Organic Grain Shortage Throws Australian Industry Into a Crisis

Over the past years demand for organic grain has been climbing and, combined with a poor growing season and the exit of four major producers, Australian grain millers and processors are finding themselves in a crisis situation.

This season, 30,000 tons of organic wheat, barley, oats, rye and lesser known specialty grains have been harvested, however, the market demand is 150,000 tons – five times the supply. One of the main reasons behind the shortage is the fallout after a group of four large-scale organic grain farmers in the Riverina, representing 40% of Australia’s production, sold their water rights last year and exited the industry.

Craig Neale, owner of Wholegrain Milling, one of Australia’s largest organic flour mills, states that this year his company is having its worst year in 30 years and it will be the second year in a row that his company will be forced to import organic flour from Ukraine. Ryuji Nakamura, chief executive of organic noodle maker, Hakubaku states that the shortage might put the future of his company in jeopardy. Hakubaku needs a minimum of 3,000 tons of organic grain per year, and he is desperately speaking with farmers trying to source a consistent supply in order to keep production going.

The remaining organic grain farmers in the country are charging $700 to $800 per ton for good quality organic grain, four times the price of conventional grain, and buyers are still desperate.

Because of the serious nature of the shortage of organic grain growers, regulatory bodies including Australian Certified Organic have joined to make organic certification easier to obtain, changing the National Standard for Organic and Biodynamic Produce to shorten the length of time it takes to convert a conventional farm to organic.