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Will the market forces and the legal framework be able
to balance demand and supply in the short and long term?
Organic agriculture is a recent development. I believe it will
take years
to reach a maturation.
Many of the large seed companies see organic production as a
niche business. The lure of new F1 hybrids is keeping most of
them busy in their R&D efforts.
The barriers to entry for organic seed production are very
high. It is not easy to get in and to produce consistently
high quality crops. Although the demand will increase by
20 to 30% per year, I think that the main producers of organic
seed will remain niche players like Genesis Seeds.
Low cost of land, low yields and cheap labor is not a formula
for successful
organic growing. It is hard for me to see the cardinal sin of
agriculture, over production, affecting the organic market.
I do believe that, in time, the price difference between
organic produce and conventional produce will diminish, but
there will probably always remain a 10-20% price premium for
quality organic produce. |
