2007 Economic Development Strategies - Organic Industry
Organic foods continue to be the fastest growing and a very profitable segment of agriculture in America, Europe and Japan. Preliminary findings from the Organic Trade Association’s 2006 Manufacturer Survey show U.S. organic food sales totaled nearly $14 billion in 2005, representing 2.5 percent of all retail sales of food. Annual growth of the organic industry has been 16-21 percent from 1997-2004, with yearly additional sales in the $1 billion to $1.7 billion range since 2000. The Nutritional Business Journal (NBJ) forecasts 10-15 percent growth from 2006-2010. Retail sales alone of National Organic Program (NOP) certified food and beverage products represented about $3.75 billion in 2005, and NBJ predicts that should hit $30-plus billion by 2025.
To make an organic claim, producers (farmers) and food processors (handlers) must follow regulations published by the USDA, and must be certified by a USDA accredited agent if making over $5,000 in sales. Currently, there are 55 certifying agents throughout the country comprising various state and private entities and 40 foreign certifying agents.
For more than a decade, the New Jersey Department of Agriculture has worked with the Northeast Organic Farming Association of New Jersey to certify organic producers and handlers. In September 2003, the legislation passed New Jersey Statute 4:10-79 allowing the Department to establish rules and regulations for a New Jersey Organic Certification Program. The Notice of Adoption for the regulations defining the organic certification program, N.J.A.C.2:78, were published on December 4, 2006.
The Department’s organic certification program incorporates all of the USDA’s NOP regulations. Once accredited, these regulations become effective, and the Department will provide New Jersey farmers and processors access to a quality organic certification program located within the State. Farmers who are transitioning to organic production will also have the ability to market their products under the new Department “Transitional Sustainable” label, which is not available under the NOP program. In doing so, New Jersey farmers will not have to wait the required 36-month “free of prohibited materials” to realize increased prices this niche market supports.
Under the NOP, States also have the option to establish state organic programs separate from organic certification programs. State organic programs are required to conduct enforcement actions of the organic regulations at the State level. Once the Department’s Organic Certification Program becomes accredited by the USDA consideration on development of a future state organic program will begin. Also planned for the Department’s Organic Certification Program is ISO Accreditation. ISO Accreditation will not only help strengthen the certification program from within, it will allow the organic certification program to certify to international requirements, thereby opening additional markets to producers certified by the New Jersey Department of Agriculture.
In support of the marketing of organic products, the Notice of Adoption for the Department’s Jersey Organic rules was published December 4, 2006. Organic price cards are printed, and will eventually be distributed to help promote New Jersey’s organic products directly to area retailers.
Over the last several years the Department received USDA funds to help offset the costs of organic certification. In 2007, the Department will continue to promote and administer cost sharing of organic certification fees for eligible operations, preparing informational brochures and fact sheets, and fully integrating organics into the Department’s promotional programs.
7.0 ORGANIC STRATEGIES
7.1 Promote Cost-Sharing
65) STRATEGY– Continue outreach efforts to educate growers and handlers about federal funds available to help offset organic certification costs. Through a cost-sharing agreement with the Department and USDA, each operation is eligible for a reimbursement of up to 75 percent of its certification costs, not to exceed $500.
7.2 Improve Marketing
66) STRATEGY - Seek out products that can benefit as organic (high-value / high demand products) and promote them to certified clients and in the marketplace. Assist the industry to supply the types of organic products that the marketplace demands.
67) STRATEGY – Continue to promote New Jersey grown organic products as distinct from, and of higher value, than competing products by establishing the Jersey Organic brand and integrating organic products into the Department’s marketing program. The Department will continue to support the branding of Jersey Organic through our website as well as point-of-sale materials developed and distributed to Jersey Organic retailers, community markets and restaurateurs. Strengthen and coordinate existing efforts of the marketing program with the promotion of organic products to area restaurants.
7.3 Educate Growers and Food Handlers about Regulatory Requirements
68) STRATEGY – Following the USDA accreditation efficiently implement the Department’s Organic Certification Program to offer quality organic certification services to growers and food handlers in New Jersey.
69) STRATEGY– Distribute fact sheets outlining the legal and regulatory requirements for production and sale of organic products, including livestock and livestock products. Make the fact sheets available on the Department’s website and distribute to handlers and retailers of organic produce.
70) STRATEGY – Continue working toward USDA accreditation of a State Certified Organic program to guarantee consumers the highest quality organic agricultural products. The program also provides farmers who are transitioning to organic production and are in the process of completing the three-year qualifying period the ability to market their products as “transitional sustainable.”