Certified organic health and beauty and

their market potential

Australian OrganicPO Box 810, Nundah QLD 4012

(07) 3350 5716contact@austorganic.com

How do organics fit into retail markets?

• Four out of five purchases of certified organic are from supermarkets. (Australian Organic Market Report 2014)

• The Australian organic industry, while mainstream, is still a niche sector.

• Consumer expectations in products, such as free from petrochemicals, ETDA’s and animal testing, are driving demand.

• The Australian Certified Organic logo is the most well known amongst consumers.

• 1/3 of shoppers say they would only buy organic if it is certified organic (Australian Organic Market Report 2014)

KEY POINTS

Four out of five purchases of certified organic are from supermarkets

What does certified organic mean?

• Companies displaying the certified organic logo are subject to annual auditing, including spot checks, to ensure they comply with the Australian Certified Organic Standard (or other standard such as COSMOS).

• Organic certification systems were set up in Australia to cut through marketing spin and ensure that you get what you expect.as well as to create an export market for Australian businesses.

Displaying the certified organic logo means regular auditing and spot checks to ensure compliance.

* According to ACOS 2013

Free from petrochemicals, harsh surfactants, EDTAs, animal testing, socially responsible, grown free from synthetic pesticides, GM, hormones and antibiotics, no animal ingredients other than beeswax and honey *

What does organic certificationmean to the consumer?

• Being able to purchase a product that has been independently reviewed for its claims by a third party organization.

• A product that is produced using environmentally sustainable farming practices.

• A product that has been grown free from synthetic pesticides, hormones, antibiotics and GM ingredients.

• A processed product that is free from harmful synthetic preservatives, colors and additives.

• A product that is cruelty free.

Third party certification protects organic consumers

The future of certified organic beauty and skincare

• Organic cosmetics and personal care industry is worth $236 million.

• Forecast to grow 11.4% each year.

• Organic industry is worth $1.72 billion in Australia - growing 15% each year.

• 90% of organic buyers shop for organics in a major supermarket.

• New organic customers have low levels in health and sustainability.

• 64% of primary food shoppers claim to have bought organic.

(Australian Organic Market Report 2014)

Organic cosmetics and personal care industry is worth $236 million

Forget the word ‘organic’

• It is so overused by clever marketers now that it’s almost lost its meaning. Some use it in the chemistry sense of the word. Others use it to denote that some ingredients are produced without synthetic inputs (while many of the other ingredients might be).

• What we really need to look for is a phrase which is protected by the law:

‘CERTIFIED ORGANIC’

The phrase ‘certified organic’ is protected by the law.

How do I know if it’s really organic?

• To know you’re really buying organic look for a government approved certification logo like Australian Certified Organic.

• Over 14,000 products carry this organic guarantee

Every Australian Certified Organic product has a unique number.

Health happens by choice

“On average most women put a minimum of 250 chemicals on their skin every day. Sixty to 70% of everything we put on our skin is absorbed into our bloodstream and our organs.”

Therese Kerr

Chemicals shoppers are starting to avoid

• TEA’s, DEA’s, parabens, sulphates, glycols, nano particles, GM, ethoxylates, formaldehyde and formaldehyde derivatives and artificial and synthetic ingredients.

• ‘Fragrance’ is made up of lots of individual synthetic chemicals.

• Chemically processed ingredients

Fragrance is one of the most toxic things a woman can put directly on her skin.

Precautionary principle

For this reason, the following are not allowed in certified organic products:

• Gamma and X-ray irradiation

• Primary raw materials or ingredients that derive from or made using GMO’s

• Nano materials (>150nm)

• Raw materials or bulk product cannot be fumigated for export purposes

When there is scientific evidence that an ingredient, technology or process could pose a health or environmental risk, the precautionary principle is applied to organic standards.

Raw materials or bulk product cannot be fumigated for export purposes

Organic label guide

All agricultural ingredients and processing aids must be certified organic.-can use bud logo on front

100% ORGANIC

Restricted ingredients are allowed to be used in multi-ingredient products to ensure the shelf life integrity.

95% of product must be certified organic agricultural products. -can use bud logo on front

“ORGANIC” >95%

At least 70% ingredients are certified organic .Only use “made with organic ingredients” on ingredient statement. - Cannot use bud logo

MADE WITH ORGANIC INGEDIENTS

Look for the bud

Products labelled as 100%

• Cosmetic products labelled as 100% organic may only contain 100% certified organic agricultural ingredients.

• All processing aids must be certified organic ingredients.

• Cosmetic products labelled as 100% organic may not contain any materials from the National organic standard list of allowed and prohibited substances.

• Use of logo is optional

• Must include certification details ( ie. ACO certified 12345) if not included in logo

• Must include contact details

100% means no other ingredients other than certified organic agricultural ingredients are used.

100% Certified

100% ORGANIC

Products labelled as Organic

For cosmetic products, where a minimum of 95% weight/weight of all ingredients (excluding water and salt) come from certified organic sources, and where all other materials are allowed under this standard for use in certified processed product, reference may be made to “Certified Organic” on the label.

In the instance of the product and all ingredients being liquid, the calculation of percentages above shall be done by fluid volume.

• Use of logo is optional

• Must include certification details ( ie. ACO certified 12345) if not included in logo

• Must include contact details

That water and salt are not allowed to be included in the end calculation of the product, this can reduce the claim on the organic label.

Certified

“ORGANIC” >95%

Made with organic ingredients

• Where less than 95% but not less than 70% weight/weight of all ingredients (excluding water and salt) are certified organic, “Made with organic ingredients” can be used.

• Unique cosmetic logo can be applied to back of label

• Logo cannot appear on product.

• Must include certification details ( ie. ACO certified 12345)

• Must include contact details

This category mostly applies to cosmetics, skincare and processed foods such as pasta sauces.

Made with Organic

ingredients

MADE WITH ORGANIC INGREDIENTS

Organic v natural – What’s the difference?

• Certified organic is a regulated industry, ‘natural’ isn’t.

• Consumer watchdog bodies like ACCC does not monitor use of words like ‘natural’ and ‘eco’.

• ‘Natural’ doesn’t have to be produced under any strict conditions.

• ‘Natural’ doesn’t have a definition.

• ‘Natural’/’eco’ are sometimes used when at least 70% of ingredients are not certified organic..

• The exception is COSMOS Natural Standard, where the above items are defined.

Certified organic is a regulated industry, ‘natural’ isn’t

Introducing COSMOS

COSMOS certification is just for the beauty and skincare industry

• COSMOS standard developed by five European certifying companies specifically for the cosmetic/skincare industry.

• Internationally recognised.

• It’s standard is different to the Australian Certified Organic Standard.

• Australian Certified Organic is accredited to certify companies to COSMOS.

• COSMOS has a certification standard for ‘natural’.

* Please note that these logos subject to change

Logos here and overseas

The Australian logos are approved by the Australian Government. Some certifications are more strict than others

Certification programs provided by ACO in Australia:

Certification programs available through ACO internationally:

Other certification bodies in Australia: Other international certification bodies:

Misleading branding and labels

• The ACCC and media are becoming increasingly savvy about the misuse of the word ‘organic’.

• In 2013 ACCC requested seven bottled water companies to remove the word from labels.

• Australian Organic and Australian Certified Organic receives complaints about the misuse of the word organic, particularly in the skincare and beauty industry.

• Some companies claim that ingredients in their product are certified, however the end product is not certified- such claims are not legal. ‘Certified’ claim, regardless how or where is used, can only be used by certified entities on certified products, not third party uncertified handlers.

The Australian Certified Organic bud logo is the most recognised organic certification in Australia.

Why do shoppers care about organic?

Why do shoppers start buying organic?

• 49% of shoppers surveyed first bought organic because they became aware of impact of food, fibre and cosmetics on their health.

• 32% first bought organics for environmental reasons

• 25% because of animal welfare concerns

• 16% because of a health crisis.

RMIT University researchers found that you can reduce pesticide exposure by 90% by switching to an organic diet.

Australian organic consumer demographics changed in past 5 years: supermarket shoppers drive growth - 4 in 5 purchases are via supermarkets.

Consumers have a good sense of what organic is.

So how do you decide what to stock?

• If a rep says their products are organic: ask for an organic certificate or look for certification logo on the label, if both are missing then odds are the product is not certified.

• If you don’t recognize a certified organic logo on the product: contact info@aco.net.au

• COSMOS is the only certifier that certifies products as natural according to a set of standard. If you’re being sold a ‘natural’ product you may wan to have the product reviewed by someone knowledgeable in raw materials and formulating.

• If you’re still not clear call ACO at 07 3350 5706.

There are instances of marketers making up symbols and graphics on skincare and beauty care products to make them look like certification logos.

Australian Certified OrganicCommunity Service Announcement

2015

Thank you

Australian OrganicPO Box 810, Nundah QLD 4012

(07) 3350 5716contact@austorganic.com

AUSTORGANIC.COMFacebookTwitterYouTubeACO.NET.AU

ACO BlogORGANICSCHOOLSFacebookTwitter