Number of Finland’s organic food producers continues to fall

Market conditions and changes in terms for subsidies are driving more organic farmers out of business.

Finnish sheep at an organic farm in Tammisaari.
Finnish sheep at an organic farm in Tammisaari. Image: Paula Tiainen / Yle
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Preliminary data released by the Finnish Food Safety Authority has revealed that there are hundreds fewer organic farms in Finland this year than there were in 2022.

The number of organic farms has fallen in particular in the regions of North Savo, Kainuu and North Karelia.

Susann Rännäri, executive director of Luomuliitto – The Finnish Organic Association, told Yle there are several reasons for the trend. The main reason has been the change in the terms for public subsidies, which led to difficulties for farmers who mix mainstream commercial operations with organic farming.

These "mixed" farms for the most part raise livestock by conventional methods while using organic farming in their fields.

"When the conditions for public subsidies started to be tightened, the first proposal was that mixed farms be banned completely. This was avoided, but the details of elgibility for subsidies were made too challenging for mixed farms," Rännäri explained.

Cows outside in winter.
The market situation has pushed many dairy farm owners into a tight spot. Image: Elina Niemistö / Yle

Rännäri added that the current market situation is another reason for the decrease in the number of organic farms, forcing dairy farmers in particular into a precarious position.

The difference between the price paid to suppliers of organic milk and regular milk has narrowed, the subsidy terms have changed and the amount of support paid out has decreased. The requirements for production conditions have also become stricter.

"The sum of all this has become too big a burden, and people have decided to move away from organic farming," Rännäri says.

Goals vs realities

Among the goals of the national organic products programme, known as Luomu 2.0, are an increase in the share of organically cultivated arable lands to 25 percent and to increase the market share of organic products to five percent by 2030.

Last year, the share of organic farming was 15 percent and the market share of organic products was 2.2 percent.

In Rännäri's view, reaching the programme's goals will be more than challenging.

She argues that the impact of bureaucratic red tape is the opposite of what the organic production growth programme is aimed at.

Organic producers have considered what kind of political action could be used to influence the market. One suggestion that has been aired would be to remove VAT from the sale of organic products. And, as Rännäri sees it, steering consumption through taxation is normal in politics.

"This could make it possible for organic products to be a bit cheaper in the store, and that advantage wouldn't come at the expense of the producers," she pointed out.

Upripe tomatoes on a vine.
Increasing organic production is important from the point of view of national security of supply, according to Finnish Organic Association. Image: Juha Kokkala / Yle

Rännäri still sees the future of organic food production in Finland as good, even though there is a sense of foreboding in the sector.

Climate change and loss of natural environments are progressing at breakneck speed. Wars also cause global uncertainty. Rännäri noted that securing the future of organic production and preserving exprtise play an important role in terms of self-sufficiency and security of supply.

"If the borders were to close at some point, at least someone will know how to produce food without external input," she says.

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