DENMARK

Introduction

Although a small country, both in population (5.3 million) and in geographical size (43 094 sq. km), Denmark has become one of the pioneers in promoting organic agriculture, and in producing and marketing organic food and beverages. The rapid development of the sector throughout most of the 1990s is a result of strong cooperation among three parties, i.e. Government authorities, farmers and the retail trade, in particular Co-op Denmark (FDB), which have all been working towards a common goal.

In 1993, FDB made a policy decision to drastically lower the retail prices of organic products, which enormously stimulated sales. In 1995, the Government issued an Action Plan for the Advancement of Organic Food Production in Denmark, of which most of the recommendations have been implemented. In January 1999, the Ministry of Food, Agriculture and Fisheries published Action Plan II (prepared by the Organic Foods Council) to support organic development during the period 1999-2003. It provides policy guidelines and recommendations on organic farming (e.g. conversion), product and quality development, marketing and distribution, export marketing, training, research, etc.

It is also significant that a number of organizations have been founded over the years to promote organic farming, food production and trade, including: Danish Association for Organic Farming (LØJ) in 1981; The Organic Foods Council (set up by the Government) in 1987; the Organic Service Centre (ØLC) in 1992; and the Danish Organic Trade Association in 1998. The latter is an association of suppliers and processors of organic food and beverages with the purpose of promoting sales of organic products, benefiting both domestic and foreign producers.

1. Organic farming in Denmark

During the five-year period 1996-2000, organic farmland, including fully converted and "under conversion" land, increased from 46 171 hectares (of which 20 193 ha were fully converted) to 165 258 hectares (of which 93 354 ha were fully converted). During the same period, the number of organically run farms increased steadily from 1 166 to 3 466. In 2000, the total organic farmland (including "under conversion") accounted for 6.2 percent of total Danish farmland, whereas the "fully converted" farmland accounted for 2.3 percent. Organic farmers accounted for 6.2 percent of all Danish farmers in that year.

In terms of geographical importance, Jutland is the most important area with 73.5 percent of the organic farms and about 85.2 percent of the total organic land (2000). In comparison, the corresponding figures for Zealand were 20.8 percent and 12 percent, and for Funen 5.7 percent and 2.8 percent, respectively. The average organic farm size was 55.2 ha in Jutland, compared with 27.4 in Zealand and 23.6 in Funen. The country average was 47.7 ha.

1.1 Organic fruit and vegetable production

Fruit and vegetable production only accounts for a fairly small share of organic farming. In 2000, there were 1912 ha of organic vegetable production (fully converted), according to Plantedirektoratet. This included 1 424 ha in Jutland, 372 ha in Zealand and 116 ha in Funen. Of the total, 1 716 ha were used for vegetables, and 197 ha were used for fruits and berries.

In terms of vegetable and root crops, potatoes were the most important, with 821 ha; followed by carrots, with 404 ha; onions, with 75 ha; cabbage, with 55 ha; leeks, with 41 ha; and mushrooms, with 8 ha. Another 293 ha were used for "other vegetables" and 19 ha were used for greenhouse vegetable production.

As far as fruits and berries are concerned, apples were the most important with 66 ha (in 2000); followed by tree fruits (e.g. cherries), with 51 ha; black currants, with 43 ha; strawberries, with 29 ha; and bush fruit, with 7 ha.

While production figures in terms of quantity are not available, it should be mentioned that production has increased considerably in recent years, though fluctuations are common due to climatic conditions, etc.

1.2 Major producers of organic fruits and vegetables

Amongst the many organic producers of fruits and vegetables in Denmark, the following major ones should be mentioned, as they are also active in the distribution of organic products, including sales of imported organic fruits and vegetables:

• Biodania, which is a cooperative, coordinates production and sales to the major supermarket chains, wholesalers and box schemes for its 65 members, which together account for a major part of total organic fruits and vegetable sales. Some members, including the following also operate commercial pack houses:
• Svanholm Gods, Skibby (Zealand) produces fruits and vegetables and fruit juices;
• Blære Frugtplantage, Aars (Northern Jutland) produces fruits and vegetables;
• Gartneriet Marienlyst, Harlev (Eastern Jutland) produces vegetables; and
• Søris I/S, Ølstykke (Zealand) produces mainly carrots and potatoes.

The following producers (non Biodania-members) should also be mentioned:

• Barritskov (in Eastern Jutland) is the largest organic farm in Denmark. Main crops include vegetables, including cabbage, salads, fennel, celery leaves and culinary herbs. Barritskov, in partnership with three other farms (Ringstholm, Billeslund and Krogerup) together farm a total 900 ha of cropland. The total production of Barritskov and part of its partners’ is sold through a box scheme/Internet company www.aarstiderne.com (see section 2.4);
• Danorganic A/S (a fusion between Fælles Grønt and Danespo), which consists of more than 50 producers of vegetables, including potatoes, carrots, onions and beetroot.

1.3 Exports/re-exports of organic food

Research carried out by the Organic Service Centre (ØLC) indicates that exports, including re-exports of organic food and beverages amounted to about DKr 237 million in 2000. The growth rate was very high during the period 1999-2000, and is expected to reach 30-40 percent in 2001.

Fruits and vegetables, including fresh and processed, constituted the third largest export item in 2000, after dairy products and cereals, and were in the DKr22-26 million range, two-thirds of which were fresh produce. In total, 45 companies exported organic food, six of which exported fresh fruits and vegetables and two exported processed fruits and vegetables. The main export markets for organic fruits and vegetables are the United Kingdom, Germany and Sweden.

1.4 Government policy on organic farming

Although, generally speaking, most Danish farmers have been reluctant to go into organic farming, a significant switch has taken place over the last decade. This is partly a result of market pressure and partly due to Government policy. The Government started to grant subsidies to organic farmers and various organic projects in 1988.

In order to promote organic farming, the Government has introduced a number of subsidies. Under one scheme (50 percent financed by EC), starting in 2001, farmers may apply for the following subsidies (of relevance to fruit and vegetable producers):

• A conversion subsidy (DKr450 per ha per year);
• A ‘general’ subsidy (DKr600 per ha per year);
• A "special regional" subsidy (DKr500 per ha per year); and
• A special conversion subsidy for organic plant production (in years 1 and 2: DKr2 000 per year; in year 3: DKr 1 200 per ha; in years 4 and 5: DKr500 per ha/per year).

Another scheme offers subsidies for specific projects that seek to further the production and marketing of organic products. The target group includes farmers, processors, research and trial institutions, learning institutions and consumers. Up to 40 percent of product development and marketing components of such projects can be given in subsidy.

Some other schemes have components that could also benefit organic farmers and processors, e.g. one scheme (EC co-financing) provides support (17-25 percent of total project costs) to companies that invest in processing selected organic product groups, including fresh and processed fruits and vegetables. Another Government programme is actively promoting the use of organic products by municipal and other public institutions.

2. The Danish market for organic fruit and vegetables

2.1 The market for organic food and beverages

Although there are no official statistics, it can be estimated that the Danish retail market for organic food and beverages reached close to DKr3 000 million in 2000 (exclusive of 25 percent VAT), corresponding to about 2.5-3.0 percent of the total food market. The figures do not cover the institutional and catering market for organic food, which is believed to still be fairly small. It is significant that retail sales of organic food and beverages have increased sharply since 1993, though it must be pointed out that growth slowed down considerably in 2000.

2.2 Sales of organic fruit and vegetables

The lack of official statistics makes it impossible to give a complete and exact picture of the market for organic fruits and vegetables. However, the figures given in Table 1 may provide a useful overview.

Table 1: Retail sales of organic fresh fruits and vegetables - 2000 (estimates in tonnes)
Vegetables		Tonnes	Comments
	Potatoes	7 500-8 000	Production -exports+imports
	Carrots	7 000-7 500	Same
	Onions	1 400-1 500	Same
	Tomatoes	1 100-1 300	Same (2/3 imports)
	Other vegetables	3 000-4 000	Same
Total vegetables		(20 000-22 300) or ca. 21 000	About one-third is imported
Fruits
	Tropicals	700-800	Everything is imported
	Citrus	1 750-2 250	Everything is imported
	Apples, pears, others temp. zone	2 000-2 500	At least 80% is imported
Total fruits		(4 450-5 550) or ca. 5 000	About 95% is imported
Total fruits and vegetables		24 450-27 850 or ca. 26 000

Note "Other vegetables" and "Fruits, others temp. zone" cover a wide range of products, including those listed in section 3.2.
Source: Compiled by ITC from trade information (producers, importers, distributors, retailers), Ecoguide 99 and Sall&Sall Report (September 2000).

With regard to organic vegetables, potatoes, carrots and onions together account for just over 80 percent of sales. Other major items include the following, mostly domestically produced: cauliflower, broccoli, mushrooms, white cabbage, iceberg salad, China cabbage, leeks, Brussels sprouts, red cabbage and lettuce. With regard to organic fruits, apples and pears, oranges and lemons and bananas are probably the most important items, estimated to account for around three-quarters of total organic fruit sales.

Overall, it has been estimated that retail sales of organic fruits and vegetables account for 5-6 percent of total fruit and vegetable sales, which is twice as much as for the total range of food products taken as a whole.

Table 1 does not include catering and institutional sales, for which figures are difficult to obtain. Some trade sources put estimates at 5-10 percent of retail sales, which would indicate total sales of organic fresh fruits and vegetables around 27 500 tonnes.

2.3 Prices

It is beyond the scope of this chapter to provide a detailed analysis on prices. However, it seems that, on average, price premiums are amongst the smallest, if not the smallest, in all the markets covered by this survey. As mentioned before, in 1993 FDB made a policy decision to drastically lower its retail prices on organic food. Since then, strong competition amongst major retailers has kept prices fairly low.

A cursory check in a number of supermarkets (February 2001) did not reveal any clear pattern in the case of fresh fruit and vegetables, although a certain premium is normal for most products. However, there were also several examples where no premium existed; for example, in the same store organic cherry tomatoes from Italy were sold at the same kilo price as non-organic cherry tomatoes from Spain. See also section 2.6 on constraints to market development.

2.4 Distribution channels for organic fruit and vegetables

It is estimated that supermarket chains sell a maximum of 70 percent of organic fresh fruit and vegetables (more for organic foodstuffs as a whole), because of strong sales through subscription/box schemes, farm gate and fresh market sales and other alternative channels, which together may account for more than 20 percent, leaving about 10 percent to other retailers and food service.

The following retail and distribution organizations are the most important in the organic food trade:

Co-op Denmark (FDB) - the Danish co-operative retail and wholesale society - is the country’s largest retail group, with about 33 percent of the overall food market. It comprises the supermarket chains Brugsen, Lokal Brugsen, DagliBrugsen, SuperBrugsen and Kvickly (which together have close to 900 retail outlets) and around 12 OBS! hypermarkets (owned jointly with NKL in Norway and KF in Sweden). Most organic products are marketed under the Ø logo (see section 3.1), although some items are sold under other organic logos. FDB also promotes its own organic brand Natura.

IRMA, owned by FDB, is an upmarket supermarket chain with about 55 retail outlets in the Copenhagen area. It offers a broad range of organic products, including fruits and vegetables. Together with SuperBrugsen, it is the Danish retailer with the highest percentage of organic food products. In general, both FDB and IRMA obtain their imports through NAF International (see section 3.3.).

Dansk Supermarket A/S is the second largest retail group in Denmark, with about 27 percent of the total food market. It comprises the following supermarket chains: føtex (a supermarket chain, with over 60 outlets throughout the country); Bilka (12 hypermarkets selling food and everyday goods); NETTO (a chain of discount shops with about 300 outlets in Denmark [which is promoting organic food aggressively] and more than 300 in the United Kingdom, Germany and Poland). The group’s strategy is that Bilka and føtex should offer the broadest possible range of organic products, also in fresh produce, whereas NETTO has a more limited range. Most items are sold under the Ø logo, although own brand labelling is becoming increasingly important. Imported produce is marked "importeret økologisk for Dansk Supermarked Indkøb I/S", when the Ø logo cannot be used.

Although the group imports some organic fruits and vegetables directly, it buys most products from Danish producers and importers, both Biodania members and others. Dansk Supermarket Indkøb i/s does the purchasing for Bilka and føtex, while NETTO does its own buying.

SuperGros A/S is the country’s largest wholesaler in daily goods, including foodstuffs, supplying a number of independent supermarkets and other retailers, like the supermarket chains Favør, Spar Danmark A/S, SuperBest, ISO Supermarked (partly owned by ICA of Sweden) and Rema 1000 Danmark A/S. Retail organizations supplied by SuperGros A/S account for close to 30 percent of the total Danish retail market for food. Fruits and vegetables are a major product group, within which organic fresh produce is growing in importance. Although the company imports certain products directly, it always buys organic fruits and vegetables from Danish producers/packers in order to obtain the Ø logo and minimize the certification problems, etc. Blære Frugt; Danorganic and Gartneriet Marienlyst are the principal suppliers.

E-commerce and box schemes

Barritskov’s www.aarstiderne.com is a subscription based sales system (or box-system), which offers consumers a weekly delivery of fresh organic fruits and vegetables, produced by Barritskov or other Danish producers, including Biodania members, such as Svanholm and Blærefrugt, or foreign producers. Imported products are usually obtained from Solhjulet A/S. The company seems to control an important and growing share of the organic fruit and vegetable market.

Another 20 smaller companies also run box schemes, some of which use the Internet to some extent, e.g. for promotion.

Catering and institutional trade (food service)

Although organic foodstuffs are of relatively little importance in this sector, the catering and institutional trade is expanding, and considerable growth is expected in the future. According to Action Plan II, there is a lack of appropriate distribution channels, although it seems that several distributors are now organized to exploit the potential in this sector. Trade sources also indicated that there is a lack of products, specially prepared and packed for the sector, e.g. salads and vegetables, as well as semi-processed items.

Further to the companies mentioned in section 3.3, other important suppliers of fruits and vegetables to this sector include the following:

-Solhjulet A/S	-Svanholm Catering	-Rønnely
-Flint & Hvids	-ØKOterminalen	-Frydenholm
-MN Catering	-H. Lembcke A/S	-FDB

2.5 Consumer habits and product preferences

According to a Note on consumption (compiled by the Organic Service Centre in August 2000), in 1999 less than 1 percent of Danish households bought only organic foodstuffs, while 6-7 percent apparently never bought organic foodstuffs. Heavy-users (households that spend more then 10 percent of their food budget on organic foodstuffs) accounted for 15 percent of all households and for 64 percent of total organic sales. Medium-users (spend 2.5-9.9 percent of the food budget on organic food) and light-users (spend less than 2.5 percent on organic food) together accounted for about 36 percent of total organic sales. In other words, 85 percent of all households account for just 36 percent of total organic sales.

Consumption is biggest in the Copenhagen region. In 1999, 37 percent of heavy-users lived there, though the region accounted for only 24 percent of all households. About 90 percent of consumers bought some organic products within a given three-month period, whereas the proportion in the rest of the country varied between 67 percent and 82 percent.

Generally speaking, consumers less than 40 years old buy more organics than older age groups, although it differs considerably according to product group. For example, potatoes, carrots and other vegetables enjoy a fairly high organic-share amongst consumers over 60 years.

It is interesting to look at the relative importance of various product groups. For those products that are sold in organic form, the organic share amounted to 5 percent of total sales in 1999. There were significant variations between different products, e.g. 25 percent for oatmeal (breakfast cereal) and 2 percent for beef. In the case of vegetables, the organic share was 15 percent for carrots, 4 percent for onions and potatoes, and 5 percent for frozen vegetables. The organic-share for organic fruit is much smaller, probably not more than 1-2 percent, although it is considerably higher for certain products, e.g. lemon. It should be noted that the organic share for most products is much higher in those retail organizations, e.g. FDB and NETTO, which promote organic products specifically.

Although the motives for purchasing organic food vary considerably according to product groups and consumer profiles, they are basically related to health, environment, animal ethics, quality and taste. In general, health is the dominating motive, according to recent research. In the case of fruits and vegetables, health and environmental considerations appear to be the two major ones; consumers consider that the absence of chemical residues is extremely important.

As in other countries covered by this survey, consumer confidence in the organic origin of the product is of the greatest importance. In the Danish market this is strongly illustrated by the role played by the State-controlled Ø logo, which enjoys a high recognition value and is considered by most buyers of organic foodstuffs as an important product guarantee. A survey undertaken by Danmarks Statistik (February 2000) indicates that 83 percent of consumers know the Ø logo and that 63 percent have confidence in Danish Ø-branded products, although only 19 percent have confidence in Ø-branded imported products, and 38 percent have very little confidence. Furthermore, 85 percent of consumers have little or no confidence in foreign organic products without the Ø logo. In general, confidence in foreign products declines as the geographical distance from Denmark widens.

2.6 Constraints to market development

Although the Danish market has developed strongly in recent years, a number of constraints still hinder the full exploitation of market potential. According to the above-mentioned Note on consumption and other research, the following points are significant:

Price considerations remain the single most important reason why consumers do not purchase more organic foodstuffs; this is true, although to various degrees, whether consumers are heavy-users, medium-users or light-users. As a rule of thumb, a price premium of 20 percent over conventional products seems to be the maximum accepted in most cases. Recent research found that nearly 40 percent of consumers were willing to pay 10 percent extra for organic food, while only 20 percent were prepared to pay 30 percent. However, for many consumers the price premium in absolute terms may also play an important role. For example, a premium of 20 percent on a low price item, e.g. milk, may correspond to only DKr1-2., whereas the same premium on a pack of meat may correspond to DKr10-20.

Quality in the broad sense of the word (appearance, taste, packaging, etc.) remains another very important factor for most consumers; generally speaking consumers expect a similar quality as for a conventional product, although they may expect even higher quality because of the higher price paid for an organic product; in the case of fruits and vegetables, appearance is an important factor.

Availability and time factor are other constraints, either because a number of food items still do not exist in organic form, or because certain organic products are not found in a given consumer’s usual food store, or even the organic version of a product may be difficult to find in the store, as organic products are often less well exposed.

Lack of knowledge about organic food, including standards and regulations for certification, etc. is also a constraint in many cases.

As mentioned at the beginning of this chapter, organic food has been promoted jointly by the agricultural sector, the food industry, the retail sector and the Government. Although FDB, the biggest organic retailer, has sold organic food on a small scale since 1981, sales really took off only in 1993. The retail group decided to cut the prices of organic products drastically at the same time as it broadened its product range substantially. A nation-wide marketing campaign, including advertising in national newspapers and television as well as the group’s own weekly promotion leaflets, was successfully undertaken. Consumer information campaigns and advertising by other major retail organizations also helped to develop the market to its present level.

With sales of organic food slowing down (even stagnating in some cases, e.g. fruit and vegetables), according to some traders, since mid-1999 and through 2000, the organic retail trade has started to refocus its activities. A good example is the FDB chain SuperBrugsen, which has selected about 75 stores (out of more than 300 stores) with a high organic profile. The concept includes a large number of organic products (400 items compared to about 200 items in the Lokal- and Dagli’Brugsen), the appointment of one person in each store being responsible for all aspects of organic marketing, intensive training of staff, etc. and targeted promotion and advertising. Another example is IRMA, which has restructured its organic assortment, focussing on those items that are profitable. In both cases, fresh produce remains amongst the principal items.

Similar strategic thinking takes place in other major retail organizations. The discount chain NETTO (part of the Dansk Supermarket group), for example, was reportedly undertaking major promotion activities during the time of this survey. It seems to concentrate on a relatively small number of selected fresh fruits and vegetables. For example, only the following import items were found in a central store in Copenhagen (February 2001): broccoli, cauliflower, parsley, apples, grapes, lemons and oranges.

It should be noted that the alternative distribution channels, in particular subscription/box schemes, like aarstiderne.com, are currently promoting fresh fruits and vegetables quite aggressively and are increasing their market shares.

3. Imports of organic fruit and vegetables

3.1 Market access

In 1987, the first Danish legislation on organic farming and organic food was introduced with the Act on Organic Farming. Since 1991, however, the production and sale of organic products have been regulated by the EC through Council Regulation (EEC) No. 2092/91 of 24 June 1991 and its subsequent amendments. Additional provisions that apply in Denmark are included in the Executive Order on Organic Farming Production (No. 757 of 3 October 1999) and the Organic Foods Act (No. 118 of 3 March 1999), etc.

Only farms approved by the Danish authorities may market and sell their products as organic. They are controlled by the Danish Plant Directorate. Processors, importers and packers must likewise be inspected and approved to handle organic products, which is the responsibility of the Danish Veterinary and Food Administration.

The Ø logo is a state guarantee that the final preparation and packaging of the organic food in question has been carried out by a company in Denmark approved by Danish authorities. In the case of imported products, the necessary permits and certificates are checked. Imported ready-packaged organic food and beverages, whether from the EC or from third countries, are not usually allowed to carry the Ø logo. This explains why most organic foodstuffs are imported in bulk form for processing, preparation or repacking in Denmark. This also applies to fresh organic fruit and vegetables, always sold pre-packed (and not loose) in Denmark, and mostly with the Ø logo, although imported organic fresh produce is also found in food stores without the Ø logo.

3.2 Imports of organic fruit and vegetables

There are no official trade statistics for organic products, but figures in Table 2, which are based on trade source information, are meant to provide an overview on imports of organic fresh fruit and vegetables.

As shown, total imports amounted to about 12 000 tonnes in 2000, corresponding to almost half of total sales in Denmark. Vegetable imports are somewhat larger than fruit imports, although it seems that growth has been strongest in fruits. Fresh fruit and vegetables constitute one of the most important organic product groups sold in Denmark, and, as shown below, several imported items have become quite significant.

Fresh vegetables

According to Ecoguide, an estimated 5 200 tonnes of vegetables, roots and tubers were imported in 1998. More recent figures have not been published, but trade sources estimate that imports amounted to 6 000-8 000 tonnes in 2000. Depending on the size of domestic vegetable production, imports have fluctuated considerably throughout the 1990s.

Table 2: Imports of organic fresh fruit and vegetables - 2000 (estimates in tonnes)
		Tonnes				Comments
Total vegetables		6 000-8 000	or	ca.	7 000	Fluctuates according to the size of domestic production and exports
Fruits
	Bananas	500-650
	Other tropical (pineapple, mango, etc.)	150-200				Mainly pineapple and mango
	(Total tropical)	700-800	or	ca.	750
	Citrus	1 750-2 250	or	ca.	2 000
	Apples, pears, others temp. zone	1 750-2 250	or	ca.	2 000
Total fruit		4 200-5 300	or	ca.	4 750
Total fruits and vegetables		10 200-13 300	or	ca.	11 750

Source: Compiled by ITC from trade information (importers, distributors, retailers).

The main imported vegetable items (in alphabetic order) are:

• asparagus (Italy, Spain, the Netherlands, Argentina and Greece); according to an importer, demand is there only during the European season, i.e. roughly April-June, when consumers are used to eating asparagus;
• broccoli (Italy, Spain);
• beet root (the Netherlands);
• cabbages (France; Italy, the Netherlands);
• capsicum (the Netherlands; Italy, Spain, Egypt);
• carrots (Israel, Spain, the Netherlands, Italy), mainly March-July;
• cauliflower (Italy);
• cherry tomatoes (Israel (biggest), Italy, Morocco);
• corn (Israel, Italy);
• cucumbers (the Netherlands, Morocco, Spain);
• fennel (Italy, Spain);
• garlic (Italy, France, Argentina, India, Egypt, Morocco);
• green beans (the Netherlands, Spain, Egypt);
• herbs, e.g. parsley (France, Spain, Italy, Israel, Greece);
• leeks (France, Belgium, the Netherlands);
• mushrooms (Italy, the Netherlands);
• onions (the Netherlands, Italy, Spain), throughout the year;
• potatoes, including early potatoes (Israel, Cyprus, Italy, France, the Netherlands), imports start from countries in the South to countries in the North, as the year proceeds;
• salads (France; Italy, Spain, the Netherlands);
• spring onions (France, Belgium, the Netherlands, Italy, Spain, Egypt);
• squash/courgettes (Italy, Spain, France, the Netherlands, Belgium); and
• tomatoes (Italy, Spain, Israel, Morocco).

The main import items are usually carrots, potatoes, onions, tomatoes, cabbage, cucumbers, as well as salads, which together may account for more than half of total vegetable imports. The Netherlands is probably the main supplier of most of these products, followed by France, Italy and Spain. It appears that there are very few suppliers from developing countries, although some products are included in imports from the Netherlands (Dutch re-exports) and maybe other countries.

Although domestic producers currently meet only about two-thirds of demand for vegetables, Danish consumers are less confident with regard to the organic origin of imported products and usually buy them only if domestic produce is insufficient or if they are not produced in Denmark, e.g. certain herbs and salads.

Fresh fruit

Based on trade source information, imports of organic fruits and berries are estimated to have been in the range of 4 500-5 500 tonnes in 2000, which meet about 95 percent of market requirements. Though imports overall do fluctuate from year to year, it is generally of little significance, except for a few items like apples, where local production fluctuates a lot because of climatic and other reasons.

The main imported fruit items (in alphabetic order) are:

• apples (Italy, Germany, the Netherlands, Argentina, the United States, New Zealand), mainly during the period March-September;
• avocados (Israel, South Africa, Spain);
• bananas (the Dominican Republic, Colombia, Costa Rica, Ecuador, Honduras and Peru), imports include normal bananas, red bananas and baby bananas;
• clementines (Italy, Spain);
• coconuts, during the winter months;
• grapefruit (Israel, Italy, South Africa);
• grapes (Italy, Spain, France, South Africa);
• kiwi fruit (Italy, France, New Zealand, Chile);
• lemons (Greece, Italy, Spain, Israel, Argentina, Uruguay), all year round;
• limes (Egypt, the Dominican Republic, Honduras);
• mandarins (Italy, minor imports from Argentina);
• mangoes (Israel, Guinea, Brazil);
• melons (Spain, Italy, Greece);
• oranges (Italy, Spain, Greece, Argentina);
• papayas (Israel), very little sales;
• passion fruit, purple variety (Israel), little sales;
• peaches and nectarines (Italy, Spain, Greece);
• pears (Argentina, USA, Italy, Germany, the Netherlands), mainly during the period February-September;
• pineapple (Israel, Guinea), although the problem with ethylene has almost stopped the supply; and
• plums (South Africa).

Of these, the most important import items are usually apples, lemon, oranges, bananas, pears, clementine and kiwi (together about three-quarters of all fruit imports, according to one importer).

With the notable exception of bananas, and to a smaller extent pineapple and mango, there is very little demand for tropical fruit, although there are some sales of papaya and occasionally others. With the exception of tropical fruit, there are few suppliers from developing countries. Most imported non-EC fresh fruits and berries, whether tropical, citrus or temperate zone fruits, is obtained through traders in the Netherlands.

3.3 Importers of organic fruit and vegetables

The major importers of organic fruit and vegetables include the following:

• Solhjulet, which is a wholesaler/distributor of a broad range of organic products (about 1 400 items) to food manufacturers, the catering/institutional sector, smaller retail stores and alternative channels. The company is one of the biggest importers, if not the biggest, of organic fresh fruits and vegetables. It also imports fruit juices and concentrates, mainly apple and orange;
• Danorganic A/S (see paragraph 1.2);
• The following are members of Biodania:

-	Svanholm	}	As discussed in paragraph 1.2, these importers
-	Blære Frugt	}	are basically producers and packers, but they
-	Marienlyst Gartneri	}	also import large quantities of foreign produce.
-	Søris Gård	}	They are all major suppliers to the major supermarket chains.

• H. Lembcke A/S (50 percent owned by Fyffes plc of Ireland)is a major importer of conventional fresh fruit and vegetables and is also a significant importer of organic produce.

As mentioned, the following two leading retail groups obtain a major part of their import requirements from Danish importers, although they usually import part of their requirements direct:

• NAF International imports organic fruit and vegetables for its members (cooperatives) in Denmark (FDB, including IRMA), Norway and Finland; and
• Dansk Supermarked Indkøb i/s imports organic fresh fruits and vegetables for føtex and Bilka.

3.4 Constraints to import growth

Most, if not all, of the constraints discussed above in relation to the market for fruits and vegetables as a whole also apply to imported products. Imported fruits and vegetables will find buyers in an expanding market more easily than in a declining one. More specifically, the following constraints should be mentioned:

• Denmark is a small market, and in the case of vegetables, domestic production is relatively high, which limits the import potential considerably;
• Consumers show a fairly strong preference for domestically grown fruits and vegetables, followed by produce grown as close to Denmark as possible, which disfavours exporters in developing countries, except for tropical and some sub-tropical products, which are not grown in Denmark or in neighbouring countries;
• Danish consumers’ strong preference for products carrying the Ø logo likewise disadvantages imported products, unless they have obtained the right to be Ø-labelled through repacking or processing in Denmark;
• The lack of market information and marketing intelligence in developing countries, in particular at the producer level;
• The problem of certification remains one of the most significant constraints for producers and exporters in developing countries, as Danish importers usually prefer to buy from EC countries or so-called Article 11 list countries (see chapter 1).

4. Conclusions and market opportunities for developing countries

Although a small country, Denmark has become an important market for organic foodstuffs with a retail market value estimated at approximately DK3 000 million in 2000, corresponding to an estimated 2.5-3.0 percent of the total food market. This probably represents the highest organic market share in the world. As shown earlier, the market has grown very rapidly between 1993 and 1999, enjoying annual growth rates of between 25-50 percent, according to trade sources.

However, from mid-1999 and throughout 2000, market growth slowed down considerably and almost stagnated for some product groups, including fresh organic fruits and vegetables. While some market players felt this strongly, other companies actually managed to increase their market share, and in early 2001 there were positive signs that strong growth, although probably less than in recent years, may resume.

It is interesting to see what happened in the Danish market, as a similar development may eventually take place in other markets that are currently growing very rapidly, but where the organic share of food sales has not yet reached the Danish level. During the years of rapid growth Danish supermarkets invested heavily in aggressive promotion, not only through advertising, but also through competitive pricing and extensive product ranges. At the same time organic products were increasingly used by the major retailers to enhance their profiles vis-à-vis consumers. Finally, consumers were becoming more and more conscious about health and environmental issues.

There are a number of reasons why market growth started to slow down in 1999. In many ways the market had reached a more mature stage and competition had become significantly stronger, while supermarkets were decreasingly using organic products as part of their overall promotional strategies and as a means to compete between themselves. Supermarkets increasingly insisted on similar profit margins for organic products as for conventional items. In other words, the organic food market is, at least to some extent, joining the mainstream market, as far as supermarket decision-makers are concerned.

As mentioned above, there are several indications that the Danish market for organic foodstuffs, including organic fruits and vegetables, will increase further in the years to come.

Firstly, the major supermarket chains are refocusing their activities in the area of organic products, typically concentrating and targeting their marketing efforts, e.g. in product assortments, training of staff, attention to specific consumer groups and selection of specific retail outlets with a high organic profile.

Secondly, alternative distribution channels, e.g. subscription/box schemes and other forms of direct sales to consumers, like "farm gate" and fresh produce markets, appear to be growing rapidly. For example, the principal subscription sales system has increased its customer base from about 1 200 in early 2000 to more than 10 000 in early 2001. The Internet is also playing a growing role, whether as a direct sales tool or as a marketing tool. The alternative channels in turn are likely to increase pressure on major supermarket chains to fight for market share.

Thirdly, the organic share is still only about 3 percent of total food sales (about 5-6 percent for fresh fruits and vegetables). As shown earlier, heavy-users currently account for 64 percent of total organic sales, while they constitute just 15 percent of all households. This means that 85 percent of households buy just 36 percent of the total, which leaves a big potential for organic products, as more households become heavy-users.

Finally, Government policy continues to promote the production and consumption of organic foodstuffs, including sales to the catering and institutional sector (food service), which is still under developed.

In conclusion, it is strongly believed that the Danish market for organic foodstuff will continue to grow and might double in size within the next five to seven years. As far as developing countries are concerned, market opportunities exist for most fruit and vegetable products listed in section 3.2, in particular those that are not produced in Denmark or are produced outside the domestic season, although most items are imported throughout the year.

The main constraints faced by exporters in developing countries continue to be the certification problem and the strong Ø logo, combined with the fact that almost all importers prefer to buy from other EC countries (including products from third countries) and so-called Article 11 list countries (currently only 6 countries: Argentina, Australia, the Czech Republic, Hungary, Israel and Switzerland), as this appears to be less complicated and less time consuming.

Bearing the above in mind, the following suggestions may be useful for developing country exporters of organic fruits and vegetables:

• To target the Danish market through intermediaries in other EC countries, where certification has already been obtained, while at the same time identifying and building up close relationships with the Danish buyer in order to acquire market knowledge and improve bargaining position;
• To create a partnership with a major Danish importer, including the organization of certification in the country concerned, storage, transportation, selection of products and target group, how to obtain the Ø logo, etc.;
• To experiment with new products and packs, in co-operation with Danish importers and distributors, including the introduction of special packs and cuts of fresh fruits and vegetables/salads, as well as processed and semi-processed items, for the catering and institutional sector; and
• The relatively small Danish market may be suitable for small and medium-sized producers in developing countries who are looking for partners within the EC, but whose production may be too small to meet the requirements of bigger markets.

References

Økoguide 1999 (Ecoguide), Michael Borgen www.ecoguide.dk and www.ecoweb.dk.

Project report on organic food, Klaus Sall [email protected].

Action Plan II www.dffe.dk/publikationer/Actionplan-II-UK/actindex.htm.

Note on consumption and Note on Danish exports (The Organic Service Centre) www.okologiens-hus.dk and www.organic-export.dk.

The Plant Directorate www.plantedir.dk.

Annex

Selected addresses*
Major importers of fresh organic fruit and vegetables

Biodania a.m.b.a

Grønttorvet 6
DK 2500 Valby
(Copenhagen)
Tel.: +45 3630 2429
Fax: +45 3630 2479
[email protected]
www.biodania.dk/
(co-operative, coordinates production
and sales for producer members)

Blære Frugt
Kelddalvej 33
DK-9600 Års
Tel: 9866 6090
Fax: 9866 6011

DanOrganic A/S
Vesterbjergevej 1
DK-7280 Sdr. Felding
Tel: 9719 8899
Fax: 9719 8903
[email protected]
www.danorganic.dk

H. Lembcke A/S
Grønttorvet 244-260
PO BOX 427
DK-2500 Valby
(Copenhagen)
Tel: 3615 6222
Fax: 3615 6223

Gartneriet Marienlyst
Tåstrupvej 86
DK-8462 Harlev
Tel: 8694 2167
Fax: 8694 1043

N.A.F. International Amba
Fanøgade 15
DK-2100 Copenhagen Ø
Tel: 3916 9000
Fax: 3916 9080
[email protected]
www.naf.dk

Solhjulet
Storhedevejen 32, Taul
DK-8850 Bjerringbro
Tel: 8668 6444
Fax: 8668 6275
[email protected]
www.solhjulet.dk

Svanholm Import
Svanholm Allé 2
DK-4050 Skibby
Tel: 4756 6656
Fax: 4756 6667
www.Svanholm.dk

Søris I/S
Sørisvej 2A
DK-3650 Ølstykke
Tel: 4733 4003
Fax: 4733 4017

Major retail and distribution companies

Dansk Supermarked Indkøb i/s

Bjødstrupvej 18
DK-8270 Højbjerg
Tel: 8930 3030
Fax: 8672 5487
[email protected]

FDB
Roskildevej 65
DK-2620 Albertslund (Copenhagen)
Tel: 4386 4386
Fax: 4386 4811
[email protected]
www.fdb.dk

SuperGros A/S
Knud Højgaards Vej 19DK-7100 Vejle
Tel: 7010 0203
Fax: 7572 3528
[email protected]
www.supergros.dk

Irma A/S
Korsdalsvej 101
DK-2610 Rødovre (Copenhagen)
Tel: 4386 3822
Fax: 4386 3809

ISO Supermarked
Vermlandsgade 51
DK-2300 Copenhagen S
Tel.: 3154 8411
Fax: 3154 3142
[email protected]
www.iso.dk

NETTO I/S
Industribuen 2
DK-2635 Ishøj
Tel: 4356 8811
Fax: 4354 3288

Catering and institutional trade (food service)

MN Catering
Fuglebakken 94
DK-2000 Frederiksberg (Copenhagen)
Tel: 3834 3812
Fax: 3834 3822

Økoterminalen
Tømrersvinget 16
DK 6360 Tinglev
Tel: +45 7364 3350
www.oekoterminalen.dk/

Flint & Hvids
Torslundevej 79
DK-2635 Ishøj
Tel: 4068 0111
Fax: 4355 1998

Rønnely
Maglebjerg 3
DK-4520 Svinninge
Tel: 5926 5658
Fax: 5926 6595
Garneriet Marienlyst
(see above for contact details)

FDB
(see above for contact details)

Svanholm Catering
(see above for contact details)

Solhjulet A/S
(see above for contact details)

H. Lembcke A/S
(see above for contact details)

Box schemes and e-commerce

Aarstiderne
Barritskovvej 34
DK-7150 Barrit
Tel: 7026 0066
Fax: 7026 0067
[email protected]
www.aarstiderne.com

Selected importers of processed fruit and vegetables

Urtekram A/S
Klostermarken 20
DK-9550 Mariager
Tel: 9854 2288
Fax 9854 2333
[email protected]
www.urtekram.dk
(dried and canned fruits, nuts and vegetables, etc.)

Unikost A/S
Over Hadstenvej 58
DK-8370 Hadsten
Tel: 8698 0144
Fax: 8698 0048
[email protected]
www. Jan-import.dk
(dried fruits and nuts, etc.)

F-I Mejerifrugt
Hestehaven 3
DK-5260 Odense S
Tel: 6613 1370
Fax: 6613 4410
(fruits and berries for
the dairy industry)

Sunprojuice.dk A/S
Huginsvej 2-4
DK-4100 Ringsted
Tel: 5767 1177
Fax: 5767 1145
[email protected]
(fresh and frozen fruits and berries)

Hans Kjaer Trading A/S
Piniehøj 23
DK-2960 Rungsted Kyst
Tel: 4557 1312
Fax: 4557 0048
[email protected]
(fruit juices, concentrates and
pulp, frozen fruits)

Government offices, other organizations and associations, etc.

Det Økologiske Fødevareråd
(The Organic Foods Council)
Strukturdirektoratet
Toldbodgade 29
DK-1253 Copenhagen K
Tel: 3363 7300
Fax: 3363 7333

Landsforeningen Økologisk
Jordbrug (LØJ)
(The Danish Association for Organic
Farming)
Økologiens Hus
Frederiksgade 72
DK-8000 Århus C
Tel: 8732 2700
Fax: 8732 2710
www.okologiens-hus.dk

Økologisk Landscenter (ØLC)
(The Organic Service Center)
Økologiens Hus
Frederiksgade 72
DK-8000 Århus C
Tel: 8732 2700
Fax: 8732 2710
www.okologiens-hus.dk
www.organic-export.dk

Øgruppen
(Danish Organic Trade Association)
Økologiens Hus
Frederiksgade 72
DK-8000 Århus C
Tel: 8732 2725 and 4015 0766
Fax: 8732 2710
[email protected]
Demeterforbundet
(The Demeter Association)
Birkum Bygade 20
DK-5220 Odense SØ
Tel: 6597 3050
Fax: 6597 3250

Økologiens Hus
Frederiksgade 72
DK-8000 Århus C
Tel: 8619 9445
[email protected]
www.ecoweb.dk/biodyn/

Danish Veterinary and Food
Administration
Mørkhøj Bygade 19
DK-2860 Søborg
Tel: 3395 6000
Fax: 3395 6001
[email protected]
www.vfd.dk
(Administers organic production
rules on labelling and inspection)

The Plant Direktorate
Skovbrynet 20
DK-2800 Lyngby
Tel: 4526 3600
Fax: 4526 3610
[email protected]
www.pdir.dk