Internationalization of the organic fruit market: The case of Washington State's organic apple exports to the European Union

Abstract

Production of some organic commodities, such as apples, is heavily concentrated in the United States (US), with Washington State being the leading US producer of organic apples. In 2003, there were 4047 ha of certified organic apple orchards in Washington State, an all-time high and a more than tenfold increase since 1989. But this growth has not occurred without difficulties. Washington State's organic apple growers have encountered international supply and demand pressures forcing them to seek new markets, such as the European Union (EU). In this paper, we explore the complexities of the international marketing of organic fruit, using organic apple production in Washington State and market opportunities for this organic fruit in the EU, as a case study. We find that as a result of the expansion of organic apple plantings in Washington State, there has been a decrease in the price premiums, which traditionally offset the greater costs of organic production and which originally motivated many Washington growers to certify their apple orchards. We also find that increased demand for organic fruits in the EU has been outpacing supply, making EU member states the most important export market for Washington's organic apples. However, despite the unification of US standards by the US Department of Agriculture (USDA) and an overriding EU standard, an entanglement of regulatory bodies from around the world is involved in the certification of organic products. For example, growers and marketers may have to interact with as many as six different regulatory bodies in order to export organic produce from the US to the EU. This study shows that while the EU market remains a promising destination for US organic apples, organic growers and marketers must plan ahead and thoroughly understand the multitude of regulations involved in the international trade of organic fruits.