Exports of organic products to Canada: what has changed over the past year

The demand for organic products is increasing worldwide. Canada is no exception. It is precisely this conclusion that can be made after reading the World of Organic Agriculture 2019 Report, which was recently published by the leading organizations FIBL and IFOAM.

Global trends

Thus, according to the 2017 results, sales of organic food and beverages reached a record high of 90 billion euros. Since 2000, this figure has grown 5.5 times, and compared with the year 2016 – by 8%.

North America and Europe remain leaders in the consumption of organic products – they account for 90% of total global sales. The United States occupies the first place with the rest of the world considerably lagging behind; about half of the world organic produce market is in the United States. Germany and France follow.

Canada with 3 billion euros of its organic market volume is no more within the world’s top five organic markets. Now it ranks sixth in the global ranking.

Australia, Argentina and China have become leaders with the largest areas of organic farming.

Sales of organic products in supermarket chains in 2017

Specifics of the Canadian organic market

Major Canadian organic producers are located mainly in the provinces of Ontario, Quebec and British Columbia. The reason is simple. It is these regions that are characterized by the bigger size of the market (population density) and its maturity, that is, willingness to pay more for organics.

Understanding the prospects of the organic market, Canadian government officials are taking steps to support it. For example, the province of Quebec set a goal to double the area of land under organic farming by 2025 compared to 2015.

Canada produces organic products mostly in such segments as dairy, ready-made food and bakery products. Of course, a lot of organic maple syrup is produced.

Food and drinks account for 93.5% of Canada’s organic market. Due to the strong consumer demand, the Canadian organic market is growing faster than the average food industry. In the period of 2012-2017, the sector’s average annual growth rate was 8.4%.

According to statistics, two thirds of Canadians bought organic products weekly in 2017. In 2016, only 56% of them did.

Millennials are fans of organic goods. More than 83% of people born in 1981-1999 buy organic products every week.

Canada imports a lot of organic goods, which is a great opportunity for Ukrainian companies. In particular, Canada imported organic goods for 637 million Canadian dollars in 2016.

At the moment, Ukraine primarily exports organic raw materials to Canada, although it would be more profitable to export processed products. The best prospects on the Canadian market are for such groups of goods as dried and frozen vegetables, vegetable oils, juices and drinks, jams, pastilles, honey, and the like.

According to the Open Register of the Organic Standard Certification Company nine Ukrainian producers have successfully passed certification under Canadian COR organic standards as of May 2019.

Some Ukrainian organic producers already have successful cases selling their own products to this market. For example, PE “Agroecology”, one of the largest Ukrainian organic producers (more information can be found from the video https://youtu.be/zsVQUao58Dc).

If your company is also interested in obtaining a Canadian organic standard, please, be informed that the CUTIS Project co-finances such certification (for more information, follow the link https://cutisproject.org/news/new-opportunities-from-cutis-project/).

Changes in Canadian legislation

On January 15, 2019, the Safe Food for Canadians Regulations (SFFC) entered into force, which in fact prescribe a policy for the production and sale of foodstuffs. This is a new document that combines food sector regulations.

The issues of producing, importing and exporting organic products are regulated by Section 13 of the SFFC. Thereunder, any food products, seeds or animal feed claimed as organic are subject to control by the Canada Food Inspection Agency (CFIA) regulatory authority.

However, CFIA does not control the flow of organic cannabis, cosmetics, food for pets and biologically active additives. The mention of cannabis in this list is an attempt to clarify the situation with its legalization in Canada since the fall of 2018.

Starting from January 15, 2021 organic products from the organic aquaculture sector will be subject to the SFFC provisions as well.

Regulatory changes in the field of organic production will come into force not immediately but gradually over the next 12-30 months (by January 2020 – July 2021). Obviously, this is due to the smooth transition of Canada’s organic sector to the new regulatory regime.

Attention of Ukrainian exporters of organic products to Canada: production of organic products eligible for sale in Canada is governed by the following Canadian organic standards (CAN/CGSB 32.310 – Organic Production Systems – General Principles and Management Standards; CAN/CGSB 32.311 – Organic Production Systems – Permitted Substances Lists). It is important to keep in mind, however, that there are plans to revise them in 2020.

In addition, organic products will be separated within the Automated Import Reference System (AIRS). What is this system? This is a resource for obtaining information on the terms of import of certain categories of agricultural products into Canada. By entering the product category name, you will receive detailed information about the terms of import. In 2019, organic fresh fruits and vegetables will be the first categories to apply this approach. This will make life easier for importers to Canada: they will have access to detailed regulatory instructions for certain categories of organic products.

This is to remind that the Canada-Ukraine Trade and Investment Support Project (CUTIS Project) is a 5-year (2016-2021) initiative of the Canadian government aimed at increasing exports from Ukraine to Canada and investments from Canada to Ukraine. The Project is funded by the Canadian Government through Global Affairs Canada. The Project is being implemented by the Conference Board of Canada in cooperation with the Canada-Ukraine Chamber of Commerce.

Zoya Pavlenko, Environmental Expert, Canada-Ukraine Trade and Investment Support Project (CUTIS)

Source: Agroportal.ua