Pipeline Foods "Clawback" Letters
Information for Organic Farmers Who Sold Grain to Pipeline Foods
On July 8, 2021, organic and non-GMO grain buyer Pipeline Foods filed for Chapter 11 bankruptcy. Earlier this year, the company’s bankruptcy proceeding was finalized by a court in Delaware.
Unfortunately, for some organic farmers who sold to Pipeline, this situation is still not behind them. This summer, some farmers have received “clawback” letters from a law firm in Minnesota serving as the trustee for Pipeline Foods’ liquidation.
IF YOU HAVE RECEIVED ONE OF THESE LETTERS, DO NOT IGNORE IT. Unfortunately, this seems to be a legitimate part of the bankruptcy process.
The letters claim that farms that were paid by Pipeline Foods during the 90 days leading up to the bankruptcy filing (on July 8, 2021) now must return a portion of that payment to the bankruptcy proceeding.
Here are some things you can do if you have received one of these letters:
- Gather information about your history with Pipeline Foods – how many times did you sell grain to the company, on what dates, when did they make payment, etc. This could be important in establishing that the payment you got during the 90-day period before the bankruptcy was similar to your previous transactions with the company. If you have contracts with Pipeline, gather those as well.
- Contact an attorney. If you already have an attorney you use for farm business, start with them. Ask if they have experience with bankruptcy proceedings. If not, ask them to refer you to someone who does.
- When you show the letter from the bankruptcy trustee to your attorney, ask them to look into two possible arguments to make in response:
- Your payment should be exempt from a preference claim because it was made in the “ordinary course of business.”
- Your payment should be exempt from a preference claim because it was a contemporaneous transaction made for “new value.” (This would apply to payments made for grain delivered within 90 days before the bankruptcy date.)
These exemptions are spelled out under 11 USC 547(c).
- Ask for an extension. The letter from the trustee gives a very tight deadline to reply with a payment. The first step your attorney may want to take is to ask for more time to formulate your response explaining why your payment is not subject to clawback by the trustee.
- Let OFA know if you have received one of these letters. We will try to keep people updated and share resources about ways to respond. You can email Kate Mendenhall, OFA Executive Director, kate@organicfarmersassociation.org or fill out a short survey about your situation. Knowing how many farmers have been affected will help us strategize on the best way to help you as a whole.
September 2022 Policy Update
September 2022
By Patty Lovera, Policy Director
USDA Support for Organic Transition
On June 1st, Agriculture Secretary Vilsack gave a speech on the USDA’s plans to transform the American food system, focusing on increasing resilience in food supply chains. One of the plans he announced was for USDA to establish a program, funded with $300 million, to assist farms that are transitioning to organic certification. On August 22nd, USDA released more details on the Organic Transition Initiative, which will provide $300 million to three areas:
- $100 million for “wrap around technical assistance” for farms going through the transition process. The USDA plans to “build partnership networks in six regions across the U.S. with trusted local organizations serving direct farmer training, education, and outreach activities…The organizations will connect transitioning farmers with mentors, building paid mentoring networks to share practical insights and advice.”
- $100 million for direct assistance to farmers through conservation and crop insurance programs. The Natural Resources Conservation Service will develop a new organic management conservation practice standard and offer financial and technical assistance to producers who implement the practice, and increase organic expertise at each of its regional technology support centers. USDA will also create a new Transitional and Organic Grower Assistance Program at the Risk Management Agency, which will support transitioning and certain certified organic producers’ participation in crop insurance, including coverage of a portion of their insurance premium.
- $100 million to improve organic supply chains. USDA will focus on key organic markets where the need for domestic supply is high, or where additional processing and distribution capacity is needed for more robust organic supply chains. More details on this initiative will be released later this year.
Changes to Crop Insurance Programs Used by Specialty Crop and Diversified Farms
At the end of August, the USDA announced changes to the Whole-Farm Revenue Protection (WFRP) and Micro Farm insurance programs. The WFRP program provides protection for all eligible commodities on a farm under one insurance policy. Changes to WFRP include:
- Doubling the maximum insurable revenue to $17 million
- Allowing a producer to report and self-certify yield at the beginning of the year for commodities without other insurance options in a way similar to those with individual crop policies.
- Eliminating expense reporting to reduce paperwork burden. In place of expense reporting, WFRP will reduce the expected revenue of commodities a producer is unable to plant to 60%, similar to prevented planting for other programs.
The MicroFarm program is offered through WFRP and provides coverage for all eligible commodities on a farm under one insurance policy on a smaller scale. The program used to be for farms with up to 100,000 in approved revenue, and now the limit has been raised to $350,000.
These updates to WFRP and Micro Farm take effect in crop year 2023.
Annual Spending Bills Support Organic Programs
This month, Congress needs to address the upcoming deadline for passing annual spending bills for federal agencies like the USDA. October 1 is the beginning of the federal government’s new fiscal year, and Congress needs to pass new “appropriations” bills or an extension by that date, or the federal government will partially shut down. At this point, it is likely that Congress will have to pass an extension, probably until early December, and then try to pass new bills for the rest of the fiscal year.
In the appropriations bills that have been drafted for the USDA for Fiscal Year 2023, organic programs are faring well. The House has already passed a bill that would increase funding for the National Organic Program and included language to direct the NOP to strengthen their enforcement of organic soil health requirements. The Senate has a draft bill, which also included an increase in funding for the NOP and good report language on enforcement. The bill still has to be passed by the full Senate, and then any differences between the House and Senate versions will have to be reconciled.
Participate in the National Organic Standards Board’s Fall Meeting
The NOSB meets twice a year to work on recommendations to the USDA about organic standards and the National List of materials that are allowed or prohibited in organic production. After several years of virtual meetings, the NOSB is planning for an in-person meeting in October in Sacramento, California.
- Public Comment Webinar Day 1: Tuesday, October 18 from Noon - 5:00 pm Eastern
- Public Comment Webinar Day 2: Thursday, October 20 from Noon - 5:00 pm Eastern
- NOSB Public Meeting Day 1: Tuesday, October 25 from 9:00 am - 5:00 pm Pacific
- NOSB Public Meeting Day 2: Wednesday, October 26 from 9:00 am - 5:00 pm Pacific
- NOSB Public Meeting Day 3: Thursday, October 27 from 9:00 am - 5:00 pm Pacific
You can watch the meeting online, and the public comment portions of the meeting will still be virtual. Meeting information and the registration form to sign up for public comment are here (registration form is at bottom of page.)
Proposed Animal Welfare Standards
By Harriet Behar
Even though the NOP organic standards state that all organic livestock should have access to the outdoors, an opportunity to express their natural behavior and have living conditions that lessen stress to promote health and well-being, these rules have not been universally implemented by all USDA organic operations. Large organic poultry operations have provided small “porches” and have convinced the NOP and certifiers that this is the same as providing outdoor access. Operations that do provide outdoor access, with living vegetation, shade, food and water have a significant economic investment that others have avoided. The NOP has acknowledged that there has been a “market failure” with many organic producers providing quality humane living conditions and others mirror standard confined animal practices, creating confusion in the marketplace.
The Obama administration published a final rule in January 2017 to make organic regulations more in line with other animal welfare certifications. The Trump administration withdrew the rule later that same year, and it was not implemented. In the past five years and prior to 2017, many organic livestock producers have felt the need to pay for additional animal welfare certifications, to differentiate themselves from other organic operations and more clearly communicate to consumers the humane aspects of their operations.
SOME PROBLEMS WITH THE RULE
IMPLEMENTATION TIMELINE
A significant difference between the 2017 version and the 2022 version of this rule, is a proposed implementation timeline for avian outdoor access. The NOP has proposed either a 5-year or 15-year implementation timeframe for operations currently certified as organic. Many organic advocacy groups have spoken out against both the 5- and 15-year implementation timeframe. It can be argued that to be fair to all crop and livestock operations that make investments and capital improvements when they transition to organic, providing a three-year “transition” to providing true outdoor access is the only fair way to approach this implementation. The NOP should prioritize the majority of organic livestock operations that for years have upheld humane animal standards to provide outdoor access and allow animals to express their natural instincts, and have suffered unfair competition with operations that do not provide their poultry meaningful outdoor access. Rapid implementation is needed to remedy this situation as quickly as possible.
NATURAL LIGHT REQUIREMENT
Birds should not be allowed to be kept in darkness during the daytime. This statement from the 2017 version was removed: Natural light must be sufficient indoors on sunny days so that the inspector can read and write when all lights are turned off. Confinement raised ducks are commonly kept in dimly lit or dark conditions in buildings with no windows. Numerous humane animal standards require sufficient natural light during the day along with artificial light of limited duration as the days get shorter. Organic farmers advocating for improvement in this area can make a difference.
VEGETATIVE COVER OF OUTDOOR ACCESS
The new regulation only requires half the outdoor access area to be soil and that soil should have “maximal vegetative cover” appropriate for the season, climate, geography, and species of livestock. This is another area where more specificity is needed. What does “maximal vegetative cover” look like on your farm? What do you do to promote healthy height and density to provide a quality forage area? Rotation, renovation, reseeding, and irrigation are used to provide lush vegetation that provides for healthy livestock as well as protection of soil and water quality. Areas of gravel and concrete should be limited to areas of high usage or possible erosion, such as right next to the doors, at roof driplines, walkways, and food and water areas. The vegetated area needs to be as close as possible to the building, and not be around the corner of the building where the birds might never use it. The vegetation should be managed in a way so it can regenerate and not permanently be denuded.
TEMPERATURE
As written now, the birds can be temporarily confined inside when the outside temperature is below 40 degrees and above 90 degrees Fahrenheit. Most birds can tolerate a larger temperature range. In many areas of the country, this keeps the birds confined for a significant portion of the year. Can you give examples of what you do on your farm and its effect on your birds?
BIRD DENSITY
Both the indoor and outdoor sq ft per bird requirements are at the lower end of the humane certifications. Outdoor areas for broilers is set at 1-1.25 sq ft per bird, for mature layers it is set at about 1.5 sq ft per hen, and for pullets it is set at about 1 sq ft per hen. Indoor areas for mature layers is set at 1-1.5 sq ft per bird depending on the type of housing and for broilers 1-1.25 sq ft per bird. The actual numbers in the regulation are based upon the average weight of the birds in the flock, so these numbers are approximate. European standards require approximately 42 sq ft per bird, but this can be accomplished through repeated rotations in a variety of areas over a full season, encouraging producers to continually move their flocks. This lessens parasite and disease problems, provides for healthier vegetation, and protects soil and water quality from the damage of overstocking. What suggestions do you have for stocking rates and forage management?
SWINE TAIL DOCKING & NEEDLE TEETH CLIPPING
Needle teeth clipping and tail docking in pigs is not typically allowed in humane standards. In this regulation, they are only allowed when documented that “alternative steps to prevent harm fail.” This area could be strengthened with more descriptive wording to provide more space and better living conditions which remove the need for these alterations. Swine producers are encouraged to provide further descriptions that have worked in their operations.
TEMPORARY CONFINEMENT OF YOUNG DAIRY CALVES
Should young dairy calves be allowed to be temporarily confined indoors for up to six months or until weaned? There is an allowance for this, as long as the calves can see, hear and smell other calves. Youngstock benefit from being outdoors, especially when seasonally appropriate. Should there be a requirement for some outdoor access for these young animals?
The NOP has acknowledged that consumers will pay more for livestock products where poultry are truly outdoors as well as all species being managed under humane requirements. Consumers deserve a speedy implementation to lessen the current market confusion and the profusion of labeling claims. The organic label should consistently uphold consumer expectations of healthy environmental and animal production practices. Your voice is important to this process!
August 2022 Policy Update
August 2022
By Patty Lovera, Policy Director
Animal Welfare Standards Finally on the Move
After years of delay, including lawsuits triggered by the USDA’s decision not to finish an earlier proposal, the Organic Livestock and Poultry Standards proposed rule is finally moving! Late last week, the USDA released a proposed rule to update the organic standards for how livestock are raised. The proposed rule would not allow porches in chicken houses to qualify as outdoor access, but does request input from the public on how long it should give current operations to come into compliance with tighter standards.
OFA is doing an in-depth analysis of the proposed rule and will share more details about what topics need farmer input during the public comment period. The comment period will be open until early October. USDA is also hosting a virtual listening session on August 19 from 12-2 pm ET. You must register by August 15 to give oral comments during this session.
Congress Injects Funding into Conservation Programs
After more than a year of stops and starts, Congress is about to pass a large spending package to address climate change, including a historic infusion of money into several USDA conservation programs. In late July, after many predictions that there was no chance to pass a bill, Democrats in the Senate came to an agreement on a package of tax reforms and spending on healthcare and climate change. The bill, referred to as budget reconciliation, uses a special procedure that bypasses the normal requirement of 60 votes in the Senate. This means it can be passed with only Democratic votes in the 50-50 Senate. Over the weekend, the Senate passed the bill and the House is expected to return from recess to vote on the bill this Friday.
The bill would provide $18.1 billion over four years for several USDA conservation programs, including the Environmental Quality Incentives Program and the Conservation Stewardship Program, with a focus on practices that address climate change. It would also provide $2 billion over several years for the Rural Energy for America Program to provide loans and grants to agricultural producers and rural businesses for renewable energy systems. Organic is mentioned as one of many purposes for increased conservation spending, and OFA will be working with our allies to make sure that USDA uses this new funding in ways that work for organic farmers.
This increased funding for conservation programs has also triggered a lot of debate about how it will impact the next Farm Bill. The current Farm Bill expires in 2023, and Congress has started the process of developing the next bill. With the new funding provided by the reconciliation bill, the process of writing the Farm Bill could provide another opportunity for Congress to instruct the USDA on how to focus conservation programs.
This summer, OFA has been working with our allies in the organic community to refine our Farm Bill proposals, on fixing organic certification cost-share, supporting organic research, tackling fraud in organic supply chains and other issues.
Annual Spending Bills Support Organic Programs
Congress is also slowly moving through the process of completing the annual spending bills for federal agencies like the USDA. These “appropriations” bills happen every year in a very prescribed process, not to be confused with the special budget reconciliation bill that just passed and provided supplemental funding for specific programs.
In the appropriations bills that have been drafted for the USDA for Fiscal Year 2023 (which starts on October 1st), organic programs are faring well. In July, the full House passed a bill that would increase funding for the National Organic Program and included language to direct the NOP to strengthen their enforcement of organic soil health requirements. At the end of July, the Senate Appropriations Committee released their draft bill, which also included an increase in funding for the NOP and good report language on enforcement. The bill still has to be passed by the full Senate, and then any differences between the House and Senate versions will have to be reconciled. It is unlikely that Congress will get all of these steps completed before the October 1st deadline, and will have to pass an extension to let federal agencies continue to run on this year’s budget levels.
Get Involved: Advocate for Organic Farms This Summer!
Many members of Congress, especially members of the Agriculture Committees, are beginning to hold public sessions to get input on the next Farm Bill in their districts this summer. If you have a Senator or Representative serving on the Agriculture Committee, you could call their office to ask if they are planning to have any public sessions to get input on the Farm Bill. Let OFA staff know if you are planning to attend any of these sessions and need any information about organic priorities for the next Farm Bill. For tips on setting up a meeting in your legislator’s district office, check out OFA’s website.
July 2022 Policy Update
July 2022
By Patty Lovera, Policy Director
Delayed Organic Regulations
After the USDA finally released the Origin of Livestock final rule this spring, pressure is growing on the agency to make progress on several other critical issues related to the integrity of the organic label. When the Under Secretary for Marketing and Regulatory Programs at USDA, Jenny Lester Moffitt, spoke to OFA members at our annual meeting in June, she said that she hoped both the Organic Livestock and Poultry Standards proposed rule and the Strengthening Organic Enforcement final rule would come out this summer. The OLPS proposed rule is a long overdue update to animal welfare requirements for organic operations and the Strengthening Organic Enforcement rule includes a long list of changes to USDA’s process for detecting and preventing fraud in organic supply chains. Under Secretary Moffitt also referenced the long list of National Organic Standards Board recommendations that the USDA needs to move through the process to update the organic standards, and said they are committed to making progress on that backlog.
USDA Support for Organic Transition
On June 1st, Agriculture Secretary Vilsack gave a speech on the USDA’s plans to transform the American food system, focusing on increasing resilience in food supply chains. One of the plans he announced was for USDA to establish a program, funded with $300 million, to assist farms that are transitioning to organic.
At OFA’s annual meeting, Under Secretary Moffitt offered a little more detail about what the USDA is considering for this program. She mentioned that a top priority for the program would be providing technical assistance for farms going through the transition to organic, highlighting the role of mentorship. Providing support through improved conservation and crop insurance programs are also on the list for this program. And the final piece of the transition program Under Secretary Moffitt described was working to increase the market for organic products. She emphasized that the USDA understands that encouraging more farms to go organic in a market that is already oversupplied is not helpful, and that they want to target their efforts at parts of the organic market where we need more domestic organic farms to meet demand. OFA will continue to engage with the USDA as they develop this new program.
Congress Gets Input on the Next Farm Bill
The current Farm Bill expires in 2023, and Congress has started the process of developing the next bill. The House Agriculture Committee is working through a series of hearings to examine how USDA programs are working, and the Senate Agriculture Committee has held hearings in Michigan and Arkansas (home to the committee chair and ranking member.) In June, the committee had a hearing on the role of climate research in supporting agriculture resiliency, which included testimony on climate benefits of organic production from the Organic Farming Research Foundation.
This summer, OFA will be working with our allies in the organic community to refine our Farm Bill proposals, on fixing organic certification cost-share, supporting organic research, tackling fraud in organic supply chains and other issues. And many members of Congress, especially members of the Agriculture Committees, are beginning to hold public sessions to get input on the next Farm Bill in their districts this summer. There are at least two sessions scheduled for late July (in Washington and Minnesota), and more could be scheduled for this summer. If you have a Senator or Representative serving on the Agriculture Committee, you could call their office to ask if they are planning to have any public sessions to get input on the Farm Bill. Let OFA staff know if you are planning to attend any of these sessions and need any information about organic priorities for the next Farm Bill.
Get Involved: Advocate for Organic Farms This Summer!
As discussions about the next Farm Bill ramp up, this summer is an important opportunity to share policy priorities for organic farmers with your members of Congress. A good way to do that is to try to meet with your elected officials while they are back home more often during the summer. During periods when Congress is not meeting in Washington, DC, legislators spend time at home in their districts, and you can arrange a meeting with them or their staff there.
For tips on setting up a meeting in your legislator’s district office, check out OFA’s website.
June 2022 Policy Update
June 2022
By Patty Lovera, Policy Director
New USDA Support for Organic Transition
On June 1st, Agriculture Secretary Vilsack gave a speech on the USDA’s plans to transform the American food system, focusing on increasing resilience in food supply chains. One of the plans he announced was for USDA to establish a program, funded with $300 million, to assist farms that are transitioning to organic. We don’t have any details yet about how the program will operate, but the initial announcement listed farmer-to-farmer mentorship programs, technical assistance, direct support through conservation and crop insurance programs, and efforts to help develop organic markets as focus areas. OFA will continue to engage with USDA about the most useful ways to implement this program and will spread the word when details become available.
Delayed Organic Regulations
Now that the Origin of Livestock final rule has finally been released, we still need USDA action on several other critical issues related to the integrity of the organic label. The Office of Management and Budget, a division of the White House that signs off on federal regulations, continues to review the Organic Livestock and Poultry Standards rule. After the OMB finishes their review, the USDA will have to make any changes required by the OMB and can then release the OLPS proposed rule for public comment. We are also waiting for the USDA to finalize the Strengthening Organic Enforcement rule, which includes a long list of changes to USDA’s process for detecting and preventing fraud in organic supply chains. When asked at a Senate Agriculture Committee hearing about these delayed regulations, Agriculture Secretary Vilsack pledged that they would be released this year.
Setting Organic Priorities for the Next Farm Bill
The current Farm Bill expires in 2023, and Congress has started to take the first steps in the process of developing the new version. The House Agriculture Committee is working through a series of hearings to examine how USDA programs are working, including a hearing in late March in the subcommittee that covers organic issues. The hearing covered a range of topics, including the release of the final rule on Origin of Livestock and ways to streamline application to USDA conservation programs. In early May, the Senate Agriculture Committee had its first Farm Bill hearing in Michigan, home to the Chair of the committee, Senator Stabenow. The lineup of witnesses included several organic farmers, who talked about the potential they see for growth in organic agriculture and how increased research on organic methods and other USDA programs like organic certification cost-share could help. This summer, OFA will be working with our allies in the organic community to refine our Farm Bill proposals, on fixing organic certification cost-share, supporting organic research, tackling fraud in organic supply chains and other issues.
Get Involved: Advocate for Organic Farms This Summer!
As discussions about the next Farm Bill ramp up, this summer is an important opportunity to share policy priorities for organic farmers with your members of Congress. A good way to do that is to try to meet with your elected officials while they are back home more often during the summer. During periods when Congress is not meeting in Washington, DC, legislators spend time at home in their districts, and you can arrange a meeting with them or their staff there.
For tips on setting up a meeting in your legislator’s district office, check out OFA’s website.
And if you do get a meeting set up, here are some of OFA’s top priorities for the next Farm Bill:
- Organic Certification Cost Share - In the next Farm Bill, Congress should:
- Increase the reimbursement level to 100% (up to $1500 per scope) to make organic certification free for small operations.
- Streamline the program. The organic community is discussing ways to improve the program and our surveys reveal that farmers are interested in making the program function differently – to reduce the up-front cost of certification instead of reimbursement
- Organic and Climate - Organic must be included in whatever climate programs are developed for agriculture, and the USDA must make sure that organic is the gold standard for climate-smart agriculture by prohibiting hydroponic production in organic and enforcing organic regulations to make sure livestock are raised on pasture.
- Stronger Standards for Organic Integrity – USDA needs to finish long-delayed improvements to the organic standards, including the Strengthening Organic Enforcement rule to prevent fraud and stronger animal welfare standards.
2022 Organic Certification Cost Share
Thanks to years of advocacy from Organic Farmers Association and our partner organic organizations pushing USDA to open the cost share program earlier and provide more funds, USDA Farm Service Agency (FSA) announced yesterday that they have opened two pots of money to reimburse farmers for 2022 organic transition & certification fees & other expenses.
Applications are open now and due October 31, 2022.
Two USDA programs cover costs incurred from October 1, 2021 to September 30, 2022 (Organic and Transitional Education and Certification Program (OTECP) and the Organic Certification Cost Share Program (OCCSP)). Organic and transitioning agricultural producers should contact their local Farm Service Agency (FSA) office and/or participating State agency to apply. See more about each program below.
Organic Certification Cost Share Program (OCCSP)
This is the standard Organic Cost Share program that reimburses farmers and processors up to 50% (max. $500) for each certification category (Crops, Livestock, Wild Crops, Processing). If you are certified for multiple categories (scopes) you can be reimbursed up to $500 for each. All FSA county offices will process this program & some certifiers or state agencies process this program.
You will need to provide a receipt of your certification fee payment and proof of organic certification. Once you have had your inspection, contact your certifier for the documentation you will need. Click for more information on OCCSP.
Organic and Transitional Education and Certification Program (OTECP)
The OTECP program was created to patch the missing cost share funds from the historic 75% ($750 max) reimbursement. This program will reimburse up to 25% ($250) per category (Crops, Livestock, Wild Crops & Processing) for 2022 certification fees AND reimburse for education (did you attend a conference?), soil tests, and myriad costs related to organic transition.
This program is only available at your FSA office. FSA recommends submitting ONE application to OTECP, so wait until you've completed your 2022 expenses (10/1/2021 - 9/30/2022) & then apply before Oct 31, 2022. You will need to provide receipts for reimbursement. Click for more information on OTECP.
Alternative USDA resource for help:
You may also call 877-508-8364 to speak directly with a USDA employee ready to provide one-on-one assistance with OTECP or OCCSP. 877-508-8364 (1- English) (2-Espanol)
INTERPRETATION IS AVAILABLE FOR USDA FSA, NRCS, RMA CUSTOMERS - USDA service centers provide FREE translation in 48 languages.
Download poster here to bring to your FSA office.
Danone Shareholders Meeting
April 25, 2022 Danone, owner of Horizon Organic, will hold its annual shareholders meeting tomorrow, Tuesday, April 26, 2022 in France. In August 2021, Danone notified 89 organic dairy farm families they would be ending their contracts and pulling out of the Northeast U.S. market. Many of the affected farm families have been providing organic milk to Horizon Organic for decades and were instrumental in building the successful Horizon Organic brand.
Danone’s decision to leave the Northeast region, one of the largest consumer markets, is devastating to the region, and farm-advocates voiced their fury with 15,324 petition signatures in November 2021 calling for Danone to repair the damage leaving the entire Northeast region will have on the farm economy and rural communities. In December, Danone responded with a commitment to 1.) extend farm contracts an additional 6-months for the 89 producers, 2.) provide a small (6% of the milk check for 6 months or $2 per hundred pounds of milk) transition payment for the affected farm families, and 3.) provide a monetary investment in the Northeast region to support these dairy farmers and the region’s organic dairy industry.
Danone has honored their first commitment to extend contracts, but has not provided specific details on how they plan to pay farmers their transition payment nor how they intend to invest in the region.
Producer groups supporting farmers affected by the Danone exit, Northeast Organic Farming Association of Vermont, Northeast Organic Farming Association of New York, Inc., Northeast Organic Farming Association of New Hampshire, Maine Organic Farmers and Gardeners Association, Northeast Organic Dairy Producers Alliance, and Organic Farmers Association, call on Danone to pay farmers their transition payments immediately based on the last 6 months of production from the date of their 2021 termination notice. They also urge Danone to match the $20 million granted by the USDA to the Northeast Dairy Business Innovation Center to follow through on their commitment for financial investment in the region to support northeast organic dairies.
Danone is one of the largest B Corporations and thus has committed to putting people over profits—a commitment its corporate decision to leave the Northeast region decision directly violates. It is imperative that shareholders hold Danone accountable at the shareholder meeting tomorrow. Danone must stand up for its farm families that have built the corporate success Danone will be celebrating tomorrow.
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Media Contact:
Ed Maltby, Executive Director, Northeast Organic Dairy Producers Alliance (NODPA)
emaltby@comcast.net; 413-427-7323
May 2022 Policy Update
May 2022
By Patty Lovera, Policy Director
The National Organic Standards Board held its spring meeting in April, and the Senate Agriculture Committee kicked off its Farm Bill process with its first field hearing.
National Organic Standards Board
The NOSB held their spring meeting online during the last week of April. Some of the big topics the board discussed included:
- Potential ways to provide NOSB members with technical help and research assistance.
- How to increase traceability in complicated organic supply chains (for bulk commodities like grain) to combat fraud.
- Updating the list of types of genetic engineering that are prohibited in organic production.
- Restrictions on the use of highly soluble forms of nitrogen.
The board voted unanimously to approve a recommendation that would limit the use of highly soluble forms of nitrogen fertilizer. The recommendation calls for the use of fertilizers with a carbon to nitrogen ration of less than 3:1 to be limited to 20 percent of the crop’s nitrogen needs. The Board also unanimously adopted a recommendation to update the list of types of genetic engineering that are prohibited in organic production.
The National Organic Coalition is hosting a briefing on the NOSB meeting on May 11 at 1:00 eastern. You can register for their webinar here.
You can read OFA’s comments to the NOSB here.
Organic Priorities in the Next Farm Bill
The current Farm Bill expires in 2023, and Congress is taking the first steps in the process of developing the new version of the bill. The House Agriculture Committee has been doing a series of hearings to examine how USDA programs are working. In early May, the Senate Agriculture Committee had its first Farm Bill hearing in Michigan, home to the Chair of the committee, Senator Stabenow. The lineup of witnesses included several organic farmers, who talked about the potential they see for growth in organic agriculture and how increased research on organic methods and other USDA programs like organic certification cost-share could help. Other witnesses talked about how USDA nutrition programs can help support farms that provide healthy food to underserved communities. And, in a reminder of what we are up against in the fight for strengthening the integrity of the organic standards, a large organic egg producer from Michigan was also a witness, highlighting what they claim are the advantages of keeping chickens confined indoors for biosecurity. (This is an argument we will hear a lot when the USDA publishes a proposed rule to update the animal welfare standards for organic, called the Organic Livestock and Poultry Standards rule. The draft is currently being reviewed by the White House Office of Management and Budget.)
This summer, OFA will be working with our allies in the organic community to refine our Farm Bill proposals, on fixing organic certification cost-share, supporting organic research, tackling fraud in organic supply chains and other issues.
Assisting Northeast Organic Dairy Farmers Losing Horizon Contracts
In late April, Danone held their annual shareholders meeting in France. Danone North America owns Horizon Organic, which notified 89 farms in Maine, New Hampshire, Vermont and parts of New York that it will be dropping their contracts in early 2024. OFA and other regional organic farming groups worked with a shareholder advocacy firm called Trillium Asset Management, which asked Danone management questions about this situation at the annual meeting. Specifically, Trillium asked Danone about their lack of communication with the 89 farms and whether a promised increase in pay price for their milk during the last portion of their contracts had gone into effect yet. The company gave unsatisfactory answers at the annual meeting, so we will be working with Trillium to meet with Danone officials to continue to advocate for the impacted farms. We are also working with the regional farm groups to make sure that USDA’s investment into the Northeast Dairy Business Innovation Center as a response to this situation actually yields concrete assistance for the impacted farms.
April 2022 Policy Update
April 2022
By Patty Lovera, Policy Director
Good news! After years of work from the organic community, the USDA finally released the Origin of Livestock final rule, closing loopholes that will level the playing field for organic dairy farms. And Congress continued to slowly move towards the next Farm Bill while the National Organic Standards Board gets ready for its spring meeting.
A WIN for Organic Integrity!
Organic Farmers Association has been pushing the USDA for a strong final Origin of Livestock Rule since we were created in 2016. This issue has been at the top of our farmer-identified priority list every year. On March 29, USDA finally released the final rule!
The new final rule:
- Specifies that a dairy livestock operation transitioning to organic, or starting a new organic farm, is allowed to transition non-organic animals ONCE.
- Prohibits organic dairies from sourcing any transitioned animals. Once a dairy is certified organic, any new animals must have been born as certified organic (managed as organic from the last third of gestation).
This win would not have been possible without the support and action from so many organic farmers, organic farm organizations, and organic consumers who signed on to letters to Congress and USDA asking for support for organic dairy farmers with clear Origin of Livestock Standards.
Now that we have a final Origin of Livestock rule that clarifies the standards for organic dairy transition and growth, we will need to make sure that the USDA’s National Organic Program is requiring organic certification agencies to enforce this rule uniformly.
Setting Organic Priorities for the Next Farm Bill
The current Farm Bill expires in 2023, and Congress has started to take the first steps in the process of developing the new version. The House Agriculture Committee has kicked off a series of hearings to examine how USDA programs are working, including a hearing in late March in the subcommittee that covers organic issues. The hearing covered a range of topics, including the release of the final rule on Origin of Livestock and ways to streamline application to USDA conservation programs.
Delayed Organic Regulations
Now that the Origin of Livestock final rule has finally been released, we still need USDA action on several other critical issues. The Office of Management and Budget, a division of the White House that signs off on federal regulations, continues to review the Organic Livestock and Poultry Standards rule. After the OMB finishes their review, the USDA will have to make any changes required by the OMB and can then release the OLPS proposed rule for public comment.
In the middle of the month, the National Organic Program held a public meeting and comment period to get input on the long list of regulations and guidance on the agency’s to-do list. OFA told NOP to prioritize the Strengthening Organic Enforcement final rule, the Organic Livestock and Poultry Standards, prohibiting hydroponic operations from being certified organic, clarifying the rules for transitioning greenhouse facilities, finalizing guidance to protect native ecosystems and other issues. You can read OFA’s comments here.
Spring Meeting of the National Organic Standards Board
The spring meeting of the National Organic Standards Board will be held during the week of April 25th. It will be a virtual meeting that can be watched online.
Some of the big topics on the board’s meeting agenda include:
- Potential ways to provide NOSB members with technical help and research assistance.
- Discussion of how to increase traceability in complicated organic supply chains (for bulk commodities like grain) to combat fraud.
- Defining new types of genetic engineering that should be prohibited in organic production.
- Possible restrictions on highly soluble forms of nitrogen.
- A list of "sunset" materials that are up for their 5-year review to be allowed in organic production.
You can read the Board’s proposed recommendations and discussion documents here. For information on watching the meeting on Zoom, go to the USDA’s page for this meeting. The public comment sessions for this meeting will be held on the afternoon of Tuesday April 19 and the afternoon of Thursday April 21. You can read OFA’s comments to the Board here.