SWEDEN (2024)

Introduction

With a population of just 8.9 million people, Sweden is one ofthe European Community’s (EC) smaller national markets for foodstuffs. Ofthe country’s total supply of food and beverages, about 80 percent isproduced domestically while imports account for 20 percent. However, for freshfruit and vegetables, the import share is substantially higher, over 70percent.

Since the beginning of the 1990s, the Swedish Government hasactively supported organic farming, resulting in a steady growth of organic landareas. Furthermore, several important market players within the retail,wholesale and industrial sectors have in recent years committed themselves topromote a wide range of organic food products.

Despite the fact that the market for organic food products hasshown double-digit growth rates of the past five years or so, especially withinthe dairy, cereal and the fresh produce sectors, the overall organic marketshare is still low, about one percent of the total food consumption. However,the large supermarket chains, which largely control the retail distribution oforganics in Sweden, have all set ambitious targets for organic items that ifimplemented, would substantially increase the current market size. Trade sourcesare therefore confident that organic foods could account for three to fourpercent of the total Swedish food consumption within a few years.

1. Organic farming in Sweden

1.1 Overview on the development of organicagriculture

Of Sweden’s total land area, 450 000 square kilometres,half is covered with forest. Its arable land amounts to only 2 800 000 ha, aboutseven percent of the total land area. The temperate climate is favourable forfarming, cold winters (that inhibit infestations of many crop pests) and warmsummers (with days of long sunlight) allows production of high qualityvegetables and berries. Nonetheless, agricultural conditions differ widelybetween regions, which is shown by the fact that farmlands in Scania in thesouth enjoys up to 100 days’ longer growing season than in farmlands in thefar north.

Organic farming has since around 1990 become an increasinglyimportant factor in the national agricultural policy. In 1994, the Swedishparliament set a goal that by the end of 2000, ten percent of the arable landsshould be using organic methods. The goal was reached, in fact eleven percent ofSweden’s arable land was in 2000 either certified organic or was using thenational support programme for organic farming, the highest recorded sharewithin the EC.

The Swedish government launched a new overall target at theend of 1999 - 20 percent organic lands in 2005. At the same time the EcologicalFarmers Association adopted a target that implies that by 2010, 30 percent ofall farmland production should be organic.

However, according to Swedish regulations, products producedat these farmlands may only be marketed or sold as "organic" if the cultivationhas been certified by any of the two official national organizations for controlof organic farming, KRAV and Demeter. Of these, KRAV is the dominant controlorganization. Most Demeter members are also members of KRAV.

The land area under KRAV control amounted to 139 000 ha at theend of 2000 corresponding to 5.1 percent of the total farmland (excludingpermanent pasture lands).

Grass and clover leis, including green manure and fallowfields, occupy the largest share of certified KRAV-lands, about 67 percent,while the remainder mainly consists of lands for producing cereals (about 30percent). Only a small fraction, or 1.5 percent, was used for production offruit and vegetables (see Table 1.2).

Approximately 3 300 Swedish farms were at the end of 2000affiliated with the control system of KRAV, of which about 10 percent wereengaged in production of fruit and vegetables.

1.2 Organic fruit and vegetable production

At the end of 2000, the total farmland area underKRAV-certified fruit and vegetables production amounted to 2 300 ha, of whichover 90 percent was under vegetables.

1.2.1 Production of fruit and berries

Commercial production of organic fruit and berries coveredabout 210 ha in 2000, of which fruit accounted for 65 ha and berries for 145 ha.There has been a decline in the production area in recent years, but due tohigher yields, the actual production output has been relativelystable.

Apples is the main commercial fruit product, but small volumesof pears, plums, cherries, and whitehart cherries are also cultivated.

There are at present only two commercial producers of organicapples in Sweden. The total production of commercial apples is approximately 20000 tonnes per year, of which organic items account for 1-2 percent (200-400tonnes). Within 3-5 years, the share should rise to 2-4 percent, according toone of the leading distributors. It should be noted that in addition tocommercial growers, there is also a substantial production of home-grown applesfor home consumption, approximately 50 000 tonnes.

Due to lower yields, it is estimated that the cost to produceorganic apples is 75-100 percent higher than conventional ones.

The production of organic berries is almost entirely made upof strawberries, which is a very traditional Swedish dessert item, especiallyduring the summer season.

1.2.2 Production of vegetables

Organically outdoor grown vegetables account for approximately5-6 percent of the total farmland area of production of outdoor grown vegetablesin Sweden. However, since the yield of organic vegetable production is onaverage 65-75 percent of the yield of conventional production, the actual shareof the total vegetables production is lower, approximately 3.5-4percent.

Since 1997, the area used for growing organic vegetables hasshown a relatively modest enlargement, or about 8 percent. However, due to arise in production yields, the actual increase in production is substantiallyhigher.

In 2000, production of organic vegetables covered an area of 2100 ha, of which over 80 percent (or 1 700 ha) was used for growing of potatoesand carrots. It is estimated that organic potatoes account for about threepercent of the total potato acreage. The remaining 400 ha was mainly used forthe production of beetroot, onions, cabbage, swede, peas, turnips, horseradish,leeks, and squash. Of these products, beetroot and peas are mainly intended forthe domestic food processing industry.

Due to climatic conditions, products such as tomatoes,cucumber and iceberg lettuce are difficult to grow organically in Sweden, whichexplains why the outdoor production of these items is very limited. On the otherhand, production of these items in greenhouses is more important.

Organic greenhouses covered about 80 000 square metres in2000, of which 90 percent was made up of tomatoes and cucumber. Other importantgreenhouse products are green peppers, lettuce, and fresh herbs.

Of the total acreage of greenhouses, organic productionaccounts for six percent. However, due to lower production yields, the organicshare of the production is only four to five percent. Some products have ahigher share, e.g. tomatoes, which account for five to six percent of the tomato production.

One greenhouse product group has during the last couple ofyears shown a very large increase, namely organic vegetables grown, distributedand sold to consumers in pots. The product range comprises some 25 differentproducts of which 45 percent consist of parsley, dill and chives, 30 percent ofdifferent kinds of lettuce, and 20 percent of fresh herbs.

Source: KRAV.

Source: KRAV.

Source: KRAV.

2. The Swedish market for organic fruit and vegetables 2.1Overview of the market for organic food and beverages

During the past decade the Swedish market for organic food hasexpanded rapidly, about 20-25 percent annually, but had there been moresupplies, the increase would have been even higher. There are now over 3 000certified organic products in Sweden, of which approximately 200 are differentkinds of fresh fruits and vegetables.

Consumption of organic foods amounted in 2000 to roughly 90000 tonnes by volume and SKr1 350 million by market value (incl. 12 percentVAT). This means that organic products have reached an estimated market share ofabout 1.3 percent by volume and 0.8 percent by value. It should be noted thatthese figures cover all consumption of food and beverages in both the retail andrestaurant sectors. If only retail sales are included, the organic share isestimated at 1.5 by volume and 1 percent by value. In general, organic productshave a much higher share within the retail sector, while the share within therestaurant sector is substantially lower. Another factor to consider is that thefigures also include product groups, which today have no or few organic itemsavailable, such as fish and crustaceans, confectionery, and soft drinks, beer,and spirits.

The organic consumption is at present dominated by dairyproducts and fresh fruits and vegetables, which together account for about 80percent of the volume and almost 65 percent of the market value (seeTable 4).

Source: Fox Research (based on trade sources).

2.2 Market for organic fruit and vegetables

The Swedish market for organic fresh fruit andvegetables amounted to about 19 000 tonnes in volume and SKr280 million(including VAT) in market value in 2000. This means that organic fresh producehad gained a market share of 1.4 percent by volume and 1.7 percent by value (seeTables 5 and 6).

Trade sources estimate that the annual rate of growth has onaverage been 20-25 percent during the last five years. For 2001, a 30 percentincrease is expected. The strong increase in demand is expected to continue alsoin the next few years.

2.2.1 Market for fruit and berries

The consumption of organic fresh fruit and berries amounted toaround 4 000 tonnes in 2000, which corresponds to a market share of 0.8 percent.By market value, the consumption amounted to about SKr80 million including VAT(share 1.1 percent).

The main organic fruit items are bananas, apples and pears,and citrus fruits.

Bananas, which was introduced as organic in Sweden in 1994,account for about half of the organic fruit supply. During 2000,consumption of organic bananas had increased to approximately 2 000 tonnes,which equals about 1.3 percent of the market for bananas (by value, themarket share is 1.7 percent). The forecast for 2001 is 2 500 tonnes. As suppliesincrease, the organic market share is expected to reach at least 3-4 percent inthe near future.

Consumption of organic apples and pears amounted to about 1000 tonnes in 2000, which corresponds to 0.8 percent of the supply ofapples and pears.

Even if the market for organic citrus fruit has expandedrapidly in recent years, it is still relatively insignificant, about 600 tonnes,well below one percent of the citrus fruit supply. The present productrange mainly consists of oranges, satsumas, clementines, grapefruit andlemons.

The relatively low market shares for both apples, pears andcitrus fruits is mainly due to inadequate and infrequent supplies. Since thesefruits all have a large market in Sweden, trade sources regard the organic itemsas having a much larger potential.

Kiwi has become a popular organic, since it has gooddurability. Other important organic fruit items are plums, peaches, melons, andgrapes, as well as strawberries and other types of berries. There is also agrowing consumption of organic tropical fruit, especially mango, papaya andpineapples.

According to a leading retailer, there is high demand for thefollowing organic fruit items: apples, pears, oranges, satsumas, lemons, grapes,papayas, passion fruit, figs, strawberries, raspberries, blueberries andcurrants.

2.2.2 Market for vegetables

The consumption of organic vegetables amounted toapproximately 15 000 tonnes in the year 2000, which equals 1.8 percent of the consumption of fresh vegetables. The estimated market value amounted thesame year to SKr200 million (including VAT), equalling a market share of 2.1percent.

For 2001, the leading suppliers estimate a market increase ofanother 30 percent, which means that the market should reach almost 20 000tonnes by volume and SKr260 million by value.

Potatoes account for a little more than half of the Swedishmarket for organic vegetables (corresponding to about 8 000 tonnes in 2000).This means that organic potatoes have gained a 2.1 percent share of the market for fresh potatoes. However, within the retail segment, the market shareis about 2.5-3 percent, while the share within the restaurant sector is wellbelow 0.5 percent.

Another important organic item is carrots, which during 2000gained a consumption level of about 2 500 tonnes, corresponding to about threepercent of the consumption of fresh carrots.

Trade sources are of the opinion that if more organic potatoesand carrots were available, they would most probably achieve much larger marketshares.

Other important organic vegetables are tomatoes, cucumber,lettuce, onion, cauliflower, cabbage, mushrooms, paprika, avocado, and freshherbs. Even if there are no official figures available, trade sources estimatethat during 2000 the consumption of these products was about 4 500tonnes.

Even if there is a growing demand for all types of organicvegetables, retail trade sources list the following products as of especiallyhigh interest: garlic, peas, beans, asparagus, chilli peppers, okra, anddifferent kinds of lettuce (including iceberg lettuce and endive), as well asmixed and sliced lettuce in ready-packed consumer packages.

There is also a growing demand for fresh organic herbs (i.e.basilica, thyme, tarragon, coriander, savoury, marjoram, oregano, rosemary). Themarket for alternatives to potatoes, such as sweet potatoes and cassava, hasalso increased in recent years, which means that there should also be a marketfor such organic products.

Sources: Swedish Board of Agriculture, Fox Research (based on trade sources).

Sources: Swedish Board of Agriculture, Fox Research (based on trade sources).

2.3 Distribution channels

There are three main sectors for fresh fruit and vegetables in Sweden, the retail sector, the restaurant and catering sector, and the food industry sector.

2.3.1 Retail sector

The retail sector accounts for 80 percent of direct foodconsumption. Two main subdivisions can be identified, supermarkets andspecialized food stores. A Swedish market characteristic is that organicproducts are predominantly sold through supermarkets. Most of the supermarkets,especially the larger ones, therefore have a relatively wide range of organicfruit and vegetables.

The specialized food store sector which comprises health foodstores, fruit stores, market halls and street markets, which have a relativelyminor share of the organic fruit and vegetables market. One reason is that whilehealth food stores sell organic foods, they generally do not carry freshproduce.

In general, the Swedish food retailing sector is characterizedby a relatively high degree of vertical integration between the wholesale andretail trade. Three large groups and one smaller hold about 74 percent of the sales within the retail level:

ICA Group

The ICA Group, with its parent company ICA Ahold, part-ownedby Ahold of Netherlands, is the largest retailer in Scandinavia with severalsubsidiaries in both Sweden, Norway, Denmark and the Baltic countries. Importsof fresh produce are handled by ICA Frukt & Grönt in Helsingborg (seeChapter 4.3, Main importers).

ICA has launched some 200 organic food products, of which halfare marketed under ICA's own labels. The market share for organic products isstill rather insignificant (below two percent). However, a goal is that inproduct areas where organic products are available, about ten percent of ICAsales should be organic.

KF Group

The KF Group, which consists of KF (the Swedish ConsumerCooperative Union) and 80 local retail consumer cooperatives, has about 2.4million individual members and holds about 19 percent of sales within thefood retailing trade. At the end of 2000, KF decided to merge its retailingactivities with its sister organizations FDB in Denmark and NKL/Coop in Norway.The new company, named Coop Norden, is expected to start its activities in2002.

The organic product range consists of 650 products, of which300 products are marketed under KF's own brand for environmental products,Änglamark. During the last couple of years, sales of Änglamarkproducts have risen by 30-50 percent per year. Even though these products arenot priced at a higher level than equivalent conventional products, the policyis that they have to be as profitable as other brands. It should be noted thatKF only imports ready-packaged goods - all fresh produce is imported bypart-owned Saba Trading (see Chapter 4.3).

Axfood

Axfood is a newly formed joint venture between the wholesalingand retailing group Axel Johnson and independent retailers in Sweden andFinland. The new group, which started operations during 1999, comprises thewholesale company Dagab as well as 1 000 supermarkets and convenience stores.The Axfood chain with the largest assortment of organic products is Hemköp,which comprises 100 large supermarkets all over Sweden. The organic rangeconsists of some 300 articles. About three to four percent of food salesare believed to be organic. The aim is to reach 10 percent within the next threeto four years.

2.3.2 Restaurant and catering sector

The restaurant and catering sector accounts for 20 percent ofthe direct food consumption in Sweden. However, the availability of organicproduce on the menus is still not so widespread. In the larger cities, there area few restaurants specialized in organic and health food. There are also somemunicipal and regional institutions (such as canteens in schools and day-carecentres) that have started to provide organic menus.

2.3.3 Food industry sector

There are about 300 domestic manufacturers certified by KRAVfor producing organic food products. Organic fruit and vegetables, such asbananas, oranges, lemons, clementines, grapefruit, berries (either natural orchopped or minced), are used as raw materials in the production of for examplefrozen foods, juices, fruit preserves, baby food, etc.

The food processors either buy needed raw materials oringredients directly themselves or through the specialized importers. However,imports of fresh fruit and vegetables needed in the production of organicproducts are as a rule carried out through one of the specialized fruit andvegetable wholesalers.

It should be noted, that for logistic, food safety andenvironmental reasons, Swedish manufacturers generally prefer raw materials fromeither domestic growers or suppliers in nearby countries.

2.4 Market access

Since 1995, Sweden is a full member of the EC. This means thatthere are no trade barriers between the EC and Sweden.

In order to be imported as organic products into Sweden or tobe traded as such, organic products have to be certified by a controlorganization.

In line with the EC Regulation, the Swedish parliament haslegislated official inspectors for organic products. The two organicorganizations in Sweden, KRAV (The Swedish Organic Agriculture Association) andThe Swedish Demeter Association, have both been named as official inspectionbodies.

KRAV, which is owned by parties involved in the production anddistribution of organic products -i.e. growers, food manufacturers, importers,wholesalers and retailers - is the only organic label recognized by the mainsupermarket chains. If other labels are used, they must be recognized by KRAV orat least comply with the EC Regulation.

However, a few importers also sell products that are certifiedby other control organizations recognized by IFOAM, such as SKAL, FVO, Ecocert,and EKO-BCS.

KRAV also approves foreign companies that produce or packageaccording to their rules. Approval of foreign production is based on thecondition that the production is in accordance with KRAV standards

All imported ready-packed food items have to have labels thatclearly state the country of origin. Sales of unpacked products require thefollowing on the invoices and delivery notes:

country of origin
name of control organization
approval by KRAV

The KRAV logo certifies that production is done according toorganic standards, e.g. without any chemical pesticides or fertilisers, thatanimals are well taken care of and have free outdoor access, and that the entireproduction is free from GMOs. To guarantee this, the KRAV inspectors carry outregular inspection visits on location at the farms, shops, processors,restaurants, etc.

2.5 Constraints to market development

There are three factors that could be regarded as mainconstraints to a further positive development of the organic fruit andvegetables market, limited supplies, high price differentials to conventionalitems and weak consumer knowledge about organic products and productionmethods.

2.5.1 Supplies

Among the leading retailers, limited and irregular supply isseen as the main constraint for further expansion of the fruit and vegetablesmarket. In order to increase the market, not only are more suppliers needed, butalso of suppliers that can provide their product during more than oneseason.

In order to increase market shares, sales promotion and othermarketing efforts are also essential. However, active marketing of a particularorganic product can not be undertaken until the parties involved can beabsolutely sure that one has dealt with the above-mentioned problems withavailability and reliable supplies.

The irregular availability of organic produce was also evidentin a price study undertaken in January 2001 in selected supermarkets inStockholm and Uppsala. At the time of the observations, several of the mostpopular organic items were not available, e.g. tomatoes, cucumber, lettuce,avocado and grapes (see Table 7).

2.5.2 Price premiums

Almost all organic produce receive a premium price. For someagricultural Swedish-grown products, the producer prices are linked toconventional prices, with a premium fixed either in Swedish crowns or as apercentage. For other products, including domestic fruit and vegetables,however, prices fluctuate widely.

Within the wholesale and retail levels it is customary to usepercentage mark-ups for fruit and vegetables. However, in order to minimize theprice differential between organic and conventional items, a few of the leadingretailers have decided to use the same mark-up value for organic items as theydo for corresponding conventional items.

Nevertheless, according to a recent study conducted by theNational Board for Consumer Policies, organic products are on average 30-35percent more expensive than conventional items. Observations in selectedsupermarkets in Stockholm and Uppsala in January 2001 also indicate that therange of price premiums over conventional products is very wide, from 0 to 300percent (see Table 7).

2.5.3 Consumer attitudes

Consumer research shows that consumers look for products thathave a good taste, are wholesome, easily available and convenient, and that areoffered at a good price. The environment also ranks high in the average Swedishconsumers’ minds. According to several market studies, two out of threeSwedes buy environmentally friendly products, of which about 40 percent do itfrom time to time and 10-15 percent on a more regular basis.

However, the actual knowledge about organic products and theway organics are produced and controlled, does not seem to be widespread. Arecent study also showed that even if the majority of consumers believed thatorganic products were good for the environment, a much larger majority (morethan 90 percent) maintained that organic products were expensive. This meansthat even if the price differential between organic and conventional items isreduced, there is still a lack of awareness in many consumers’ minds aboutthe benefits of organic products, which limits the potential for furtherdevelopment of the organic fruit and vegetables market.

Source: Fox Research.

3. Imports of organic fruit andvegetables

Imports account for a substantial share of the fruit andvegetable supplies. The main part consists of items which is not at all producedin Sweden - such as citrus and tropical fruits - and of products which are onlyproduced part of the year, such as most vegetables, deciduous fruits andberries. Imports of these products depend on how much local produce is availableor when importing is more favourable.

Exports of organic fruit and vegetables are insignificant,since local supplies are still inadequate to meet the domestic demand. The onlyexport items at present are carrots and cabbage, but only when there aretemporary extra supplies.

3.1 Imports of fruit and berries

Imports account for about 95 percent of the fresh fruitsupplies, and about the same share applies for organic fruit. By volume, imports of organic fruit and berries amounted to approximately 3 800-3 850tonnes in 2000, of which the most important items were bananas (2 000 tonnes),citrus fruit (600 tonnes), apples and pears (850-900 tonnes), and other items(350 tonnes) - see also Table 8.

The largest single import item is bananas, which account foralmost half of organic fruit imports. During 2000, about 2 000 tonnes wereimported, corresponding to 1.3 percent of banana imports. The mainsupplier is the Dominican Republic, but smaller volumes are also exported fromColombia, and as of 2001, Ecuador.

Imports of organic citrus fruits are still relativelyinsignificant, well below one percent of citrus fruit imports. The presentproduct range consists of oranges, clementines, satsumas, mandarins, tangerines,grapefruit and lemons. The main supplier is Italy, with supplement shipmentsfrom Spain and Israel.

Apples and pears are imported throughout the year, even thoughthere is some competition with domestic production during the domestic highseason, i.e. between August and January. Main foreign suppliers are Italy andFrance, but during off-season, there are also shipments from Argentina andChile.

Sweden is also a relatively large importer of kiwi fruit, allof which comes from Italy or New Zealand. Other organic fruits imported intoSweden are peaches and nectarines (Italy), plums (Chile), grapes (Italy, SouthAfrica), mango (Mexico, Dominican Republic, Guinea), pineapple (Brazil), andstrawberries (Israel). The following items are also imported, but in limitedquantities: papaya, melons, kumquats, limes, cherimoyas, custard apples, guavas,lychees, passion fruit, grenadilla, dates, figs, and cherries.

3.2 Imports of vegetables

Imports account for about 60 percent of the marketsupply for fresh vegetables. The same share also applies for organic vegetables,but only when potatoes are excluded. When potatoes are included, the importshare is down to about 35 percent.

During 2000, imports of organic vegetables amounted to between5 000 to 5 200 tonnes, of which potatoes accounted for approximately 900-1 000tonnes (see Table 8).

Source: Fox Research (based on trade sources).

The most popular organic vegetables in Sweden are potatoes andcarrots, which are supplied almost entirely by domestic growers. The only realpotential for exporters is probably during April and June, just before thedomestic harvest begins.

For other domestically grown vegetables, such as onions,beetroot, cabbage, swede, peas, turnips, leeks, and horse-radish, importslargely depend on how much local produce is available. The domestic growingseason generally starts in June and ends in August or September. During thisperiod it is very hard for foreign suppliers to compete with domestic growers,with the result that imports rarely start until several months after the growingseason has ended, i.e. in late autumn or in early winter.

Tomatoes are currently the largest import item. Due toclimatic conditions, organic tomatoes are difficult to grow economically inSweden, and are therefore imported all year. The main supplier is theNetherlands, but when Dutch tomatoes are not in season, imports are from theCanary Islands, which calls for air freight. Consignments of tomatoes from theCanaries are flown in practically every day between Christmas and Easter.However, during summer and autumn, there is also competition with domesticallygrown greenhouse tomatoes.

Other products imported are cucumber, lettuce, and paprika, aswell as cabbage lettuce, aubergines, mushrooms, avocado, chilli peppers, garlic,ginger, fennel, pimentos, zucchini and pumpkins.

Organic vegetables are mainly imported from other ECcountries, of which the Netherlands, Italy, France, and Spain are the mostimportant ones. Suppliers from outside the EC include Israel (onions, avocado),Argentina (onions, garlic), Mexico (avocado), the Dominican Republic (ginger),and China (pumpkins).

3.3 Main importers of fruit and vegetables

Most imports of fresh organic produce into Sweden are carriedout through the specialized fruit and vegetable wholesalers, since retailers,caterers and food manufacturers rarely import fresh producethemselves.

There are about 200 fruit and vegetable wholesalers in Sweden,and nearly all of them also function as importers. Most of the wholesalers arelocated in one of the following four locations:

Helsingborg and Malmö (in the southern partof the country)
Göteborg (west coast)
Stockholm (east coast)

There are at present twelve wholesalers that are authorized byKRAV to import fresh organic fruit and vegetables into Sweden, of which fiveoffer both conventional and organic items, while the other seven deal solelywith organic items.

Even if there are no exact figures available, it is clear thatthree wholesalers dominate imports of organic produce into Sweden: Saba Trading,ICA Frukt & Grönt and Biodynamiska Produkter (BP) - see also Table9.

Saba Trading

Saba Trading is Scandinavia’s leading importer of fruitand vegetables and holds about 50 percent of the Swedish market for fresh fruit,vegetables and flowers. The company is owned by the United States fruit andvegetables group Dole Food Company (60 percent), and the two domestic retailgroups Axfood/Axel Johnson (25 percent) and KF (15 percent). Sales amount toabout SKr4 500 million yearly.

Imports are handled by Saba Frukt & Grönt, asubsidiary based in Helsingborg. However, bananas are imported throughBanan-Kompaniet, based in Stockholm. Another subsidiary is FTK in theNetherlands, one of Europe's leading importers of tropical fruits. A relativelylarge part of Saba’s European import is channelled through FTK’sterminal in Rotterdam.

Saba Trading has a wide range of organic fruit and vegetables,well over 100 articles. Organics are estimated to account for about 1-1.5percent of fruit and vegetable sales. Main customers are food storeswithin Axfood and the KF Group, as well as independent food stores. The cateringsector is another important customer group.

ICA Frukt & Grönt

ICA Frukt & Grönt, part of the ICA Ahold Group, isthe second largest importer and wholesaler of fresh fruit and vegetables inSweden. Sales amount to about SKr2 500 million. The market share is about 30percent.

The main customers are food stores belonging to different ICAchains, as well as independent caterers.

Organic items account for about one percent of the volume. The range includes about 80 articles, of which the most important onesare bananas, oranges, apples, pears, potatoes, carrots, tomatoes andbroccoli.

Direkt Frukt & Grönt and Ewerman/Frukt &Grönsaksspecialisten

The three medium-sized wholesalers of fruit and vegetables,Direkt Frukt & Grönt, and Ewerman/Frukt & Grönsaksspecialisten(both are part of the STC Group), that have been authorized by KRAV to importorganic items, but volumes are still insignificant (well below one percent shareof their respective sales).

Biodynamiska Produkter (BP)

BP with headquarters in Järna outside Stockholm, marketsabout 90 organic fruit and vegetable articles, of which more than half thevolume is imported. With a turnover of SKr100 million, BP ranks as one of thethree largest importers of organic produce in Sweden (in organic bananas, itranks as number two).

In addition to fresh produce, also packaged foods areimported. The range consists of more than 1 000 different organicproducts.

BP imports both from other EC countries and from othercountries in Europe, Asia, Africa and Latin America. Besides supplying otherwholesalers (including Saba and ICA), BP sells directly to supermarket chainsand health food stores, as well as to the catering sector and the foodmanufacturing sector.

Samodlarna Sweden

Samodlarna Sweden is a buying and marketing cooperative forabout 350 domestic farmers and gardens, but also handles import of someproducts. The main customers are fruit and vegetable wholesalers and thedomestic food processing sector.

Others

The smaller wholesalers of organic fruit and vegetables areeither concentrated on a few specific items or product groups (Mariannes Farm,Natura, Raggårdens Produkter and Råby Biogrönt), or a regionalgeographical area (Alt-Grönt).

There are also a few KRAV-certified fruit and vegetabledistributors in other European countries that regularly export organic items toSweden, of which the most important one is Eosta International BV in theNetherlands. Eosta’s customers in Sweden include Saba Trading, ICA Frukt& Grönt, Biodynamiska Produkter and Direkt Frukt & Grönt, aswell smaller wholesalers.

3.4 Import trends and constraints to importgrowth

As has been pointed out earlier, the market for organicproduce has shown a steady increase during the past few years, about 20-30percent annually. But since domestic producers have not been able to meet thegrowing demand for either organic fruit or vegetables, imports have grown evenmore, well over 30 percent per year. A further 30 percent increase is expectedfor 2001.

Source: The Market for Organic Products/SLU, KRAV, Fox Research.

Since the Swedish market for organic fruit and vegetables to arelatively large extent already is supplied by imports, especially regardingfruits, the only real constraints to a further increase of imports would be asubstantial increase in domestic production combined with a slowdown in themarket development. Neither of these factors are likely to happen in the nearfuture.

However, as the market for organic fruit expands, it isprobable that there will be an increase in the domestic growing of apples andpears as well as strawberries, which is likely to have a negative effect onimports of these items, at least during the domestic growing season.

4. Conclusions and market opportunities fordeveloping countries

The organic food market in Sweden has seen a tremendous growthduring the last couple of years. The development has been enhanced by the largesupermarket chains, which have introduced a wide range of organic foodstuffs intheir assortment, of which quite a few fall under their own brands.

The market for organic fresh fruit and vegetables is estimatedto have grown about 20-25 percent annually in recent years. The positive trendis expected to continue also in the near future. In fact, sources within thefruit and vegetable trade foresee a 30 percent increase for 2001.

Despite the very positive market development, it must bepointed out that the market penetration is still relatively low. In 2000,organic vegetables had an estimated market share of just 1.8 percent by volumeand 2.1 percent by value. For fruit and berries, the corresponding market shareswere even lower, 0.8 percent and 1.1 percent, respectively. By volume, themarket for organic vegetables amounted to 15 000 tonnes and organic fruit andberries to 4 000 tonnes. By market value, the corresponding figures were SKr200million and SKr80 million.

The low market shares has several origins, of which three canbe seen as the most important ones. First of all is the high price difference toconventional items (in general 30-35 percent), which consumers generally cite asthe main factor for not choosing organics. Since at least 10-15 percent of theconsumers regularly buy environmentally friendly products, there is a strongpotential for a much higher market share for organic fruit and vegetables, ifthe price difference could be somewhat reduced, at least to 15-20percent.

Another market constraint is inadequate and infrequentsupplies. The retail trade prefer products that can be marketed throughout thewhole year. This means that in order to increase the market, not only are moresuppliers needed, but also of suppliers that can provide their product duringmore than one season.

A third hampering factor is that even if environmental concernranks high in most consumers mind, the actual knowledge about the differencebetween organic and conventional agriculture is not widespread. More informationand promotional activities towards consumers should therefore be undertaken, inorder to strengthen the development of the organic market.

However, the foundation for a further strong development ofthe organic market in Sweden is already at hand. Organic farming is an importantfactor in the Swedish agricultural policy and this is also emphasized by the newnational target, which stipulates that 20 percent of the country’s arableland should be organic farm lands by 2005. If the goal is reached, it would putSweden in a top position in organic agriculture in Europe.

Nevertheless, only a small share of the organicfarmlands is currently under certified fruit and vegetable production, just 2300 ha, which explains why domestic production only accounts for barely half the market supply for organic fruit and vegetables.

Imports account for almost all supplies of organic fruits. Themain part consists of items which are not produced in Sweden - such as citrusand tropical fruits - and of products which are only produced part of the year -such as deciduous fruits and berries.

The leading import items in organic fruit are bananas, citrusfruit, apples and pears. Bananas are by far the most popular organic fruit. Evenso, organic bananas have just 1.3 percent of the market for bananas.Considering that Sweden has one of the highest consumption of bananas in theworld (outside banana-producing countries), around 20 kg per person, there is apotential for a much larger export volume to Sweden.

The organic market for both citrus fruit and apples and pearsis still underdeveloped, which means there should be a potential for much higherimport volumes. Since importers generally prefer to buy from sources as near aspossible, the best opportunities for suppliers in developing countries areprobably during the European off-season. This also applies for other itemsproduced in Europe, such as stone fruit, melons and berries.

Tropical fruit has seen a very positive market trend in recentyears, which means that there exist excellent export opportunities for suppliersin developing countries for a number of items, such as mango, papaya,pineapples, cherimoyas, custard apples, guavas, lychees and passionfruit.

Imports account for about 50 percent of the supply oforganic vegetables. However this figure excludes potatoes, which account forover half the organic vegetable market. If potatoes are included, the importshare is substantially lower, about 35 percent.

Imports of organic vegetables are oriented towards productsthat are not produced or not available in sufficient quantity in Sweden.Potatoes and carrots are almost entirely supplied by domestic producers.Furthermore, during the Swedish growing season, it is generally hard for foreignsuppliers to compete with domestic producers of vegetables such as onions,beetroot, cabbage, swede, peas, turnips, horse-radish, leeks, and squash. On theother hand, other vegetable products, such as tomatoes, cucumber, iceberglettuce, cabbage lettuce, cauliflower, mushrooms, paprika, aubergines, andfennel are imported all year round.

Even if the main part of vegetable imports come from other ECcountries (with the Netherlands and Italy as the main suppliers), there are goodprospects for non-European suppliers of a number of organic vegetables, such asonions, chilli peppers, avocado, garlic, ginger, okra, pumpkins, and sweetpotatoes.

Given the rapid development of the organic market, the currentinsufficient supply, and the large import share, producers in developingcountries of fruit and vegetables, especially tropical fruit and off-seasonvegetables, should have good opportunities to export organic items to theSwedish market.

Annex I
List of major importers of organic fruit andvegetables

Selected list of KRAV-certified importers of fresh fruit andvegetables. A current list of all KRAV-certified importers as well as otherinformation about imports can be obtained from KRAV, see address in AnnexII.

Importers of fresh fruit andvegetables

AltGrönt AB
Products: Fruit and vegetables
Contact: Mr Bernt Klingberg
Tel: +46 8 511 700 60
Fax: +46 8 511 763 64
Address:Vargmötesvägen 14, S-
186 30 VALLENTUNA
[emailprotected]
www.altgront.se (under construction)

Biodynamiska Produkter
Products: Fruit and vegetables;
packaged foods
Contact: Mr Tobias Zeiher
Tel: +46 8 554 810 30
Fax: +46 8 554 810 39
Address:PO Box 42, S-153 21
JÄRNA

[emailprotected]

Direkt Frukt och Grönt AB
Products: Fruit and vegetables
Contact: Mr Torbjörn Karlsson
Tel: +46 40 18 09 00
Fax: +46 40 18 09 01
Address:Flintrännegatan 21, S-
211 24 MALMÖ
[emailprotected]
www.direktlivs.se

ICA Frukt & Grönt
- part of ICA Ahold AB -
Products: Fruit and vegetables
Contact: Mr Björn Hacklou
Tel: +46 42 18 90 00
Fax: +46 42 18 92 88
Address:PO Box 713, S-251 07
HELSINGBORG
[emailprotected];
[emailprotected]
www.ica.se

Marianne's Farm AB
Products: Carrots
Contact: Ms Marianne Härning-
Nilsson
Tel: +46 42 20 71 33
Fax: +46 42 20 70 49
Address:Dalsgård 2393, S-262 92
ÄNGELHOLM
[emailprotected]
ww.mariannesfarm.se

Natura AB
Products: Fruit and vegetables
Contact: Mr Bengt Carlsson
Tel: +46 415 622 50
Fax: +46 415 620 35
Address:Almarkaröd, S-242 92
HÖRBY
[emailprotected]
www.natura.se

Raggårdens Produkter AB
Products: Potatoes, roots, other
fresh vegetables; Preserved
vegetables
Contact: Mr Owe Johansson
Tel: +46 512 134 90
Fax: +46 512 130 77
Address:Arentorp, S-534 94
VARA
[emailprotected]
www.raggardensprodukter.se

Råby Biogrönt AB
Products: Fruit and vegetables
Contact: Mr Tommy Nordgren
Tel: +46 415 31 11 56
Fax: +46 415 31 11 56
Address:Råby 4, PL 250, S-242
92 HÖRBY

Saba Trading AB
- part of Dole -
Headquarters, Stockholm
Tel: +46 8 602 60 00
Fax: +46 8 602 60 99
Address:PO Box 9101, S-120 05
ÅRSTA
[emailprotected]
www.saba.se

Importing subsidiaries:

Saba Frukt &Grönt AB
Products: Fruit and vegetables;
Flowers
Contact: Ms Linnea Jönsson
Tel: +46 42 24 96 69, +46 42 24
95 00
Fax: +46 42 29 71 31
Address:PO Box 15 073, S-250
15 HELSINGBORG
[emailprotected];
[emailprotected]
www.saba.se

BananKompaniet AB
Products: Bananas
Contact: Mr Anders Cottrell
Tel: +46 8 667 91 60
Fax: +46 8 661 36 07
Address:PO Box 27294, S-102
53 STOCKHOLM
[emailprotected],
[emailprotected]
www.banan-kompaniet.se;
www.saba.se

Samodlarna Sweden
Products: Fruit and vegetables;
Dried vegetables; Cereals;
Packaged foods
Contact: Mr Jan Knutar
Tel: +46 8 602 23 38
Fax: +46 8 91 81 20
Address:Grosshandlarvägen 3
S-120 44 ÅRSTA
[emailprotected]
www.swegro.se

STC Scandinavian Trading Company

Importing subsidiaries

Ewerman AB
Products: Fruit and vegetables
Contact: Mr Björn Jansson
Tel: +46 42 490 11 00
Fax: +46 42 490 11 80
Address:Knut Påls väg 9, S-256
69 HELSINGBORG
[emailprotected]
www.ewerman.se

Frukt & Grönsaksspecialisten
Products: Fruit and vegetables
Contact:Mr Nils Barnholdt
Tel: +46 42 20 11 60
Fax: +46 42 15 37 27
Address:Knut Påls väg 8, S-256
69 HELSINGBORG
[emailprotected]
www.fgs.se

Retail Groups

Axfood AB
Retailer and wholesaler in
Sweden and Finland.
Imports of fresh produce, see
Saba Trading.
Tel: +46 8 553 998 00
Fax: +46 8 82 58 59
Address:PO Box 7314, S-103 90
STOCKHOLM
[emailprotected]
www.axfood.se

ICA Ahold AB
Retailer and wholesaler in
Sweden, Norway, Denmark and
the Baltic countries.
Imports of fresh produce, see ICA
Frukt & Grönt.
Tel: +46 8 585 500 00
Fax: +46 8 585 500 09
Address:S-171 93 SOLNA
[emailprotected]
www.ica.se

KF
Retailer and wholesaler in
Sweden.
Imports of fresh produce, see
Saba Trading.
Tel: +46 8 743 10 00
Fax: +46 8 743 15 75
Address:PO Box 15200, S-104
65 STOCKHOLM
[emailprotected]
www.kf.se

BergendahlsGruppen AB
Retailer and wholesaler in
Sweden
Imports fresh produce, see Saba
Trading
Tel: +46 451 480 00
Fax: +46 451 482 22
Address:PO Box 22, S-281 21
Häassleholm
[emailprotected]
www.bergendahls.se

Annex II
List of organizations and national authorities in theorganic sector

KRAV
- Swedish Organic
Agriculture Association
Certification organization for
organic production, processing,
importing, distribution and
marketing.
Activities include standards
development, inspection,
certification, and information.
Tel: +46 18 10 02 90
Fax: +46 18 10 03 66
Address:PO Box 1940, S-751
49 Uppsala
[emailprotected]
www.krav.se

GroLink
Consultancy and assistance of
certification programmes,
projects and training world-
wide.
Contact: Mr Gunnar Rundgren
Tel: +46 563 723 45
Fax: +46 563 720 66
Address:Torfolk, S-684 95
Höje
[emailprotected]
www.grolink.se

National Food
Administration
Tel: +46 18 175500
Fax: +46 18 105848
Address:PO Box 622, S-751 26
Uppsala
[emailprotected]
www.slv.se

Swedish Demeter Association
Certification organization for
bio-dynamic production.
Tel: +46 8 551 579 88
Fax: +46 8 551 579 76
Address:Skillebyholm, S-153
91 Järna
www.demeter.nu

Föreningen för Rättvisemärkt - SwedishMember of Fair Trade Labelling
Organization International (FLO)
National organization for fair
trade labelled items (products
marketed in Sweden are usually
also KRAV-certified).
Tel: +46 8 668 03 50
Fax: +46 8 668 03 14
Address:Drakenbergsgatan 11,
S-117 41 Stockholm
[emailprotected]
www.raettvist.se

Swedish Federation of Trade
and Service
Tel: +46 8 7627700
Fax: +46 8 7627777
Address:S-103 23 Stockholm
[emailprotected]
www.svenskhandel.se

Swedish University of Agricultural Sciences(SLU)
A main actor of research,
courses and training within the
Swedish organic agricultural
sector.
Tel: +46 18 67 10 00
Fax: +46 18 67 20 00
Address:PO Box 7070, S-750
07 Uppsala
[emailprotected]
www.slu.se

Swedish Board of Agriculture
Tel: +46 36 15 50 00
Fax: +46 36 19 05 46
Address:S-551 82 Jönköping
[emailprotected]
www.sjv.se

Annex III

Currency Conversion

Average exchange rate of the Swedish currency SKr

Average rate in SKr

* Average rate January-February 2001
Source: Sveriges Riksbank