US introduces organic labels - a blow for European exports?

Related tags Usda Organic food

New organic food labels regulated by the US Agriculture Department
which were launched this week have been welcomed by most US
producers as a useful marketing tool, but the move could shut out
many smaller European farmers from the export market.

New organic food labels regulated by the US Agriculture Department made their debut on Monday, enabling household names like Kraft Foods to tell consumers which products are free of pesticides and genetically modified crops.

Food makers ranging from giant corporations like General Mills to independent firms such as Annie's Naturals and Honest Tea can now market their organic products under a federally approved USDA seal.

"Today, when consumers see the USDA national organic seal on products, they will know that the products labelled organic will be consistent across the country,"​ Agriculture Secretary Ann Veneman said in a statement.

To carry the new USDA seal, organic products cannot include pesticides or genetically modified ingredients, or be irradiated to kill bacteria and lengthen shelf life. Meats sold as organic cannot be produced from animals that receive antibiotics.

Before these labels were issued, the term "organic" was defined under a hodgepodge of state, regional and private certifier standards, creating confusion about its meaning.

The circular, USDA organic sticker is similar to the "USDA Prime" shield on beef or the grade labels on egg cartons.

The USDA said the new labels were a marketing tool and not a statement about food safety, nutrition or quality. However, organic producers and grocers were advertising their products as a better alternative.

"Like using a seat belt or bicycle helmet, choosing organic products is a simple way to reduce exposure to the potential for harm caused by the use of toxic and persistent pesticides and fertilizers,"​ said Katherine DiMatteo, executive director of the Organic Trade Association.

Margaret Wittenberg, vice president for Whole Foods Market, said organic products were an alternative for consumers seeking to "protect the wellness of the environment, their families and themselves."

US consumers will find three types of organic labels in grocery stores. Products that are entirely organic will have a "100 per cent organic" USDA label. Those with at least 95 per cent organic ingredients can have a USDA "organic" stamp.

Foods with at least 70 per cent organic ingredients cannot use the USDA seal, but their labels can say "made with organic ingredients."

The organic industry is the fastest growing US agriculture sector, increasing at about 20 per cent annually. Sales of organic foods are expected to reach $11 billion in 2003, more than double the amount five years ago, according to the Organic Trade Association.

The USDA said more than 6,900 farmers were certified organic last year. To pay for the additional costs of growing and manufacturing these foods, consumers usually have to pay a hefty premium, ranging from 10 per cent to 50 per cent above conventional foods.

Violators of the USDA's labelling program could be fined up to $10,000.

Some overseas competitors say the new USDA labels may shut them out of the lucrative US organic market.

The Danish Dairy Board said on Monday its organic exports were at serious risk as many small farms could not meet stringent US regulations.

"I think Danish exports of organic dairy products to the US are going to disappear, at least for now,"​ said Anne-Mette Arve, head of the Danish Dairy Board's Economic and Political Department.

Related topics Market Trends

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