Conveying trust as food safety comes to the fore: Organic breaks into indulgent categories

25 May 2020 --- Organic food production is expected to branch out into new and indulgent categories. With this success, quality control must remain tight, as cases of labeling fraudulence have been reported in some markets. During a time of global uncertainty, the peace of mind that organic foods bring to consumers with its stringent regulations and inherent naturality should not be underestimated. Nevertheless, organic production and certification pose considerable challenges. FoodIngredientsFirst speaks with key suppliers on their strategies to deal with higher costs, inconsistent yields and quality control to meet the rising demand for organic ingredients.

The organic trend shows no sign of slowing. Where this food category once appealed only to the health-conscious consumer demographic, it is now rapidly diversifying. To attract European shoppers looking for organic labels they can trust, manufacturers will need to keep abreast of new organic EU Regulations coming into effect in 2021.

“Organic used to be associated with health foods, but as organic foods have become democratized, we can expect to see more indulgent food with an organic claim. For example, a super-indulgent ice cream, high in fat and sugar, but made with only premium and organic ingredients. This is where flavors can have a huge impact,” says Marie Le Beller, Product Manager at Prova.

“Consumers are paying more and more attention to food safety, notably in the context of a global pandemic. They link up healthiness with naturality. Thus, they perceive organic-certified products as safer, because the ingredients they contain are more natural,” says Kévin Bangratz, Marketing Researcher at Prova.

“When consumers hear ‘organic,’ they assume the product is healthy, sustainable and wholesome,” says Joe Katterfield, Sales Development Manager, Health & Performance, Arla Foods Ingredients (AFI).

With that feeling of wholesome goodness, comes an inherent trust, which Erik Walder, Product Development & Marketing, Blattmann Schweiz, describes as a belief system. “Organic is not simply a production method; for many, it is an ideology. For these people, buying organic products is perceived as the ‘right’ and ‘trustworthy’ choice for their health and the well-being of the planet.”

For many consumers, buying organic products is perceived as the right choice for their health and the well-being of the planet.Trust in organic is not based on belief alone. “As one of the most heavily regulated and transparent food systems, certified organic products signal to consumers that a food was produced in accordance with a set of strict standards,” observes Esra Akmanli, Business Development Manager, EMEA, Ingredion.

It is this that drives trust with consumers, giving them the traceability they seek in order to make conscious and informed choices. In fact, 24 percent of consumers said that they look for an organic claim to help their purchase decision, she adds.

Innova Market Insights reports that Western Europe is leading the way, with organic claims accounting for 18.6 percent of total F&B launches in 2019. Meanwhile, analysis by Bunge Loders Croklaan (BLC) found that in 2019, 19 percent of all bakery innovations were organic. Furthermore, organic share of bakery innovation has grown by 60 percent since 2015, according to Feike Swennenhuis, Marketing Director EMEA at BLC.

Adhering to specific regulations
It’s clear that consumers have been looking for healthier, more sustainable and traceable ingredients. However, sourcing or manufacturing organic ingredients comes with challenges, such as meeting the specific regulations that vary across regions of the world.

“Globally there are different organic standards, each with their specifics, but essentially they share the philosophy of an agricultural system that does not make use of chemical inputs and is in harmony with its natural surroundings,” says Wouter Floot, Commercial Director, Tradin Organic.

In the EU, organic production means a sustainable agricultural system respecting the environment and animal welfare, but also includes all other stages of the food supply chain, notes Katterfield.

Under the EU regulations, processed foods can be labeled organic provided that 95 percent of the ingredients are of organic origin and produced organically. The remaining 5 percent needs to be on approved lists of process aids, food additives or non-organic agricultural ingredients, explains Akmanli at Ingredion.

“Other regions, such as the US, are governed by their own national legislation. In the US, the use of the description ‘organic’ is regulated by the United States Department of Agriculture. Arrangements for the import into the EU of organically certified US products are in place, as their standards and control measures have been assessed as equivalent to those in the EU,” she adds.

The price of organic
The cost of organic ingredients can, in some cases, be cost-prohibitive. This can be a result of more expensive production methods or the supplier not yet having the economies of scale necessary to reduce costs, notes Katterfield at AFI.

“Consumers are often willing to pay a premium for organic products, but only to a certain threshold. Brands developing products with an organic positioning should, therefore, ensure that their final retail price is going to be acceptable,” he advises.

While organic certifications may give consumers peace of mind, the ingredients supplier is likely to take on some risky unknowns associated with organic production.

Digital solutions offer increased transparency and traceability across the supply chain. Photo by Tradin OrganicVariable quality in raw materials is one such risk as organic production is more at the hands of nature. Walder of Blattmann Schweiz gives the example of lower protein content in wheat, which can lead to quality fluctuations. “Therefore, having a good strategy for systematic quality analysis and food safety control is particularly important when dealing with organic ingredients,” he states.

“Sourcing can also be difficult if organic ingredients are only available on a small scale, which may mean there is not a stable supply of raw material for future growth,” says Katterfield. He therefore maintains that it is important to keep a dialogue going with organic producers about their ability to supply ingredients in the long term.

Tradin Organic has positioned itself to bridge the financial gap of organic uncertainty. “Many of our suppliers require assistance in the form of crop financing and prepayments. Since we are often operating in emerging economies and crop yields are not always predictable, this includes great financial risk. In doing this, we de-risk our customers and even extend them favorable payment terms,” says Floot.

Keeping tight quality control
Due to high demand, the enforcement of organic standards differs from country to country, and some suppliers will try to cut corners,” explains Walder. “This has led to fraud cases where conventional foods have been labeled and sold as organic foods. Fulfilling the organic certification requirements and controlling the quality of the product requires experience and good communication with the responsible inspection bodies.”

Regarding the purchase of vanilla, the main risk is that the growers do not comply with good cultivation practices, which can cause contamination. Thus, it is essential for companies to work with partner suppliers, who control the whole supply chain locally, from crop maintenance to collection, preparation and exportation, according to Clément L. Strohmann, Sourcing Manager Vanilla at Prova.

Digital technology also has a role to play. Last year Tradin Organic introduced a digital traceability system allowing the company to map organic fields in its projects.

For Floot, technology and automation will play a significant role in the future of organic farming, such as the use of high tech mechanical weeding equipment, preventing both the use of chemicals and manual weeding. Also, drones are being used to monitor crop health, soil quality, and map fields.

“Organic farming is not a silver bullet, but a combination of different practices and a change in dietary habits can lead to sustainable and ethical agriculture that produces healthy, cleaner products,” concludes Walder.

Earlier this year at the Biofach 2020 event in Nuremberg, Germany, FoodIngredientsFirst spoke with a host of organic producers, who elaborated on the sourcing and cultivation challenges in organic production.

By Missy Green