Ever since the pandemic hit the world, people have deeply understood that health is the real wealth. With increased awareness of quality and organic food eating habits of people, a surge in demand for organic food products can be seen in the Indian market.
We find that people are opting for organic products over other ordinary products for a better and healthier life. However, there is still a long way to go for the organic food market in India. According to a study, India, which holds almost 20% of the world’s population, consumes only 1% of organic products out of the total organic products. While India itself is the country with the largest agricultural land in the world. With such data and figures, it is easy to understand that there are still many hurdles facing organic food products in the Indian market.
Limited awareness: There is still a prejudice in Indian society that has made organic food a sign of status and luxury rather than a basic reference. Many people think it symbolizes quality of life. Word of mouth, therefore, may have increased awareness of the term “organic,” but more as a status symbol and less as a sustainable solution.
Make choices for a cheaper product: Indian markets are home to price sensitive customers with huge gaps in their disposable income capacity. Therefore, even a slight difference in the prices of the food products can induce him to opt for a cheaper option rather than opting for a product of better quality and at a fair price. This is leading a large part of the Indian diaspora to withdraw from the organic food market.
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Unfriendly retail market: Retailers will always prefer to fill the shelves with a cheaper product that sells out quickly rather than risk losing shelf space to a lesser-known organic product. The organic keyword, on the other hand, puts the retailer in a state of ROI anxiety. This leads to a wide gap between the buyer and the seller of organic food products in the Indian market.
Traditional farming habits: Farmers in India’s agricultural sector have become too familiar with chemical fertilizers. The majority of farmers do not opt for organic farming for fear that the change will not bring them results like farming with chemical fertilizers.
Administrative Support: Currently, subsidies available for chemical fertilizers by governing bodies make them cheaper and more accessible to the agricultural sector. Hence the importance of raising awareness among farmers in terms of educating them on the benefits of organic farming while giving them the necessary administrative guidance. Along with this, recovery safety net on crop losses and subsidy of organic farming will also help boost the organic food market in India.
Understanding demand and supply gaps: There are times when some of the organic food products are supplied in the market more than their demand and on the other hand, the other most demanded organic food products are simply not seeing any supply. This gap needs to be bridged and balanced to have a balanced organic food market in India. For example, the demand for jaggery powder is higher in Uttar Pradesh compared to its supply.
There is still a long way to go for the organic food market in India. But we cannot deny the fact that over the past few years, organic food products have gained popularity among people. This is not limited to urban but also rural areas, mainly because access to information has enabled everyone to understand the benefits of organic farming and adopt a healthier lifestyle. It is hoped that we will not only see more organic food products but also innovations in the Indian market if the major challenges are addressed in time. Despite all these challenges, the organic food market in India seems to be moving forward steadily, especially post Covid.