Will a Final Origin of Livestock Rule for Organic Dairy Farms Take Effect in 2020?

Written By: Gary Quackenbush
Published: January 2, 2020

After being stalled for nearly five years, amendments to the Origin of Livestock Rule governing standards, required for dairies to be certified as producing organic milk and milk products, has moved closer to reality.

The latest step was the announcement by the USDA’s Agricultural Marketing Service (AMS) in early October that the comment period would be reopened for another 60-days ending at midnight on December 2. The goal of the second comment period was essentially the same as the first, to give all interested parties an opportunity to comment on the proposed rule.

With the 2019 comment extension, the Federal Register stated that unless interested parties had new or different information to provide, there would be no need to resubmit original comments. Comments were sought in connection with three topics:

  • Comments on the cost/benefit analysis presented, including assumptions and estimates of limiting dairy transition to a one-time exception for a given producer;
  • Comments on procedures that certifying agencies would use under this proposal to determine whether a producer is eligible for the one-time transition, and
  • Comments on the proposed implementation approach for this rule.

The first comment period was launched on April 28, 2015, under the authority of the Organic Foods Production Act of 1990, when AMS published a proposed rule in an attempt to clarify requirements for organic dairy farmers under the USDA National Organic Program (NOP) regulations. One of the most controversial aspects of the proposed rule deals with transitioning dairy animals to organic production.

The proposed rule says organic dairy animals must be raised on organic feed for the last third of gestation or be raised organically for one year if transitioning a conventional herd to organic. Once a given herd is transitioned to organic or sourced from another dairy farm that has completed its one-time transition, all animals must be raised organically from the last third of gestation.  The rule prohibits continuous transitions and cycling of dairy animals in and out of organic production.

According to the Organic Trade Association (OTA), this rule is needed “to clarify and narrow the allowance to transition dairy animals into organic milk production as a one-time event.”

The April 2015 comment period generated 1,583 responses, but the Obama administration did not take further action to implement the regulation. In 2019, only about 655 comments were received, however, this may not be the final count since these comments should only include new information not previously submitted.

On December 2, 2019, several organizations including the OTA, the National Organic Coalition and the Organic Farmers Association, sent a letter to Secretary Sonny Perdue of the USDA, saying they are unified in their support of the proposed Origin of Livestock rule in order to ”to bring consistent enforcement, to maintain a level playing field to all organic dairy producers, and to uphold strong organic identity for all organic farmers.”

These industry organizations urged Secretary Perdue to “quickly review submitted commitments and move toward immediate implementation of the rule.”

Citing the fact that the delay in issuing a final rule has resulted in economic harm for organic dairy farmers resulting from low pay prices caused by an oversupply of organic milk enabled by loopholes in the current rule.

The letter to Secretary Perdue said that “99% of the original comments to the 2015 Origin of Livestock Rule supported making these same changes.” Despite the overwhelming support by the organic dairy industry and stakeholders, a rule change was not published in 2015.

The letter ended with an appeal to “move quickly to end the five-year wait for legal clarity and consistent implementation of Origin of Livestock regulations” and noted that “organic dairy farmers are suffering” saying the solution is to uphold consumer’s expectations with strong regulations…”We urge you to ensure the final rule reflects the much-needed clarity requested by the organic dairy producer community and upholds a strong sense of organic integrity.”

To bring additional pressure on the administration for rule passage, on December 2 a bipartisan coalition of five House of Representatives members led by Congresswoman Chellie Pingree (D-Maine) and including Organic Caucus co-chairs Rep. Rodney Davis (R-Illinois) and Rep. Peter DeFazio (D-Oregon), along with Rep. Ron Kind ((D-Wisconsin) and Rep. Dan Newhouse (R-Washington), urged the USDA to issue a final rule on the Origin of Livestock standards “critical for thousands of organic dairy farmers across the country.”

Rep. Pingree is also a member of the House Appropriations Committee. She included language requiring the USDA to finalize and issue a final Origin of Livestock ruling in the FY2020 Agriculture Appropriations Bill passed by the House in June 2019, within 180 days from the date of enactment.

According to Organic Caucus co-chairs, “A handful of milk producers (chiefly those among the largest national firms) have exploited the lack of clarity in the regulations causing direct economic harm to the majority of the nation’s organic dairy farmers who adhere to the intent of the organic regulations.”

They said a final rule must be issued and become effective as soon as possible and without delay.

Jennifer Beretta, a Farm Bureau and Western Organic Dairy Producers Alliance board member, also works at the Beretta Dairy in Santa Rosa. She knows what it takes to go organic by working in the family business, with 300 milk cows, plus 500 heifers and calves. She is responsible for the family dairy’s organic paperwork, pasture management and irrigation.

“We’ve been organic for over 13 years. An organic dairy’s cost of operations is definitely higher than for conventional dairies. In the past, we have not always seen a uniform interpretation of existing rules by third-party certifiers.”

Beretta said loopholes in current regulations can also be found in USDA pasture rules that require a minimum of 120 days for cattle.

“We are fortunate in Santa Rosa having an average of from 180 to 220 days in our grazing season using tertiary-treated water for irrigation. She said there is a difference between the grazing and growing season, in dry areas grazing is only 120 to 140 days — so the question is, are organic dairy farmers leaving the gates open to provide sufficient access to the outdoors, to pastures and are they abiding with restrictions on confinement and housing provisions to meet the Section 205.237 requirement?”

Section 205.237 of the National Organic Program regulations requires that ruminant animals receive not less than 30% of their dry matter intake from pasture throughout the grazing season and that animals graze throughout the entire grazing season.

She observed that a major issue for USDA is how to make dairies comply.“The USDA needs to more closely monitor certifiers and make sure they de-certify dairies not in compliance thereby taking cheaters off the playing field and out of the organic market. Since there is an oversupply of organic milk, this could reduce supply and increase demand.”

In the 2012-2013 time period, the supply of organic milk could not keep up with consumer demand. This was largely due to the low pay price and high feed costs. As a result, some farms exited the organic sector and some went bankrupt, while many downsized their herd in an attempt to survive.

Starting in late 2013 and into 2014 dairy pay prices increased from the mid-$20 range to the mid-$30 range with some getting as much as $42 per 100 lbs. for organic milk. Milk buyers were pushing farmers to produce more milk while also bringing on new dairies. By 2016, milk buyers were cutting pay price. Today, this pricing level has dropped to the mid-$20’s to as low as $20 per 100 lbs. The average organic dairy needs a pay price at least in the low $30’s to break even.

“In the past, conventional dairies were not getting good milk prices, the market fell to between $12 to $15 per 100 lb. This helped drive them toward becoming organic with a higher organic milk value. As a result, in the North Coastal region, 98%went organic as a way to stay in business. California milk is in high demand due to its much better quality,” Beretta declared.

Similar warnings about organic practice violators have been voiced by Richard Mathews, currently a consultant, who spent 34 years with USDA and served in this department’s organic program for 11 years, including four years as head of the program. He was also the former director of the Western Organic Dairy Producers Alliance (WODPA) from 2013 to 2019.

“Alleged actions in violation of the National Organic Program (NOP) accreditation rules are not just limited to the super large milk producers.  State departments of agriculture and their organic programs also receive formal complaints, such as those filed with the USDA-AMS-NOP’s director in charge of the compliance and enforcement branch by the Western Organic Dairy Producers Alliance in 2018.”

Matthews said complaints were filed against the Idaho State Department of Agriculture and Texas Department of Agriculture in connection with their failures to properly enforce the organic dairy standards.

For example, Idaho’s state agriculture organic certifying entity allowed an animal born of an organic cow to be declared as conventional (allowing the use of drugs, cheaper feed and other practices not permitted for organic animals) and then transition the calf back to organic later.

“In this instance, the USDA did not enforce its rule,” Mathews’ added. “Part of the reason for this back and forth transition is due to the high mortality rate among calves on dairies lacking the knowledge and skills needed to raise young organic livestock.”

He said what made the USDA stop delaying a move toward the new rule was that the organic milk industry went to Capitol Hill to get Congress to include this rule in the Farm Bill and asked the House and Senate to agree to tie the requirement to appropriation’s legislation saying that the USDA must issue this rule within six months after approval.

“People say this has been a five-year battle. It really goes back 12 years to 2007 when the USDA first promised to fix it.  Previous secretaries of agriculture and big milk-producing organizations have not been friends of organic milk, but they do have a lot of political influence in Washington.”

One of the main reasons some milk producers want to convert an organic calf to conventional is to avoid more than a dozen prohibitions, such as those on antibiotics (including feed where ionophores have been added). Growth-promoting hormones and most synthetic substances are expressly prohibited for use in organic livestock production. For proper health care maintenance and practices, synthetic medications must be limited to those allowed under Section 205.603.

Animal drugs in the absence of illness are also prohibited along with the use of parasiticides on a routine basis.

Specific management practices and physical barriers must be in place to prevent the commingling of organic and nonorganic products through a split operation and to prevent contact of organic production operations with prohibited substances.

Also banned is the selling, labeling or representing an animal as organically produced when that animal is removed from an organic operation and subsequently managed on a nonorganic operation.

Feed supplements or additives in amounts above those needed for adequate nutrition and health maintenance are prohibited for organic animals. Furthermore, preventing, withholding, restraining or otherwise restricting ruminant animals from actively obtaining feed grazed from pastures during the grazing season is not allowed.

In addition, organic livestock producers are required to describe the total feed ration and document the amount and type of feed, changes to rations, and the method for calculating dry matter demand and intake.

For Mathews and other industry watchers, the big problem is how to get organic certifiers to enforce this pending new rule, since they may have a conflict of interest when receiving money from operators they are called upon to certify and do not wish to offend their clients. He believes a single certifying agent not linked to milk producers in each region may be a better solution.

“Looking back, USDA officials and big national milk producers never wanted the proposed organic rule to begin with since it went against conventional wisdom in the past. Top leaders at USDA would say to milk producers, get bigger or get out. Today most of the organic milk producers are small (herds of about 40 to the mid-100s) with some having herds of up to 1,000 or even 2,500 cows, as they look for a greater rate of return on their lifetime investments. It is hard for them to compete with mega-companies, such as Aurora Organic Dairy based in Boulder, operating large mega-dairies each with many thousands of dairy cows in Colorado and Texas.”

While no one can predict the future, or the date when it will take effect, a critical mass of support has been built favoring the proposed new USDA rule.

The strong public-private partnership between USDA and the organic industry has created a foundation that has allowed the U.S. Dairy industry to grow into a $50 billion market providing economic opportunities for U.S. farmers and businesses while producing one of the most highly trusted labels recognized by consumers.

Related Articles

Premium Members

To represent, protect and advance the social, economic and educational interests of the farmers and ranchers of Sonoma County.