Journal of Contemporary Issues in Business and Government Vol. 27, No. 3, 2021 https://cibg.org.au/ P-ISSN: 2204-1990; E-ISSN: 1323-6903 DOI: 10.47750/cibg.2021.27.03.046 Copyright © The Author(S) 2021. Published By Society Of Business And Management. This Is An Open Access Article Distributed Under The CC BY License. (Http://Creativecommons.Org/Licenses/By/4.0/) A Review of Organic Agriculture Industry in Malaysia and Gross Margin between Organic and Conventional Plantation SITI RAHYLA RAHMAT 1* , HAMAD HASUL KHAN 2 , RADIN FIRDAUS RADIN BADARUDDIN 3 , MOHD FIKRI MOHAMAD 4 , MOHAMAD SHAHARUDIN SAMSURIJAN 5 1,2,3,5 School of Social Sciences, Universiti Sains Malaysia, Gelugor, Penang, Malaysia; 4 School of Social Sciences, Universiti Sains Malaysia, Gelugor, Penang & Faculty of Business, Economic and Social Development, Universiti Malaysia Terengganu, Malaysia; Email: rahyla@usm.my 1 , hasul.hamad123@gmail.com 2 , radin@usm.my 3 , fikri@umt.edu.my 4 , msdin@usm.my 5 *Corresponding Author Abstract: The objective of this study are 1) To review the definition of organic farming 2) To investigate the international and local standard for organic food and 3) To compare gross margin between organic and inorganic paddy farming. Using field evaluation and interview techniques, this study conducted a study on 3 organic farms and 27 inorganic paddy farms in Malaysia. Two leading organic agriculture regulators in the world are IFOAM and USDA, IFOAM allows private standard setters to define their additional criteria and USDA does not allow others to set a standard that is above the federal. This study also laid out a few organic accreditations in several Asian countries including Thailand, Indonesia, Cambodia, Japan, India, and China. Field evaluation of conventional and organic paddy plantation are discussed and it is found that organic plantation earned less gross margins (13.5 %) as compared to inorganic farming. This study may give some inputs for the Research and Development (R&D) department to improve the organic farming activities and how to reduce its cost and increase its gross margin. Organic farming is important as it is sustainable to lure bio-economy strategy and food security in Malaysia as laid out in National Agricultural Policy. Keywords: Food security, governance, organic farming, organic accreditation, paddy farming, system of rice intensification (SRI) INTRODUCTION Food security and food supply have become an important issue to be dealt with by the international organization as well as governments across the globe in these times of the overgrowing population. The growing population means growing food demand which needs to be met by the food supply to ensure everyone’s survival. This issue was first pointed out back in 1798 by the British economist named Thomas Malthus in his work entitled An Essay on the Principle of Population. Malthus argued that the population grows at an exponential rate while food supply grows at an arithmetic rate over time, and he predicted that over time it will create a shortage of food supply. Since the theory was proposed in 1798, it may not be probable with the current era as it does not take into account the important variables such as wars, climate change, technological advancements, and more (Paul, 2013). However, organic farming is of vital significance while providing the food supply. The idea of organic farming dates back to the early 1920s, but it has recently attained a worldwide concern due to food contamination in raw food and the increase of pesticide residues (Somasundram et al., 2016). Although organic farming at the current stage is only a fraction of the worldwide amount, but the growing awareness of the public for nutrition and health is pushing organic farming to an entirely new level. This has led researchers, scientists, businesses to find out alternatives to promote food security and to start organic farming movement. One popular alternative is to integrate agriculture with organic farming (Ciccarese and Silli, 2016). There is remarkable growth in organic farm size witnessed by Malaysia i-e from 131 hectares to 2367 hectares in the years 2001 and 2006 respectively. Apart from the tremendous growth, the Malaysian local organic food industry is yet needed to be sustainable since approximately 60% of the organic food in the country is imported. Among imported organic products include processed food such as cereal, grains, beverages, and fresh raw food of vegetables (Dardak et al., 2019). Rice is the main food in the county and the Ministry of Agriculture and Argo-based Industry (MOA) is responsible for the monitoring of the growth of paddy. Malaysia is motivated to attain a self-sustainable level of rice production and to safeguard and ensure the food security. Nevertheless, a study by the World Bank maintained that the Malaysian paddy industry is neither sustainable nor profitable (USDA, 2017). Therefore, a cultivation method called the system of rice intensification (SRI) is also being applied in addition to the