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Organic Farming: The next major opportunity in agriculture

Organic Farming: The next major opportunity in agriculture

Agriculture

GlobalLinker Staff

GlobalLinker Staff

25 Apr 2016, 10:30 — 6 min read

With an increase in lifestyles related illnesses, especially among the upper middle class section of India, there is a greater inclination towards healthy-eating, and consumption of unprocessed and organic whole foods. In this regard, organic farming is fast emerging as a breakthrough technique, involving cultivation of plants and rearing of animals in natural ways.

 

Employing innovative use of biological materials, this technique precludes synthetic substances and maintains soil fertility and ecological balance, thereby minimising pollution and wastage. It is reliant upon ecologically balanced agricultural principles like crop rotation, use of green manure, appropriate processing of organic waste, methods of biological pest control and the prudent use of mineral and rock additives, among others. Owing to its unique philosophy of ecological harmony, resource efficiency and non-intensive animal husbandry practices, the use of organic farming techniques is increasingly on the upswing.

The Need for Organic Farming

The burgeoning population worldwide, especially in developing economies, places heavy demands on food production. In keeping with this requirement, sustainable cultivation is the need of the hour. Organic farming is expected to be the next big investment avenue in agriculture as it presents improved methods of food production that are conducive to overall wellbeing. With a rise in incidences of food adulteration and other such concern areas, consumers of organic food are rising at a steady pace.

Geeta Handa, Managing Director of Nurture Organics Pvt Ltd, which provides organic animal feed supplements shares, “These days the masses are aware of the benefits of healthy eating and antibiotic free products. Rearing of livestock on antibiotic free feed is ultimately going to benefit the masses as the end products are consumed by them.” 

Business Opportunity in Organic Farming

Increased consumer awareness of the risks associated with products containing GMO’s (genetically engineered organism), pesticides, preservatives, and other harmful additives has helped bolster the growth of the natural & organic product sector. The recent growth in e-commerce has further fuelled the growth of this sector.

Currently, there are more than 25 e-commerce platforms selling organic foods online in India. In addition, grocery sites like Bigbasket and Peppertap are engaged in selling organic food categories. Moreover, specialised organic retailers like ISayOrganic, JoyByNature, Ekgaon, and OrganicShop have also emerged as players to watch out for. Established brands like Fabindia have also increased investments in organic farming.

An efficient and responsive supply chain that is characterised by better quality control and improved traceability as compared to traditional agri-business models is another compelling reason for companies’ growing inclination towards organic farming.  In all probability India’s organic opportunity could scale from $500 million to an estimated $2 billion by 2020. Of this approximately $1 billion is likely to cater to the booming domestic market while the remainder expected to be earmarked for exports.

An estimated $300 million of investment is needed to achieve these levels, and about $100 million to $150 million of this is likely to be in the form of private equity over the next five years. This corpus of funding is seen as necessary to expand the organic farmer base, gain the requisite certifications, and brand and distribute such organic products.

Government Schemes Promoting Organic Farming

The government can play a critical role in further encouraging organic farming. Geeta Handa opines, “Government should provide subsidies on the raw materials for healthy and organic farming. Media should be playing a pivotal role in creating greater awareness.”

The Government of India promotes organic farming through various schemes like:

National Project on Organic Farming (NPOF) has been a continuing central sector scheme since the 10th Five Year Plan. Under this scheme, the Government of India has initiated project based systematic promotion of organic farming in the country in specified areas. The project is being operated by National Centre of Organic Farming (NCOF) and its six Regional Centers of Organic Farming (RCOF).

 

Organic farming is clearly a boon for the agricultural industry, with huge potential and growing business opportunities in the years to come.

An environmentally sustainable system of agriculture promoted by the use of organic farming is becoming a central agricultural theme that will help maintain a stable resource balance and avoid over exploitation of renewable resources while ensuring soil fertility and promoting biodiversity.

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GlobalLinker Staff

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