The Chinese Ministry of Agriculture expects that China will be the fourth largest consumer of organic food before 2020. Organic food will increasingly be in demand as the Chinese consumers’ quest for quality, health and safety and the growth in the middle class and their income increases. In addition to this, the Chinese consumers have greater trust in foreign products, because they perceive these as more safe and of higher quality than the domestic alternatives. The Chinese consumers pay 2-4 times more for organic products, which will mean that the relatively expensive Danish products can be sold in China with a profit.
Denmark is internationally well-known for safe food and high organic quality standards. The domestic consumption of organic food in Denmark has been increased significantly for the past few years and has been reached to 7.6% in 2012. Furthermore the Danish government has set the goal in the “organic plan of action 2020”, that the organic farming area in Denmark should be doubled until 2020.
On the other hand, the market is difficult to access, since there is a requirement for Chinese organic label issued by a Chinese certification body, when the foreign organic food is sold in China. This entails a very expensive inspection and an annual renewal of the permit and the process is very much a barrier for entering the market and requires a lot of focus.
The current inspection procedures entail that it is only the large organic producers that has the strength to become certified to the Chinese market. Since the large majority of the organic producers are small and medium sized products, they do not have the same resources to go through such a certification process.