sustainability Article Can the Market Deliver 100% Organic Seed and Varieties in Europe? Susanne Padel 1, * , Stefano Orsini 2 , Francesco Solfanelli 3 and Raffaele Zanoli 3   Citation: Padel, S.; Orsini, S.; Solfanelli, F.; Zanoli, R. Can the Market Deliver 100% Organic Seed and Varieties in Europe? Sustainability 2021, 13, 10305. https:// doi.org/10.3390/su131810305 Academic Editor: Riccardo Testa Received: 13 August 2021 Accepted: 9 September 2021 Published: 15 September 2021 Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affil- iations. Copyright: © 2021 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https:// creativecommons.org/licenses/by/ 4.0/). 1 Thünen Institute for Farm Economics, 38116 Braunschweig, Germany 2 Organic Research Centre, Trent Lodge, Stroud Road, Cirencester GL7 6JN, UK; stefano.o@organicresearchcentre.com 3 Department of Agricultural, Food and Environmental Sciences (D3A), Università Politecnica delle Marche, 60131 Ancona, Italy; f.solfanelli@agrecon.univpm.it (F.S.); zanoli@agrecon.univpm.it (R.Z.) * Correspondence: susanne.padel@thuenen.de Abstract: This paper considers European organic seed as a market in the sense of economic theory and explores factors impacting seed supply and demand. Under the organic regulation, farmers have to use seed multiplied in organic farming or apply for a derogation. We evaluated the functioning of the organic seed market, based on case studies of seed supply chains for arable, vegetable and forage crops; a farmer survey; and a status-quo analysis of the organic seed sector from the European LIVESEED project. The organic seed market is characterised by small size, great diversity of crops grown, unsolved technical problems for some crops and limited capacity of breeding varieties adapted to organic farming conditions. Demand vastly outstrips supply for most crops, but strong regional and sector differences were observed. A lack of information about availability and price for organic seed is likely to act as barrier to investment. Full enforcement of the regulation to use only organic seed might have unforeseen consequences, such as a reduction of agrobiodiversity in organic farming, rather than supporting an increase in supply. We conclude that the market alone is not likely to deliver 100% organic seed and government intervention is justified. Keywords: organic seed; organic regulation; seed market 1. Introduction Seed is an essential input for food production and vitally important to all of us. In our western society the exchange of seed, like many goods and services, is governed by the rules of the free market, even if this view is not universally shared or liked around the world. This paper considers organic seed in the marketplace and the factors that are likely to impact on supply and demand. Economic theory of free markets assumes that the balance between supply and de- mand is regulated by price, and that this is the most efficient way to allocate scarce resources. In an ideal market, increases in demand will lead to increases in price and this will stimulate more production, resulting in an improved supply. Fall in demand should result in a fall in price; and if fewer producers cover their production costs, they will no longer produce so that overall supply is reduced. David Bateman considering the Economics of organic in 1994 [1] compared Adam Smith’s metaphor of the ‘invisible hand’ to a voting system, in which each consumer (or in this case organic farmer or grower) is given the opportunity to express her or his choices and preferences. The ideal market is assumed to be competitive, i.e., large numbers of buyers and sellers compete freely based on access to perfect information. Many economists and policy makers believe that there should be as little intervention as possible from regulations in any market and intervention is only justified if market failure exists. Organic agriculture in Europe is regulated by the European Organic Regulations (at present EC/834/2007 [2] and related Implementing Legislation). This includes the Sustainability 2021, 13, 10305. https://doi.org/10.3390/su131810305 https://www.mdpi.com/journal/sustainability