Here is a compilation of case studies on organic agriculture in the different regions of China.
1. Case Study on Organic Agriculture in Inner Mongolia (Livestock-Lamb):
Caoyuanxingfa Co., Ltd. (CYXF), is one of China’s leading agro-industrial enterprises, employing 10000 people in six provinces, and serving as the facilitating company for organic livestock development in one of the poorest regions of Inner Mongolia.
CYXF has a history of working directly with producers and felt comfortable in this role, but its primary purposes for entering into organics were to further enhance its reputation as a Green and sanitary company (it also has eight certified Green Food products) and explore the potential of this emerging market in light of increasing food safety issues for livestock trade.
Its processing plants have been ISO 9001 and HACCP certified yet in the area of Xilinhaote it takes a less industrial approach in its relationship with local herders and a free grazing system that produces about 500 tons of organic lamb meat (2004) to be certified by Organic Food Certification Centre (OFCC).
Currently, 300 households participate in the programme that involves extensive grazing. The region has for centuries pursued traditional livestock production in relatively undisturbed grazing areas. The advent of the project has not imposed any significant changes in these methods other than the halting of some veterinary medication and improving production assets (i.e. sheep house, digging wells).
As a result, neither yields nor production costs have changed significantly apart from some initial investment. Although the traditional production methods have not changed for these families, the elevated price of lamb since 2000 has significantly improved their livelihoods taking them from the lowest economic rungs in the province to a medium- high ranking.
While producers found the transition relatively smooth, they had considerable difficulty with the record-keeping and unnecessary paperwork. The process of verification of compliance is handled with random tests at the processing plant and with an effective Internal Control System called the Responsibility Sharing System.
The producers are not formally organised and there are no other supporting institutions such as NGOs working in the area. Government has played no direct role in the project that was initiated and financed entirely by the company.
The project success has in part coincided with the very elevated demand for livestock, especially high-quality natural lamb. Most of its production (80%) has gone to the domestic market since it is just beginning to use the organic label. The balance goes to Japan and the Middle East; since organics fetch a higher premium abroad, exports are its primary target.
2. Case Study on Organic Agriculture in Anhui (Tea):
China has 45% of world’s total tea growing area and more than 80 million tea farmers and 50 million tea traders across the country. Anhui Province’s Huoshan County produces Huoshan Huangya, a particularly high quality tea as well as typical green tea at both high and low altitudes with somewhat different results.
Initiated by the China Netherlands Poverty Alleviation Project (CNPAP), the “Huoshan Organic Development Strategy” was shaped by the County government in 1999, defining milestones and targets for organic tea production. Soon afterwards the County Tea Industry Association was set up as an NGO with CNPAP funding.
This Association plays a leading role in the organic development of the County and is supported by the government. The County government continues to provide finance to the NGO staff after the CNPAP project completed in 2003, although continuity has been difficult.
This makes it possible for the NGO to provide training and other services to local farmers and traders. The local County government handles technical support and promotion, having set up more than 48 Tea Field Schools in the region.
The CNPAP also encouraged development of small farmer associations and these have apparently been essential for field level dissemination and the management of internal control systems for certification. The farmer associations have also proven useful in arranging the processing and marketing.
The high altitude producers are often poorer and use more traditional methods and no agro-chemicals while the lower altitude producers typically incorporate synthetic pesticides into their management systems. The more natural tradition of tea production in the Highland areas, as well as a superior taste, led the government to introduce organic agriculture into these areas first.
The number of farmers participating in organic tea production has gone up from 367 households in 2000 to 6502 households in 2004. The average size of a family’s tea holdings is rather small at 0.075 ha. The technical support coupled with the opportunity for considerable price premiums have led to better care for the tea plots, especially in the somewhat neglected highland areas.
The extra care plus organic requirements have substantially increased labour costs. Some of the methods promulgated by the organic project have been selectively adopted by non-organic producers in other villages.
The government’s organisational support, processing, marketing and the farmer training and inputs such as organic seedlings were mentioned by farmers as critical support measures that permitted their conversion. IFAD’s poverty alleviation project funded some of the training and inputs. As a result, both quality and yields have improved considerably, adding to the farmers’ income.
OFDC, China’s largest organic certifier provided technical experts to train the local extension people and help to draft Huoshan’s own organic tea production regulations. Because of small tea plots and difficulties in certifying fragmented areas, entire villages or village groups were converted simultaneously with donor funding.
3. Case Study on Organic Agriculture in Jianxi (Ginger, Soybeans and Rice):
Jiaohu Township is located in the northern mountainous area of Wanzai County in Jianxi Province. It has 800 ha of cultivated land and 68% is still covered in forest. There are seven villages with about 3000 households (11000 people) and each family cultivates an average area of 0.27 ha.
This is a particularly poor area with an annual per capita income of about USD 232. Rice was the main staple crop — cultivated with some synthetic agro-chemicals — and surplus harvests were used for local trade. Income was supplemented with foraging for both timber and non-timber forest products. Poor management and over harvesting led to resource degradation and falling farmer incomes.
In 1999, the township government recognising the inevitable decline came up with the idea of organics and conducted market research that was fruitful and soon led to their first standing order. The People’s Congress, with government encouragement, voted to convert the entire township to organic methods and banned all synthetic agro-chemicals from entering the township.
The first test plot of 3.3 hectares was certified in 2001 and by 2004 all 800 hectares were certified to international standards. Not only was government the initiating force, but it also supported the process with farmer training and new technology, product collection, and marketing.
Organic products such as ginger and soybeans are sold to domestic middlemen or processors who export these primarily to North America. To encourage farmers, arrangements were made with processors to pay them some premiums even while they were still in the transition phase.
Gross earnings for 2003 were approximately USD 280000 and, even after expenses, earnings dramatically improved incomes throughout the township. Equally important, they diversified from a dependence on one crop to growing more than ten kinds of crops including new cash crops such as ginger, green soybean, strawberries, scallions and red sweet potatoes.
As farmers have mastered organic farming methods they have contributed to the recovery of the ecological environment with reduced land clearance, better terracing, and less farming on steep slopes. They have also become less reliant on forest resources thereby allowing these to slowly recover.
Farmers however have also faced a number of difficulties in adapting to both new methods and new crop varieties. In some cases, this has resulted in production inefficiencies and very low yields that have frustrated some of the farmers. These changes have also helped to create a leasing market as less capable or inefficient farmers have opted to rent their land to the more successful farmers who can enjoy better economies of scale in applying their experience and methods.
4. Case Study on Organic Agriculture in Yunnan (Ancient Tea Groves) Fair Trade and Kidney Beans:
Three villages with 4112 farmers in the higher elevations of Lancang County produce organic tea on 720 hectares. Two of them have been internationally certified since 2001 and the third will be certified in 2005. Most of the certified area is actually a primary growth forest interspersed with ancient tea trees.
According to local records these tea trees have been producing tea for the last 800- 1000 years. Fresh tea leaves are harvested but traditionally no soil or plant maintenance has occurred. One segment is a newly replanted area designed for commercial organic cultivation. These villages are interspersed with commercial tea plantings that are conventionally managed and somewhat larger in land area.
The villages are extremely poor with average annual incomes of USD 45, USD 60, and USD 70 respectively. In comparison, the average per capita income in Yunnan for 2002 was USD 195. All three villages are almost completely populated by ethnic minorities- the Dai, Bulang, Hani, and Lahu people. The latter were primarily hunter gatherers until settling in the late 1950s and so are relatively new to agriculture. Tea is the primary source of income for all the residents.
The Lancang Antique Tea Company (LATC) is one hundred per cent worker-owned shareholding company that was established in 1998 after the bankruptcy of the previous state-owned tea processing enterprise. Its 60 owner- employees are involved in tea processing and marketing.
Most of the business is in the lucrative domestic market and exports are undertaken through a trading company. LATC helped to set up The Lancang Antique Tea Garden Association (LATGA) with farmers from the three villages. LATGA was initiated as part of a fair-trade project and listed in the Fairtrade Labelling Organisations International (FLO) register.
LATGA and LATC are struggling to conserve and maintain the forest resources that are in danger of over extraction and degradation. They also face difficulties controlling the economic access to the public forest where Lancang County government and a foreign firm have arranged their own extraction plans independent of the farmers groups.
Lijiang County, located in the mountainous Northwest part of Yunnan Province, has a long history of kidney bean production dating back to 1924. This case covers three relatively remote townships averaging just over 2500 metres above sea level where about 65% of the farmers have converted 3037 ha to organic and are now internationally certified.
The 5000-6500 participating farmer households each have about 0.67 to 1.33 ha for cultivation. In many cases, the land is not contiguous but rather is scattered into smaller plots. About half of the land is on steep slopes rising from a valley. Cultivation methods have been traditional although in recent years synthetic pesticides have increasingly come into use.
Most households also cultivate other crops such as potato, maize and rapeseed in rotation with kidney beans and have achieved food security with grains although a good portion of these are purchased with the incomes earned from their cash crops. Average per capita income ranges from USD 120 to USD 160 per year. Farmers are ensured a minimum price for their kidney beans to ensure that organic standards are adhered to: the possibility of better prices is the primary motivating factor for most of them.
The Lijiang Deyi Food Processing Ltd. manages the collection and marketing of the products through simple contracts with farmers. This company emerged to replace the former government owned company that first stimulated organics in the region in the late 1990s and also performed much the same post harvest and marketing functions.
Today, extension services and even crop collection are conducted by county extension agents although many have only modest organic knowledge. Farmers have no organisation of their own.
The company owns the organic certification and it pays for a number of different certifications each year to satisfy clients and improve marketing opportunities. It is ISO 9001 and HACCP certified and processes about 3000-4000 tons annually for domestic sales and export to a number of countries. Anhui (Kiwi and Wild Rice).
Yuexi County in Anhui Province is situated in a remote area that is very suitable for kiwifruit growing. Organic conversion began in 1997 with a 2.9 ha test plot in the Yufan Kiwifruit Research Institute which was a research, demonstration, and seedling propagation farm. There are now 5.9 ha of certified kiwifruit.
The project was supported by Sino-German cooperation with GTZ’s five-year “Organic Farming Development in China” that played an important early role in the development of organic farming in China.
In addition to developing an information and advisory service for organic farming, the project supported the development of certification and the use of participatory techniques involving farmers in all of the aspect of organic agriculture.
The aims of organic conversion for local farmers were to improve quality and storage properties thereby raising the competitiveness (and price) of their products. The project’s research component was vital to farmers’ success and their yield and quality improvements were strong reasons for conversion.
To go beyond the research station, the establishment of the Yuexi Organic Kiwifruit Association facilitated training and on-farm trials that were essential to the project’s success. This farmers association planted early seeds of cooperation and problem solving than helped them to endure the three-year conversion process from conventional production methods to organic methods. The association is now continuing the learning work by serving as a platform for farmers to exchange experiences and ideas and serves as a bridge to semi-literate farmers.
In 2001, after researching and conducting its own trials, the association introduced wild rice to its members as a form of diversification from Kiwi as their only cash crop. Wild rice has been an immediate and unmitigated success. This has been particularly important in light of several years of falling prices and climactic difficulties that diminished yields. The association also handles marketing for the producers, helping to ensure reasonable prices.
5. Case Study on Organic Agriculture in Shandong Food Company:
The local government’s recognition of the opportunities in organics has been instrumental in making the five towns of the Feicheng area one of the most successful organic vegetable production zones in Shandong Province. This is a developed area that specialises in high-value produce for the Japanese and European markets.
It serves as a good example of the predominant organic production model in China where larger scale enterprises and trading companies contract farmers to produce high-value certified products for export. It involves small producers although these are not necessarily the poorest nor are they in disadvantaged regions.
This mini case study was undertaken in order to better understand the most common approach to organics that accounts for the vast majority of China’s organic trade and represent what most domestic policy-makers would be familiar with as organics.
There are 5066 ha of farmland in organic or in conversion producing 20 kinds of internationally certified products including taro, burdock, asparagus, sweet corn, cha dou, tian dou, squash, carrot, string bean, lima bean, garlic, spinach, green soybean, cauliflower, green Chinese onion, and Japanese pumpkin. Annual production amount is 130000 tons.
Several companies in the area are involved, primarily in post-harvest preparation and processing. One of these, the Tai’an Asia Food Co. is a Sino-Japanese joint venture that employs 1200 staff and that coordinates the production of 10600 farmers. Farmers are relatively well-off and able to earn several hundred US dollars considering average farm size is only 0.083 ha and this is similar to the conventional farms in the region.
The company is diversified and draws only 40% of its income from organic operations. These intensive commercial operations initially reduced their yields after conversion but have rebounded close to the original conventional yields and this is improving as they gain more experience with organic management.
6. Case Study on Organic Agriculture in Hubei (Mushrooms and Tea):
Shiyan Municipality is a poverty area in Hubei Province where only 9% of the land is arable. Since 1999, organic product development was initiated and supported by the government. Supportive policies have been passed and a public fund was set up to support organic producers and traders.
Organic product development in Shiyan is now carried out primarily by private enterprises such as the Shiyan Wudang Wild Products Development Co. and state owned tea farms such as the Longwangya Tea Group. These dictate requirements to the farmers and in return pay them a price significantly higher than they would receive for conventional products.
The firm’s own and pay for the certifications that are both international and domestic (i.e. OFDC and Organic Tea Research and Development Centre) for 13 different products. Currently, some of the products are exported but most are sold in the domestic market including a sizable (about 1000 m2) retail marketing facility.
The state owned Longwangya Tea Group Co. has a processing facility and 173.3 ha of landholdings that are contracted to small farmers that are organised into teams. Farmers are not organised and nearly all are smallholders with limited resources. Most practice traditional forms of agriculture using few external inputs. They primarily cultivate tea, mushroom i.e. shitake, and harvest wild mushrooms and medicinal and aromatic plants.