Horticulture and Organic Agriculture Food, Conservation, and Energy Act of National Farm Bill Education Conference Kansas City, July 8-9, 2008 Esendugue Greg Fonsah Associate Professor & Extension Economist Department of Ag & Applied Economics Fruit, Vegetable and Pecans University of Georgia Tifton, Georgia

2002 Vs Farm Bill Titles 2002 Farm Bill Titles Title I – Commodity Programs Title II – Conservation Title III – Trade Title IV – Nutrition Programs Title V – Credit Title VI – Rural Development Title VII – Research and Related Matters Title VIII – Forestry Title IX – Energy Title X - Miscellaneous 2008 Farm Bill titles Title I – Commodity Programs Title II – Conservation Title III – Trade Title IV – Nutrition Title V – Credit Title VI – Rural Development Title VII – Research and Related Matters Title VIII – Forestry Title IX – Energy Title X – Horticulture and Organic Agriculture Title XI – Livestock Title XII – Crop Insurance and Disaster Assistance Programs Title XIII – Commodity Futures Title XIV – Miscellaneous Title XV – Trade and Tax Provisions

Where is the $ Spent? $289 Billion net budget and revenues CBO scored at $307 Billion for the period $209 billion or (68%) is for nutrition programs, $35 billion or (11%) is for agricultural commodity programs, $25 billion or (8%) is for conservation programs.

TITLE X – HORTICULTURE AND ORGANIC AGRICULTURE Subtitle A – Horticulture Marketing and Information Sec : Mushroom promotion, research and consumer information  The mushroom production area was reduced to 3 regions instead 4  It requires the formation of a Mushroom Regional Council with 9 members maximum  Membership representation is based on annual regional production.

Sec cont. A. One additional member if annual production >110 million lbs <180 million lbs. B. Two additional members if annual production >180 million lbs < 260 million lbs. C. Three additional members if annual production >260 million lbs Functions: To Develop Good Agriculture and handling practices for the mushroom industry and make recommendations to the Secretary of Agriculture

Section 10105: Food Safety Education Initiatives. The objective is to carry out food safety educational program to educate the public and the actors of the fresh produce industry about: A. Scientific proven practices for reducing microbial pathogens on fresh produce and; B. How to reduce the threat of cross-contamination of fresh produce through sanitary handling practices. C. $1 million for each fiscal years allocated.

Sec : Farmer’s Market Promotion Program This program will be funded by the Commodity Credit Corporation (CCC). $3 million for fiscal year 2008; $5 million for ; $10 million for each fiscal year 2011 & 2012; At least 10% of allocated funds for each year will be use to support the use of electronic benefit transfer for Federal nutrition programs at farmer’s markets.

Sec : Specialty Crops Market News Allocation The objective is to provide price and shipment information of specialty crops throughout the United States on a timely manner. $9 million each from

What are Specialty Crops? Definition by Congressional Research Service (CRS): Specialty crops include the following: 1. Fruits and vegetables, 2. Tree nut and nursery crops or producers, 3. Processors, manufacturers and wholesalers, 4. Importers and exporters.

Sec : Specialty Crop Block Grants. The block grant is for the following states: Puerto Rico, Guam, American Samoa, the United States Virgin Islands, and the Commonwealth of the Northern Mariana Islands. $100,000 for each fiscal year from or 1/3 of 1% of the total amount of funding available for each fiscal year. The other states will receive the following: (1) $10 million for fiscal year 2008; (2) $49 million for fiscal year 2009; and (3) $55 million for fiscal year 2010 – 2012.

Subtitle B: Pest and Disease Management Specialty Crop Certification and Risk Management: Funds have been provided for the following: Technical assistance to specialty crop growers, Organizations representing specialty crops growers; and, Organization for the development and implementation of: 1. Audit-based certification systems, such as best management practices, and; 2. Nursery plant pest risk management systems in collaboration with: A. The nursery industry, B. Research institutions; and, C. Other appropriate entities.

Specialty Crop Certification and Risk Management cont. Fundings through Commodity Credit Corporation (CCC) are as follows: $12 million for fiscal year 2009; $45 million for fiscal year 2010; $50 million for fiscal year 2011; $50 million for fiscal year 2012 and thereafter.

Sec National Clean Plant Network This section requires a network of clean plant centers for diagnostic and pathogen elimination services to do the following: 1. Produce clean propagative planting materials 2. Maintain blocks of pathogen-tested plant material in sites located throughout the United States. 3. $5 million was allocated for each fiscal year from

Subtitle C: Organic Agriculture Sec : National Organic Certification Cost-share Program  $22 million allocated for fiscal year 2008 compared to only $5 million in 2002  By March 1 st of each year, the Secretary is obliged to submit a report explaining the number of producers and handlers per state who benefited from this program.  The report will be submitted to the Committee on agriculture of the House of Representatives and Committee on Agriculture, Nutrition and Forestry of the Senate.

Sec : Organic Production and Market Data Initiatives This section requires the collection of production and marketing data for organic agricultural products. Collection and distribution of prices for organic agricultural products Conduct surveys and analysis and publish reports of organic production, handling, distribution, retail and trend studies Develop surveys and report statistical analysis on organically produced agricultural products.

Sec : Organic Production and Market Data Initiatives cont. $5 million allocated for each fiscal year from 2008 – The Secretary is required to submit a report not later than 180 days after the program is enacted with the following: 1. Description of progress made in implementing this section; 2. Identifying any additional production and marketing data needs.

Sec : National Organic Program The following funding were provided for the National Organic Program: $5 million for fiscal year 2008; $6.5 million for fiscal year 2009; $8 million for fiscal year 2010; $9.5 million for fiscal year 2011; $11 million for fiscal year 2012.

Subtitle D: Miscellaneous Sec : Market Loss Assistance for Asparagus Producers. Payment for 2007 asparagus crop for market loss due to imports during 2004 through 2007 crop years. Payment rate shall be based on the reduction in revenue received by asparagus producers associated with imports during Payment quantity shall be the average quantity of the 2003 crop produced by producers on the farm.

Sec : market Loss Assistance for Asparagus Producers. A total of $15 million funding through Commodity Credit Corporation (CCC). $7.5 million for fresh market asparagus producers, and; $7.5 million payment to processed and frozen market producers of asparagus.

Title XI - Livestock Sec : Country of Origin Labeling (COOL) In subtitle ©, the following were added: (vii) Meat produced from goat; (viii) Chicken, in whole and in part; (ix) Ginseng; (x) Pecans; and (xi) Macademia nuts

Title XI - Livestock (4) Designation of Country of Origin for Perishable Agricultural Commodities, Ginseng, Peanuts, Pecans and Macademia nuts – (A) A retailer can use the United States as Country of Origin only if the covered commodity is exclusively produced in the U.S.A.

Sec. 1107: Planting Flexibility General limitations: 1.Agricultural commodity can be planted on base acres for peanut so long as it is destroyed before harvest. 2.The planting of trees or other perennial plant crops on base acres for peanuts is prohibited. 3. The planting of fruits, vegetables (other than mung beans and pulse crops), and wild rice shall be prohibited on base acres

Sec. 1107: Planting Flexibility cont.1 Exceptions 1. In any region in which there is a history of double- cropping of covered commodities with agricultural commodities 2. On farm that the Secretary determines has a history of planting agricultural commodities except that direct payments and counter-cyclical payment shall be reduced by an acre for each acre planted to such an agricultural commodity; or 3. By the producers on a farm that the Secretary determines has an established planting history of a specific agricultural commodity, except

Sec. 1107: Planting Flexibility cont.2 A. The quantity planted may not exceed the average annual planting history of such agricultural commodity by 1998 through 2001 crop years (excluding any crop year in which no plantings were made), as determined by the Secretary; and B. Direct payment and counter-cyclical payments shall be reduced by an acre for each acre planted to such agricultural commodity

Sec (D): Planting Transferability Pilot Project 1. The Secretary shall carry out a pilot project to permit the planting of cucumber, green peas, lima beans, pumpkins, snap beans, sweet corn, and tomatoes grown for processing on base acres during each of the 2009 through 2012 crop years.

Sec (D): Which States Are Eligible for Planting Transferability Pilot Project? (A)9,000 acres - Illinois; (B)9,000 acres – Indiana; (C)1,000 acres – Iowa; (D)9,000 acres – Michigan (E)34,000 acres – Minnesota (F)4,000 acres – Ohio; and (G)9,000 acres - Wisconsin

(3) Contract and Management Requirements – Pilot Project To be eligible for this pilot project, the producer on the farm shall do the follows: A. Producers interested in the pilot project must show proof that they have a contract to produced the covered crops for processing; B. Agree to produce these crops as part of their crop rotation program which will enable them achieve agronomic, pest and disease management benefits; and C. Provide evidence of the disposition of the crop

Sec. 1107: Planting Transferability Pilot Project cont. (4) Temporary Reduction in Base Acres: Total acres used for the pilot project to produce any of the covered crops will be subtracted from the based acres. (5) Duration of Reductions: The reduction of based acres for the pilot project will expire at the end of the crop year.

Sec (D): Planting Transferability Pilot Project cont. (7) Pilot Impact Evaluation (A)A periodic evaluation will be conducted to determine the effect of the pilot project on the supply and price of fresh fruits, vegetables and fruits and vegetables for processing. (B) Determination (i) Are producers of fresh F&V negatively impacted? (2) Are existing production capacities being suplanted?

Subchapter B – Conservation Stewardship Program Under Sec F. Stewardship Contracts. (H) Coordination with Organic Certification Allow growers to start organic certification under the Organic Foods Production Act of 1990 (i)On-Farm research and demonstration of pilot testing may be approved and; (ii) Pilot testing of new technologies or innovative conservation practices may be approved under this sub-section.

Sec. 1240B. Establishment and Administration (i) Payment for Conservation Practices Related to Organic Production Funds will be allocated for conservation practices on some or all of the growers operations, i.e. (A) Related to Organic Production; and (B) Related Transition to organic production

Sec. 1240B. Establishment and Administration cont. (2) Eligibility: To qualify for this program, growers must accept to: (A) Develop and carry out an organic system plan; or (B) Develop and implement the recommended conservation practices for certified organic production

Sec. 1240B. Establishment and Administration cont.2 (3) Payment Limitations: <= $20,000 aggregate per year or $80,000 during 6 years period This amount does not include payment received for technical assistance

Sec. 1240B. Establishment and Administration cont.3 (4) Exclusion of Certain Organic Certification Costs Payment under this section will not cover costs associated with organic certification that are eligible for cost-share payment under section (5) Termination of Contracts: A grower’s contracts may be terminated if: (A) He/she is not pursuing organic certification; or (B) He/she is not in compliance with the Organic Foods Production Act of 1990

Who gets what from these $? The farmers? The researchers? The Horticulture and Organic Agriculture industry? How?

ERS Baseline Forecasts of Horticulture Production Values, Vegetable & Melons Outlook/VGS-318/December 14, 2006, ERS/USDA, pg. 14

Average U.S. farm cash receipts for crops: Lucier et al. (2006) “Fruit & Vegetable Backgrounder” ERS/USDA, VGS , April, pg 3.

Any Questions?