Allay Consulting’s March Newsletter: USDA Cracking Down on Organic Fraud
USDA Cracking Down on Organic Fraud
Consumers want options, especially when purchasing products, and organic seems to be a popular selection. Organic items are widely available and can be purchased at any grocery store, farmers market, and online sales. Most people associate “organic” with healthy foods that were grown using safe and sustainable agricultural methods. Organic certified products are typically pricier compared to conventionally grown crops – this can be attributed to the cost of the organic certification, required use of costly organic approved chemicals, special handling practices, potential lower yield, lack of government subsidies, etc. With organic products being sold at a higher price than conventional products and with the high consumer demand for organic products, does this combination open the door to fraud?
Where Are the Pitfalls?
Organic foods may not be as organic as you think. Unfortunately, “organic fraud” is a very real issue. The result of organic fraud is simple – consumer deception. According to the USDA, companies who knowingly violate the USDA organic rules can face penalties up to $11,000 per violation. Organic fraud violates federal law and the organic regulations and is punishable by financial penalties. This type of fraud may occur throughout the food system from cultivation, harvesting, processing, and through to distribution. Intentional and non-intentional organic food fraud may look like…
- Negligent handling or preparation practices.
- Illegally using the organic seal or labeling a product as organic without being certified.
- Marketing products or processes as organic on a website without being certified. Using fraudulent paper trails to market and label non-organic products.
- Using fake organic certifications.
- Using a co-manufacturer’s organic certificate for products not listed on their organic certification.
- Practicing non-organic methods yet marketing the product as organic certified. This includes using bioengineered seeds/plants, artificial pesticides, antibiotics and growth hormones.
- Using non-allowable pesticides or altering pesticide testing results.
Fraud is fraud in the USDA’s perspective, and they are seeking to cull out the outliers by modernizing their enforcement authorities.
Regulating “Organic” in the Food System
The United States Department of Agriculture (USDA) is cracking down on organic fraud. The USDA is responsible for creating and executing laws for farming, forestry, rural economic development, and food – including overseeing organic products. More specifically, the National Organic Program (NOP) is a part of the USDA’s Agricultural Marketing Service and has regulatory oversight covering organic standards and the accreditation of certifying bodies. The NOP’s rules and regulations encompass various stages within our food system to include production, handling, labeling, and enforcement of all USDA organic products.
To help prevent organic fraud, updates to the organic standards are underway. The goal for the update is to protect organic integrity and bolster consumer confidence in the USDA organic seal.
“The Strengthening Organic Enforcement rule is the biggest update to the organic regulations since the original Act in 1990, providing a significant increase in oversight and enforcement authority to reinforce the trust of consumers, farmers, and those transitioning to organic production. This success is another demonstration that USDA fully stands behind the organic brand.”
Under Secretary for Marketing and Regulatory Programs – Jenny Lester Moffitt
Thirty-three years after going into effect, the organic standards are getting a much-needed revamp! The updates will hopefully reduce the number of uncertified entities by requiring the use of electronic import certificates, strengthening recordkeeping and supply chain traceability, and strengthening the oversight of accredited certifiers. Updates to the standards will impact more businesses in the organic supply chain, businesses engaged in buying, selling, or negotiating the sale of organic products, certifying agents, and other organic stakeholders. The final rule will be implemented by March 18th 2024, and all businesses must comply with the final rule within 14 months from this date. Hopefully these updates will close gaps and prevent organic fraud.
What’s the Purpose of Certified Organic?
Achieving an organic certification means that the operation has undergone a robust review and inspection to verify compliance with the NOP. Being certified as organic ensures the integrity of organic products from the farm to the consumer. The certified organic seal is a recognizable symbol of consumer trust and appreciation that the brand cares about our environment’s health.
Which Cannabis Businesses can get Certified?
Currently, the certification is only available to hemp cultivations and hemp processors (such as product manufacturers). Because the certification is a federal designation, it is not yet available to the THC industry, however California is developing their own state-level certification program called “Comparable to Organic.” Additionally, the non-profit group, the Cannabis Certification Council, has developed an Organically Grown Cannabis Standard and certification program for the THC industry.
What is the Process to get Certified?
- Step 1: Implement organic farming or processing practices into your operation by developing SOPs and training staff.
- Step 2: Select a USDA-accredited certifying body. Submit the application packet and fees.
- Step 3: The certifying body reviews the application packet and conducts an onsite inspection.
- Step 4: The certifying body reviews the inspection report and may require corrective action.
- Step 5: The certifying body issues the certification.
- Step 6: The certifying body conducts an annual review and inspection to maintain certification.
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