Unveiling the World of Organic: Featuring the Organic Trade Association

February 12, 2024

In the latest episode of “Get the Scoop with Smirk’s,” hosts Elisa Louis and Donny Edson dive into the dynamic world of organics with the Organic Trade Association’s (OTA) experts, Adrienne Messe and Scott Rice. The podcast covers key topics including regulatory updates, insights from the OTA’s member survey and Nielsen data, and valuable resources for businesses dealing with organic products.

Adrienne Messe, the OTA’s event engagement manager, shares details about the association’s mission and its efforts to bring together diverse stakeholders in the organic industry. She emphasizes the importance of continuous improvement, citing the recent success of the Continuous Improvement and Accountability in Organic Standards Act.

Adrienne also highlights OTA’s major event, Organic Week in Washington DC, scheduled for May 14-16, 2024, providing a unique platform for industry leaders and policymakers to connect.

Scott Rice, the OTA’s regulatory director, delves into the significant regulatory updates, including the Strengthening Organic Enforcement rule and the Organic Livestock and Poultry Standards rule. He emphasizes the importance of ensuring the integrity of the USDA Organic label through continuous attention to standards and accountability.

The podcast covers the diverse support and services offered by OTA, from government affairs and policy work to sector-specific collaborations within member communities. Adrienne introduces the Diversity and Entrepreneurship Program, where OTA extends complimentary memberships to BIPOC and women-owned businesses, fostering inclusivity in the industry. She also highlights the OTA’s influential role as a data provider, showcasing trends and insights through the annual Organic Industry Survey.

The hosts express their admiration for OTA’s innovative toolkit, which empowers members to effectively communicate the benefits of organic products. Adrienne describes the toolkit’s organic wheel of sustainability, a visual aid that breaks down the positive impacts of organic practices on people, the planet, and businesses. The toolkit has proven to be a valuable resource for members engaging with retailers and consumers.

Donny Edson shares his transformative experience with the Colorado Department of Agriculture and the Organic Trade Association (OTA). The conversation delves into the significance of relationships, trade missions to Europe, and participation in the largest organic food show, BIOFACH, held annually in Nuremberg. Donny emphasizes the impact of these experiences on his business, fostering connections with international partners and shaping the trajectory of SMIRK’S, his organic ingredient company.

The discussion also highlights the pivotal role of OTA in supporting organic businesses through programs like BIOFACH and other initiatives. Donny expresses gratitude for OTA’s assistance in navigating the complexities of the organic industry, particularly considering the upcoming changes in March. 

Key Takeaways:

  • Overview of Organic Certification Conversations The discussion began with insights into the ongoing conversations between brokers and certifiers. While some brokers fully embraced the organic certification process, others opted to focus solely on building relationships without direct involvement in the certification procedures.

  • Five Steps to Certification: It starts with developing an Organic System Plan (OSP), a comprehensive view of operations aligned with organic regulations. The subsequent steps involve implementation, certification application, inspection, and a review decision. The entire process typically takes 90 to 120 days.

  • Certifier Selection Tips: Choosing the right certifier is critical. Scott recommended utilizing the USDA’s integrity database for locating certifiers and emphasized the importance of compatibility, communication, and understanding timelines when selecting.

  • Organic Certification Process Timeline: With a countdown to the March 19th enforcement date for the SOE Rule it’s important to initiate the certification process promptly. Start the process even if the certificate isn’t obtained by the deadline, things will be heading in the right direction.

  • Post-Certification Expectations: There might be additional verifications and questions, the focus will be on educating and supporting businesses rather than imposing strict penalties.

  • Adapting to Changes: The discussion acknowledged the anxiety surrounding the SOE Rule. However, it emphasized the collective effort to adapt to changes, with Adrienne providing a broader perspective on the rule’s purpose in fortifying the integrity of the organic market.

  • Importance of Early Planning: Proactive planning allows for a smoother process, minimizing delays.

  • OTA Resources and Support: The Organic Trade Association’s resources include the Organic Fraud Prevention Guide, webinars, and an SOE page for members.

Organic Feature Story with Dean Soicher

Dean Soicher’s journey into the organic realm began in 1986 when he became a vegetarian after college. A chance encounter with a job opening for an organic food buyer in the mid-’90s redirected his career path, making him an instrumental player in introducing organic products into conventional supermarkets. Back then, there was a staggering 95% rejection rate for mass market channels to embrace organic foods.

However, as retailers like Whole Foods gained popularity in the mid-’90s and early 2000s, there was a noticeable shift. The mass market channels, initially hesitant, saw the rising demand for organic products and started incorporating them into their offerings. Dean’s role expanded to include educating store managers about the organic food industry, paving the way for better-informed consumer choices.

Dean sheds light on the significant growth of organic ingredients at Smirk’s, emphasizing the company’s focus on certified organic ingredients and its ability to compete on price. He highlights Smirk’s participation in events like BioFach, the world’s largest organic food show, to stay abreast of trends and market information.

Discussing current organic trends, Dean notes an increased consumer focus on transparency, traceability, and a preference for working with small-scale farmers. Notably, supermarkets, which once rejected organic products, are now producing their organic private-label items.

The article concludes with Garrett showcasing some key organic ingredients from Smirk’s portfolio, such as chia, sunflower, pumpkin seeds, coconut, grains, seeds, nuts, and dried fruits.

Dean’s insights underscore the impressive growth and acceptance of organic products, demonstrating how the industry has transitioned from rejection to a multi-billion-dollar market. The future, as Dean and Garrett suggest, seems limitless for organic food ingredients, reflecting a broader shift in consumer preferences toward healthier, sustainable choices.

Smirk’s January 2024 Market Report

Shipping Disruptions: The biggest change has to do with ocean freight. Attacks on ships in the Red Sea have led to shipping lines stopping service in that part of the world. The Red Sea feeds into the Suez Canal, in which approximately 15 % of the world’s shipments pass through daily.

Alternative routes add three to four weeks of additional transit time. This has caused an immediate disruption in the availability of ships, shipping containers, and booking spaces globally. In addition, it’s made the price of shipping surge instantly.

Everyone needs to be aware of the impact of these shipping issues. There are going to be shipping delays. There are going to be increased shipping costs.

Chinese New Year. Tết in Vietnam, Ramadan

It will not be possible to get new orders to ship out of China until late February or early March due to the Chinese New Year. Tet holiday in Vietnam is the same time. Most of the packers in Vietnam are booked through mid to late March already, so it will take longer to get new purchases from Vietnam.

 Ramadan begins March 10th and runs through April 8th. This date is important if you are using coconut sugar from Indonesia. We see supplies tighten up and stress the supply chain. Indonesia shuts down for a period during Ramadan, so generally there’s a surge in demand for sugar after the holiday. Plan out if you’re using coconut sugar way well in advance.  

Lower Inventories

There’s already a little bit less inventory in the US. We highly recommend you work with your suppliers to ensure that you are giving ample lead times on everything and accurate forecasts, or you may find some items are not available. Planning is going to be very, important, especially for the next third quarter.  We used to recommend a lead time of 8 weeks and we’ve updated that to 12 to 14 weeks right now.

Tree Nuts

Some current market information. Smirk’s just visited the Peanut and Tree Nut Processors Association annual conference in Florida. Attitudes were a little bit more optimistic.  For the first time in a long time, there’s a larger demand for tree nuts, seeds, pumpkins, and others.

Walnuts

A larger crop with great quality is good news. Organic walnut demand has tightened up and that’s caused a price increase. We expect that to continue and recommend placing orders now.

Cashews

40 count cashews have been very tight and now the three twenties are starting to get a little bit tight too. We are keeping an eye on increased shipping costs so the market may firm on cashews.

Macadamia nuts

We’ve gone from an oversupply to processors selling out the inventory in a short time.  in a strange change of events, in the Macadamia market, the processors did an excellent job of selling out of their huge stocks. Everyone is waiting on a new crop. Expect higher prices going into the new crop.

Coconut

Desiccated coconut or virgin coconut oil has seen increased prices. Inventory in the U S is finally getting lower and most of the very aged product is about gone for the buyers booked out as far as possible last year. The market has risen everywhere and ocean freight keeps increasing so we are a little bit bullish on the coconut front.

Coconut sugar could get a little tight because of Ramadan. It is recommended to communicate what you might need very soon to your suppliers so they can make sure they allocate stuff. If we’re your supplier, please let us know so we can allocate because we anticipate delays.

Chia

Good news here. We do not foresee any supply chain issues from this current crop. We’ll be watching planting reports as they start planning to get an idea of the total acreage planted, but we do think there will be a sufficient carryover this year.  The prices have probably softened a little bit.

Pumpkin seeds

Organic pumpkin is rising weekly. The crop was a lot smaller this year and demand has been picking up. Stocks in the USA are very, very low. We do not anticipate pumpkin prices to go down until the new crop in the fall.

Be sure to get yourself covered and plan with your suppliers further out. Forecasts are going to be very important to make sure you keep the inventory you need.

If you are in the market or have questions about vanilla or any other natural food products, reach out at: whatsnew@smirks.com

OTA Resources:

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