Organic Trade Association kicks off pilot project to deter organic fraud

Unprecedented effort by organic stakeholders will cover the entire organic supply chain

Washington D.C., May 24, 2018 (GLOBE NEWSWIRE) -- WASHINGTON, D.C. (May 24, 2018) – The Organic Trade Association on Thursday announced the kick-off of a groundbreaking pilot project by the organic industry to prevent and detect fraud in the global organic system. 

The far-reaching three-month pilot project was initiated by the Global Organic Supply Chain Integrity (GOSCI) Task Force of the Organic Trade Association. This group of 48 members of the trade group was formed last year to develop a fraud prevention program designed specifically for the organic industry that organic companies will be able to voluntarily enroll in. As the first step toward this program, a comprehensive “best practices” guide was created by the task force to facilitate the industry-wide implementation of systems and measures to preserve the integrity of organic, both inside and outside of the United States. 

“Organic now operates in a global market. Fraud is one of the biggest threats to that market, and it cannot be tolerated in the organic system,” said Laura Batcha, CEO and Executive Director of the Organic Trade Association, in announcing the initiative at the association’s Annual Policy Conference in Washington.

“Everyone has a role and responsibility to detect and deter fraud. I commend the Organic Trade Association members participating in the pilot for the commitment to doing everything in their power to address the problem and taking the lead in finding constructive and workable solutions.”

Participating in the pilot project are 11 members of the GOSCI Task Force, representing the entire organic supply chain, from farm to retailer and a diverse range of products, services and commodities including fresh produce, grain, spices, dairy, eggs, meat, beverages, packaged and prepared foods, importers and consulting services. Pilot participants are:

  • Clarkson Grain Company, Inc. (handler/processor/feed grains/oilseeds)
  • Egg Innovations, LLC  (producer/handler/eggs, livestock feed)
  • Global Organics Ltd. (handler/importer)
  • Grain Millers, Inc. (handler/processor/grains) 
  • I Was Thinking (importer/handler/co-packer, grains, seeds, legumes, sweeteners)
  • MOM’s Organic Market (retailer)
  • Organically Grown Company (distributor/produce)
  • Organic Valley CROPP Cooperative (producer/handler/livestock/dairy/meat)
  • Pipeline Foods, LLC (handler/supply chain solutions/feed grains/oilseeds)
  • J.M. Smucker Company (processor/multi-ingredient) 
  • True Organic Products, Inc. (manufacturer/fertilizer)

The pilot will run from June to September. It is designed to be an intensive-focused exercise in which participants will “test drive” in their specific businesses the fraud prevention and detection strategies developed by the GOSCI Task Force. Participants will concentrate on one product or ingredient, or a specific location to run through the pilot program. During the pilot, the participants will seek comments from other stakeholders in their unique supply chain, then share feedback on their experiences and give recommendations on how to improve and strengthen the suggested strategies.  

Collaborating partners in the project are the U.S. Department of Agriculture’s National Organic Program, the Accredited Certifiers Association, and NSF International. The collaborating partners will review and provide feedback on the recommendations put forth by the task force, as well as provide support on implementation and adoption efforts, as agreed with pilot participants. 

“We’ve worked for a year to develop a fraud prevention program for organic, and now we need to have companies put our recommendations to the test in their everyday business activities to find the elements that have to be further developed,” said Gwendolyn Wyard, Vice President of Regulatory & Technical Affairs for the Organic Trade Association and staff coordinator for the GOSCI Task Force. “This pilot project is key to advancing the adoption of an industry-wide systemic approach to preserving organic integrity from the farm to the plate and to ensuring the honesty of global control systems.” 

"Pipeline Foods is honored to work with the Organic Trade Association and member organizations to develop and test these industry best practices for assuring organic integrity. This collaborative industry initiative is critical to the health of the organic industry,” said Erin Heitkamp, Managing Director of Sustainability and Assurance at Pipeline Foods.

The fraud prevention plan, which was presented to the National Organic Standards Board in draft form at the Board’s 2018 spring meeting, provides organic businesses with a risk-based approach for developing and implementing a written strategic plan to assure the authenticity of organic products. The plan focuses on identifying and assessing specific weaknesses or vulnerabilities in their business that pose the most risk of fraud, identifying and taking measures to reduce those vulnerabilities to deter fraud, establishing a monitoring program to ensure the fraud prevention measures are in place, and developing  a complaint system to be used when fraud is suspected or detected.

The recommended practices are intended to establish an industry standard for businesses to create continuously improving internal programs and processes for achieving organic integrity throughout their associated supply chains.

The global organic market has been on a steady rise for more than two decades, and has never been bigger. It is now an almost $90 billion market, with the American organic market alone accounting for close to $50 billion. Organic imports into the United States in 2017 totaled around $2.1 billion, up nearly 25 percent from the previous year. In the past year, however, investigations have revealed imported products fraudulently labeled as organic and gaps in the complex organic supply chain. 

“If we want to grow as an industry, we as industry are going to need to challenge our policymakers to become better. It is then equally as important that we as industry challenge ourselves to become better. We believe this pilot program is a great format for Grain Millers Inc. to look at our organic procedures from a different point of view,” said Sam Riser, Manager of Organic Procurement for Grain Millers.

“The success of organic relies on consumer trust of the Organic seal,” said OTA’s Batcha. “It is critical that every link in the organic chain has systems and measures in place to provide the organic food that people can trust. We want our fraud prevention plan to become the industry standard for achieving integrity across complex organic supply chains. But, before we get to that point, certain steps have to happen. This pilot project is a key step, followed by industry training and a roll-out with enrollment by the industry into this proactive and beneficial program.”

Quotes on pilot project of Global Organic Supply Chain Integrity Task Force
“The Global Organic Supply Chain Integrity Task Force has worked for the past several months to develop a best practice guide to assist in the development of an organic fraud prevention plan. The next step for the task force is to “test-drive” the best practice manual through this pilot program made up of task force members companies. The commitment and leadership from these member companies to supply chain integrity is to be commended.”
- Kim Dietz, President of Organic Trade Association’s Board of Directors and co-chair of Global Organic Supply Chain Integrity Task Force 
Pilot Project Participants:
“Clarkson Grain worked with a team of university supply chain students to review the flow of organic grain and risks to organic supply chain integrity. They were incredulous to learn that fraud continues to be the key risk to the integrity of the supply of organic feedstock and produce. This is a very personal issue to them and the primary risk to consumer confidence in the USDA Organic seal. We must get this right if we expect the Millennial and iGen consumers to continue to demand USDA Organic at the grocery store.”
- Ken Dallmier, President, Clarkson Grain, Inc.
 “Egg Innovations is proud to participate in the Organic Trade Association’s GOSCI project. As an industry leader and user of imported and domestic grains, we have a responsibility to help ensure integrity in the supply chain so consumers can continue to trust the organic community.”
- John Brunnquell, President, Egg Innovations, LLC
"We participate in Organic Trade Association activities like the GOSCI initiative because that work is consistent with our values. Building collaborative relationships with suppliers, customers and colleagues is one of our basic beliefs. In this case, we are participating in what has been an effective public/private partnership to define a sustainable and healthy segment of the food business.” 
- Mark Novak, Director of Operations, Global Organics
“If we want to grow as an industry, we as industry are going to need to challenge our policymakers to become better. It is then equally as important that we as industry challenge ourselves to become better. We believe this pilot program is a great format for Grain Millers to look at our organic procedures from a different point of view.” 
- Sam Riser, Manager of Organic Procurement, Grain Millers, Inc.
“As a recent victim of organic fraud, I Was Thinking made a business decision to champion organic integrity. Through regular visits to our farmers around the world, IWT is constantly collecting information and educating our producers in an effort to improve organic integrity across the entire supply chain. While we identify problems, we always provide solutions to our growers.”
- Rudy Lorenzo, Chief Operating Officer, I Was Thinking
"At MOM's, our mission is to protect and restore the environment. We see our company's growth as a means to that end, as long as we maintain the level of quality and culture that we started with. I see a similar parallel to the exciting growth of the organic marketplace. And I believe it’s up to all sectors of the industry (retailers, certifiers, manufacturers, etc.) to take responsibility and do their part to ensure that organic retains its authenticity as the sector grows.” 
- Lisa de Lima, Vice President of Grocery, MOM’s Organic Market
“The transfer of fresh produce from farm to home can be complex and is the fastest moving sector of the organic industry. To maintain organic integrity, excellent systems are vital for all steps to ensure product traceability. Organically Grown Company has chosen to participate in the GOSCI pilot project to highlight and define best practices to deter fraud.”
- Rebecca Willows, Senior Compliance Specialist & Pricing Control, Organically Grown Company  
“As a cooperative, we are deeply invested into dairy but are very proud of our diverse producer pools including our Grower Pool, and committed to providing high integrity grains and forages. We are eager to participate in the pilot program to enhance the integrity of all grains and feedstuffs available to organic farmers. We are glad to be part of an industry-led approach that sets the stage for establishing best practices when it comes to ensuring integrity on imported organic grains and other goods. Organic is global. While we are all about increasing organic feed supplies domestically, part of that equation depends on having improved fraud prevention measures for imported products. This is a smart and strategic effort we want to be a part of.”
- Miranda Leis, Feed Program Operations Manager, Organic Valley
"Pipeline Foods is honored to work with the Organic Trade Association and member organizations to develop and test industry best practices for assuring organic integrity. This collaborative industry initiative is critical to the health of the organic industry and to Pipeline Foods as we work to develop sustainable supply chains in agriculture with full traceability and transparency. Industry must do our part to complement the federal government’s efforts to ensure the National Organic Program is implemented and enforced in compliance with its original intent and consumer expectations."
- Erin Heitkamp, Managing Director of Strategy, Sustainability and Assurance, Pipeline Foods, Inc.
“True Organic Products is pleased to be a part of the GOSCI Pilot Project. It is important for the industry to understand that fraud in organic crop production can occur throughout the supply chain. It is important to True Organic Products that the industry also understands that the inputs used in organic farming are included in the supply chain. Answering the question of organic integrity from an input perspective is what we hope to contribute to this project. The bottom line is: our priority is Protecting the USDA Organic Seal.”
- Michael E. Menes, Ph.D., VP Food Safety & Technology, True Organic Products 

Collaborating Partners
"The ACA envisions a world in which the USDA Organic label is always trusted and valued. Consistent organic supply chain verification is critical to that vision, and that's why the ACA is collaborating with the Organic Trade Association on the GOSCI initiative. The ACA has developed its own certification agency tool for verifying organic integrity in the supply chain, and the GOSCI project complements that by providing organic handlers with best practices within their roles. It is important that we all work together to mitigate the risk of fraud, so we are glad to participate in implementation of this project as it moves forward."
- Jenny Cruse, Coordinator, Accredited Certifiers Association, Inc. - Paul Medeiros, Managing Director, North America, NSF International
“NSF International is delighted to be chosen as a collaborating partner in support of the Organic Trade Associations’ important initiative to address the integrity of the organic supply chain.”
- Paul Medeiros, Managing Director, North America, NSF International

The Organic Trade Association (OTA) is the membership-based business association for organic agriculture and products in North America. OTA is the leading voice for the organic trade in the United States, representing over 9,500 organic businesses across 50 states. Its members include growers, shippers, processors, certifiers, farmers' associations, distributors, importers, exporters, consultants, retailers and others. OTA’s Board of Directors is democratically elected by its members. OTA's mission is to promote and protect ORGANIC with a unifying voice that serves and engages its diverse members from farm to marketplace.The Organic Trade Association does not discriminate on the basis of race, color, national origin, sex, religion, age, disability, political beliefs, sexual orientation or marital/family status. Persons with disabilities, who require alternative means for communication of program information, should contact us.


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