EU organic farmland area up 25%, in line with global trend

The global market for organic food is estimated at over €80bn and forecast to grow, despite high production risks.

Organic farmland in the EU increased by 25 percent between 2012 and 2017 and is expected to continue growing, according to Eurostat, the bloc’s statistical agency.

Total organic land in the EU reached 12.6 million hectares in 2017, 7 percent of the region’s total utilized agricultural area, helped by demand from millennials, said one expert.

Spain (2.1 million hectares), Italy (1.9 million hectares), France (1.74 million hectares) and Germany (1.1 million hectares) account for 54.7 percent of organic land, according to Eurostat. At national level, the highest shares of organic land were in Austria, Estonia and Sweden, which all had more than 19 percent of total agricultural land classified as organic.

Eurostat predicts the amount of organic land will continue growing, noting that Bulgaria, Croatia, Hungary, Romania and Serbia have large areas undergoing conversion. Bulgaria and Croatia have also recorded more than 100 percent growth in total organic areas between 2012 and 2017.

Arable land represented 44.5 percent of the total organic area. There was also growth in the livestock sector, although only 4.3 million cattle were classified as organic out of a total head count of 88.4 million in 2017. Latvia, Austria and Sweden have the highest shares of organic cattle, sheep and goats. More than 20 percent of their populations were classified as such.

The overall growth masked falls in Poland and the UK, which reported reductions of 24.5 percent and 15.6 percent respectively. Greece (11.3 percent) and Romania (10.3 percent) also saw falls in organic land, Eurostat said.

Global trend

The rise is echoed globally. The Swiss-based Research Institute of Organic Agriculture (FiBL) and the international organization IFOAM estimated there was a 15 percent rise in global organic farmland in 2016, compared with 2015, with almost 58 million hectares.

Nearly half is located in Oceania (27.3 million hectares), followed by Europe (13.5 million hectares), Latin America (7.1 million hectares), Asia (4.9 million hectares), North America (3.1 million hectares) and Africa (1.8 million hectares).

The growth is responding to increasing consumer demand. Market research company Ecovia Intelligence estimated the global market for organic food to be worth more than €80 billion in 2016, led by the US (€38.9 billion), Germany (€9.5 billion), France (€6.7 billion) and China (€5.9 billion). There are also nearly three million producers worldwide, with India reporting the highest number, followed by Uganda and Mexico, FiBL and IFOAM said.

Paul McMahon, managing partner at asset manager SLM Partners, believes millennials’ interest in health, nutrition and the environment, in particular, is driving the trend.

A report on impact investing in agriculture by Valoral Advisors, an advisory firm, identified seven key food and agriculture themes, singling out organic production as a key way to meeting the UN Sustainable Development Goals.

Valoral expects the industry to continue growing in the near future, as consumers increasingly buy organic, believing it to be better for health and the environment.

The European Investment Fund, the investment arm of the European Investment Bank, is also targeting organic and ecological production in its recent funds in France, together with farm modernization such as robotic milking parlors.


Organic farmland globally remains at just 1.2 percent of total agricultural area in 2016. Fred Appleby, investment associate at private equity firm ADM Capital Europe pointed to the higher risks associated with it. It is much more vulnerable to pests, disease and weather events than conventional agriculture, he told Agri Investor. He cited their investment through the Cibus fund of the Innoliva project which involves management of over 6,000 hectares of high-density olive trees. “Currently, it has approximately 5 percent of its production under organic and we are slowly converting a portion of our groves to organic, but we are unlikely ever to be wholly organic. It takes three years to convert and then they become susceptible to an increased risk of disease and other biohazards. Demand for organic olive oil is increasing, but there are other factors that consumers also demand, such as traceability, quality and sustainability”, he insisted.

McMahon also pointed to the difference between the EU and North America. The latter’s organic area less than 1 percent of the agricultural total.

“US row crop farmers, in particular, have been slower to switch to organic production, despite the strong price premiums and higher profits, because of the financial risk during the transition period,” he said.

In the EU, however, farmers receive incentives under the Common Agricultural Policy, which helps them get through the difficult two- to three-year transition period. “There is a massive supply deficit of organic grains, which has led the US becoming a major importer of organic grains but this is a situation that will eventually be corrected, partly through wise investment,” McMahon added.

A workshop looking at the potential of the organic sector to feed the world and contribute to the UN 2030 Agenda for Sustainable Development is set to be held by the EU Commission at the end of the month.