WASHINGTON, June 4, 2014 - The Organic Trade Association (OTA) had some good news to announce at its annual policy conference in Washington. The sector had $35 billion in sales in 2013, up 12 percent from the previous year. But there were alarm bells as well: Organic food manufacturers need organic supplies to make their products, and shortages abound.

“We’ve now had a shortage of milk for the past six to nine months,” said George Siemon, CEO of Organic Valley, the country’s largest organic farmer cooperative. While Siemon attributes some of the problem to natural changes in the milk market, he and other industry members say many of the current supply challenges come down to a few, specific crops: grains. 

According to USDA’s Economic Research Service (ERS), certified organic cropland made up about 0.7 percent of all U.S. cropland in 2011. Only about 0.3 percent of corn, 0.2 percent of soybeans and 0.6 percent of wheat were grown in organic systems. Organic vegetables (6 percent of U.S. vegetable acreage), and fruits and nuts (4 percent) were much easier to come by.

“There’s certainly a lot of interest from the U.S. sector to try and build U.S. production of organic feed grains,” USDA National Organic Program head Miles McEvoy said in an interview.

Grains are a problem for a number of organic producers and manufacturers, organic dairymen and snack-makers chief among them. So it’s up to the industry – and USDA – to determine how best to recruit new farmers into the organic fold.

That’s challenging, says Nathaniel Lewis, senior crops and livestock specialist at OTA. For products to be certified organic by USDA, land used to grow organic crops can’t be treated with synthetic substances for at least three years. Slaughter livestock cannot be “transitioned” to organic production – they must be allowed year-round access to outdoors, raised on organic land and fed organic feed since birth. Dairy herds can be transitioned once, and their products are only organic if they’ve been fed 100 percent organic feed for a year.

Those are burdensome regulations, though organic producers say they have no interest in changing them. Strict government oversight is “really why consumers trust the organic label,” Lewis said.

So organic advocates turn to other recruiting options.

The most effective, according to Organic Valley’s Siemon, is a field walk-through. “The best person (for a potential organic farmer) to talk to is a neighbor,” he said. He says his cooperative has had success recruiting producers through field days and pasture walks, as well as open meetings that bring in interested farmers.

“We tell them that this is a marketplace with a lot of future, with stable prices for farmers that they can count on,” Siemon said. For the organic industry, the hope is that those premium prices in the long term will persuade farmers to make the upfront investment in organic methods.

Organic Valley also provides technical assistance and transitional funding for farmers when they’re incurring final, additional costs before entering the organic market.

For OTA, which sees itself as the voice of the organic industry in Washington, solving supply issues begins with policy. The Farmer’s Advisory Council (FAC), a recently formed OTA board meant to liaise between OTA and its member producers, is tackling supply as its top priority.

Lewis said the group has already begun to engage with USDA on crop insurance. It’s often difficult for the organic industry to recruit risk-averse farmers – “U.S. farmers are one of the most risk averse populations in the world,” Lewis said – with an incomplete organic safety net. USDA’s Risk Management Agency (RMA) “has a hard time modifying its products for particular farms,” he said.

At the recent annual policy conference in Washington, producers asked RMA Administrator Brandon Willis how to best protect their specific mix of organic and often heirloom crops. One producer from the Northwest explained that he grows a mix of 150 products – something RMA is not yet equipped to completely insure.

That might change, however, in the next year or so, as USDA implements the 2014 Farm Bill.. The legislation first directed USDA to develop and implement a new whole-farm crop insurance policy that will allow producers to insure (and may even incentivize) diversified crops. (See Agri-Pulse, 5-21-14). The bill also requires USDA to finalize organic price elections by 2015, thereby allowing organic farmers to insure organic crops at the organic price and protect their full value.

As RMA creates and implements those provisions, OTA says it will work with the agency on a specific set of solutions to current recruitment and supply challenges.

Meanwhile, many will have to get their organic feed from overseas. Countries like Romania, China, India and even the former states of the Soviet Union are among the top organic exporters to the U.S.

Importing organic grains “is definitely a growing thing,” said Siemon. “That’s, of course, a good thing in terms of having those countries go organic.”  But more organic producers in the U.S. would be better, he said.


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