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Does the distribution of organic seed
present specific problems?
With the US law effective in October of this year, and the European law
effective in January,
2004, significant changes have to take place in all aspects of the
organic seed industry.
From research to production, harvesting, processing,
warehousing, labeling, and shipping,
organic seed must be kept separate from
conventional seed. Beyond the seed and all the way down the supply
chain, organics must be kept separate from conventional products.
Seed companies
and seed dealers who become part of the organic seed supply
chain will have to commit capital and human resources to
ensure proper separation and identity preservation of the
organic seed at all levels.
At this stage, however, I find that many seed companies and
seed dealers are waiting to see how the certifiers will
interpret and execute the organic laws before making any long
term capital committments. The big question in everyone's mind
is how strictly and uniformly the laws will be interpreted and
enforced.
The challenge for the present customers is that this is a
business in expansion and a new opportunity. Much of their
present
SG&A
can be used in this new enterprise to help offset some of the
expenses. As the law is implemented, the rewards will be well
worth the risks. |
