NSAC's Blog

Organic Production Survey: A Deeper Dive

October 1, 2015

This blog explores several areas of the 2014 Organic Production Survey that have not been extensively covered already. The areas include: demographics and income, crop insurance use, USDA conservation program participation, and the source of the overall loss of organic acreage.

It is likely that the portion of the survey discussed here merit further in-depth research as to why the numbers are what they are.

This kind of research will benefit policy makers and advocates who are seeking to tackle challenges like an aging farm workforce, barriers to transitioning to organic production, and the need to conserve our resources for future generations.

Who Are Organic Farmers?

Of the 14,093 farms with organic acreage identified by the survey, over 50 percent have less than 20 years of experience in agricultural production and nearly 30 percent have less than 10 years of farming experience.

USDA considers any farmer with less than 10 years of farming experience to be a beginning farmer. So, nearly a third of organic farmers are beginning farmers.

This seems to confirm the conventional wisdom that the experience of farmers in regard to organics has not yet matured fully. As farmers gain more experience using organic production methods, increased yields and potentially incomes will likely result.

This has been reinforced by research that has found that organic yields are highly dependent on a farmers experience and skill.

Of all organic farms, only 17 percent derive 100 percent of their net household income from organic sales. The largest percentage (36 percent) of organic farms derive less than 25 percent of their income from organic sales. The other 47 percent derive 25-99 percent of their income from organic sales.

The relatively large number of farmers that derive less than a quarter of their income from organic sales could be indicative of a couple of things. The 2012 Census of Agriculture found that approximately 70 percent of all farming households generate less that 25 percent of their income from farming. So, it may not be surprising that 36 percent of organic farms derive less than 25 percent of their income from organic sales, half the rate for farms overall.

Of course many farmers that have some organic sales also have non-organic sales. So, it is not necessarily true that these 36 percent of organic farmers derive the rest of their income from off-farm sources.

But it certainly raises the possibility that organic farming is more lucrative, resulting in more farmers deriving a larger percentage of their income from the farm than all farmers combined.

What the Organic Survey Does and Doesn’t Tell us About Crop Insurance Use by Organic Farmers

The 2014 Organic Production Survey proffered two questions on crop insurance: what percentage of organic acres are covered by crop insurance and if not all acres are covered, what are the reasons crop insurance was not purchased?

Of the 14,093 organic farms with organic acreage, only 2,801 had organic acres enrolled in crop insurance in 2014. That means only around one fifth of farms with organic acreage have some land covered by crop insurance.

Of those 2,801 farms, just 1,626 had 100 percent of their organic acreage covered by crop insurance. Of farmers with some acreage covered, 211 had less than 25 percent covered with the other 964 falling somewhere in between.

This is a sadly low number of organic acres utilizing crop insurance and is likely the result of the limited options that organic farmers have for obtaining crop insurance.

Luckily, the Risk Management Agency (RMA) has made great strides in opening more crop insurance options to organic producers, even since 2014, the year this survey covers. In 2014, there were only 16 Organic Price Elections available, but 28 more have been added since. Organic Price Elections allow farmers to insure an organic crop at the organic price rather than the conventional price.

It is unclear from the survey what percentage of farms utilizing crop insurance are utilizing a Organic Price Election or are insuring the crop at the conventional price, since the survey did not ask that question.

Farmers can now also use a Whole Farm Revenue Policy (WFRP) policy or a Contract Price Addendum (CPA) to insure an organic crop at the organic price. WFRP is available in every county in every state and CPA are available for more than 60 crops.

Of the farms indicating a reason why they have not purchased crop insurance for some or all of their organic acres, “other” represented over 53 percent of responses. The rest of the respondents to this question are almost evenly split between “too expensive” and “unfamiliar with crop insurance,” the only other two options in the survey.

Given the limited availability of organic price elections in 2014 and the limited geographic availability of many other crop insurance policies, it is likely that the “other” category was dominated by these two responses.

Organic Farmers and USDA Conservation Programs

The survey found that 1,673 certified organic farms, or nearly 14 percent of all certified farms, and seven percent of all organic “exempt” farms (110 farms) had land enrolled in the Organic Initiative.

Additionally, seven percent of all certified acres and two percent of exempt acres were enrolled in the program. While these results provide insight into total organic enrollment, they fail to capture annual enrollment trends, because EQIP contracts can be in place for multiple years.

We are pleased that NASS added this question on participation in the Environmental Quality Incentives Program (EQIP) Organic Initiative, but hope future iterations will ask the question in a more meaningful way.

The EQIP Organic Initiative, administered by the U.S. Department of Agriculture (USDA)’s Natural Resource Conservation Service (NRCS) provides financial assistance to producers to address resource concerns by implementing and installing conservation practices.

Examples of conservation activities eligible for funding include developing conservation plans, establishing buffer zones, planning and installing pollinator habitat, improving irrigation efficiency, and enhancing cropping rotations, cover cropping, and nutrient management.

Missing from the survey is a question regarding general EQIP enrollment. Organic producers are eligible to participate in the general EQIP pool, where they can receive cost share assistance for the same practices as the Organic Initiative, but are not subject to the Organic Initiative’s lower payment limit. NRCS plans to begin tracking organic producers within general EQIP in 2016, which, for the first time, will shed light on how accessible the program is for organic producers.

The National Sustainable Agriculture Coalition (NSAC) continues to advocate that the organic payment limit should be lifted, as well as for additional improvements to EQIP to increase conservation funding for organic, transitioning, and exempt producers.

EQIP is also not the only conservation program that provides valuable support for organic producers. The Conservation Stewardship Program (CSP), also administered by NRCS, provides comprehensive conservation assistance to farmers who actively manage and maintain their conservation efforts. Many organic producers are well suited for CSP as a result of their high level of stewardship. Over 30,000 organic acres were enrolled in CSP in 2014, but unfortunately the survey did not offer any questions regarding CSP or other NRCS conservation programs. We hope NASS will consider including CSP among an extended list of conservation programs in its next survey.

Where Did the Acres Go?

The 2014 Organic Production Survey showed a decrease in total U.S. organic acres of 406,777 acres. While it is very interesting that organic sales increased by 72 percent while organic acres decreased by about 10 percent, we thought we would explore where those lost acres came from, which had interesting results.

As it turns out, the top five states for organic acreage (CA, MT, WI, NY, OR) experienced significant increases in organic acreage between 2008 and 2014. In fact, these five states increased their organic acreage by 425,544 acres.

Not surprisingly, these are the states that also lead the nation in the sale of specialty crops and dairy products, some of the most successful organic products.

Interestingly, this list of states comes close to mirroring the top five for largest increases in organic acreage. California, Oregon, New York lead the way on increased organic acreage followed by Pennsylvania (43,993) and Vermont (37,442), two states that do not make the top 10 for organic acreage.

So, where did the overall loss in acreage come from? One explanation comes from the fact that Wyoming, according to survey returns, experienced a loss of 548,645 acres of organic land between 2008 and 2014. There were 677,147 acres of organic land in Wyoming in 2008 and only 128,502 acres in 2014.

In 2008, the vast majority of Wyoming’s organic farmland was pastureland and rangeland (617,352 acres). For the 2014 survey, the number of farmers in Wyoming reporting organic pastureland was so small (3) that they could not report the acreage and there are no responses for for rangeland.

The overall decline in organic acreage that has occurred at the same time as a monumental increase in organic sales is likely the result of several factors. One that has already been sighted is increased efficiency from farmers becoming more familiar and experienced with organic farming.

Additionally, there seems to be significant a shift in organic acres to higher value specialty crops from rangeland and pasture land. The reasons for this are unclear.

Prepare for 2015 Organic Production Survey

NASS is planning on conducting this survey again in 2016 and NSAC supports their doing so. We also hope that NASS and USDA maintain their commitment to organics by continuing to conduct this survey and other organic data collection activities on a regular basis into the future.

We also encourage NASS to reevaluate some of the questions to bring them in line with current organic production practices.  This includes adding cover crops as an organic production practice, modifying the crop insurance question to capture whether the organic premium is insured, and including conservation programs other than EQIP.

The importance of data collected over time, which can show trends, is critically important to policy makers and organic farmers. This information helps inform policy priorities and farmer decision making.

Categories: Commodity, Crop Insurance & Credit Programs, Conservation, Energy & Environment, Organic

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