore• No national organic agriculture standard;• Food products labelled as organic foods, organically produced or words of similar meanings: CODEX• All import of organic processed food are required to accompany with organic certification from the relevant certification bodies of the country of origin
Hong Kong – 31NO legal legislation on Organic” ？ ？ ？ 31
The Need of Legal Legislation on 32 “Organic”?• Recent Concerns raised by Consumer Council – “Consumer Council supports calls to introduce specific regulation governing the production, certification and labeling of organic foods in Hong Kong.”• HKSAR Gov (Food and Health Bureau ) – FHB has commissioned a consultant to study the need of Legal Legislation on “Organic”.
Organic Food Regulation – possible implications• Clear labelling that help consumers identify the genuine organic products and enhance their confidence on organic products• Regulate the organic market• The increase burden of organic regulations restricts market access• Costs on production increase for small producers – FHB has been funding the Hong Kong Organic Resource Centre for 8 years that promotes voluntary Organic Certification scheme and educates the public on Organic consumption. The Government believes these approaches are currently sufficient to meet the needs.
35 Promote Organic Certification Next Step to Build Confidence Applying for International Accreditation: IFOAM Accreditation & ISO65 Build Trust towards HKORC Cert among public & the operators Build a credible organic certification system: Independent Organization Structure Standard formulated with reference developed according to principles of IFOAM Policy Manual formulated with reference to ISO65 Consultation process
36 Develop Unilateral Product Acceptance Service HKORC Organic Seals: Known by HK public(HKORC Consumer Survey 2011 <Valid samples：616 >HKORC Consumer Survey 2009Jan <Valid samples: 501>)* The data for JAS label in 2009 is NA. 36
37 Develop Unilateral Product Acceptance Service Raise the no. of organic imports with HKORC Cert seal Increase HKORC seal exposure and increase consumers’ confidence
38 Surveillance / Market Surveys• Surveys with focus on – Consumer Attitude & behavior – Labeling Situation of Retails – Labeling Situation of Wet Market Stalls