What's holding back the US organic feed sector? Trade group leads pioneering research project

By Jane Byrne contact

- Last updated on GMT

Related tags: Organic food

What's holding back the US organic feed sector?
The growth in demand for organic animal feed is far outstripping supply, said the Organic Trade Association (OTA), as it looks to review the barriers to the take-up of organic farming in the US.

Last year saw a boom in the retail of organic produce in the US, with sales reaching $35 billion - a jump of over 12% from 2012.

But organic food represents just over 4% of the $760bn US food industry, and only 1% of the agricultural land base there is given over to organic crop production.

Grain growers, livestock producers, and food firms attended a two-day summit in May organized by the OTA’s new Farmers Advisory Council (FAC) to address the concerns over limited organic feed supply and to look at ways to help producers switch to organic systems.

Risk sharing model

Nathaniel Lewis, senior crops and livestock specialist at the Washington-based OTA, told us delegates at the summit discussed the idea of a model that would enable risk-sharing between farmers and feed processors to help incentivize greater transition to organic farming.

Changing from conventional to organic production is a regulated process - organic certification requires that crops do not receive any synthetic chemicals including fertilizers or pesticides for three years.

And the conversion period can have a substantial negative impact on farm incomes.

If farmers could reduce their exposure through contracts with feed manufacturers or other stakeholders, it would make the switch to organic systems more appealing,”​ said Lewis.

Research into transition challenges

While there are some "amazing"​ organic grain and livestock operations throughout the US, he continued, it is really a nascent industry there.

“To broaden the availability of organic grain for feed, we first need to identify all the challenges that exist for converting to an organic model from a conventional one.

This type of baseline analysis has never been done before in the US organic sector and we are actively seeking to partner with a university and a leading economist to generate this data.

An investigation of this kind is critical to fully understanding what barriers to conversion exist and to maintaining the current momentum in the organic food segment,​” added Lewis.

Crop insurance

One critical impediment to greater take-up of organic farming, he said, is the fact that the US crop insurance model is geared towards conventional production.

Federal crop insurance, delivered by the US Department of Agriculture, provides risk management tools for US farmers to stay in business after a difficult crop year.

Lewis said that while changes to organic farming risk coverage have been ushered in under the 2014 Farm Bill, they “don’t yet go far enough.”

OTA's Farmer Advisory Council said it has made crop insurance a priority and is advocating for appropriate price elections on organic crops.

“We also want to ensure that USDA's pilot program, Whole-Farm Revenue Protection, is rolled out in a manner that takes into consideration organic farmers' holistic approach to production,”​ said the crop and livestock specialist.

Bi-partisan political support for organic sector

Lewis stressed that radical solutions are required if supply is to catch up with demand for organic feed grains in the US.

Fortunately, he said, there is bi-partisan support for the organic sector in the US Congress and Senate, which was evident in the support it received in the 2014 Farm Bill.

The legislative reforms include allowing the organic sector access to the same agriculture research and promotion programs available to conventional farmers.

In addition, the Bill provides increased funding for the National Organic Program to enforce organic standards, improve technology, and negotiate international trade agreements, as well as funding for organic research, data collection, and certification cost share.

But​ we have to keep our foot on the pedal. We cannot afford any more plateaus in the rate of development of the sector or interest in transitioning to organic farming will wane,”​ added Lewis.

Related topics: Markets, North America, Grains

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