Organic Products Market

Increasing buyer preference for organic goods stems from a number of factors, including environmental concerns and recent research showing worrying associations between pesticide exposure, particularly organophosphates, on learning, IQ and behaviour. This will likely continue to lead to an increase in organic, regenerative and agroecology horticulture. 

The Market 

The value of New Zealand’s organic exports to the EU over the financial year 2022/2023 was over $45 million, and the value of organic exports for all markets was over $165 million. Standards for New Zealand are required to have an equivalence rating by 2027 to retain market access to EU. 

Increased demand will expand both domestic and international markets leading to more competitive pricing. Suppliers and retailers will benefit from and be subject to the new Standards in addition to consumer expectations.  

The new National Organic Standard Regulations were agreed by Cabinet on 1 November 2023 and will be implemented over a three-year period

The Standards 

MPI has been developing the Standards, associated approvals and compliance regulations for making organic claims about food, beverages, and plant and animal products following the Organic Products and Production Act 2023.  

The new National Organic Standard Regulations were agreed by Cabinet on 1 November 2023 and will be implemented over a three-year period, adding to the current statutory requirements for goods to comply with the term ‘’organic’” such as under the Fair Trading Act. Meanwhile Australian legislators are currently introducing their equivalent organic production bill/Act.  

At present, certification is obtained from third party organisations such as BioGro New Zealand and AsureQuality Limited. The new Standards aim to achieve consistency with existing practices which has been a key consideration in development of the regulations together with a transition period.

The Standards include provisions to:  

• require pest management techniques that minimise the negative impacts to the ecological balance;  
• require cultivation for weed control resulting in bare ground is minimised in order to protect soil health;  
• prohibit gene technology for organic production and processing;  
• require demonstration in the organic management plan that the growers have an understanding of the whakapapa of the land that their organic production operates on;  
• require the use of acceptable inputs/fertilisers for growers and limitations of pest control for livestock;  
• require specific management of manure, effluent, and other byproducts 

How Far Will Regulations Go 

A balance of interests will be necessary going forward. Over-regulation can have the effect of stagnating production.  

In 1996, Denmark developed detailed rules for organic livestock, three years ahead of the EU. However stricter regulations on the use of husbandry manure coupled with reduced export possibilities led to decreased growth of organic land shares in 2021-2023. 

It is yet to be seen how New Zealand will tackle these competing interests in order to best secure market access and meet consumer demand.  

There may be complex regulatory issues to navigate with any new standards or legislation. We suggest you obtain timely legal and business advice before embarking on any new expansion or agreeing to any significant contractual obligations.  

This article is for general informational purposes only and does not constitute legal advice. While every effort has been made to ensure the accuracy of the information, readers should not rely on this article as a substitute for professional legal advice.