Announces Organic Crop Insurance, Other Measure
Washington, May 14, 2013 ― Agriculture Secretary Tom Vilsack today discussed his vision for U.S. organic agriculture and USDA efforts to ensure its continued success during remarks to the Organic Trade Association. Vilsack announced a number of changes and new initiatives to support the continued growth of organic agriculture, including that the USDA's Risk Management Agency's (RMA) federal crop insurance program will increase coverage options for organic producers this year and provide even more options in 2014, including a contract price addendum as well as new premium price elections for organic crops. Additionally, RMA will remove the current five-percent organic rate surcharge on all future crop insurance policies beginning in 2014.
Vilsack also said USDA will be providing new guidance and direction on organic production to all USDA agencies in support of organic agriculture and markets. USDA is now asking each agency to routinely address the needs of the organic sector in their programs and services where appropriate. The National Organic Program has supported the continued growth of America's organic sector, which has been increasing market share each year and now is a more than $30 billion industry. Vilsack noted that accurate data is the biggest obstacle for developing better crop insurance options for organic farmers and expressed his desire that Congress help USDA make further progress by renewing the 2008 Organic Data Initiative as part of a new Food, Farms and Jobs bill.
"Organic agriculture is one of the fastest growing segments of American agriculture and helps farmers receive a higher price for their product as they strive to meet growing consumer demand," said Agriculture Secretary Tom Vilsack. "These new options will extend the safety net provided by crop insurance and provide fair and flexible solutions to organic producers. Coupled with the new guidance for agencies to support this growing sector, USDA recognizes that organics are gaining market share and is helping boost this emerging segment."
New crop-insurance pricing options will be available to organic producers who grow crops under guaranteed contracts beginning with the 2014 crop year. This contract price option allows organic producers who receive a contract price for their crop to get a crop insurance guarantee that is more reflective of the actual value of their crop. They will have the ability, where available and at their choice, to use their personal contract price as their price election or to choose existing crop insurance price elections. This contract price option will be available for between 60 and 70 crops in the 2014 crop year and this contract price feature will be available to the majority of insured organic crops. RMA is also changing organic transitional yields (t-yields) so they will be more reflective of actual organic farming experience, starting with the 2014 crop year.
All crops are being evaluated for establishing organic prices for the 2014 crop year. Current pricing options only allow farmers to insure organic crops at the conventional prices, with the exception of eight crops (corn, soybeans, cotton, processing tomatoes, avocados, and several fresh stone fruit crops) that already have premium organic price elections. RMA is working to provide organic price elections for six to ten crops in 2014. Oats and mint are two crops that have already been selected for organic price elections in 2014, and apricots, apples, blueberries, millet, and others are still under consideration.
USDA's Agriculture Marketing Service last year announced the Organic Literacy Initiative, a public outreach and employee training program to help connect current and prospective organic operations with appropriate USDA resources. To date, over 14,000 USDA employees have taken the basic training on USDA's role in organic agriculture. The new guidance will further improve USDA agencies' ability to incorporate the needs of the growing organic sector into their programs and services. These combined actions should result in staff better equipped to help organic farmers obtain technical and financial assistance, insure crops and livestock, access research findings, secure loans, develop conservation practices, find current organic price information, and access local, regional, and international markets. Through this effort, agencies will also better understand the scope and rigor of the certification process and how it complements their own programs.
Organic certification allows farmers and ranchers to receive premium prices for their value-added products. Over the past 10 years, the number of certified organic farms and businesses in the United States has expanded to approximately 17,750, representing a 240 percent increase since USDA first began collecting this data. Similarly, the retail value of the organic industry grew almost 9.5 percent in 2011 to $31.4 billion. Organic foods continue to gain market share in the food industry, climbing to 4.2 percent of U.S. retail food sales in 2011.
USDA has already made several changes to better serve organic customers, including offering more flexible microloans and improving Federal crop insurance programs. To help open new markets for U.S. farmers and ranchers, USDA has streamlined trade with multiple foreign governments. These trade partnerships allow U.S. organic products to be sold as organic in Canada, the European Union, Taiwan, and Japan without maintaining certification to multiple standards. Expanding the reach of U.S. organic products creates opportunities for small businesses and increases jobs for Americans who grow, package, ship and market organic products.
USDA is responsible, under the Organic Foods Production Act of 1990 (OFPA), for establishing national standards for organically-produced agricultural products. The National Organic Program has been critical for the development of clear standards and enforcing a level playing-field for organic businesses, which has lead to expanded trade opportunities to create new markets for U.S. organic businesses. These standards assure consumers that products with the USDA organic seal meet consistent, uniform standards. For additional information about the USDA National Organic Program, visit www.ams.usda.gov/NOP.
Crop insurance is sold and delivered solely through private crop insurance agents. Contact a local crop insurance agent for more information about the program. A list of crop insurance agents is available at all USDA Service Centers or on the RMA web site at www.rma.usda.gov/tools/agents/.
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