Brief

Cheap organic imports anger farmers, but meet demand

Dive Brief:

  • As organic grain floods into the U.S., prices are decreasing and domestic farmers are complaining, according to The Wall Street Journal.
  • Data from the U.S. Agriculture Department shows that Turkey became the largest supplier of organic corn and soybeans to the U.S., in 2016, shipping 400,000 metric tons of corn and more than eight times the amount of soybeans than its prior year total.
  • Organic-farming groups in the U.S., believe the large imports of foreign grain have been a chief factor in slashing prices. Organic corn is down by about 30%, and prices are 20% lower for organic soybeans.

Dive Insight:

U.S. farmers who transitioned to organic farming are rightfully upset that imports from other countries are affecting their prices. It’s not an easy process to become an organic-certified farm. The required three-year transition period that can be daunting and expensive. And while foreign organic farms also have to be certified in order to import to the United States, there are questions about how rigorously guidelines are followed for offshore inspectors of foreign producers.

However, with the organic shopper base expanding far beyond the traditional core group of hard-core organic loyalists, numerous analysts say demand has more than doubled in scale in a very short time. Studies show that the U.S. supply is not keeping up with the demand, so imports are needed. The Organic Trade Association estimates U.S. sales in 2015 at $39.7 billion for foods containing 70% or more organic ingredients, and those numbers are increasing.

In the past year, a stronger U.S. dollar has also made foreign-produced crops cheaper, which has only added to farmers’ frustrations.

Of course, President Trump hasn’t been shy about making changes to trade agreements in his first month in office. There’s always the possibility that he could implement import restrictions that turn the situation on its head and make domestic organic grains relatively cheaper.

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Filed Under: Ingredients Policy Sustainability
Top image credit: David Prasad