Consumer Corner: Organics gain clout in export markets

By MICHELLE GROENKE  |  July 15, 2012 at 4:30 AM
share with facebook
share with twitter
| License Photo

CHICAGO, July 15 (UPI) -- Organics have moved well beyond the niche of farmers markets and health food stores to become an important sector in the U.S. economy and the next big commodity class to watch, the Organic Trade Association said.

U.S. Department of Agriculture figures show organic takes sixth place for the value of production, right after wheat and cotton and directly before almonds, peanuts and rice.

The Obama administration says the retail value of the organic industry grew to $31.4 billion in 2011, up from $21.1 billion in 2008. The number of operations certified organic grew by more than 6 percent between 2009 and 2011.

Organic dairy and produce are the two largest categories, OTA said.

USDA's Foreign Agriculture Service says the United States exported $410 million of organic products last year, nearly evenly split between fruits and vegetables.

Matt McLean, president of the OTA board, said organics are creating jobs, 5,000 in 2010. The OTA also said data released earlier this year shows for every $1 billion in retail sales of organic products, 21,000 more jobs were created throughout the economy.

"Organic is also creating an important economic opportunity for rural Americans through new business opportunities generated from the recent organic equivalency trade arrangements with Canada and the European Union," McLean said in a statement.

U.S. organic food is a significant part of President Obama's efforts to boost agriculture exports, OTA said.

As of June 1, organic products certified in the United States or European Union may now be sold as organic in either market under a new U.S.-EU equivalency partnership.

This partnership will open new markets for American farmers and ranchers, create more opportunities for small businesses, and result in good jobs for Americans who grow, package, ship, and market organic products," Agriculture Deputy Secretary Kathleen Merrigan said in a statement.

Merrigan said equivalency arrangements are critical to growing the U.S. organics industry.

The United States signed a similar partnership with Canada in July 2009, and additional equivalency arrangement conversations have begun with South Korea, Taiwan and Japan.

Previously, producers and companies had to obtain separate certifications, which resulted in a double set of fees, inspections and paperwork. The partnership eliminates those barriers, which is especially helpful for small and medium-sized organic farmers, according to the USDA announcement.

"This agreement provides economic opportunities for certified organic farmers as well as additional incentives for prospective farmers," said Miles McEvoy, National Organic Program deputy administrator.

Although there are slight differences between the U.S. and EU organic standards, officials determined that the programs were equivalent, with the exception of antibiotics, which are prohibited under U.S. organic standards except to control blight in organic apple and pear orchards. The European Union organic regulations allow antibiotics to treat infected animals.

"Estimates show the market for U.S. organics sales to the EU could grow substantially within the first few years of this arrangement," USDA said in April. "Today, more than two-thirds of U.S. consumers buy organic products at least occasionally, and 28 percent buy organic products weekly."

China is also interested in U.S. organics. Jessen Wheat Co. in Pine Bluffs, Wyo., in May became the first U.S. wheat producer to export organic proso millet and wheat to China.

"We feel this opportunity will open the door to be able to export our Wyoming organic grain to a country that has almost 1.4 billion people, and with China's disposable income on the rise, organic will become a great market opportunity," owner Clint Jessen said when the deal was announced.

Jessen sells wheat to Kellogg's and Safeway in the United States.

Related UPI Stories
Topics: Barack Obama
Trending Stories