ADB: organic, a boon for the SEA

Southeast Asian countries like the Philippines, where demand for organic food products has increased in recent months, could become hot spots for agricultural investments, according to the Asian Development Bank (AfDB).

The AfDB report says the pandemic has underscored the importance of healthy eating and a healthy lifestyle. Demand for these products has increased in Indonesia, the Philippines and the PRC.

However, the thematic chapter of the Asian Development Outlook Update 2021 noted that obtaining organic certification and complying with regulations remains “complex and costly” for farmers.

“Organic farming was developing in developing countries in Asia before
the pandemic. [However] the report deals with certification and regulatory issues. He is [still] does not know how the Covid-19 pandemic will affect production and
demand for organic products, ”Takashi Yamano, senior economist in the AfDB’s Department of Economic Research and Regional Cooperation, told BusinessMirror by email.

Yamano said blockages and mobility restrictions have disrupted supply chains and markets, prompting farmers to switch from perishable crops to other storable crops.

He said this has led to an increase in the prices of organic products. However, Yamano said, demand has continued to increase in places like the United States and Asian cities.

“These developments on both the supply and demand sides suggest
possibility that the pandemic could mark a “turning point” for the industry, ”added Yamano, while acknowledging that“ the evidence so far is anecdotal and deserves further study ”.

Organic certification, notes the AfDB report, requires annual inspections and monitoring which are often difficult and expensive.

Obtaining international certification is even more expensive, making it unprofitable for small and marginal farmers.

Citing data from the Food and Agriculture Organization of the United Nations (FAO), the AfDB said only 54 percent of organic farmland in developing Asia has been certified.

In addition, other studies estimated that by 2020, only 72 economies in the world had fully implemented organic regulations, and only 10 of these were located in Asia.

“The lack of support in terms of distribution and marketing systems for organic products makes it even more difficult for farmers to meet certification requirements and standards,” the report also states.

The AfDB said daily energy consumption per capita in the region is expected to increase from 2,612 kilocalories in 2012 to 2,844 by 2030.

Food demand in Asia has shifted from basic commodities to more resource-intensive animal products. Asians are also the largest per capita consumers of fish in the world.

With this, AfDB said, Asia’s agricultural sector must be productive enough to meet these increases and changes in demand.

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