The economic impact of a ban on imports of air freighted organic products to the UK, Gibbon and Bolwig / DIIS, 2007
| Implementing agency(ies) | Danish Institute for International Studies (DIIS) | |
|---|---|---|
| Date completed | December 2007 | |
| Issues/challenges | Against the background of growing concern about climate change, some European private organic standard-setting bodies led by the Soil Association are considering whether to refuse certification of organic produce imported by air. Their right to determine the rules to which they certify produce, irrespective of whether this is already certified to EU public rules, has been recently re-affirmed in the process of the revision of EU Organic Regulation. A change in Soil Association rules along these lines may have a significant impact, firstly because UK supermarkets have historically favoured that their suppliers certify to Soil Association rules, and secondly because air freighting of organic produce to the UK has increased considerably in recent years. This increase is related to UK supermarkets' embrace of organic sales, in a context where competition between supermarkets over fresh produce market share emphasises widening the product range and securing its year-round availability. | |
| Country(ies) | Ghana, Kenya |
- Description
Air freighted organic imports into the UK in 2006 accounted for only about 1.9% of all organic fresh produce imports by volume, although for the categories of product subject to air freighting they constituted 4.1% by volume. Their share of retail sales was considerably greater. in terms of value, air freighted imports represented 3.1% of all organic fresh fruit sales, 13.4% of all organic fresh vegetable sales and 8.1% of the entire organic fresh produce category.
Low income and lower middle income countries account for the great majority (79%) of all air freighted organic imports to the UK in 2006. Amongst low income countries, dependence on air freight as a means of fresh produce transport is very high.
This study therefore considers whether such a ban is indeed workable - and if so, what the likely impacts are on trade globally, and on exporting countries in particular.
Summary of results
If a ban is introduced and somehow proves workable, virtually all the produce currently transported by air will be removed from the UK market. This corresponds to an annual loss in retail sales of around GBP 42.6m. In addition to this static impact on sales, there will be a series of so-called dynamic impacts which will increase losses further. The two most easily measurable of these will add around another GBP 4.9 m to these losses. Others, longer-term and more difficult to measure, may be at least as damaging.
Country case studies of Kenya and Ghana demonstrate that the indirect impacts in exporting countries of a ban will almost certainly also include a decline in living standards, elimination of opportunities to attend fee-paying schools, firing of employees and destabilisation of local communities.
For more detail, please refer to the report, downloadable from the link below, or the DIIS website (see above).
The economic impact of a ban on imports of air freighted organic products to the UK, by Gibbon and Bolwig, DIIS Working Paper no 2007/23 (498 kB)