Organic food industry feels shortchanged by government

organic produce section of store Photo: Thinkstock

Canada’s organic sector says it’s not getting its due.

Canada is the fifth-largest organic market in the world as well as leading exporter of several organic commodities but gets little assistance from government, says Tia Loftsgard, executive director of Canada Organic Trade Association (COTA).

“Canada’s organic sector should be positioning itself as a world leader,” she told the Commons agriculture committee. “However, the sector on its own cannot achieve this stature when it is continually having to fund its own standards, inspections, and certifications, and to assume all the business risks on its own.”

She added that in their current state, proposed new food safety regulations carry many threats for the organic sector, and pointed out the lack of equitable crop insurance coverage and transition incentives for farmers, which are both offered in other jurisdictions. Just maintaining the status quo is costly too.

The lack of sound data limits the ability to assess market opportunity or the loss of market opportunity for Canadian producers, manufacturers, and businesses. – Tia Loftsgard

“Maintaining the Canadian organic standards review process is going to cost our sector over $1 million by 2020,” she said. “This is a cost that the industry has to bear in Canada, yet it is funded entirely by governments in the United States and in the EU.”

Organic is a unique subsector of Canadian agriculture and trade, as it is limited to traceable organic supply chains and is subject to regulations, standards, third-party inspections, and maximum residue level inspections beyond its conventional counterpart, she said.

Organic trade faces many business risks due to our limited supply options, the unknown risks of any changes to NAFTA and additional testing required on maximum residue levels on Canadian organic products entering foreign markets, particularly because there is no tolerance within the organic sector, she said.

“These non-tariff trade barriers are holding back the growth of our sector and the ability to capitalize on the opportunities that exist,” she said. “At a minimum, the Canadian organic sector should be able to keep pace with its major trading partners and eliminate the non-tariff regulatory barriers that exist.”

There is little about the organic sector in all the agricultural production and import and export trade flows government collects, she said.

“The lack of sound data limits the ability to assess market opportunity or the loss of market opportunity for Canadian producers, manufacturers, and businesses,” she said.

As harmonized sales codes are used to negotiate trade agreements, maintain trade statistics, and identify goods and shipments that pose a risk to the health, safety, and security of Canada, the organic sector is very limited in its ability to track trends, evaluate trade flows, and have concrete data, she said. The last time census data was collected on the organic sector was in 2011.

Canada has organic equivalency agreements with 90 per cent of its major trading partners and is in the process of negotiating them with Mexico and South Korea, she said.

Wallace Hamm, general manager of Pro-Cert Organic, told the MPs the sector badly needs an overhaul of the eight-year-old federal organic regulatory regime to remove non-tariff trade barriers. The regime is being transferred to the Safe Food by the end of April.

Among the changes is no longer requiring Canadian organic products to be certified to U.S. standards as they only cover health food products and pet food. Another will permit Canadian products to use the EU organic label.

The new regime needs fraudulent organic claims, he said. U.S. organic rules contain “robust penalties and fines and a five-year revocation period.”

The biggest concern is the demise of the Canada Organic Office at CFIA, he said. “Although underfunded and staffed, it was a highly effective and internationally recognized administrative body that was equivalent to the USDA national organic program office,” Hamm said. “The unheralded and unrationalized demise of the Canada Organic Office and the dispersion of the COO staff throughout the CFIA, coupled with the erasing of all organic titles from correspondence and legal documents, will send — and is sending — negative shock waves throughout the domestic and international organic community. The net message is one of lost emphasis and interest in the organic sector by the government.”

This article first appeared on the Manitoba Co-operator.