Nate, thanks so much for taking some time with us today. Organic farming. Numerous farmers who were asked about it, told the AP that they've stayed away from the certification because it's costly, and not enough to combat climate change. It appears to be losing cachet in the marketplace. Is that the status in Montana currently?
It's not the status Karl, in Montana nor the status in the United States. Let me just throw a few statistics at you. In Montana in 2023, we had 323,000 certified organic acres. Last year, the most recent data, we had 349,000 organic acres nationally, when we look at the acreage, we had 4.9 million acres in 2023, and last year we had 7.2 million acres.
So the numbers just support an absolute bright spot in the marketplace in growth for the farmers. But I wanna talk a little bit about the question of value. So, organic is one of the most rapidly growing value propositions for both consumers as well as farmers. When we think about the profitability of farming today, oftentimes in, in more traditional conventional farming, we're looking at breakeven, if not losing a little bit of money.
There is a real benefit to organic because most of our market is right here in the States, and so it's domestic demand that drives all of this sales. The US consumes 40% of the global demand for organic food. And so that's a huge benefit to organic producers.
In thinking about that article though, I think that it was an interesting piece of journalism just because they interviewed folks who weren't organic. They just interviewed conventional farmers for why they wouldn't go organic. I was a little surprised 'cause I would think you would interview folks who are organic together, side of the story, who have actually experienced it.
So I wanted to bust just a couple of myths. The expense of certification via the Farm Bill, 75% of the cost of certification up to $750 is reimbursed. And so it's this program that's been around for many years - hopefully it's gonna be renewed in the next farm bill - but it's made it certification for a small operation for a couple hundred bucks.
If you're looking at a bigger operation, it can get to a couple thousand bucks. But what we're looking at is the value difference. When we sell organic wheat, we're usually looking at two to three times the value of conventional wheat, and in my farm and I would say on farms across the state, across the country spending a few hundred bucks eating up to a couple of thousand dollars for that certification pales in comparison to the value that you're creating with the certification in the markets that it opens up.
Now, let's talk a little bit about that certification because it's a double-edged sword; you have not only the state certification, but there's also the federal issues.
So the National Organic Program administers all organic across the entire country. They accredit certifiers like the state of Montana. Also some nonprofits are certifiers. There's other companies. There's about 60 certifiers around the country and around the world, and they all certify to the exact same standard. So the state is the actual technical certifier who grants a certificate to farmers and they're accredited by the federal.
And so the USDA doesn't actually certify anybody. They just give licenses to state departments of ag and private companies to carry out that certification process.
And the Department of Agriculture here in Montana is supporting you at least. Somebody in the new position who was just recently appointed. She's got a background in organic farming. Is that correct?
We are so lucky, yes. Secretary Streit is just a real, an awesome person to have in that position and has been a great champion for organic.
And the organic association here in Montana is also the spokesman for the organic (business) more of the state official spokesman. Now, that changed this year too. Did it not?
It sure did. And so when we look to organic, it is a dynamic marketplace, a dynamic set of rules, and we always wanna be evolving and updating those rules. So they reflect the current state of organic across the state, across the country. And this year the legislature updated the Department of Ags, basic feedback mechanism so that they'll be consulting the Montana Organic Association to receive feedback for how we make the program better, and make the services more relevant to producers.
There was a bad publicity case in 2017, 2018 out of Iowa. Is that still resounding or is that pretty much gone away?
It's a fascinating frame. I think of that case where we had the fraud out of Iowa as such a great example of how effective organic is because it got caught, and we had all of the mechanisms to catch it. If you are looking at fraud and food otherwise, most of it never gets caught, it just continues to snatch value from the pockets of consumers. But because of certification, we had the federal government, the Inspector General to actually do an investigation and bust this criminal ring. that. The incident led to an entire rework of the tools available for certification that came out in 2022.
And so it's called the Strengthening Organic Enforcement. And it was an update to the rules that provided a lot more insight, a lot more data, and a lot more tools to certifiers to keep up with the explosive growth of the industry. When we think about 2002, when certification just came out for organic, it was about a billion dollars of sales. Today it's over $70 billion of sales. So you can imagine there is so much more volume, so much more value, so many more players that we need a better, more robust tool set. And that's what we got as a result of looking into that case,
Are young people coming into it?
One of the biggest points of pride for Montana Organic Association when coming to our annual conference and seeing quite a few young folks, not just a room full of, the average farmer whose age is about 62. I've got an entire cohort - I'm 33 - I've got probably 30 other young farmers that are always in the room having these conversations, and that's very unique in any farming organization, any ranching organization in Montana or around the country. That is organic, because it is a more profitable way to grow, and it's a way that makes it so that you can value a more human scale of agriculture. You don't have to be enormous just to make a moderate living. You can make a good living and be a reasonable size, and that's attractive, I would argue, to young folks my age.
Finally, can you give us an overview of some of the farms that are representative of organic growth here in Montana?
Absolutely. Montana is the number one organic wheat producing state in the whole country.
We have really dialed in and we have an excellent group of farmers who are producing all of the high protein spring and winter wheat that the rest of the country relies on to make their organic baked goods. Those farms can range from a smaller operation, say a few hundred acres, all the way up to 20 or 30,000 acres. It takes a lot of folks, a lot of really excellent management, but organic is completely scalable, and those farmers who are succeeding the most are really getting yields that are comparable to conventional. They've dialed in their crop rotations, they've been able to manage pests, weeds and diseases with that crop rotation, and they're seeing tremendous results.
You sound pretty optimistic about this.
I am optimistic. There's been a really, really heartening level of investment by USDA recently. The Transition to Organic Partnership Program was a program that aimed to help new farmers find mentors, and learn about organic farming, and find markets for their products once certified.
When I got started, I've been certified since 2009, it was just like, if you knew someone, you could learn about organic. That's been streamlined so that you can call up the Montana Organic Association and we are able to hook you up with an experienced organic farmer who can mentor you if you're new to organic - mentor you and help you figure out the entire system.
There's also just a lot of market growth, that, as we look at a place to invest, especially from a farming point of view, I wanna be farming for the next 40, 50 years. I want my kids to be farming for their entire careers. And organic is really indicating that it's gonna be able to provide that opportunity.
There's that premium. But there's also an incredible opportunity to reduce inputs, and inputs for farmers in Montana and around the country are really where you spend most of your money: seeds, fertilizer, all that. In organic, we mostly grow our inputs. We're growing them through cover crops, we're growing them through animal manure, and we're able to reduce that off-farm flow of cash and make our businesses more resilient.
And that is something that I think is good for not only us as individual farmers, but good for our communities. The more folks we have farming in our communities, the more folks we have making a decent living means that these small communities around Montana are gonna stick around.
Anything we missed that you feel should be brought up in this conversation?
One thing that we're working on right now is trying to continue to shore up consumer confidence in organic. We had the Organic Import Verification Act just introduced by Senator Ricketts in the US Senate, and that piece of legislation increases testing so that we can continue to keep up with building confidence in this program.
And we're really excited for the Montana delegation to support this legislation. We're really excited for a wide swath of bipartisan support, because it is really exciting to not only support the current growers, but make sure that everyone's playing by the same rules as we look to grains and feed grains that are imported into the United States.
And so there is active legislation going on, constant rulemaking, and it's a bright spot as far as consumer interest for sticking with organic and seeing it grow.
Nate Powell Palm is the spokesman for the Montana Organic Association. He's also a certified organic green farmer based in Gallatin County, Montana.
Thanks for your time today. This has been great.
I really appreciate it. Thanks for your time.
