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Oregon's Organic Agriculture and Food Processing Industry
by Guy Tauer
Published Apr-14-2010

 
When Santa Rosa, California-based Amy's Kitchen expanded to Southern Oregon in late 2006, it showed further evidence of organic food quickly becoming a phenomenon that has seeped from farmer's markets and natural food co-ops to mainstream supermarket grocery store shelves and into the eating habits of many consumers.

Organic agriculture and food processing is a relatively small but rapidly growing segment of Oregon's total agriculture industry.

According to the United States Department of Agriculture, "Organic farming has been one of the fastest growing segments of U.S. agriculture for over a decade." The U.S. had fewer than 1 million acres of certified organic farmland when Congress passed the Organic Foods Production Act in 1990. By 2002, when the United States Department of Agriculture implemented the National Organic Standards, certified organic farmland had doubled. It doubled again by 2005. The United States had 4.8 million acres of organic farmland by 2008 - 2.7 million acres of cropland and 2.1 million acres of rangeland and pasture - according to the U.S. Department of Agriculture.

The Organic Trade Association says Americans spent $20 billion on organic food and beverages in 2007 and were forecast to reach nearly $23 billion in 2008. Organic food sales are projected to increase an average of 18 percent each year from 2007 to 2010. Organic products accounted for 2.8 percent of food and beverage sales in the U.S in 2006. Oregon ranks fifth in the country for the number of organic and exempt certified farms, according to the U.S. Department of Agriculture's 2008 Organic Production Survey. Oregon had $155,613,000 total organic agriculture sales in 2008, fourth among all states, with nearly 5 percent of all U.S. Organic agriculture sales. Concerns around food safety, nutrition, and impacts on the environment from the use of synthetic fertilizers and pesticides are some of the factors driving the growth of consumer demand for organic products. The list of goods and products that are billed as organic appears to be ever-increasing. One of the latest organic products is being produced in Ashland, Oregon. Cascade Peak Spirits, Oregon's first organic distillery, recently began offering its O-N, or Organic Nation, vodka at liquor stores, bars, and restaurants. They are also producing an organic gin. In late 2007, Bend-based Deschutes Brewery debuted their Green Lakes Organic Ale, the first to be brewed with Salmon-safe certified hops. Deschutes worked for nearly six months with Oregon Tilth to receive organic certification for its 50-barrel brew house, and the new Oregon microbrew now meets National Organic Program standards.

Defining ¿Organic¿
 
Organic agriculture is an ecological production management system that promotes and enhances biodiversity, biological cycles, and soil biological activity. It is based on minimal use of off-farm inputs and on management practices that restore, maintain, and enhance ecological harmony. 'Organic' is a labeling term that denotes products produced under the authority of the Organic Foods Production Act. The principal guidelines for organic production are to use materials and practices that enhance the ecological balance of natural systems and that integrate the parts of the farming system into an ecological whole.

Organic agriculture practices cannot ensure that products are completely free of residues; however, methods are used to minimize pollution from air, soil and water. Organic food handlers, processors, and retailers adhere to standards that maintain the integrity of organic agricultural products. The primary goal of organic agriculture is to optimize the health and productivity of interdependent communities of soil life, plants, animals, and people. This definition was passed by the National Organic Standards Board in 1995.

So does organic mean that those products are completely pesticide free? No, organic crops can be inadvertently exposed to agricultural chemicals that are now pervasive in rain and groundwater due to their use over the past 50 years, and drift via wind and rain. However, when residue testing detects prohibited substances at levels that are greater than 5 percent of the Environmental Protection Agency's tolerance for the specific residue detected, the product must not be sold, labeled, or represented as organically produced. U.S. organic certification standards allow application of botanicals or other non-persistent pest controls. Botanicals are derived from plants and are broken down quickly by sunlight and oxygen.

How Did the Organic Movement Sprout?
 
The organic movement can be traced to research done in the 1930's, when British soil scientist Sir Albert Howard suggested that people who used composting extensively in their village farms in India grew better food and were healthier than those who didn't. In the late 1940s, Howard formed a partnership with J.I. Rodale, the founder of Organic Gardening magazine. The methods they touted relied on composting and the rejection of chemical pesticides and fertilizers.

The seeds of the organic movement were planted in the public's consciousness during the 1960s and early 1970s. A book by Rachael Carson, Silent Spring,raised public awareness of the ecological problems associated with the use of agricultural chemicals and particularly, synthetic insecticides. Water pollution related to fertilizer and pesticide use, along with the two energy crises in the 1970s, provided added incentive for some farmers to reduce use of farm chemicals.

Oregon and Washington were early implementers in the organic movement, with the establishment of the Oregon-Washington Tilth Organic Producers Association in the early 1970s. In 1982, the Willamette Valley chapter of the Tilth began an organic certification program to protect and promote organic farming. These standards became the blueprint for the eventual National Organic Program.

In 1989, the CBS news show Sixty Minutes did a feature on Alar, a chemical used in apple orchards that was eventually abandoned after studies linked it to accelerated risk of cancer. That resulted in an immediate increase in sales of organic products. Due to inconsistent or non-existent state laws, inadequate enforcement programs and fraud all threatening to undermine the value and meaning of "organic," a coalition of stakeholders persuaded Congress to pass the Organic Food Production Act in the 1990 farm bill. In 1992, the USDA appointed the National Organic Standards Board and established the National Organic Program to develop a uniform set of organic standards for the U.S., which were implemented on October 22, 2002. The Oregon Tilth Certified Organic (OTCO) program remains the main certifying agency in Oregon for the USDA's "organic" label and offers organic certification services throughout the USA and internationally.

Who are Oregon¿s Organic Farmers?
 
When you hear the term "organic farmer," you may have a picture of a counter-culture, tie-dye wearing hippie-type living "off-the-grid" in Takilma. You may be right in some cases. The 2007 Census of Agriculture contains data about Oregon's organic farms and farmers. Of Oregon's approximately 38,500 farms, only 799, or 2.1 percent, were certified organic up from 1.3 percent of the total in 2002. According to the 2007 Census of Agriculture, the average age of principal operators of farms with organic production was 54 years. About one in six were 65 years or older. Most organic certified farms were small operations in 2007. About one-half had total sales of less than $5,000. Total sales were less than $25,000 for 72 percent of certified organic farms (Graph 1).

According to Laura Barton, from the Agricultural Development and Marketing Division of the Oregon Department of Agriculture, "You have two types of organic growers in Oregon. There are the people who believe in it as a lifestyle and a philosophy as a way of nurturing the soil. Then there are the more conventional growers who have seen that the profitability and margins are much higher for organics." Ms. Barton also states, "organic production is attracting a number of retired Oregonians who are operating on small acreage as a hobby or second career."

Graph 1
Most Oregon certified organic farms are small (sales) 2007 Census of Agriculture
Oregon Organic Farm Statistics
 
Estimates of certified organic crop acreage and livestock numbers in Oregon come from the report Profile of Organic Crops and Livestock in Oregon, published by the Center for Sustaining Agricultural and Natural Resources, in cooperation with Oregon Tilth Certified Organic and Washington's Department of Agriculture Organic Food Program. The data in this report represent a low-end estimate of organically farmed land in Oregon. These estimates show that in 2008 there were 424 certified organic crop and

livestock farms in Oregon. Estimated acreage of certified organic farmland totaled 115,502 acres, up from 45,429 acres in 2005. The amount of certified organic acreage about doubled from 2006 to 2008, as shown in Graph 2.

Forage makes up 77 percent of the certified acreage. Forage acreage has grown rapidly to meet demand to supply organic dairies. Graph 3 shows estimates of distribution by crop for organic acreage in 2008.

Farm gate sales data are available from 2007. Information was reported from 75 percent of the certified farms, representing 85 percent of total acreage. Estimated sales in 2007 totaled over $89.3 million, an increase of 53 percent from 2006.

Graph 2
Oregon certified organic crop acreage surging
Graph 3
Diverse crops grown on Oregon certified organic acreage 2008
Around the State
 
Willamette Valley producers reported over 43 percent of the state's organic farm sales in 2007. Main crops include forage, wine grapes, vegetables, berries, nuts, and tree fruit. Livestock production includes several dairies, beef, cattle, and poultry operations.

The coastal region has specialty crops - including cranberries and blueberries - but mostly grows forage crops, and includes several dairies located in Coos and Curry counties. Southwestern counties - Jackson, Josephine, and Douglas - have vegetables, mainly corn and squash, herbs, garlic, grapes, as well as beef cattle.

Hood River Valley and Central Oregon are also diverse production areas. The area contains 42 percent of the state's organic vegetable acreage, 50 percent of tree fruit and 70 percent of dry pea acreage. Sweet corn, potatoes, onions, and green peas are also important crops. Eastern Oregon, mostly the Columbia Basin and Southeastern Oregon, had over 85 percent of the state's grain production and more than 20,600 acres of forage. Alfalfa is mainly produced in Southeastern Oregon. Eastern Oregon has several dairy and cattle operations.

Data regarding organic food processing are more difficult to obtain. Many food processors that are certified by Oregon Tilth Certified Organic also process non-organic products. The 2007 Oregon Tilth Directory lists over 100 processors and handlers that they have certified, as of January 2007. While not an exhaustive list, it represents the most complete list of organic certified food processors in Oregon.

Amy's Kitchen continued to expand since sprouting up in an expansion to Southern Oregon and even despite the loss of 30 jobs split between their Santa Rosa and White City operations, a Medford Mail Tribune story published February 19, 2009 stated they still had 600 full-time positions at their White City plant in Jackson County. According to Amy's Kitchen's website, they are the "nation's leading natural frozen food brand. Amy's is #1 in popularity and sales." The expansion of Amy's to Oregon was a large feather in Oregon's organic cap.

Oregon Assistance for Organic Certification
 
According to Laura Barton, the Oregon Department of Agriculture has used federal funds to reimburse organic producers and processors for the cost of obtaining organic certification. Applicants receive 75 percent of the costs associated with gaining a certification, up to $500. Between 2004 and 2006, grants were made to 202 growers and 63 processors. There were 408 reimbursement requests processed during that three-year period. As more people are concerned about where their food comes from and how it is grown the trend toward more organic products.

Rising costs such as labor and fuel, tight grain supplies, and rising demand will impact organic operations, as they have traditional agriculture operations. However, as more competition among organic producers crops ups - pardon the pun - consumers may see the price of organic goods ease a bit.

For more information, see:

Oregon Tilth homepage at tilth.org

2007 Oregon Census of Agriculture at http://www.agcensus.usda.gov/Publications/2007/Full_Report/usv1.pdf

U.S. Department of Agriculture's 2008 Census of Organic Agriculture Survey

 www.agcensus.usda.gov/Publications/2007/Online_Highlights/Organics/

U.S. Department of Agriculture Economic Research Service organic production data and tables- by state and in excel format data www.ers.usda.gov/Data/Organic

Organic Trade Association homepage at www.ota.com/index.html

Washington State University's Profile of Organic Crops in Oregon- 2008

 www.oregonorganiccoalition.org/pdf/OR_OrgCert_Acres_08.pdf