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Date:

June 15, 2000

Subject:

Iceland Foods and Organic Economics

 

AgBioView - http://www.agbioworld.org, http://agbioview.listbot.com

Colleagues,

Critical to the question of whether or not Iceland will
always have to pay more for organic produce than for
conventional produce is the economics of production. I have
been told two things:

1. That organic production is costlier in terms of input,
and has lower outputs, thereby requiring a price premium to
be economically sustainable. If this is true, Iceland will
always have to subsidize its 'organic' lineup to make the
consumer cost of produce the same as that of conventional
produce.

2. That the costs of producing organic produce are the same
as conventional, and equal to conventional in terms of
output, and that the premium price for organic merely
reflects consumer demand. If this is true, competition in
the organic produce market will tend to drive prices down to
the same level as conventional produce, as more growers
enter this market to satisfy demand.

To settle this, I need some hard facts/figures from
side-by-side comparisons of conventional and organic crops
which compare cost of inputs and volume of outputs. Does
anyone know of a credible source for this information?