How green is your trolley?

In Britain's shops and markets, organic food has never been more popular. But the industry itself does not enjoy such rude health.

There are no takers at the tofu stall. The tattooed couple selling hemp products are not exactly swamped with customers, either. In fact, the Sunday crowds at Spitalfields indoor market, in east London, barely register the health food zealots and marijuana evangelists as they go about their weekly shop.

Over at the stalls selling organic produce, though, it is a very different story. The scrum of people has barely subsided since early morning. Customers come and go clutching bagloads of Guatemalan coffee beans, Leicestershire mince and other wholesome, nutrition-rich foodstuffs.

Just a few years ago, the organic stallholders would have stood as idle as the tofu traders, their produce equally shunned as fodder for hair- shirted food fascists who haunt Holland & Barrett. Not now, though. The BSE and E coli scares have seen to that. "For me, there's nothing New Age or cranky about it," says Inga Phipps, a publisher, clasping a brace of red peppers. "I grew up in a farming community in Dorset and I know what they do to the animals, and the pesticides they use. I'm certainly not subscribing to the latest food fad. It's simply a matter of eating healthily."

She is not alone. According to a Mintel survey, organic food has shed its associations with "committed activists and vegetarians" and become a staple of the high street. Marks & Spencer has just re-introduced organic items after a hiatus of five years, while Sainsbury's plans to extend its range after a customer survey found a massive demand for pesticide- free food.

It seems we've all gone organic-manic. At least, that's what the figures suggest: an annual UK business of pounds 260m; a domestic market that has doubled since 1995; and a global market likely to increase tenfold in eight years. It is a wonder we can find any chemical-coated food on the menu at all.

But behind the healthy glow of changing attitudes and upward sales predictions, the organic market is not quite as robust as it seems. Although Mintel reported that three-quarters of customers are "sympathetic" to the idea of buying natural foods, it also found that the produce is bought predominantly by the young, affluent and childless, while almost one-third of us have never even touched the stuff.

"It is definitely a middle-class market," says Thoby Young, whose Fresh Food Company supplies organic fruit and vegetable boxes around the country. "Organic production is spread throughout the UK, but our customers are mainly concentrated in the more prosperous parts of the South-east."

The main stumbling-block to organic's move into the mainstream is its higher price - on average it is between 25 to 50 per cent more expensive than its conventional counterparts. According to the Consumers' Association, one in four people is actively put off by the extra cost, while few supermarkets bother to stock organic food at branches that serve the poorer parts of the country.

Renee Elliott, founder of Planet Organic, Britain's only "natural food supermarket", agrees that the high prices effectively exclude large swathes of the population. "The higher cost to the consumer is justified by growers on the grounds that yields are less reliable and their methods more labour- intensive," says Elliott. "It is a better product, but the price is certainly prohibitive for some people - that's partly why the market is still so small."

Elliott, 33, who was born in Mississippi, set up Planet Organic with her business partner Jonathan Dwek in 1995. Catering to a fashionable clientele in Notting Hill, west London, the store was awarded Organic Retailer of the Year in 1997, but plans to open another outlet have so far come to nought. "We hope to open another London store soon," she says, "but research has shown that outside the capital, only towns with the demographics of Windsor or Oxford could sustain a store the size of ours."

At Spitalfields, the luxury nature of organic produce is not disputed. "We're very lucky in that we can afford to buy it," chorus Sam and Sarah, two dancers who have travelled from south London to stock up for the week. "We realise it's something of an indulgence, but we need to be healthy for our work, so good food is a priority."

The bananas spilling out of their bags may be twice the price of the non-organic fare found at the local greengrocers, but at least they look appetising. Yet the erratic quality of the produce can be another deterrent to the consumer. With most shoppers accustomed to the visually perfect Class I products sold in supermarkets, it can be a shock to be confronted with the type of lewd-looking parsnip that used to appear on That's Life.

Inga Phipps was advised to go organic by her doctor after a serious illness. She still buys additive-free food at markets, but gave up on home-delivered veggie boxes owing to their indifferent quality.

"I didn't expect the food to be nicely polished but I expected it to be edible," she says. "It was all a bit manky and mouldy, and you could have tied the carrots in a knot. It just wasn't good value for money. The last straw was when I ordered a 5lb box of fruit, most of which was taken up by a very heavy coconut."

The highly perishable nature of organic produce is not helped by the fact that so little is grown locally. Most organic carrots bought in Britain are grown in Denmark, Holland and Israel; overall Britain imports 70 per cent of its organic food.

"If more produce were home-grown that would certainly help to bring down the price," suggests Elliott. "Yes, the market is tiny, but if British farmers get their act together, there is huge potential." So far, however, our farmers are reluctant to rise to the challenge. Of the UK's 150,000 farms, just 0.5 per cent are registered as organic.

Earlier this year, the Government increased its Organic Aid Scheme - the subsidy it pays farmers to encourage conversions from chemical methods - by a hefty 80 per cent, a tacit admission that the organic movement has stalled.

Graeme and Vivienne Matravers are among the few farmers in Leicestershire who have ditched synthetic pesticides and fertilisers in favour of natural alternatives. Opening the five-bar gate to their farm in Long Whatton is like walking into an HE Bates novel. All the cliches of idyllic rural life materialise before your eyes. Chickens scour the yard for grain, shaggy dogs doze in the shade, while wholesome children - Benjamin, Amy and Murray - befriend the customers buying organic food from the farm shop.

Like Renee Elliott, the Matravers represent the new generation of young, environmentally concerned entrepreneurs who are making a good living from the green economy. The couple, both of whom are in their mid-thirties, met at agricultural college and farmed a Yorkshire smallholding before moving to Manor Farm four years ago. "My father was a mathematician which helped us a great deal - we didn't have the heavy weight of coming from farming families," says Matravers, slipping on his Wellington boots to show off his 300 acres. "Coming into it from the outside means we had no preconceived ideas. We didn't have an ingrained `pesticide culture'."

As a showcase for the organic movement, the farm plays host to around 200 farmers each year, all contemplating conversion from traditional methods. Although applications for organic certification have risen since the Government raised the level of subsidy, most leave Manor Farm unconvinced.

To achieve Soil Association accreditation as a licensed organic producer, land must lie fallow for two years before crops can be grown or animals grazed. With other farm subsidies making it more profitable to continue growing chemical crops than setting the land aside, it is hardly surprising that most farmers opt for the status quo.

"Most of them are so used to a chemical way of production that they can't accept you can do it without," says Matravers. "The biggest reason why the organic movement has failed to take off is that farmers are so stuck in their ways."

So far, Manor Farm is a bountiful anomaly in an otherwise bleak landscape. Walk its fields and you will see skylarks nesting in restored meadows and carpets of red clover naturally enriching the soil. But peer over the hedge into the neighbouring farm and you find the true face of British farming: scarred fields sprayed with organophosphates and devoid of wildlife.

There is hope, however. Across from the farmhouse, the Matravers have converted a granary into a classroom to accommodate parties of local schoolchildren who visit the fields of wheat, barley and free-range livestock, learning the virtues of crop rotation and sustainable, organic agriculture. Vivienne Matravers is optimistic. "There is a lot of interest from younger people in the organic lifestyle," she says. "We are in a transitional phase and it may take some time for attitudes to change completely. But hopefully our children will be the ones to make it reach fruition."