Greenfield, Massachussett
October 24, 2005Today
the Organic Trade Association
(OTA) submitted to Congress a letter signed by over two hundred
companies, farmers and trade associations supporting its request
that Congress restore the National Organic Program at the United
States Department of Agriculture (USDA). This request follows a
court ruling that undermined over 12 years of effort by organic
growers, consumers, manufacturers, Congress, and the USDA to
build a vibrant, growing organic marketplace.
"We believe that the current
standards, which represent the result of a unique partnership
between the government and the public and private sectors, need
to remain intact in order to minimize disruption and marketplace
confusion and to protect the growing marketplace for organic
farmers," said Katherine DiMatteo, executive director of OTA.
A June 2005 court ruling found
a few technical inconsistencies between the 1990 organic law and
the final standards implemented by the USDA in 2002 after an
extensive process of public discussion and input. In order to
allow Congress time to clarify the 1990 law, the court did not
immediately implement its ruling. "The court identified the
problem and set the timeline, and Congress is responding," said
DiMatteo. "The support from the overwhelming majority of organic
businesses and the administration for a prompt solution has been
great."
The "USDA Organic" seal
currently guarantees that the consumer is getting a product made
from 95 percent or more organic ingredients and processed with
the least amount of non-organic ingredients and processing
aids.
"We spent 12 years developing
and establishing these rules", said George Siemon, CEO of the
country's largest organic cooperative. "We strongly support
Congress restoring the standards that the organic community has
invested so much into and which have worked so well on the farm
and in the marketplace."
Under the court ruling, unless
the 1990 law is clarified, numerous products now bearing the
"USDA Organic" seal could disappear from store shelves, thus
threatening the growth of organic farms and acreage and taking
away markets and outlets for organic farmers.
"Any drastic changes like this
are extreme, causing huge amounts of modifications in the
regulations that would make it impossible for family farms such
as ours to continue growing quality organic crops," said Jean
Hediger, whose Golden Prairie Farm in Colorado grows organic
wheat and millet. Products that would be in jeopardy include
many breads, cereals, and snack items.
An economic impact report
summarizing the results of a survey taken among OTA's membership
has concluded that if the court decision directives are
implemented, an estimated 25 percent of all manufacturers
currently producing certified organic products would exit the
organic industry altogether. Another 18 percent said they would
change product formulations to include fewer organic ingredients
or would eliminate many certified organic products currently
sold in the marketplace. The projected net revenue loss for the
manufacturing sector would be $758 million per year. That loss
trickles down the supply chain to the farmer, causing potential
economic devastation to those small and mid-sized organic
farmers (see chart below).
Support for retaining the
existing National Organic Program is broad-based. Signatories to
OTA's letter include large and small organic and natural
businesses, representing every step of the organic supply chain
from farm production of organic fresh fruits and vegetables to
processors and retailers. Among the letter's supporters are the
United Fresh Fruit and Vegetable Association and the Soyfoods
Association of North America, as well as organic grain-producing
businesses and organic dairies.
"Consumers want products that
meet the national organic standards and are specifically seeking
products with the USDA seal because it signifies that these
products contain the most organic ingredients,' said Margaret
Wittenberg, Vice President of Communications and Quality
Standards for Whole Foods Market, Inc. "Shoppers have learned to
look for the 'USDA Organic' seal so keeping it in place on the
products now helps maintain consumer confidence in the
comprehensive organic program we have all worked so hard to
create and sustain."
The current organic standards reflect the recommendations of the
National Organic Standards Board (NOSB), a citizen's advisory
board to the USDA on organic matters. The board includes
representatives of farmers and consumers. Developing the
standards involved over 12 years of public meetings, stakeholder
discussion and compromise, two rounds of notice and comment
rulemaking, and over 300,000 public comments.
Based on label categories
created by Congress, the work of the NOSB has resulted in more
choices in the organic marketplace. The federal regulations
include the '100 percent organic' label category for shoppers
seeking those products that can be made with organic ingredients
and nothing else. "The 'Organic' label category expands the
variety of organic products available and, by doing so, supports
organic farming and makes products available for more
consumers. Having more farms using organic practices benefits
everyone," DiMatteo added.
U.S. organic standards are as
strict as any in the world, and throughout the world there are
lists of specific allowed materials that are essential to making
numerous organic processed products. These are non-agricultural
materials, such as baking powder, carbon dioxide and certain
sanitizers, that are necessary for many processed foods and have
been used safely for decades. These materials are strictly
regulated, must go through extensive review, and must be chosen
by the citizen board before they may be allowed in organic food
production.
"OTA supports the strict review
of materials and the role of the citizen board in approving
these materials for use in products that carry the 'USDA
Organic' seal," said DiMatteo.
The mission of the Organic
Trade Association is to promote and protect the growth of
organic trade to benefit the environment, farmers, the public
and the economy. OTA envisions organic products becoming a
significant part of everyday life, enhancing people's lives and
the environment. As a membership-based business association, the
Organic Trade Association focuses on the organic business
community in North America. OTA's more than 1,600 members
include farmers, processors, importers, exporters, distributors,
retails, certifiers, and more.
USDA
Certified Organic Wheat
From Farm to Table and Back Again:
Organic Breads, Crackers, Baked, Packaged and Frozen Products in
Jeopardy
|
Current Organic Program |
Scenario A (2) |
Scenario B (3) |
Grower |
Profits and acreage
increase every year * |
Profits and acreage
planted continue to increase |
20% of growers will
stop planting organic (4) |
Supplier |
Many potential
customers |
Number of potential
customers increases |
Fewer potential
customers to sell to as most processed foods can no
longer be labeled as 'USDA organic' |
Shippers/Handlers |
Large variety of
products |
Number and variety of
products increase |
Added expense to
change post-harvest practices to meet the new standards |
Processor/Manufacturer |
Wheat is processed
with other certified organic ingredients and allowed
materials on the NOP list** to produce various products
such as bread, crackers and baked goods |
Greater number enter
the marketplace |
25% will exit the
organic category with an estimated sales loss of $758
mil/year (4) |
Distributor/Broker |
Large variety of
products |
Increase in number and
variety of products available |
Marked decrease in
number and variety of products available |
Retailer |
Sales of assorted
breads ($966 mil/per year), pastas, snacks, ($484 mil
per year), baked and frozen goods ($1.326 billion per
year) with sales growing at an average rate of 22.83%
per year (1) |
Merchandise diversity
and sales continue to increase |
Product selection
dwindles and sales decrease by an estimated $139
mil/year in the bread/grains category and $97 mil/year
in snack foods (4) |
Consumer |
Diverse and growing
choices which lead to increased use of organic products |
Use of organic
products continues to increase |
Less demand due to
decreased choices and confusion about labeling |
Environment |
Reduction in use of
toxic and persistent pesticides and synthetic
fertilizers leads to greater biodiversity, healthy soil,
less water pollution |
Reduction in use of
toxic and persistent pesticides and synthetic
fertilizers leads to greater biodiversity; healthy soil;
less water pollution |
More toxic and
persistent pesticides and synthetic fertilizers are used
due to decreased organic acreage |
This chart is intended as an
example and does not represent cumulative impact.
* The organic industry has been growing at a rate of 17 - 21%
annually for 15 years.
** National Organic Program (NOP) approved list of 38 materials
that are needed to the processing of many organic foods.
(1) Organic Trade Association's 2004 Manufacturer Survey
(2) OTA's amendment passes; the law changes and the current NOP
standards remain in place.
(3) OTA's amendment is defeated; the law stays the same and the
standards change, removing materials needed to produce a variety
of products now labeled as "USDA organic."
(4) 2005 Economic Impact Industry Survey for OTA |