Economic Impact of Coronavirus on Organic Products Market
Organic products have been gaining prominence and grabbing shelf space from conventional products over the last few years. However, many people trading with organic products would obviously be thinking about the impact of coronavirus on their business and supply chains.
As per our initial conversations with many big traders across Europe, they have witnessed stronger demand for organic food products during March and April as people started buying more of products due to lockdowns across Europe and other parts of the world.
The price of food commodities vary with demand and supply and it is interesting to note that till now, the prices have remained stable, despite the rise in demand for organic products. Traders have also informed us over the past few quarters that the price difference between organic ingredients and conventional ingredients has been declining.
Organic Market Europe feels that the supply chains will remain stable and trading houses across Europe have good level of products in stock. This can keep the prices of organic ingredients stable for the next few months.
We also expect higher consumption of organic food items in future as people would be careful about their health and improving their immunity. There has been higher consumer awareness in the recent years and many people have shifted to healthier food options.
If the price difference is less than 30 percent between organic and conventional food items, consumers prefer to buy organic.
Organic food producers and traders have additional expenses due to certification costs and other overheads. The quality of organic products has been found higher compared to conventional products.
With coronavirus, there can be a short term spike in demand but the average demand for organic food items is expected to grow in future as well.
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