tma business summary

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Table of Contents

Executive Summary............................................................................................................ 3

Vision/Mission Statement and Goals .............................................................................. 5

A. Vision/Mission Statement ..................................................................................... 5

B. Goals and Objectives .............................................................................................. 5

C. Keys to Success ........................................................................................................ 5

Company Summary ........................................................................................................... 6

A. Company Background ........................................................................................... 6

B. Resources, Facilities and Equipment ................................................................... 6

C. Marketing Methods ................................................................................................ 7

D. Management and Organization ............................................................................ 7

E. Ownership Structure .............................................................................................. 8

F. Social Responsibility ............................................................................................... 8

G. Internal Analysis ..................................................................................................... 9

Products and Services ...................................................................................................... 10

A. DEARICE (Natural & low Glycemic Index Rice) ......................................... 10

B. Green Tea ............................................................................................................... 11

C. Fruit Chips ............................................................................................................. 12

Market Assessment........................................................................................................... 13

A. Examining the General Market ........................................................................... 13

B. Customer Analysis................................................................................................ 14

Strategic Implementation ................................................................................................ 15

A. Production .............................................................................................................. 15

B. Resource Needs ..................................................................................................... 16

C. Sourcing/Procurement Strategy ......................................................................... 17

D. Marketing Strategy ............................................................................................... 17

Social Impact ..................................................................................................................... 18

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Executive Summary

Farmer-owned Enterprises PT. Tanjung Mulia Agronusa (TMA) built on the basis of business requirements Join Farmers Group "Sukamaju" and Association of Organic Rice Growers "Tanjung Mulia" in Magelang Central Java, as a follow-up program of Farmer Empowerment through Agricultural Technology and Information (FEATI) Ministry of Agriculture Republic Indonesia supported by the World Bank in 2011. TMA Vision is Being farmer-owned enterprises that are professional, reliable and sustainable to improve the welfare and living standards of farmers and their families, Mission; 1) Promote the establishment of welfare for farmers and their families; 2) Realizing the farmers group an independent, sovereign on seed and materials of production, as well as determining of its agricultural product prices; and 3) Improving the science and technology of cultivation, processing and marketing. Our started this business with production natural rice of local varieties "Mentik Wangi Susu", processing and distribution in one management; (comprise provision of production materials, cultivation, processing, packaging and sales). Farmers involved are 348 people composed of 10 groups of farmers with a land area of 48.6 ha. In 2013, us developed a functional natural rice for diabetics and obese, is a low Glycemic Index (GI) Rice on an area of 7 hectares. Standards and testing laboratory of products, we were in collaboration with the Center for the Study of Food and Nutrition Gadjah Mada University in Yogyakarta. Besides rice, we were also has conduct to empower the Tea Farmer Groups in West Java to develop product and marketing to fair trade market and we have become the suppliers of Indonesian Green Tea in buyer fair trade EL PUENTE GmbH, Germany. Legal form of company is Limited Liability, and under the laws in force we have permits to operate in all regions of the unitary Republic of Indonesia. The main stakeholders in this business is farmers and farmer groups are joining in Gapoktan SUKAMAJU and Organic Rice Farmers Association of TANJUNG MULIA in Magelang, Central Java. Gapoktan Sukamaju and association Tanjung Mulia each have 50% and 30% of the shares. The remaining 20% is owned by farmers founders. Products and/or Services is Natural Low Glycemic Indec rice with DEARICE brand, Green Tea and Fruits Chip. "DEARICE" is derived from the original Indonesian rice varieties that naturally have a low glycemic index values (

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harvesting, packaging) applying internal control system in accordance ISO-9001 2008 Certification for Varieties Assurance, followed by testing the glycemic index value periodically and sustained by Center for the Study of Food and Nutrition, University of Gadjah Mada. Green Tea product is a lovely everyday green tea: delicate pale yellow liquor, soft texture and pleasant aroma like freshly roasted artichokes or okra. Slightly toasty and very balanced, mellow astringency. Green tea has been tested by GBA Gesellschaft Fr Bioanalytik MBH, Laborgruppe Wissen Wass Drin Ist, Hamburg Germany for supply needs in El Puente GmbH., and comply with EU food safety standards. Our green tea has a characteristic a strong tea with light green color, which develops an earthy, smoky flavor during infusion.

Fruit Chips product make the best quality fresh fruit origin Indonesia and only removes moisture content to provide crispness without any added sugar and artificial preservatives. 100% natural, thing closest fresh fruit. All natural fruit chip made with real fruit, baked never fried, gluten free, fat free, non GMO, with no preservatives or artificial anything. There are 9.1 million people diabetics in Indonesia is. Most of them consume rice as a staple food. The tendency to replace the rice is very difficult for a country with a population of more than 200 million inhabitants. Therefore, we believe that this business has a long-term prospect. Increased diabetics in Indonesia and several countries have shown our business prospects. This issue becomes particularly relevant when we develop healthy food products are healthy for many people in the world. We had partnerships groups of farmers to produce "DEARICE". We've established Standard Operating Procedures and Internal Control Systems documents who will guide of production, processing and packaging. We will create the value of the product on the functions and benefits for consumers. They are obtaining health benefits of each product purchased with guaranteed quality. Added value to farmers is increasing their income because of the quality of products produced better appreciated. Our competitive advantages are the support of stakeholders and grassroots producers who are in a lot of areas with diverse cultures and local characteristics. Rice products, fruits chips and green tea produced in the fertile soil are believed to have its own flavor. Because it is produced naturally, our products have a relatively long shelf life (between 6-18 months).

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Vision/Mission Statement and Goals

A. Vision/Mission Statement

Vision Being farmer-owned enterprises that are professional, reliable and sustainable to improve the welfare and living standards of farmers and their families. Mission 1. Promote the establishment of welfare for farmers and their families 2. Realizing the farmers group an independent, sovereign on seed and materials

of production, as well as determining of its agricultural product prices 3. Improving the science and technology of cultivation, processing and

marketing.

B. Goals and Objectives

1. Achieving food security, improving the welfare of farmers through the development and empowerment of commercial agribusiness, advanced, professional, based on the local culture, preservation of natural resources and the environment.

2. Developing Farmer-owned Enterprises, as a hybrid of business and society empowerment agencies to: a. Introduce technological innovation, social innovation and institutional

innovation that can improve farmers' production and sustainable prosperity;

b. Facilitate the financing of farming through the development of a credit system that is easily accessible by farmers;

c. Facilitate production costs to farmers (for the purchase of liquid fertilizer, pesticide plant and compost) paid after harvest;

d. Mentoring group and implementation of the field school covering technical aspects, management, and entrepreneurial attitude;

e. Develop improvement harvesting technology and post-harvest to suppress loss and improvement of value-added products;

f. Guarantee the marketing of products with better prices and provide a favorable bargaining position of farmers;

g. Develop business partnerships and farmers empowerment with business actors, government, academia, and other stakeholders.

C. Keys to Success

Think positive, work hard, keep trying, networking, collaboration and pray

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Company Summary

A. Company Background

Farmer-owned Enterprises PT. Tanjung Mulia Agronusa (TMA) built on the basis of business requirements Join Farmers Group "Sukamaju" and Association of Natural rice Growers "Tanjung Mulia" in Magelang Central Java, as a follow-up program of Farmer Empowerment through Agricultural Technology and Information (FEATI) Ministry of Agriculture Republic Indonesia supported by the World Bank in 2011. The business activities of TMA in agriculture, trade and services have been started in 2011 and be confirmed by the Notary CM Novia Puspita Wardhani, SH, in 2012 by Deed of No. 1 Date July 3, 2012 and ratified by the Minister of Law and Human Rights of the Republic Indonesia No. AHU-08161.AH.01.01.Tahun 2013 on February 22, 2013. Our started this business with production natural rice of local varieties "Mentik Wangi Susu", processing and distribution in one management; (comprise provision of production materials, cultivation, processing, packaging and sales). Farmers involved are 348 people composed of 10 groups of farmers with a land area of 48.6 ha. In 2013, us developed a functional natural rice for diabetics and obese, is a low Glycemic Index (GI) Rice on an area of 7 hectares. Standards and testing laboratory of products, we were in collaboration with the Center for the Study of Food and Nutrition Gadjah Mada University in Yogyakarta. Besides rice, we were also has conduct to empower the Tea Farmer Groups in West Java to develop product and marketing to fair trade market and we have become the suppliers of Indonesian Green Tea in buyer fair trade EL PUENTE GmbH, Germany.

B. Resources, Facilities and Equipment

Farmer groups sell dry grain harvest to Farmer-owned Enterprises. The water content of 20% is paid USD 0.49/Kgs. Partly of them are also selling rice and we were pay USD 1,07/Kgs. Decree of regarding this price was done when of production planning (before farmers planting) in a farmers' group meetings and they have agreed.

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Land, equipment, labor and costs borne by farmers. TMA create and define the Standard Operating Procedures and Internal Control System that must be obeyed by farmers. For farmers who require production costs, TMA provides loans (without interest) paid after harvest. TMA gives rewards to farmers' groups who are able to go beyond the average productivity. Awards were given in the form of equipment needed to support the group in order to better the production process.

C. Marketing Methods

The annual sales volume specified in IDR (Rupiah) for services and units for products. We are open to working with others to improve profitability, including strategic alliances with suppliers or customers that can benefit from each others in business development. Suppliers can expand the network of production and customers can increase additional revenue by becoming a reseller or sales agent. Cooperation will be carried out by a formal contract is open, sharing a clear, and mutually beneficial. To the marketing development we were requires cost to produce and deliver as many USD 24.925; that is for 12.000 units of DEARICE (USD 14.876), 800 units of Green Tea (USD 10.049). These products will be marketed by methods; Radio Media Partner & Agent, Flyers, Value Additions, Referral Networks, Follow-Up, Cold Calling and The Internet.

D. Management and Organization

The management team is currently carried out by the Board of Commissioners who served as supervisor the company and the Board of Directors as a business manager in the field of production, marketing, finance, and empowerment, determines employees salaries and conducts performance reviews. Management responsibilities been divided among the team, one of Directors act as spokesman and CEO and other director acts as responsible for the company's operations as well Chief Financial Officer assisted by 2 staff. The management team of undergraduate educational background, that has a good reputation in the community, special skills and abilities in the field of Organic Farming; Agribusiness; Vegetables; Fair Trade; Contract Farming; Agricultural Production; Fruit; Crop; Seed Production; Employee Training; and Organic Products. Skills required additional management team need is a global marketing and advertising.

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Management and employees have avenues for personal development through training on their jobs.

Figure 1. Sketch a diagram of lines of authority

E. Ownership Structure

The main stakeholders in this business are farmers and farmer groups are joining in Gapoktan SUKAMAJU and Organic Rice Farmers Association of TANJUNG MULIA in Magelang, Central Java. Gapoktan Sukamaju and association Tanjung Mulia each have 50% and 30% of the shares. The remaining 20% is owned by farmers founders. Legal form of company is Limited Liability, and under the laws in force we have permits to operate in all regions of the unitary Republic of Indonesia. Our company is registered in Magelang regency government and has Company Registration, Micro Trade Permit (including Export / Import), as well as Customs Identification Number issued by the Directorate General of Customs and Excise, Ministry of Finance of the Republic of Indonesia.

F. Social Responsibility

The environmental practice on organic rice cultivation is aim to ecological based farming and sustainable. Cultivation procedures do not use chemicals and pest management control using natural enemies. The industry of rice processing uses good handling processing (GHP) for noise/dust/timing/odor policies. Our involvement at the local/state/national level in commodity organizations is producing and supply healthy food for many peoples. The roles of management and employees in organizations hope farmers and the employees are welfare together.

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All new employees must be follow orientation and training to insure proper handling of hazardous materials and safe operation of equipment. Company has standard operating procedures in production and processing. We give training to the farmers and employees before starting as a part of empowerment.

G. Internal Analysis

Strengths Weaknesses

raw material easily

certain products and functional

broad market

support health institutions

public awareness about health

very complex business

farmers' fields are not widely

poor management farmer groups

damaged irrigation

consumer education

Opportunities Threats

fertile rice fields

at least competitors

national and global health issues

increasing diabetics

lifestyle

conversion of agricultural land

pests and plant diseases

industrialization and urbanized

climate

The strength of our firm is a grassroots involvement and broad stakeholder due to their welfare impact. Weaknesses of this very complex business such as science, culture and mindset of farmers in Indonesia are mostly not having an entrepreneurial spirit. The relative strengths of business unit within the firm is the same base in agriculture; rice, green tea and fruit chips. They need good organization.

The core competencies (things we were doing better than others) are the base produce in the farmers and competitors make low glycemic index rice by steaming method. We are firm build on things can controlled areas: Knowledge and work in base scientific method; Financial position stable to assure all units working better; Increased productivity for a stable supply; Welfare of farm families; The simple lifestyle; Accessible location; and Optimizing local resources.

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Products and Services

A. DEARICE (Natural & low Glycemic Index Rice)

"DEARICE" is derived from the original Indonesian rice varieties that naturally have a low glycemic index values (

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Product certified; Mutu Certification International is Meets the requirements of General Provisions Execution Systems Guarantee Certification Varieties of Agricultural Products (PU-

01/MS/03/2008) and is registered within the MUTU Certification from PT. Mutu Agung Lestari, Bogor Indonesia and Food Safety Competent Authority Ministry of Agriculture Republic of Indonesia. PSPG - UGM Certified is a certification test results glycemic index value and sustainable done regularly conducted every harvest season. Price; "DEARICE" paperboard packaging (1 kg) sold for USD 2.95 in outlet distributors and our online store. Cheaper than other products sold USD 3.30 and USD 4.95.

B. Green Tea

Green tea is made from the leaves from Camellia sinensis that have undergone minimal oxidation during processing. Our product is a lovely everyday green tea: delicate pale yellow liquor, soft texture and pleasant aroma like freshly roasted artichokes or okra. Slightly toasty and very balanced, mellow astringency. Our green tea has been tested by GBA Gesellschaft Fr Bioanalytik MBH, Laborgruppe

Wissen Wass Drin Ist, Hamburg Germany for supply needs in El Puente GmbH., and complies with EU food safety standards. Our green tea has a characteristic a strong tea with light green color, which develops an earthy, smoky flavor during infusion. Price; Indonesian Green Tea paperboard packaging (100) sold for USD 1,23 in outlet distributors and our online store. Cheaper than other products sold USD 2.15 and USD 3.65.

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C. Fruit Chips

We make the best quality fresh fruit origin Indonesia and only removes moisture content to provide crispness without any added sugar and artificial preservatives. 100% natural, thing closest fresh fruit. All

natural fruit chip made with real fruit, baked never fried, gluten free, fat free, non GMO, with no preservatives or artificial anything. Fruit chips business development is a joint operation with our network of small industries in Malang, East Java, which has over 15 years of experience producing fruit chips; jackfruit, salak, rambutan, apple, pineapple, watermelon and others. Most of the fruit chips produced by the vacuum frying. Tubers such as cassava, potato, pumpkin made chips with open frying method. Price;

Fruit chips products sold at USD 2.07/unit (100 grams) at our distributor outlets and online stores.

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Market Assessment

A. Examining the General Market

Our firm market characterized by monopolistic, A market structure characterized by a large number of small firms, similar but not identical products sold by all firms, relative freedom of entry into and exit out of the industry, and extensive knowledge of prices and technology. The consumer market pertains to buyers who purchase goods and services for consumption rather than resale. However, not all consumers are alike in their tastes, preferences and buying habits due to different characteristics that can distinguish certain consumers from others. These particular consumer characteristics include various demographic, psychographic, behaviorialistic and geographic traits.

Tabel 1. Market Segmentation

Demographic Gender Male & Female

Age 35 70 year old

Income $25.000 - $50.000

Occupation private employees,

Education High school & undergraduate

Household Size Small & medium household

Geographic Asia. Europe & USA

Nationality All nations

Psychographic Lifestyle Healthy

Personality All personality

Social Class medium & high class

Behaviorialistic Reason Healthy, make healthy

User status Consumer

Increased diabetics in Indonesia and several countries have shown our business prospects. This issue becomes particularly relevant when we develop healthy food products are healthy for many people in the world. Diabetics in Indonesia are 9.1 million people. Most of them consume rice as a staple food. The tendency to replace the rice is very difficult for a country with a population of more than 200 million inhabitants. Therefore, we believe that this business has a long-term prospect. http://www.novonordisk.com/about_us/stories/story/the-

challenges-of-diabetes-care-in-indonesia.asp

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B. Customer Analysis

Diabetics and obesity will be our customers. We are sell low glycemic index rice 'DEARICE' for solve a key customer problem -- diabetics and obesity. Green tea and fruit chips we dedicate to consumers who need a healthy life.

International Diabetes Feration 2014 release, Indonesia is one of the 23 countries and territories of the IDF WP region. 387 million people have diabetes in the world and almost 138 million people in the WP Region; by 2035 this will rise to 202 million. There were 9 million cases of diabetes in Indonesia in 2014. (http://www.idf.org/membership/wp/indonesia)

The figure describes which age groups in the population have the highest proportions of diabetes. The dotted line is the distribution of diabetes prevalence by age for the world; the black line is the distribution for the region; and the country distribution is plotted in the red line. Many middle- and low-income countries have more people under the age of 60 with diabetes compared to the world average. Meanwhile, for high-income countries, a growing population over the age of 60 makes up the largest proportion of diabetes prevalence.

We will not be difficult to retain customers (especially rice products) because of its benefits in controlling blood sugar levels.

Diabetes in Indonesia - 2014 Total adult population (1000s) (20-79 years)

156,789

Prevalence of diabetes in adults (20-79 years) (%)

5.8

Total cases of adults (20-79 years) with diabetes (1000s)

9,116.0

Number of deaths in adults due to diabetes

175,936

Cost per person with diabetes (USD) 174.7 Number of cases of diabetes in adults that are undiagnosed (1000s)

4,854.3

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Strategic Implementation

A. Production We had partnerships groups of farmers to produce "DEARICE". We 've established Standard Operating Procedures and Internal Control Systems documents who will guide of production, processing and packaging. We will create the value of the product on the functions and benefits for consumers. They are obtaining health benefits of each product purchased with guaranteed quality. Added value to farmers is increasing their income because of the quality of products produced better appreciated. Our competitive advantages are the support of stakeholders and grassroots producers who are in a lot of areas with diverse cultures and local characteristics. Rice products, fruits chips and green tea produced in the fertile soil are believed to have its own flavor. Because it is produced naturally, our products have a relatively long shelf life (between 6-18 months). All the processes used to produce the product are natural process. Rice cultivated without chemical fertilizers and synthetic pesticides (poisons) used Organic - SRI (System of Rice Intensification) method. Similarly the production of green tea and fruit chips. Farmers are taught and apply Good Agricultural Practices (GAP) is also Good Handling Practices (GHP) according to prevailing standards in the national and international scope. Growth options use to develop the business unit is enterprise expansion, replicate, integrate and network. Business expansion will lead to the microfinance sector in order to help the cost of renting land to farmers group members. It is also useful to develop a business unit of replication and integration. Special to the network, we will develop a distribution and marketing.

Table 2. Strategic Implementation Timeline

Starting a business Growth plan

2011 2012 2013 2014 2015 2016 2017

First to Implement/Phase I

Start-up / search business format

Launch technical execution

Strategic plan Retreat

Second to Implement/Phase II

Implementations planning

Launch technical execution approved strategy

Semi Annual System wide

Annual system

Third to Implement/Phase III

Implementations planing

Launch technical execution approved strategy

Per year evaluations

Annual system

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B. Resource Needs 1. Human

To support the development of our business require some skilled human resources;

a. Management and Leadership Skills; to set priorities, delegate, motivate and develop peoples, coach them to become top performers and communicate objectives and goals.

b. Communication Skills; to get point across, create a compelling presentation to support your goals and get buy-in for ideas, inspire others to achieve better results and demonstrate emotional intelligence.

c. Collaboration Skills; so can value and celebrate differences, build rapport, form alliances and negotiate effectively.

d. Critical Thinking Skills; to approach problem solving logically, research options, avoid biases and focus on meaningful data to draw the right conclusionseven under pressure.

e. Finance Skills; to weigh the dollars-and-cents implications of your decisionsincluding the ability to build a sound budget and formulate reasonable forecasts.

f. Project Management Skills; to grasp the scope and objectives of projects, recognize the roles and responsibilities of others, use PM tools to stay on track and become an effective member of a cross-functional team.

Human resources acquired through planning with the aim of focusing in order to meet the strategic objectives of the company. Planning is a process designed to translate the plans and goals of the organization with the requirements of the job qualitatively and quantitatively in the future as well as meeting the requirements of labor demand in the short and long term. Human resource planning is the total amount of planning that is formulated for the recruitment, screening, compensation, training, job structure, and promotion. Human resources are done with the following steps: a. Preparation

1) determine needs, competence and position 2) designing advertisements or announcements as well as the selection

of appropriate media b. Implementation Phase

1) announcements and advertisements in the media 2) sorting incoming application 3) calling 4) tests of competence, attitude, mental and candidate preferences

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c. Phase reception 1) contract signing 2) orientation period (1 week) 3) internship period (3 months) 4) period of appointment 5) performance evaluation (every 6 months)

2. Financial

PT. Tanjung Mulia Agronusa is included small enterprises who needs financial resources under USD 1 million.

3. Physical

We require of physical resource 1 unit building for warehouse and office (96 M2) medium quality.

C. Sourcing/Procurement Strategy

We base a decision to buy products or services by quality. We have a regular suppliers and direct from manufactures.

D. Marketing Strategy

1. Sales plan

Product/Services Unit/year Notes

1. Rice 12.000 Local market

2. Green tea 800 Export

3. Fruit Chips 7.500 Export

2. Advertising and Promotion

a. Radio b. Interactive brochur, leaflet & flyer c. Internet

Our product/services distributed to agent, outlet distributor and sold in online store. The price is desided ourself.

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Social Impact

Potential market 9.100.000 diabetics in Indonesia

Target Market (10%) 910.000 diabetics in Indonesia

Rice conumer percapita 135 Kgs per year

Product needs 122.850 tons per year

On-farm

Materials supplies 178.133 tons rice grain

Material prices (IDR) 5.500.000 per tons paddy/grain

Land support 12.724 hectare (2 sesson years)

Farmers participant 31.809 farmers

Family farmers 95.428 peoples

Employment 381.713 man days per year

217.576 woman 57%

164.136 man 43%

Gross Income

Farmer members (IDR) 77.000.000 /ha (2 sesson years)

Non-member farmers (IDR) 40.800.000

Differential (IDR) 36.200.000

Percentage 47,01%

Production Cost




Percentage 58,68%

Net Income




Percentage 38,42%

Off-Farm

Farmers Empowerment

Farmer groups Empowerment 1.272 groups

Farmer Enterprise 4 enterprise

Non Farm

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Stakeholder engagement

Extension worker 318 people

Guides farmers 848 people

Environment Benefits

Sustainability over the long term. Many changes observed in the environment are long term, occurring slowly over time. Organic agriculture considers the medium- and long-term effect of agricultural interventions on the agro-ecosystem. It aims to produce food while establishing an ecological balance to prevent soil fertility or pest problems. Organic agriculture takes a proactive approach as opposed to treating problems after they emerge. Soil. Soil building practices such as crop rotations, inter-cropping, symbiotic associations, cover crops, organic fertilizers and minimum tillage are central to organic practices. These encourage soil fauna and flora, improving soil formation and structure and creating more stable systems. In turn, nutrient and energy cycling is increased and the retentive abilities of the soil for nutrients and water are enhanced, compensating for the non-use of mineral fertilizers. Such management techniques also play an important role in soil erosion control. The length of time that the soil is exposed to erosive forces is decreased, soil biodiversity is increased, and nutrient losses are reduced, helping to maintain and enhance soil productivity. Crop export of nutrients is usually compensated by farm-derived renewable resources but it is sometimes necessary to supplement organic soils with potassium, phosphate, calcium, magnesium and trace elements from external sources. Water. In many agriculture areas, pollution of groundwater courses with synthetic fertilizers and pesticides is a major problem. As the use of these is prohibited in organic agriculture, they are replaced by organic fertilizers (e.g. compost, animal manure, green manure) and through the use of greater biodiversity (in terms of species cultivated and permanent vegetation), enhancing soil structure and water infiltration. Well managed organic systems with better nutrient retentive abilities, greatly reduce the risk of groundwater pollution. In some areas where pollution is a real problem, conversion to organic agriculture is highly encouraged as a restorative measure (e.g. by the Governments of France and Germany). Air and climate change. Organic agriculture reduces non-renewable energy use by decreasing agrochemical needs (these require high quantities of fossil fuel to be produced). Organic agriculture contributes to mitigating the greenhouse effect and global warming through its ability to sequester carbon in the soil. Many management practices used by organic agriculture (e.g. minimum tillage, returning crop residues to the soil, the use of cover crops and rotations, and the greater integration of nitrogen-fixing legumes), increase the return of carbon to the soil, raising productivity and favouring carbon storage. A number of studies

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revealed that soil organic carbon contents under organic farming are considerably higher. The more organic carbon is retained in the soil, the more the mitigation potential of agriculture against climate change is higher. However, there is much research needed in this field, yet. There is a lack of data on soil organic carbon for developing countries, with no farm system comparison data from Africa and Latin America, and only limited data on soil organic carbon stocks, which is crucial for determining carbon sequestration rates for farming practices. Biodiversity. Organic farmers are both custodians and users of biodiversity at all levels. At the gene level, traditional and adapted seeds and breeds are preferred for their greater resistance to diseases and their resilience to climatic stress. At the species level, diverse combinations of plants and animals optimize nutrient and energy cycling for agricultural production. At the ecosystem level, the maintenance of natural areas within and around organic fields and absence of chemical inputs create suitable habitats for wildlife. The frequent use of under-utilized species (often as rotation crops to build soil fertility) reduces erosion of agro-biodiversity, creating a healthier gene pool - the basis for future adaptation. The provision of structures providing food and shelter, and the lack of pesticide use, attract new or re-colonizing species to the organic area (both permanent and migratory), including wild flora and fauna (e.g. birds) and organisms beneficial to the organic system such as pollinators and pest predators. The number of studies on organic farming and biodiversity increased significantly within the last years. A recent study reporting on a meta-analysis of 766 scientific papers concluded that organic farming produces more biodiversity than other farming systems. Genetically modified organisms. Genetically modified organisms. The use of GMOs within organic systems is not permitted during any stage of organic food production, processing or handling. As the potential impact of GMOs to both the environment and health is not entirely understood, organic agriculture is taking the precautionary approach and choosing to encourage natural biodiversity. The organic label therefore provides an assurance that GMOs have not been used intentionally in the production and processing of the organic products. This is something which cannot be guaranteed in conventional products as labelling the presence of GMOs in food products has not yet come into force in most countries. However, with increasing GMO use in conventional agriculture and due to the method of transmission of GMOs in the environment (e.g. through pollen), organic agriculture will not be able to ensure that organic products are completely GMO free in the future. A detailed discussion on GMOs can be found in the FAO publication "Genetically Modified Organisms, Consumers, Food Safety and the Environment". Ecological services. The impact of organic agriculture on natural resources favours interactions within the agro-ecosystem that are vital for both agricultural production and nature conservation. Ecological services derived include soil forming and conditioning, soil stabilization, waste recycling, carbon sequestration, nutrients cycling, predation, pollination and habitats. By opting for organic

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products, the consumer through his/her purchasing power promotes a less polluting agricultural system. The hidden costs of agriculture to the environment in terms of natural resource degradation are reduced.

tma business summary

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