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Organic cheaper as oil prices rise.

Sir, A recent Chatham House report predicted the price of oil would rise to $200 per barrel in five to 10 years. At this point the production of organic combinable crops, such as wheat, barley and oil seed rape, could become more profitable than non-organic, a study carried out for the Soil Association has revealed.

The study, entitled 'The impact of rising oil prices on organic and non-organic farm profitability' was carried out by Andersons, the farm business consultants.

With oil at $135 per barrel (when the analysis was done), the profit margins show similar rates of return. The margins of non-organic combinable crop systems range from 397 [pounds sterling] to 449 [pounds sterling] and the organic margins range from 405 [pounds sterling] to 445 [pounds sterling].

However, with oil at $200 per barrel, the profit margins of non-organic combinable crop systems range from 296 [pounds sterling] to 348 [pounds sterling], while the organic profit margins range from 371 [pounds sterling] to 411 [pounds sterling], it says, due to the high cost of artificial fertilisers, a fossil fuel-heavy input used in non-organic systems, which could rise to 550 [pounds sterling] per tonne. At these prices, the claimed efficiency of fossil fuel and fertiliser-dependent industrial farming decreases sharply. Organic farming, instead builds soil fertility through crop rotation and the use of clover, which fixes nitrogen naturally using the sun's energy and photosynthesis and can fix 200kg of nitrogen per hectare over a year.

The study suggests that as oil becomes scarcer and costs more, economic forces will increasingly favour organic farming.

Peter Melchett, policy director, Soil Association
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Title Annotation:letters
Author:Melchett, Peter
Publication:Grocer
Article Type:Letter to the editor
Date:Sep 6, 2008
Words:266
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