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AUSTRIA

1. Organic farming in Austria

1.1 Organic production

Austria has the highest percentage of organically farmed agricultural land of all the European countries. In 2000 there were about 19 000 certified organic farms, or about 7 percent of all farms. Approximately 272 000 hectares were farmed organically. The average size of organic farms is 14 hectares. Most of the organic production takes place in mountainous areas, where permanent grassland prevails.

The rate of conversion towards organic agriculture in Austria has slowed down in the last two years. While there is a stagnation of organic production, the marketing of organic products continues to increase. Currently, considerable amounts are marketed conventionally. While the increases in production were very high for most products until 1998, the level of production and marketing has remained stable since then. Exceptions are cereals and non-perishable vegetables, to some extent. The rapid increase between 1996 and 1998 was mainly triggered by subsidies. Most farms that benefited from subsidies have converted to organic farming; therefore, further increases will be mainly market driven.

On average, production has more than doubled over the past four years for all product groups. The highest increases are found with pork, but this has to be seen in relation to the very low overall production level. Non-perishable vegetables rank second, while fresh vegetables have shown a rather modest increase.

According to data supplied by VNÖ ("Verein der Naturkostläden Österreichs", an umbrella organization of natural food stores in Austria), the Agrarmarkt Austria (AMA) estimated that Austria experienced an annual growth in organic sales of about 10-15 percent in 1999, among the lowest in Europe.

1.2 Governmental policy

When Austria joined the EC in 1995, producer prices dropped dramatically. Therefore, conversion to organic farming was advocated as the survival strategy for small-scale farming. This contributed significantly to a greater acceptance of organic farming within the agricultural system. The Austrian Government had already started to give subsidies for conversion to organic agriculture in 1992. In 1995 a horizontal agro-environmental programme under EC Regulation 2078/92 was effected. The programme, called Österreichisches Programm für umweltgerechte Landwirtschaft (Öpul), was slightly adjusted in the year 2000 and extended for five years (see Table 1). The payments per ha increased and are presently as follows:

Table 1: Subsidies for organic production under the agro-environmental programme (ÖPUL)

Category

1998

2000

Arable land

S4 000/ha

4 500

Meadows

S3 000/ha

3 450

Vegetables, strawberries

S6 000/ha

7 000 to 9 000

Horticulture, tree nurseries, hops

S10 000/ha

11 000

Source: BMLF.

Table 2: Total organic production of fruit and vegetables 1999

Product (tonnes)

Total production

Indirect marketing

Direct marketing

Potatoes

12 000

10 000

2 000

Other storable vegetables (carrots, onions, etc.)

6 000

5 000

1 000

Fresh vegetables (tomatoes, green pepper, lettuce, cucumber, etc.)

3 000

2 500

500

Total vegetables

21 000

17 500

3 500

Total fruit

6 000

5 000

1 000

Source: (BMLF, 2000) The Austrian market for organic fruit and vegetables.

Virtually no official statistics are available for the organic sector on fruit and vegetables in Austria. This underlines the minor importance of this sector within Austrian agriculture. Import data for organic and conventional products are not separated.

Market partners and importers were reluctant to supply hard data. The Austrian market of organic products in general is dominated by supermarket chains, which are in the process of establishing their own organic labels. They were disinclined to release any data, as they fear loss of competitive advantages. Therefore, in order to at least get a general picture of the situation, the author has made estimations and rough calculations based on estimates. These estimations were cross-checked with market experts and seem to be realistic. However, the results have to be seen in the light of these limitations.

2. The Austrian market for organic fruit and vegetables

2.1 The organic market

In 1999 the total organic turnover was estimated at S2.9 billion, or 1.8 percent of the total food market. The annual growth rate is estimated at 10-15 percent. About 70 percent of the turnover is made in urban areas.

Table 3: Organic production marketed as organic 1996-1999 (indirect marketing channels only)

Product

1996

1997

1998

1999

Average growth rate/year

Beef (numbers)

3 500

6 200

7 800

8 000

32.14

Pork (numbers)

1 000

5 000

10 000

10 000

225

Poultry (numbers)

150 000

160 000

200 000

200 000

8.33

Milk (mill. litres)

75

100

135

150

25

Eggs

500 000

1 500 000

1 600 000

1 800 000

65

Cereals (tonnes)

16 000

22 000

28 000

38 000

34.4

Potatoes (tonnes)

5 500

9 500

13 000

13 000

34.1

Other less perishable vegetables (carrots, onions) (tonnes)

1 000

2 600

5 000

7 000

150

Perishable vegetables (tomatoes, green pepper, lettuce, cucumber, etc.) (tonnes)

2 000

2 000

2 500

2 500

6.25

Total vegetables (tonnes)

8 500

14 100

20 500

22 500

41.2

Total fruit (tonnes)

1 120

2 150

1 500

1 200

1.7

Source: ARGE- Biolandbau.

VNÖ expects that the share of organic products within the total turnover in the food sector will rise to more than ten percent (compared to the present two percent) within the next ten years (VNÖ, 2000). Although this might be an optimistic statement, there is potential for a steady market-driven growth of the organic sector.

2.2 Sales of organic fruit and vegetables

About three percent of all fresh fruit and five percent of all vegetables sold in Austria are produced under certified organic production standards (RICHTER et al, 2000). Table 4 provides estimates of sales value using these percentages. The table shows that sales value of organic vegetables is estimated at S61 million, while organic fruit sales are estimated at S170 million. The value found in literature is S200 million (RICHTER et al, 2000).

Table 4: Total sales value of fruit and vegetables and estimated organic sales value (in 1 000

Austrian shillings)


 


Total sales value

Estimated portion organic

1999

2000

1999

2000

Fresh vegetables

5 011 543

5 230 472

250 577

261 523

Fresh fruit

5 629 830

5 663 402

168 894

169 902

Total fresh fruit and vegetables

10 641 373

10 893 874

419 471

431 425

Source: AMA, author's calculation.

2.3 Average prices at retail level and premiums over conventional products

No statistical data is available for prices of organic products. Therefore, the authors had to rely on their own assessment, based on supermarket observations.

Table 5: Assessment of premiums for organic (January 2001)

Product

Price organic

Price conventional

Premium (percent)

Potatoes

12.90/kg

8.90

45

Carrots

10.90/kg

4.90

122

Onion

14.90-/kg

7.90

89

Broccoli

12.90 - 15.90/kg

10.90

18- 45

Oranges (Italy)

19.90/kg

14.90

33

Grapefruit

9.90/piece

7.90

25

Lemon

16.90/kg

12.90

31

Kiwi

2.90/piece

1.66

74-135

Apple

24.90/kg

19.90

25

Pears

29.90/kg

24.90

20

Tomatoes

24.90/kg

19.90

25

Source: Authors’ assessment, drawn from a sample of 3 major Austrian supermarket chains.

The range of premiums for organic fruit and vegetables at the supermarket level is, on average, around 20-30 percent, in some cases they are much higher (for example, carrots). This corresponds well with the range of premiums found in literature on organic horticultural products. The assessment varies, however, according to price specials and can therefore be regarded only as indicative. Premium levels differ, depending on region as well as on the type of distribution channel. In natural food stores the prices for organic products are generally higher. Premiums paid to organic producers are estimated by market experts between 30-100 percent.

2.4 Distribution channels

The main organic sales outlet is a supermarket. A sector analysis by the Austrian umbrella organization for natural food stores (VNÖ) shows that 66 percent of organic products are marketed by supermarkets, 22 percent by natural food stores and about 12 percent by direct marketing.

For sales of organic fruits and vegetables these percentages differ, as shown in Table 6. Direct marketing through farm sales is the main sales channel for fruit and vegetables.

Table 6: Distribution channels for organic fruits and vegetables 1996

Direct sale of farmers

Delivering services of farmers’ initiatives

Natural food stores

Supermarket

49

9

19

23

Source: BMLF, 1997, cit. In ZENNER/VON ZIEHLBERG, 1998, p. 62.

Natural food stores cooperate with smaller farmers’ associations, which are organized under the umbrella organization ÖIG (Österreichische Interessensgemeinschaft für biologischen Landbau). Marketing into the supermarket chains is organized by the farmers’ association Ernte für das Leben, which has a daughter firm called "Ökoland". This firm collects the products for supply to supermarkets and also for export.

The supermarket chain "Billa/Merkur" launched the organic food brand "Ja!natürlich" in 1994. All major supermarket chains (including discounters), such as Adeg, M-Preis, Maximarkt and Spar ("Natur pur" dairy products) now offer organic products.

Within the supermarkets, "Billa/Merkur" with the "ja!natürlich" label (www.janatuerlich.at), holds about 70 percent of the organic market share, followed by the supermarket chain "Spar", with 20 percent. Spar has an organic label called "Natur pur" (www.naturpur.at). The two supermarket chains differ in their policy towards organic products. While "Billa" has a strong, central unit dealing with organic products only, Spar’s organic products fall under the responsibility of each separate product department.

Austria has about 150 natural food stores, many of which are very small. Recently an umbrella organization called "Verein Naturkostläden Österreichs" (VNÖ) was formed. About 33 natural food stores are members, most of which are small with only 3 shops that have more than S3 million annual turnover. They are concentrated in eastern and southern Austria.

The natural food stores fill the gap between supermarkets and farmers’ shops and farmers’ markets, which remain an important distribution channel for organic products.

2.5 Trends and attitudes

A recent trend can be recognized towards the creation of "organic supermarkets", with a full range of products and more than 300 m² of floor space. The first organic supermarket opened in 1999 in Vienna. The strength of this distribution channel lies in the fact that it combines the convenience of ordinary supermarkets with the advantages of natural food stores (specialized in the organic sector and more detailed consumer information).

A relatively new but growing segment is the provision of organic products in public canteens. Recent food scares motivated Government officials and labour unions to put more pressure on public canteens to incorporate a higher share of organics into their purchases.

According to market research reviewed, Austrian consumers in general still prefer fresh products to convenience products and rank health higher than time-saving. Regarding quality criteria, "freshness" is ranked first (68 percent), followed by "natural" (27 percent) and "origin" (20 percent). Austrian origin is regarded important by 19 percent. (BMLF, 1997).

For horticultural products, the trend of sales since 1996 shows a varying picture (Table 7). While the share of production marketed as organic potatoes and other storable vegetables has increased, fresh (and perishable) vegetables and fruit sales have been almost stagnant. Only a slightly positive trend is expected in the long run by market experts. The market seems to be too fragile, and therefore, market partners are unwilling to take a risk with perishable products.

Table 7: Annual growth rate of marketed production in organic horticulture 1996- 1999

Product (tonnes)

1996

1999

Average growth rate/year(percent)

Potatoes

5 500

13 000

45

Other storable vegetables (carrots etc.)

1 000

7 000

200

Fresh vegetables (tomatoes, green pepper, lettuce etc.)

2 000

2 500

8.3

Total vegetables

8 500

22 500

55

Total fruits

1 120

1 200

2.4

Source: ARGE- Biolandbau.

Based on the market research reviewed, 54 percent of Austrians at least occasionally buy organic products. The typical consumer of organic products buys fruit and vegetables (79 percent), milk and milk products (61 percent) and cereals (52 percent). Consumers of organic products are usually those with higher income and higher education in the urban population.

The organic "fundamentalists", those who strictly buy organic products, still favour direct sales in farmers’ markets, on-farm sales or natural food stores. This group is becoming smaller, however, while the group of occasional buyers is growing.

Since all major supermarkets offer a share of organic products, the turnover of organic sales has increased considerably.

2.6 Constraints to market development

Constraints to market development are found on production as well as marketing sides.

On the production side, due to climatic constraints, Austria is limited to a certain range of products. Most farmers producing organic vegetables are small-scale farmers who have a considerable history in direct sales. In the fruit and vegetable sector direct sales still play a major role. Production of small-scale farms cannot be increased to meet the requirements of supermarkets. Conversion of large-scale farms is difficult as their specialization prevents the nutrient cycling and pest management required in organic farming. Therefore, a high percentage of the fruit and vegetables (conventionally and organically produced) needs to be imported.

On the marketing side, consumer attitudes and price expectations are the strongest limitations. Austrian consumers prefer regional products. Freshness is very important for buying, especially in the vegetable sector. For some consumers (especially for the ecologically conscious) ecological transport is relevant since transit, especially in the Alpine regions, is a major issue of the ecological debate.

For organic products, the confidence in certification mechanisms is important. The highest confidence is reached through direct sales by the producer. Direct sales further reduce exact price comparisons. Most supermarkets offer organic products under their own labels. Trust in the labels of supermarket chains is less than in the labels of producers. Producer labels are found more frequently in natural food stores and on-farm shops.

Sales via supermarkets has increasingly reached new consumers’ groups, but as they offer organic and conventional products side by side, the price becomes the main criterion of choice.

3. Imports of certified organic fruit and vegetables into Austria

3.1 Market access

EC Regulations regarding market access are applied. Besides the Regulation on organic production, there are market regulations for fruits and vegetables and processed products in general. Within the frame of these market regulations, the common norms (trade classifications) for fruit and vegetables are followed. Imports and exports of fruit and vegetables are furthermore restricted by licences and quotas. Licences are needed amongst others for the import of fresh garlic from China, tomatoes from Morocco, and for processed fruits and vegetables according to EC rule (EG) Nr. 1921/95.

The import volume of specific varieties of fruits and vegetables is monitored by an online system, whereby customs offices transfer data on imported quantities to the European Commission on a weekly basis (AMA; www.ama.at).

Besides these general trade restrictions, the EC has special norms for organic products. In addition to the EC Regulation, all market partners in Austria require certification by an Austrian certification body (e.g. "Austria Bio Garantie") to be sure of adequate standards.

3.2 Total import of organic products

No statistical data is available on import totals of organic products. Most key sources estimated the value of imports at S1 billion. Considering a total turnover of organic products of S3 billion, this would come to about 30 percent. Also, experts answering in a study on supermarkets (RICHTER et al, 2000) assume that about 30 percent of the organic products are imported. The main imports come from the Netherlands, France, Germany and Italy (CIR, 1999, p 38). The highest proportion of imports is fruit and vegetables.

However, if converted into absolute numbers, these figures do not match those given for overall imports in the organic sector. As already mentioned, the total value of imports is estimated to be S1 billion. The total value of the organic fruit and vegetable sector is estimated to be about S430 million (see Table 5). The total value of vegetables was estimated at S261 million. A 50 percent import share would mean about S130 million. The authors’ assessment after discussions with market participants regarding organic vegetable imports resulted in about S169 million. For the fruit sector, the authors’ estimates resulted in a rough figure of S158 million. This would total up to S327 million.

Therefore, considerable amounts of other products would need to be imported to reach that total. The amount of cereals imported, totals 2 000 tonnes (BMLF, 2000). Even under the assumption that the 20 percent (mentioned in Table 9) would total up to 7 000 tonnes (total production is 38 000 tonnes, see Table 2), this still cannot make up for the difference. It can only be assumed that there are a number of smaller items, such as processed products, which in total might add up to the reported value. On the other hand, it is also possible that the import value is greatly overestimated.

3.3 Total import of organic fruit and vegetables

Market sources estimate that between 1-5 percent of total imports of fruit and vegetables are organic. Since 1999 total import value of fresh fruit was S5.4 billion, while fresh vegetables were valued at S3.2 billion (total value for imported fresh fruit and vegetable was S8.6 billion); organic imports are estimated to range between S86 million and S370 million.

According to the report of the Corporate Intelligence on Retailing (CIR, 1999), about 70 percent of organic fruit and 40 percent of organic vegetables are imported. Given the figures (Table 4) for the sales value of organic fruit (S170 million) and vegetables (S261.5 million), this would mean a value of S104.6 million for vegetables and S119 million for fruit. The total import value thus would be S223.6 million.

The authors’ own assessment of major fruit and vegetable imports resulting from interviews with market participants gave a total of S176 million for vegetables and S158 million for fruits. This would total to S334 million (see Tables 8 and 9). Therefore, it can be assumed that the total import value is around S300 million.

3.4 Breakdown of organic fruit and vegetable imports by product

According to market experts, there are two rules of thumb to be applied on the situation of imported organic fruit and vegetables:

1) The more perishable an organic product is, the less interested importers and retailers are. While this attitude is general and not restricted to the organic sector, the fact that the organic market is still weak and that retailers cannot rely on known consumption patterns, contributes to this situation. Non-traditional products (like exotic fruit and vegetables) are especially perceived to have a higher commercial risk.

2) The premium for organic products over conventional products is a critical factor. This is true for all organic products. However, it applies especially to imported organic products as trust in foreign certification is low and organic products are easily substituted by conventional products if there is a high premium. In the long term it is expected that premiums will decrease, especially in supermarkets.

These restrictions influence, for instance, the situation with bananas. On the one hand they do not store very long, but on the other hand, their premiums are the highest within the group of tropical fruits.

Off-season organic berries (strawberries, etc.) and other perishable fruit are not imported in substantial amounts as the market is not yet stable enough and the risk of losses is high. Exotic fruit (mango, papaya, etc.) fall into a similar category. There is no organic demand for these fruits. They are highly priced luxuries and do not constitute a substantial share of the daily consumer purchases.

Table 8 provides estimates on imported organic vegetables.

Table 8: The main imported organic vegetables

Product

Quantities (tonnes)

Value (ATS 1000)

Zucchini

2 700

67 500

Kohlrabi

2 500

17 500

Broccoli

1 000

17 000

Potatoes

900

7 000

Onions

700

7 000

Carrots

1 200

18 000

Fennel

300

7 500

Tomatoes

100

2 000

Others (green pepper, cherry tomatoes etc.)


32 500

Total

9 400

176 000

Source: author’s assessment, estimations out of interviews with key informants.

As for organic fruits, the main products sold are oranges, followed by lemon, apples and kiwi. The results are given in Table 9.

Table 9: The main imported organic fruits

Product

Quantities (tonnes)

Value (ATS 1000)

Oranges

4 000

65 000

Lemon

3 400

50 000

Kiwi

1 000

20 000

Apple

400

8 000

Others (bananas, pears, mango, avocado)


15 000

Total

8 800

158 000

Source: author’s assessment, estimations out of interviews with key informants.

3.5 Trend for each product

Strong increases have been seen for organic zucchini and fennel. However, imports of organic tropical fruit is growing slowly, as particular organic quality is not requested, and the total quantity is low. Market sources expect a rather strong positive trend for citrus and carrots (as the domestic supply cannot meet the growing demand), especially in the baby food sector.

3.6 Main importers

Main import structures for organic fruits and vegetables include direct imports by supermarkets, general import wholesalers on contract with supermarkets, specialized importers for organic products and specialized importers for fruit and vegetables.

Supermarkets: some of the big chains, like "Spar", import themselves. Presently, they import organic fruit and vegetables from producer cooperatives in Mediterranean countries. "Billa" imports through wholesalers who are also in the conventional fruit and vegetable business. It seems, however, as if they are only involved with logistics, since all organic farmers supplying "Billa" (also those outside Austria) need a contract with the label "ja!natürlich". "Billa" does not only issue a frame contract but also negotiates price and quality. "Billa" usually issues long term contracts to potential producer groups for the most important products. This is true for Austrian producers and for producer groups in other countries

Specialized importers of organic products supply other distribution channels (natural food stores, specialized fruit and vegetable shops, small processors in gastronomy, etc.). Most operate either via Austrian daughter firms of German importers (e.g. "AL Naturkost" in eastern Austria), or they operate directly from Germany (Dennre, Bodan), as the Austrian market is comparably small and as "AL Naturkost" does not import directly from the exporting country but via importers in Germany.

Conventional importers of fruits and vegetables have a very limited share of organic products so far. They have a relatively stronger position in western Austria, while organic specialists especially cover Vienna and eastern Austria. There is a growing interest among some conventional importers to move towards dealing with organic products, but one major constraint they raise is the strong market position that is built up by "Billa", contracting with only a few importers.

Others: some organic food processors need components (such as potato starch or white sugar) in limited amounts. " Bioservice" (a daughter firm of the biggest organic farmers’ association "Ernte für das Leben") specializes in importing such products.

"Hipp", a major processor, is the largest producer of organic baby food. For vegetables there is a specialized firm that deals with domestic, as well as imported, products (carrots, onions, potatoes, etc.). According to "Hipp Austria" (Gmunden), tropical ingredients are imported for the central firm in Pfaffenhofen/Germany and the Austrian firm mainly receives final products. Another processor, specialized in dried fruit and mixtures with cereals (for muesli), is "Naturprodukte Perlinger". It imports and exports dried fruit (partly only re-labelling, with distribution via supermarkets).

3.7 Product specification

Products are only marketable if they comply with the requirements of the trade classification in categories "Extra, I or II". The classification system acts according to the Austrian federal law on quality classes.

According to importers, the reduction of storage life due to the prohibition on use of storage chemicals does not affect organic products in their sector. This is a major problem, however, on the retail level. Some retailers try to increase shelf life of sensitive organic products by packaging organic fruits and vegetables in cardboard boxes with plastic wrap, but that contradicts the consumers’ expectations of "natural" and "freshness".

3.8 Prices at import level

AMA gives import prices for organic and conventional products. Prices vary considerably according to the country of origin. While some importers claim that prices are almost the same as for conventional products, others claim that a 10-15 percent premium is charged for oranges and lemons. According to supermarket chains, oranges and lemons from Italy (the main organic products) achieve a premium of up to 30 percent. The difference might be explained by the fact that some supermarket chains have their regular suppliers, while others buy on the daily market.

An assessment was made, comparing price lists of German wholesalers specialized in organic products, which also export to Austria, with the price list of an Austrian importer of conventional fruit and vegetables.

Table 10: Prices and premiums for selected organic products on import level (Jan. 2001)

Product

Price organic (ATS)

Country of origin

Price conventional (ATS)

Country of origin

Premium %

Tomatoes

31.5/kg

Italy

25/kg

Spain

26

Lettuce

133/kolli

France

122/kolli

Italy

9

Green pepper

34.65/kg

Italy

34/kg

Spain

2

Onions

17.15/kg

Italy

18/kg

Italy

-

Apples

20/kg

Germany

16/kg

Italy

25

Oranges

19/kg

Spain

19/kg

Spain

-

Lemon

18/kg

Spain

18/kg

Spain

-

Bananas

26.95/kg

Dom. Rep.

22/kg

Panama

22.5

Source: author’s assessment.

According to this assessment, the premiums for citrus seem to be practically nil. Tomatoes fetch a rather high premium. However, because of storage problems with organic tomatoes, the amount of imported tomatoes is low.

Relatively high premiums are paid for bananas, however market experts attribute this to the small organic banana market. The low market share and the short shelf life result in the high premiums at the import level (according to one importer, it can reach up to 100 percent at times), which is a sort of risk payment. On the other hand, the high premiums restrict market development.

3.9 Major suppliers and main products

The Austrian market for organic fruit and vegetables relies mainly on suppliers from the European Community. One reason is because retailers (and consumers) do not trust certification in overseas countries. Within the EC, no import restrictions exist. Therefore, European countries are the main sources of origin.

However, sometimes consumers are reluctant to buy non-Austrian products. As some countries are regarded as practising intensive agriculture, many organic consumers do not buy organic products originating from them.

The main suppliers of fruits and vegetables are in southern Europe or in Mediterranean countries.

Table 11 shows a variety of countries of origin, for which data has been taken from lists of importers and retailers showing the country of origin. It has to be kept in mind, however, that the quantities for most of these products are very low.

The main import season for many products is the off-season (winter). Potatoes are imported only in spring, especially for the asparagus season (which are eaten traditionally with boiled potatoes) when fresh, but domestically produced potatoes are not available and the old stock is no longer of sufficient quality.

Table 11: Main countries of origin for imported organic fruit and vegetables, major products, major season of supply

Country

Product

Season of supply

Israel

 

green pepper, Chinese cabbage

winter

potatoes

spring

avocado

all year

tomatoes

February to May

oranges, grapefruits, tangerines

all year

Italy

 

apples

winter

oranges

October to March

lemons

all year

fennel, aubergines, green pepper,

winter

tomatoes, lettuce


Spain

 

oranges, lemons

October to March

grapes

winter/spring

cucumbers, cabbage, broccoli

winter

sweet potatoes

all year

France

 

cabbage, lettuce

winter

garlic, shallots


parsley


Greece

oranges,

October - March

lemons

all year

Dominican Republic

bananas

all year

Source: author’s assessment in shops, opinion of market experts.

3.10 Constraints to import growth

Major marketing institutions (like the AMA) and the general agricultural policy inspire the general consumer to "buy Austrian". Many consumers consider Austrian products more natural and better than those from abroad. This idea is further fostered by the recent food scares in the meat sector (BSE and foot and mouth disease).

The main constraint to import growth in the fruit and vegetable sector is the lack of confidence in the certification bodies of non-EC countries. A second constraint comes from organic farming associations (especially their biggest organization "Ernte für das Leben"), which are involved in the main organic labels of supermarket chains. Usually their market representative are consulted before new products are listed. They try to argue against products that can be grown in Austria or that substitute Austrian products (like organic apples from Argentina), and in general, retailers share this view. The third constraint is that consumers are unwilling to pay the premiums for organic products, especially at supermarkets, where consumers can choose between organic and conventional products.

4. Conclusions

4.1 Summary of key characteristics of the market

More than half of the organic fruit and vegetables on the Austrian market are sold directly by farmers. Supermarkets sell about 23 percent of all vegetables, and natural food stores sell about 19 percent. Imported organic fruit and vegetables are sold either by supermarket chains (about 55 percent) or by natural food stores (about 45 percent).

There is a significant demand for organic fruit and vegetables that cannot be produced domestically, mainly due to climatic conditions. However, consumers as well as retailers prefer domestically produced organic products, and only purchase imported products if they are not available in Austria. Imports from Mediterranean countries are preferred over imports from countries farther away. Retailers fear produce loss due to limited shelf life, and therefore, the highest imports are seen for those products that are not so easily perishable.

4.2 Main opportunities and constraints

Opportunities for foreign exporters to supply the Austrian market are available because Austrian production cannot meet demand. Therefore, especially during wintertime, a range of fruit and vegetables has to be imported, including fruits, such as oranges, lemon, apples, kiwi, bananas, as well as off-season vegetables, among which zucchini, kohlrabi, broccoli and fennel are the leading products.

However, retailers give priority to imports from producers in neighbouring countries, reducing prospects for developing countries to export organic products to the Austrian market. Exotic fruit and vegetables, such as papaya, mango or sweet potatoes are not demanded in large quantities and usually not in organic form. Retailers are mostly interested in products that store well. Apples come mainly from South Tyrol in Italy, a region with strong cultural ties to Austria.

There are severe constraints to imports from developing countries:

4.3 Entry strategy and recommendations for export development

EC registration is a prerequisite for market entrance. Generally there are two possible strategies for market entrance into Austria:

1. Directly via supermarket chains, which have long-term contracts with exporting producer groups, or via wholesalers and importers. Retailers request the producer group in the exporting country to adhere to the international standards for organic production. In order to build up trustful relations, most retailers, especially supermarket chains, request the approval of a national Austrian certification body, like ABG. They, in turn, are affiliated to organic growers’ associations, which are resistant to imports that might substitute domestic production.

2. Via specialized import firms that supply the natural food store sector. In this case, the Austrian market should not be seen independently from the bigger German market, as this is the traditional partner for imports of organic products. Many of the importing firms specialized in organic products either operate directly from Germany or are Austrian daughters of German firms. Entrance into the Austrian market thus, to a large extent, is via Germany. Also, natural food stores are linked to organic farmers’ associations, which are sensitive to products that might substitute domestic production.

Within the organic movement however, there is a strong sympathy for "fair trade" products. According to a recent study, 32 percent of Austrian consumers are interested in fair trade product. (Hörtner, 2001). Chances seem to be best for organic combined with "fair trade". This means that the rules for production do not only include organic standards but also social aspects. Austrian certification bodies apply reduced rates for certification of farmers’ groups in developing countries, if involved in organic "fair trade" projects. The long-term trade relations, characteristic of the "fair trade" movements, are also found in contracts issued by Austrian supermarket chains. Therefore, the most promising entrance strategy seems to be close cooperation with Austrian organic growers’ associations (and certification bodies), as well as with "fair trade" organizations.

References

BMLF. (1999) Gruener Bericht - Bericht zur Lage der oesterreichischen Landwirtschaft. In: Bundesministerium fuer Land- und Forstwirtschaft, Vienna.

BMLF (1997) Lebensmittelbericht, Bundesministerium fuer Land- und Forstwirtschaft, Vienna. http://www.bmlf.gv.at/download/dlpublik/LEBMBER.PDF

CIR (Corporate Intelligence on Retailing) (1999): The European Market for organic foods. London

GREGOR L. (2000) Naturkost-Fachhandel im Aufwind; Bioclub Aktuell Nov/Dez 2000

HAMM U.; MICHELSEN J. (1999) Der Markt für Ökolebensmittel in Europa. In: Agra-Europe, Sonderdruck, 43/99

HÖRTNER W. (2001) Vorbild Schweiz, Südwind 5/2001

POHL A. (2000) Organic Europe, Country report Austria, www.organic-europe.net/cuntry_reports/Austria/default.asp#10.3, 15.6.2000

RICHTER T. SCHMID O.; MEIER U.; HALPIN D.; BERGE P.; DAMRAY P. (2000) Internationale Untersuchung von Einzelhandelsunternehmen hinsichtlich ihrer Aktivitäten zur Vermarktung von Bioprodukten, FIBL, Switzerland (unpublished)

VNÖ (2000) Eine goldene Zukunft für Bioprodukte (Presseaussendung Oktober 2000)

ZENNER,S.; R. v. ZIEHLBERG (1998): Der Markt für Bioprodukte in Österreich.; Diplomarbeit am Lehrstuhl für Agrarmarketing des Instituts für Agrarökonomie der Christian-Albrechts-Universität Kiel

Annex I - Importers of tropical fruits

Importer

Johann Ischia & Co
Im- und Exportgesellschaft
mbH & Co
Amraserstr. 6
6020 Innsbruck/Tirol
Tel: +43/512/52015-0
Fax: +43/512/52015-15

Obst Huber Fruchtimport GesmbH
Neinergutstr. 28-30
4600 Wels
Tel: +43/7242/404-0
Fax: +43/7242/404-147

Main importers that have a stall at the main wholesale market for fruits and vegetables in Vienna- Inzersdorf.

Firm

Ahorner josef Ges.m.b.H.
B 1/1-8
Tel: 01/61002

H. Dorfinger
C12/137-138
01/616 99 40

Import firms specialized in organic products

Al Naturkost
Schulgasse 35
2542 Kottingbrunn
Tel. 02252 77218

Natürlich Weber
A- 3932 Kirchberg/Walde 52
Tel: 02854 20417
Fax: 02854 631016
office@weber-austria.at

Operating from Germany

Bodan Verteilerdienst
Bruchfelderstr. 6
88662 Überlingen
Tel: 0049 7553 8240
Fax: 0049 7553 6118
bodan.VTD@t-online.de

Dennree Versorgungs GmbH
Hoferstr 11
95183 Königshof/Töpen
Tel: 09295-180 ·
Fax: 09295-1850

German actors in the organic food sector are also found under:
http://www.naturkost.de/herst/grosshandel.htm

Annex II - Organic farmers organizations

Umbrella organizations

ARGE Biolandbau,
Wickenburggasse 14/9
1080 Vienna
Tel: 0043 1 4037050
http//:www.bioclub.at

ÖIG Österreichische
Interessensgemeinschaft für biologische
Landwirtschaft
Schlag 14;
2871 Zöbern
Tel: 0043 2642 865319
http//:www.oekoland.at

Farmers Associations

Arche Noah
0bere Strasse 40
3553 Schiltern
Tel: 0043 2734 8626

BAF Verband der biologisch wirtschaftenden
Ackerbaubetriebe Österreichs
2164 Gut Prerau,
Tel. 02523/8412
Fax 02523/8412

Biolandwirtschaft Ennstal:
Bahnhofstr. 182
8950 Stainach
Tel.: 0043 3682 24521 254
Fax 03623/20117
bioland.ennstal@telering.at www.bioland-ennstal.at

Demeter Bund
Hitzinger Kai 127/2/31
1130 Vienna
Tel.: 0043 1 8794701
Fax 01/8794722

DINATUR Verein für fortschrtittliche kontolliert biologische Landwirtschaft
(Barbara Fink-Spann)
Schlag 14
A-2871 Zöbern
Tel.: 02642/8651-19
Fax: 026242/8651-9
dinatur@nextra.at www.dinatur.at

ERDE & SAAT
(Katharina Keplinger)
Hanriederstr.8
A-4132 Lembach
Tel.: 07286/7517
Fax: 07286/7517-20
erde.saat@aon.at www.oekoland.at/erde_saat

ERNTE für das Leben, Verband organisch biologisch wirtschaftender Bauern
Europaplatz 4
4020 Linz
Tel.: 0043 0732 654884
www.bio-ernte.at

FREILAND Verband
Wickenburggasse 14/9
1080 Vienna
Tel.: 01 4088809
Fax 01/402 78 00
freiland@ins.at

HOFMARKE Dachverband für biologische Landwirtschaft und Direktvermarktung (Mag. Martin Tragler)
4553 Schlierbach Nr. 226
Tel.: 07582/61404-0
Fax: 07582/61404-4
office@hofmarke.at
www.hofmarke.at

KOPRA Konsumenten
Produzenten
Arbeitsgemeinschaft (DI Franz Rauch)
Hirschgraben 15
A-6800 Feldkirch -
Tel.: 05522/79687
Fax: 05522/79687-11
kopra@verein.vol.at
www2.vol.at/kopra

LEBA Lebensqualität aus Bauernhand
Buntweg 14
5611 Zams
Tel 0043 5442 65765

Ökowirt Informationsservice für Bauern und Konsumenten
(DI Wolfgang Pirklhuber)
Feyregg 39
A-4552 Wartberg
Tel.: 07587/7177
Fax: 07587/7177-29
oekowirt@oekoland.at
www.oekoland.at/oekowirt

ORBI Fördergemeinschaft für ein gesundes Bauerntum
Nöbauerstr. 22
4060 Leonding
Tel.: 0043 732 675363
www.bioclub.at/orbi

Verein organisch biologisch wirtschaftender Bauern Weinviertel (Johann Kettler)
A-2053 Peigarten 52
Tel.: 02944/8263
Fax: 02944/8402
aon.912042121@aon.at
www.oekoland.at/kettler

Annex III - Organic certification bodies

ABG Austria Bio Garantie
Königbrunnerstr 8
A-2202 Enzersfeld
Tel. 02262/672212
Fax 02262/674143
nw@abg.at
(covers all Austria)

BIOS Biokontrollservice
Österreich
Feyregg 39
4552 Wartberg
Tel: 07587/7177 14
Fax 07587/7177 11
(covers all Austria)

LACON
4122 Arnreit 13
Tel. 07282/7711
Fax 07282/7711 4
(covers all Austria)

SLK Landwirtschaftliche
Kontrolle
Ges.m.b.H.
Maria-Cebotari Straße 3
5020 Salzburg
Tel. 0662/649483
Fax 0662/649483 19
office@slk.at
www.slk.at
(only for Salzburg, Carinthia, Upper Austria, Styria and Tyrol

BIKO Verband Biokontrolle
Tirol
Brixnerstr 1
6020 Innsbruck
Tel. 0512/5929-336
Fax 0512/5929 212
(only for Tyrol)

Lebensmittelversuchsanstalt
Blaasstr. 29
1190 Vienna
Tel. 01/3688555
Fax 01/3688555 20
(covers all Austria)

SGS Austria Controll & Co
Ges.m.b.H.
Johannesgasse 14
1015 Vienna
Tel. 01/5122567
Fax 01/5122567 9
(covers all Austria)

Fair trade organizations

Trans Fair Österreich
Helmut Adam
Wipplingerstraße 32,
1010 Vienna
Tel: 01-5330956
Fax: 01-5330957

EZA Dritte Welt
8, Plainbachstr.
5101 Bergheim
Tel: +43 662 452 178
Fax: +43 662 452 586
office@eza3welt.at

Fair trade in Germany

GEPA
Gewerbepark Wagner,
Bruch 4
42279 Wuppertal
Tel: +49 202 26 68 30
Fax: +49 202 266 83 10
marketing@gepa.org

Fair Trade e.V.
www.fairtrade.de

El Puente GmbH
Hildesheimerstr. 59
D-31177 Harsum
Tel: 05127-98860-0
Fax: 05127-9886028
info@el-puente.de
vertrieb@el-puente.de
einkauf@el-puente.de

BanaFair e.V.
Langgasse 41
63571 Gelnhausen
Tel: 06051-8366-0
Fax: 06051-8366-77
info@banafair.de
presse@banafair.de
vertrieb@banafair.de
http//:www.banafair.de

Annex IV - Other sources of information

Herbert Allerstorfer
Marketing Director of "ErntE
für das Leben
Europaplatz 4, 4020 Linz
Tel: 0732 654884/16
herbert.allerstorfer@ente.at

Alexandra Pohl: ARGE
Biolandbau
Wickenburggasse 14/9
A- 1080 Vienna
Tel: 01/4037050
arge.biolandbau@ris.at

SPAR Supermarket
Taborstr. 95, 1200 Vienna
Tel: 01/3300539-726
Fax: 01/3303322
Person responsible for fruits
and vegetables:
Harald Rauchegger
harald.rauchegger@spar.co.at

BILLA Supermarket
IZ NÖ Süd Str.3 Obj.16
2355 Wr. Neudorf
Tel: 02236/600 6930
Fax: 02236/600-7690
Person responsible for fruits
and vegetables:
Thomas Rogy
thomas.rogy@billa.co.at

Organic Supermarket
Stefan Maran
Tel.: 01/4818880-18

Verein Naturkostläden
Österreich VNÖ
R. Liebing, Rosensteingasse 84

1170 Vienna
Tel: 01/4802047
vnoe@oekoland.at
http//:oekoland.at/vnoe

AMA Agrarmarkt Austria
Dresdnerstr. 70
1200 Vienna
Tel.: 01/33151
http//:www.ama.at

ARGE Bio-Landbau/BIO
CLUB
Wickenburggasse 14/9
A-1080 Vienna
Tel.: (07114) 22 13 14

http://www.bioclub.at/bioclub.htm
Magazine: Bio Club Aktuell

Federal Ministry of Agriculture, Forestry, Environment and Water Affairs
Stubenring 1
A-1012 Vienna
Tel: (+43 1) 711 00-0
Fax: (+43 1) 711 00-2127

http://www.bmlf.gv.at/frame.p
html?file=/ge/lebensm/bio_lex/index.htm

OEKOLAND
http//:www.oekoloand.at
Magazine: Ökoland


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