Organic farmers created the organic certification agencies, the system of
inspection and the standards for both farm and handling operation
certification, both in terms of the private sector certification and
ultimately most of the content of the Act. In the process their objective
was to create a system to assure the consumer they were getting what they
paid for--products produced and handled by a transparent and clearly stated
system of farming and handling. Obviously, such a strong statement would
take some time to determine and verify. Organic farmer's certification
agencies had been experimenting and improving the organic certification
system since the early 70s. In OCIA as in many other private sector
certification agencies we attempted to perform this verification and
determination of certification status as least expensive as possible,
primarily with us, certified organic farmers, along with other non organic
farmers, sitting on the certification determination committee. And yet,
there was still a cost--administration, the inspector, the certificate. As
anyone who has ever run a chapter of OCIA (or another private agency) and
carried out quality certifications on say 25 farms and 5 handling operations
in the course of one year using volunteer labor soon acknowledges, this is a
lot of work--definitely non-profit. Only the inspector, perhaps the
administrator is getting paid. Private for profit organic certifiers are few
and far between. Farm Verified Organic, Quality Assurance International are
really the only two that come to mind out of 65 US organic certifiers (if you
count every OCIA and NOFA Chapter as a single certifier.) In fact every
chapter of OCIA International and each NOFA Chapter are making the final
decision on the qualifications of organic certification applicants. As
private sector organic certifiers became more professional and organic
standards grew to encompass all types of agriculture, along came the States.
24 or so now with State organic laws. Some of the laws are really
registration laws with simple requirements a farm or handling operation must
meet in order to use the word "organic"--California comes to mind. Other
States got in the actual certifying of farms and handling operations, like
Washington, New Mexico, Texas, Idaho, Maryland, New Hampshire, Louisiana.
Other States approved the certification agencies that operate within their
State like Florida, Indiana, Minnesota, Ohio and may have certain
requirements to use the word "organic". All in all State organic laws tended
to reflect somewhat what the existing private certifiers in these States
wanted made into law. Some time State organic laws caused trouble for
existing private sector certifiers. California might be interpreted as such.
State organic programs as well as all other related state employees and
their offices need to carry on their appointed work with the objective of
balancing the interest of organic farmers, handlers and customers in light of
applicable laws as their highest mission. Ultimately though, only the
involved citizen can assure such an outcome.
In Arkansas, a State law was brought before the the 1994 legislature by very
influential members of the legislature. It started by charging everyone
certified organic in Arkansas $25 and ended up coming out of committee asking
for a minimum of $100 for the farmer and $200 for the handling operation.
Furthermore, it turned the decision of who could be certified as well as
accreditation of private certifiers over to the State Plant Board, who knew
zero about organic farming, certifying or handling. We stopped the law by
finding out who had proposed it--some very influential rice and soybean
growers who had received request to supply organic field crops to large
firms. When I talked with the individual farmers, explained there were
already many private sector organic certifiers (provided phones and
addresses) available to certify their land and handling operations and that
the National Organic Program would soon come into being and supersede all
State organic laws, perhaps creating havoc and confusion if Arkansas got into
the certification program development with a Federal Law on the books, they
called their representatives and the bill was immediately retracted. Common
sense, good timing, close observation and communication performed the deed.
All traits I might point out that the best farmers or business operations
(also citizens in a democracy) anywhere must have to be successful.
Now, I strongly suggest anyone actively concerned about the future of organic
farming, handling, certification and the National Organic Program read the
details of the law on the OFMA Website http://iquest.net/ofma/ You will
find OFPA, the House/Senate Joint Conferee Report (the final reasons for
passage of the final language of OFPA) and numerous documents related to what
these documents say and their potential impact on the people effected. I
know it sounds like a big order, but as Sagan use to say the librarys are
very large, but their is usually only a very few important books related to
what we want to know. Our problem is finding them. Here is one of the most
important US laws: Every US citizen should know the details of the Regulatory
Flexibility Act (RFA) as amended in the 94 Congress. The RFA is to make sure
that so called "small entities" are not detrimentally effected by Acts of
Congress. RFA acknowledges that all Acts of Congress are passed to manage
and regulate "large entities" not small entities. I simply can not take the
time to quote RFA here, but will tell you that it is essential to read the
RFA to know your rights concerning rule enactment as a US citizen, as a small
business, a small farm, a small non-profit, a small or local community
government. Under RFA small entities have a legal basis to not be burdened
with regulations that would detrimentally effect their affairs. How OFMA
believes the RFA applies to the organic community of small to moderate size
farms, certifiers and businesses is also on the
Website--http:www//iquest.net/ofma/ The OFMA Website will lead you to
details of the RFA by touching the hyperlinks. Opinion and a lot of
sputtering inflammatory rhetoric will not effect regulatory agencies. What
does effect them is the necessity to follow the law. In a democracy it is
the citizens' responsibility to make regulatory agencies follow the law, in
this case, using OFPA and RFA and common sense, good timing, close
observation and communication will do the job. Suit can follow if necessary.
In previous or subsequent writings I have illustrated how OFPA can provide
consumer assurance at a reasonable price, with reasonable paperwork and
little intrusion into the life and business of an applicant for organic
certification status. If you feel I am incorrect, I challenge you that each
of ours first task is to be informed on the language and intent of OFPA and
RFA. I think, rather I know, with OFPA and RFA as the basis of conversing
and subsequent direct action, the direction to take in redressing Sal's
grievances or Rich's suggestions for lessening the burden on small organic
farmers, certifiers and handlers will become very clear, legal, powerful and
be able to be joined by many others.
Local production for local need and circumventing the unnecessary middle
agent in marketing:
Now, I am running out of time. Local organic production for local demand
will only come into being throughout the US when there is a national,
consistent and uniform organic standard and no interference in interstate
trade of organic products. (Remember a lot of folks live near State lines
which across them comprises a local market.) This only will occur with
implementation of OFPA. Local production for local demand will only come
into being when local farmers are efficient in biological management of their
soils and are efficient in mechanical, labor (including harvest and post
harvest handling) and marketing management and performance. If someone does
not know what efficient management and performance is, visit the local,
regional or national organic farm that is growing the fast and dominating the
market. Price reflects efficiency in 99% of the cases. Those who are
selling organic products at the most reasonable prices can do so for reasons
of efficiency. Without visiting any farms, any farmer can innovate and
become efficient by simply using the maxim of common sense, good timing,
close observation and communication. But lets face it as organic farmers,
many, many organic farmers are simply not efficient and have on occasion let
quality not be a priority. There is no excuse in the market place for such
production.
Now on the marketers.
The conventional wholesale distribution system exist as it is because it
works--it fulfills the customers needs--those customers being the retail
business buyer and translating (and influencing) the consumers needs and
desires to the broker. Collusion exist, but what wholesalers can recognize
very quickly is consistent production, consistent high quality, diversity of
production and on time delivery. All these attributes are essential to any
successful marketing of production, organic or conventional.
There are real ways to change the existing wholesale distribution system, to
make the linkage more direct and immediate between the consumer and the
producer. Walmart, for the many objections voiced about it, was the biggest
retail outlet to accomplish just that--shorten the link between producer and
consumer. 4 years ago Walmart eliminated all the brokers and middle agents.
Walmart became its own broker. And it passed part of the savings on to the
consumer from its purchasing policy and started buying from the producers.
The hint is there. Organic farmers have to ban together to consolidate
knowledge of their supply, centralize offering of products and market it
direct to the most direct market they can reach. The most direct, large
volume market available to organic farmers is presently through the 10 coop
warehouses and direct into coop storefronts--all 1200 of them across the
country. Farmer markets including farm stands, restaurants and CSA groups
are existing, immediate local options that can be individually developed. As
anyone in organic farm production soon realizes, under the present marketing
scenario, local markets are saturated rapidly once vegetable farms expand to
in number an acreage. The same goes for field crop, dairy and livestock
producers. To create consistent markets for increasing numbers of organic
small to moderate farms, marketing must and will expand into the retail
grocery outlets. A worthwhile question is whether organic farmers want to
support the home grown cooperative grocery outlet or the mega-chains. All
small to moderate size organic farmers selling individually know where they
stand with the mega-chains--at the bottom of the food supply chain. So, why
bother organizing production for them.
Under the USDA National Organic Marketing Cooperative Feasibility Study a
scenario for high speed telecommunication marketing was developed. The
system was developed to give priority to local production for local sales by
every 10 minutes from the beginning of a daily offering, enlarging the circle
of offering by a 50 to a 100 mile radius from the epicenter of 5 to 6 organic
farms location. If an order was taken, the volume was subtracted from the
total offering. Prospective buyers could buy anytime but received a priority
offering at the first offering of the day from local producers to buy firstly
from local supply. By the same token as sales was not taken up locally, then
ever enlarging regionally offerings were made. Offerings extend further out
from the epicenter in concentric circles until the product(s) are sold. Such
a complex system of priority for local sales and further expansion of sales
opportunity was very costly and time consuming before the advent of high
speed communications. Email is the preferred offering and contracting
medium, cutting cost to a bare minimum.
Organizing:
A farmer run cooperative association is the only way to keep cost low and
responsiveness to farmers high. The marketing association does not have to
have in house sales staff, but could take bids from private or cooperative
marketing businesses to operate on a contract basis with the association.
Such a bidder would have to maintain all the other normal support services:
production and transportation coordination, market development and post
harvest handling quality education and control, perhaps a degree of
production technical assistance and of course sales information
consolidation, offering and accomplishment. The study concluded this is the
only way small to moderate size organic farms in any number will be able to
compete with the CalOrganics, Pavich Farms, Piedmont Farms, Cargill, Kellogg,
Tyson or Montfort or MidAm. Further innovation and suggestions are in order.
Each kind of crop production sector would have to design the style and
procedures for the respective cooperative marketing association. A new
organic marketing association would work to support an alternative more
direct farmer to consumer distribution network--the coop distribution centers
and coop storefronts. The Organic Farmers Marketing Association, meeting
December 2 and 3, 1997 prior to the ACRES USA conference at the same hotel in
St Louis, invites participation in developing such an approach for marketing
organic products. For more information contact Val Carr at Vcarr@ccrtc.com
or check the OFMA website http://www.iquest.net/ofma/ for more details.
New organic handling operations for value added--innovative businesses and
collaboration with existing cooperatives:
Under OFPA, the national organic processing standards for livestock and other
food products open marketing opportunities never available before. For the
first time poultry, processed eggs and red meat will be able to be labeled
"organic". New, local organic processing businesses will really have an
island to stand on that separates them from conventional as well as a level
field of standardized organic processing requirements that will allow them to
compete on the taste and innovativeness of their processed organic product
with the mega-marketers . Local value added organic products for local
demand can be the lever that brings repeated sales over the mega-marketers
both in terms of pulling sales away from conventional ag products and pulling
sales away from out of region organic marketers. Maybe it is an opportunity
for Indiana organic soybean producers to finally break into the expanding
domestic and regional markets for soy products with development of their own
value added line rather then selling to the brokers, who in turn sell to the
processors, who in turn develop the processed organic food market. There are
many more possibilities then one may imagine for organic farmers to develop
cooperative value added. Farmer marketing cooperative value added is a
multi-billion dollar industry in 1997 and expanding in billions every year.
Organic is a new and untested market for them. Feasibility Study
indications were that conventional farmer run marketing coops appear to be
waiting for quality invitations on how to collaborate with organic farmers in
new, organic market value added development.
Best of luck, until we meet again,
Eric Kindberg
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