The Organic Trade Association had been advocating for the establishment of organic export codes for a number of years. On Oct. 20, 2010 Agriculture Deputy Secretary Kathleen Merrigan announced the U.S. Department of Agriculture’s decision to establish trade codes for select organic products. The codes are an invaluable tool for the industry as the data gathered on organic international trade will help everyone get a better overall picture of where, and in what quantity, U.S. organic companies export. This, in turn, will lead to more targeted assistance from USDA and OTA, and will help make the case for more fair-share funding to support organic trade.
In the words of Kathleen Merrigan, “As the organic industry continues to grow in the United States and around the world, this will provide a more complete picture of the international demand and sources of supply for organic products. This decision will support the development of more international trade and the work of the National Organic Program to ensure compliance with U.S. organic standards.”
On July 1st 2013, four codes for organic imports were added to the Harmonized Tariff Schedule. The new codes organic are olive as extra virgin and other. The new codes are as follows:
- Olive oil and its fractions, whether or not refined, but not chemically modified ; virgin
- Weighing with the immediate container under 18 kg, Certified organic:
- 1509.10.20.30: Labeled as extra virgin
- 1509.10.20.40: Other
- Other, Certified organic:
- 1509.10.40.30: Labeled as extra virgin
- 1509.10.40.40: Other
This brings the number of Import Codes to 35 and the number of export codes to 26. Unfortunately, addition of new export codes has come to a halt, because of a trade data reciprocity agreement, the United States uses Canada’s import data as the U.S. data on exports to Canada. Therefore, if Canada does not have an established code for an imported organic product, the U.S. cannot add it of its own accord. OTA is working with FAS and the Canadian Organic Trade Association to have codes added to the Canadian list of imported organic products. Unfortunately, this halt makes it very difficult to obtain a more comprehensive list of exported organic products.
Import codes know no such barrier and 12 more codes were added between 2012 and 2013. In 2012, with 23 codes covered, the U.S. recorded a little under $496 million in imported organic products tracked by existing codes, with coffee dominating the import market with $283 million in trade. Organic coffee imports, which represented nearly 80 percent of the “selected” organic imports in 2011, plunged roughly 45 percent to $280 million in 2012 as volumes and unit values fell. Organic soybean imports have more than doubled, supported by higher volumes from China, India and Argentina. The addition of 12 new codes in 2013 has seen the amount of tracked organic imported products reach $706 million between January and March, with the import of bananas taking the lead with $206 million (bananas were not tracked in 2012) and coffee a ways behind with $212 million.
Exports of “selected” organic products expanded to nearly $450 million in 2012, with apples accounting for virtually all of the growth. Canada and Mexico remain top markets for the vast majority of the selected organic trade, although exports to the European Union (EU) could expand following the implementation of the Organic Equivalency Arrangement. The majority of U.S. organic product exports continue to go to Canada, facilitated by an organic equivalence arrangement in place since 2009. Although shipments are relatively unchanged from 2011, more than 75 percent of organic vegetables were exported to Canada. Organic exports to Mexico have more than doubled in just a year. About half of the organic fruit is destined for Mexico. Apple exports more than tripled in 2012, representing more than half the total selected organic shipments to that market. Grape, pear, and cherry trade to Mexico also more than doubled.
An organics group is available on the FAS Global Agricultural Trade System under the “Product Groups” box in the standard query section to facilitate tracking the trade. The “Organics-Selected” group includes 35 U.S. import and 26 organic export trade codes, covering mostly horticultural products. The FAS organic webpage can be found at www.fas.usda.gov/htp/organics/organics.asp.
As OTA plays a crucial role in submitting organic commodities for possible inclusion in the Harmonized Tariff Schedule, it encourages its members and other companies in the organic industry to suggest organic items to be considered. To do so for the committee’s next deadline of April 1, contact Jessica Poingt, OTA’s International Trade Manager.