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The road to certification
Here are the broad steps to certify a farm under
the National Organic Program (NOP), according
to the National Center for Appropriate Technology’s
national sustainable agriculture information service:
• Choose a suitable certifier. A list of
certifiers and explanation of the NOP standards
are located at www.ams.usda.gov/nop
(To see descriptive profiles of 65 US certifiers,
check The
New Farm Guide to US Organic Certifiers)
• Submit an application to the certifier
• Review of your organic farm plan by the
certifier
• Complete an on-farm inspection
• Go through a final review
Once the certifying agency approves the certification,
a farmer can start marketing his product as being
organic. For more in-depth information on these
steps, visit www.attra.ncat.org.
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Horizon farmer says organic
transition worth the effort
The dairy operation of Ephrata, Pa., farmer
John Lapp became certified organic four years
ago. He had complied with organic regulations
for three years before an organic milk company
contracted with him. Market demand was not as
prevalent as it is today.
Lapp, who now contracts with Horizon Organic,
said the biggest concerns of dairy producers when
they consider going organic are usually higher
feed costs and the lengthy time requirement for
certification.
For him, the time in transition was just part
of a positive process.“Nobody should let
themselves be troubled with four years,”
Lapp said.
He believes the rewards of going organic far
outweigh the rigors of the regulation process.
He supports the standards that call for the elimination
of all but organically approved pesticides used
on the land and antibiotics used on the animals.
Society benefits from a better food product because
of these rules, Lapp says. Besides, he believes
conventional dairy farming has peaked out in deriving
benefit from traditional farming practices such
as constant chemical use.
“The ground is so heavily chemicalized,”
he said. “The land no longer works as it
should.” |
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State ag officials bullish on
organics
Tom Sleight, director of the Division of Marketing
with the Virginia Department of Agriculture and
Consumer Services (VDACS) believes Virginia is
well-suited to expand the production of organic
meat, milk and eggs. VDACS also recognizes the
need for organic grain and soybean production
to supply the livestock sectors.
As an incentive, VDACS offers dairy farmers a
cost-share program for those looking to transition
to organic. Once they become certified, they are
eligible for reimbursement of 75 percent of their
costs or up to $500, whichever is greater, “at
least as long as the funds holdout,” says
Catherine Cash, an organic dairy inspector currently
working with VDACS to assist farmers transition
to organic. In Virginia, she says the average
cost of certification seems to fall within the
$350 to $700 range, depending on the certifier.
From 1996 to 2002, VDACS handled the state’s
organic certification process before the U.S.
Department of Agriculture established the standards
under the National Organic Program (NOP), Sleight
says. Since then, the department’s focus
has been marketing.
Donald Ayers, director of VDACS’ Office
of Commodity Services says, “We try to bring
buyer and seller together to develop markets for
the organic products, the same as we do for conventional.”
Sleight says Virginia farmers need somewhere
definitive, such as one agency or organization,
to turn to for questions on organic certification.
“VDACS recognizes the need for prospective
organic farmers to gain advice and counsel on
preparing for certification,” he says, “and
VDACS will work with Virginia Tech, Virginia State
University and the various Virginia organic associations,
companies and certifying organizations on how
best to provide this service.”
He sees a future for farmers who want to transition.
“We see current growth trends in the organic
industry continuing into the foreseeable future,
i.e. seven to 10 years. VDACS is committed to
providing marketing assistance, whether that be
with direct marketing, Community Supported Agriculture
organizations, farmers' markets, restaurateurs,
specialty food stores, grocery chains, wholesalers
and/or international customers.” |
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Study shows potential and risks
in intensive grass-based dairying
Going from conventional nutrition management
to a grass-based feed program can reduce costs
but can also reduce overall profits if a dairyman
does not look closely at control of variable and
capital or fixed costs, suggests Gordon Groover,
Extension economist of farm management with Virginia
Tech in Blacksburg, Va.
“When you go from a conventional to a grass-based
herd, production drops,” he says. “The
cost of producing feed to that cow has to drop
from that of a total mixed ration” he says.
“You also have to reduce the capital cost
of producing that feed, milking cows and everything
else. If you don’t reduce total fixed costs,
you could become worse off because you lose milk
production.”
Groover recently finished a systems modeling
study comparing several pasture-based systems
with varying levels of confinement feeding using
total mixed rations. While organic dairy farmers
moving to organic would save on capital costs
and may benefit from the organic premiums he says
they also would pay higher prices for organic
feed. Feed sourcing becomes especially critical
in the fourth year of transition when all feed
has to be certifiable under organic rules.. “More
organic livestock farms will mean higher prices
for organic feeds,” Groover says.
Groover’s research showed that 100- and
200-cow pasture-based seasonal dairying was the
most profitable of all systems, while intensive
pasture-based year-round systems are least profitable.
Farms that would supplement pasture-based nutrition
with up to 25 percent of ration dry matter with
a partial mixed ration were more profitable, in
general, than the same sized, confinement dairy
farm modeled. |
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August 16,
2005: The US organic dairy industry wrestles with an
unusual dilemma for American agriculture — how to keep
up with the growing consumer demand for its high-priced product.
With demand outpacing supply month after month, representatives
of organic dairy companies and cooperatives have taken to
the road to sign up more dairy producers ready to transition
to organic management. They look for clusters of farms to
create a support network for the farmers and make milk pickup
efficient.
The Shenandoah Valley area of Virginia, lying on both sides
of I-81 in the west central part of the state, is one of those
hot spots. Farmers and others were welcomed to an information
session last month in Stuarts Draft on organic dairying production
and marketing. Sponsored by the Virginia Department of Agriculture
and Consumers Services (VDACS) in Richmond, Va., the event
featured presentations by competing organic heavyweights:
Horizon Organic, the leading U.S. organic foods corporation
of Boulder, Colo., and Organic Valley, an organic marketing
cooperative of La Farge, Wis.
“The dairy part is new for us in that these two companies
here today have come to Virginia looking for additional suppliers
of organic milk, or additional milk producers to [convert
to] produce organic milk,” said Donald Ayers, director
of VDACS’ Office of Commodity Services.
Ayers told the dairy farmers that VDACS was not there to
make recommendations, but to help them with the marketing
their milk. Part of that assistance meant introducing them
to two dairy companies, who both desperately need organic
dairy farmers in the Southeast. Horizon Organic now hauls
milk from Pennsylvania, Idaho and the Midwest to fulfill its
demand in the Southeast.
“We’re doing that because we don’t have
a milk supply here,” said Jule Taylor, director of milk
supply for Horizon Organic. The Horizon milk is hauled to
its processing plant in Mt. Crawford, Va., a few miles up
the interstate from where the dairy farmers were attending
the workshop.
“There is an opportunity out there today,” Taylor
said, but she cautioned. “Organic is not for everybody.
This is one option for you.”
Why transition?
Horizon Organic offers certified dairy farmers a base price
of $22 per hundredweight, said Cindy Masterman, producer relations
manager. Farmers receive a bonus if they sign up within six
months, and they receive $1 per hundredweight extra during
the final 12 months of the four-year certifying process. She
says Horizon Organic also offers two-year contracts with automatic
one-year renewals.
Organic Valley, a farmer-owned cooperative, offers its certified
organic dairy farmers a base component of $18.70 with a regional
premium of $3.20 for a $21.90 total base, said Peter Miller,
east region pool coordinator for Organic Valley. The co-op
also offers transitioning dairy farmers a $2 per hundredweight
premium payment. He says Organic Valley works with farmers
on an agreement basis. The basic agreement is for farmers
to give the company a 180-day notice in writing in case they
decide to go to another organic marketplace. If they need
to leave organic farming, Organic Valley prefers a two-month
notice. If their farmers leave organic dairying, the company
stops accepting their cows’ milk.
These base prices and premiums perk up the ears of Virginia’s
dairy farmers, who have recently received prices of about
$14 per hundredweight, and about $2 more offered by the Virginia
Milk Commission, said Alan Grove, Extension agent in Rockingham
County, Va.
Price and stability drive the movement to organics. “I’ve
been in dairying since I was a kid,” Grove said. “It
used to be you had a steady price. In the last five to ten
years, we’ve seen more price fluctuations” due
to supply and demand variability in the conventional milk
marketplace.
Steady base payments versus price fluctuations may sound
good to dairy farmers who struggle with budgeting from one
year to the next. “These organic companies will give
[certified organic dairy farmers] a guaranteed minimum price
for a specific time period,” Grove said. “They
know in the next 12 to 24 months what their milk is worth.
The regular dairy farmer has a general idea what the price
will be, but there are no guarantees.”
Farms in transition
Interest is developing in Virginia to try organic dairy
farming, said Tom Sleight, director of VDACS’ Division
of Marketing. It is growing from a small organic livestock
base. The single certified organic dairy farm in the state
is in Marshall, Va., said Catherine Cash, an organic dairy
inspector and currently working with VDACS to assist farmers
with transitioning from conventional to organic dairying.
“Sooner or later, it will be happening here [in Rockingham
and Augusta counties],” she said.
Eight Shenandoah Valley dairy farms are currently exploring
organics or in transition. “Three or four of those farms
should be certified organic by September of next year,”
Grove said.
One farm in Grove’s coverage area may become certified
sooner, based on the farmer’s cultural practices. “I
never gave a thought to organic,” said Steve Hord, a
Middlebrook, Va., dairyman raising about 60 cows -- 45 in
the milking herd and the rest dry cows. “I’ve
been going to organic without realizing it.”
“I never gave a thought to organic.
I’ve been going to organic without realizing it.”
--Steve Hord
He started establishing his pasture about 15 years ago. He
has put up adequate fencing and installed water lines through
a cost-share program with federal and state funds. About three
years ago, his cows began grazing mostly on pasture and were
fed grain and hay over winter. As the pasture matures in spring,
he takes the cows off the grain, depending on weather and
pasture conditions.
Hord, who is working on his certification paperwork, believes
certifiers can approve his pastureland as organic by this
fall and his cows by about mid-2006. He also believes, if
his operation could become certified by the end of this year,
the extra milk premium will offset the higher costs of organic
feed.
Transitioning as a group
By early 2007, Augusta County, Va., dairy farmer James Wenger
expects a certifier to approve his operation as organic. He
and about five Rockingham County, Va., dairies expect to become
certified at about the same time. They committed to the move
several years ago. Back then, interested companies said they
would buy the milk only if they could cost-effectively haul
at least 40,000 pounds of milk from one region.
Wenger farms with his two sons, Nathan and David, and his
wife, Lynn, on the land where he grew up. They milk about
84 cows. By following organic practices, Wenger believes his
herd is healthier, and his cows last longer, because they
are not under as much stress.
By following organic practices, Wenger
believes his herd is healthier, and his cows last longer,
because they are not under as much stress.
“We’re not pushing them as bad, and they are
walking and getting exercise,” he said. “We’re
milking about 14,000 pounds of milk, and everybody else is
milking about 25,000 pounds.”
He sees his vet less often due to lower animal stress and
better health, and he culls harder. Wenger no longer tolerates
unproductive and unhealthy cows. “If a cow gives us
a problem, we let her go,” Wenger said. “We sell
her and get rid of the problem.”
To offset the higher costs of going organic, Wenger cut his
fertilizer and equipment costs. He stopped growing corn to
keep from replacing his worn-out equipment. He pocketed the
money he would have spent on buying the heavy metal, as well
as his labor to plant and harvest the corn. The decision freed
up his time to concentrate on his management needs to obtain
certification.
He figures high and low corn prices from year to year will
average out to favor buying over growing his own. Once he
becomes certified, Wenger says the premium milk prices will
more than pay for the organic feed he must give his cows.
Local feed suppliers have expressed interest in supplying
him with organic feed, as well.
Horizon Organic and Organic Valley are courting Wenger to
buy his certified milk when it comes. Wenger is still weighing
his decision.
Plus – minus for organic dairy
From her experience as an organic inspector, VDAC’s
Cash says organic dairy farming has its risks and rewards.
Some of the rewards for a successful pasture-based operation
include:
- healthier cows
- healthier soils
- fewer veterinarian bills
- lower cost for fertilizers and chemicals
- more money for the farmer’s product
- less overhead in machinery
- a healthier work environment
- possible extra income selling organic calves
- fewer issues dealing with excess manure
Some of the negatives are:
- more expensive organic feed
- probable decrease in milk production during a farmer’s
learning curve in grazing and organic feeds management
- four-year transition period with no full premiums until
certified
- the need for precise and extensive recordkeeping
In considering whether to invest in transition, Extension
Agent Grove advises farmers to first ask themselves if their
operation fits the decision. What will transition cost, in
terms of learning new management and in dollars? Do I have
access to enough land for grazing? Will landowners I rent
from agree to this transition? Will I need to haul organic
feed in from the Midwest or can I work with a local supplier?
Grove urges farmers to figure on paper whether transition
will be profitable in their situation. He advises them to
talk with out-of-state organic dairy producers to learn what
their costs are. (See sidebar: “Horizon farmer….”)
Farmers wonder where the demand for organic milk will be
in five to 10 years. Is the health-conscious movement just
a fad? Horizon’s Masterman doesn’t believe so.
She said the personal health focus of Americans is here to
stay and predicted organic demand will continue for years
to come.
If the supply of organic milk in the Southeast eventually
does catch up with demand, will the higher premiums level
off or fall as fast as the rise in interest? Neither Taylor
nor Miller could give an iron-clad answer. Miller said it
will depend on how much the marketplace can bear.
Both said the two companies that they represent want to pay
for high-quality organic milk. After the meeting, both continued
their quest to find farmers willing to promise their Virginia
milk to help meet surging regional markets. 
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