Vol.2 No.1 (2007)

Winners and losers with harmonization of organic guarantee systems

Els Wynen

Theoretical issues of harmonization of international organic guarantee systems - encompassing standards, certification and accreditation - are explored, after which the benefits are quantified for two commodities, wheat and coffee.

Included in the theoretical framework are the concepts of actual direct costs (certification), and indirect costs (mainly inefficient and foregone production and marketing, and consumption) for the exporting and importing countries of organic produce.

The extra welfare of harmonization in the organic wheat trade is estimated at over US$0.4 million per year (1.3 per cent of the total organic wheat trade) under conservative assumptions, and US$2 million per year (7per cent of the organic wheat trade) with less conservative assumptions. Canadian, Slovakian and USA producers, and Japanese and Swiss consumers, gain the most from this harmonization. For coffee, the welfare gain is close to US$8 million per year (over 7 per cent of the traded value of organic coffee), or more with less conservative assumptions. The major gains from harmonization in the organic coffee market go to consumers, not to producers.

Keywords: organic agriculture harmonization standards certification accreditation trade wheat coffee

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