COMPARISON OF ECONOMIC EFFICIENCY OF ORGANIC VERSUS CONVENTIONAL FARMING IN THE CONDITIONS OF BOSNIA AND HERZEGOVINA

Organic farming, which, as a modality of agricultural production, responsibly treats natural resources and fits into the concept of sustainable development, is increasingly prevalent, especially in developed countries. However, reconciliation of the interest and benefits of organic food producers and consumers is crucial for sustainability of that production. This adjustment is done through market prices. Prices of organic food must be acceptable for consumers, while at the same time should enable farmers to cover the cost of production and to make a certain profit. Organic food production is in a very early stage in Bosnia and Herzegovina (BiH). This paper is deducted to the analysis of the economic efficiency of organic food production based on case studies of three selected products, wheat, tomato and raspberry in the conditions of BiH. The aim of research was to quantify and evaluate economic efficiency of organic farming versus conventional farming. The obtained result confirmed the general trends, that the yields and sale price of agricultural products produced on the principles of organic farming are lower, and therefore revenues are higher. The expenses were higher for two products while they were lower for one product. However, in the end, gross profit in organic farming for all three products is higher than the profit generated in conventional farming. Thus, it may be concluded that, from the financial point of view, there is great chance and economic viability for organic farming in BiH, if there is demand for organic food consumption or conditions for its export.