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Published October 23, 2011, 11:06 PM

Organic food sales rebound from recession

Industry still not as strong as it was a few years ago
ADRIAN, Minn. – Two years after the recession cut demand for higher-cost food products, organic farming is on the rebound, with prices at record highs.

By: Mark Steil, Minnesota Public Radio, INFORUM

ADRIAN, Minn. – Two years after the recession cut demand for higher-cost food products, organic farming is on the rebound, with prices at record highs.

But the industry is still not as strong as it was just a few years ago, and no one knows if organic sales will return to the double-digit growth of the pre-recession years.

Still, farmers like Ben Cook are pleased with the turnaround. As he walks into a soon-to-be-harvested field of organic corn near the town of Adrian in southwest Minnesota, Cook can’t help but admire the quality of his corn.

It’s not his best crop ever, thanks to the weather. First the fields were too wet, then too dry. That was followed by a cold spell that cut yield at least 10 percent. But still, Cook said, it’s a good time to be an organic farmer.

“I think this year’s going to be an excellent year,” he said. “Because both the yields are respectable and prices are very good.”

During the worst of the downturn, his corn brought just over $4 dollars a bushel. His cattle profits also went down. As a result, his farm’s total income plunged.

As Cook watched profits decline, the same thing was happening throughout the organic food chain.

Sales growth reached nearly 20 percent in 2007, said Carla Ooyen, director of Market Research for the Colorado-based Nutrition Business Journal, which tracks a wide range of food sales information.

Then in December of that year, the recession started.

“In 2008 we started to see a slowdown,” Ooyen said. “And in 2009 the category only grew about 5 percent.”

The reduced growth reflected lower consumer demand for organic food, as many switched to cheaper conventional products.

But Cook said that while corn prices are important, they’re not the most important thing for him. Unlike conventional farmers, he said he would never expand corn acres just to take advantage of the high prices. He said what’s most important is the organic farming system itself: not using chemicals, rotating crops, enriching the soil.

“That whole system needs to be in place for it to work,” Cook said. “So then the $13 corn doesn’t drive your decision as much as having the whole system in place.”

For Cook, the high corn prices are just a temporary reward for practicing what he sees as the healthiest way to farm. Prices may go down next year, but he said he’ll still farm the same way then as he does now.


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