Organic Trade Association’s International Program A History of Growth and Influence

1. Organic Trade Association’s International Program A History of Growth and Influence

2. Cultivating the USDA partnership From $25,000 in 2001 to over $550,000 in funding today, OTA’s International Programs include generic promotions, market analysis, trade barrier evaluation and assistance, market surveys, GAP analyses, and trade negotiation technical assistance.

3. Meet the OTA International activities team OTA’s international team of experts include: • Tiffany Landry, Landry Consulting, Organic Promotion • Bob Anderson, Sustainable Strategies, Technical Trade Issues/GAP analyses • Grace Gershuny, Technical Trade Evaluation • Katherine DiMatteo, Wolf and Associates, Technical issues and promotion • Caren Wilcox, OTA ED and advisor • David Gagnon, OTA COO, International Trade Forum staff liason and grant manager • Marissa Potter, OTA Operations Manager, Grants management • Cindy Clark, OTA bookkeeper and financial manager of grants

4. Outreach,Communication and Meetings • International Trade Forum List Serve postings • Two page quarterly report in the Organic Report • Quarterly mailing to Export Directory companies, FAS, State Dept of Agriculture, Board of Directors • Quarterly meetings w/ state departments of agriculture and State Regional Trade Groups • OTA has regular meetings with USDA • OTA international advisory group at All Things Organic™ • Update meetings at Expo East, Expo West and All Things Organic • OTA News Flash updates • OTA Export Web Pages • Organic Export Industry Survey

5. OTA participation in the annual meeting(s) of the United States Agriculture Export Development Council • Conference calls with Forum members • OTA/USDA/Industry member meeting (to be scheduled) • Contact Staff or Advisors

6. International Task Forces • Global Organic Textile Standards Review Task Force (completed) • Canada Permitted Substances List Task Force (Stephanie Wells) • Canada Regulation Task Force (Stephanie Wells) • Mexico Federal Seed Treatment Task Force (Cara Smilley and Luis Acuna, Co-Chairs) • Asian Trade Task Force (Hal Shenson, Chair) • Market and Promotion Strategy Task Force (TBD, expansion of “advisory” group) • Others as needed

7. USDA Technical Assistance for Specialty Cropsand OTA supported trade programsBob Anderson, Sustainable StrategiesGuided by input from the USDA trade office, responses from postings on the OTA International Trade Forum list serve, and support from the international task forces as well as technical trade advisors, OTA plays a pivotal role supporting the industry through negotiation support and analysis.

8. ORGANIC MARKET LANDSCAPES • Robert Anderson • SUSTAINABLE STRATEGIES • Advisors in Food and Agriculture • EXPO WEST • March 2007

9. Dramatic Growth of US Organic Food In billions of dollars

10. ORGANIC FOOD SALES Category Shares for 2003 Information Sources: OTA 2004 Manufacturer Survey, Nutrition Business Journal surveys of manufacturers, SPINS, and others.

11. ORGANIC NON-FOOD SALES Category Shares for 2003 Other 7% Personal Care 39% Nutritional Supplements 34% Fiber 20% Information Sources: OTA 2004 Manufacturer Survey, Nutrition Business Journal surveys of manufacturers, SPINS, and others.

12. US and EU ORGANIC PROGRAMS Similarities and Differences in US NOP and EU 2092/91

13. SHARED VALUES • 3rd Party Certification • Audit Trails • Annual Inspections • Accreditation • Materials Lists • Defined Conversion Periods • Sustainable Farm Plan

14. DIFFERENCES Cultural US - Similar language and cultures EU - Different languages and cultures Political US - Federal law supercede state laws EU - 15 sovereign State governments; - Derogation by member States

15. CROPS Agriculture Conversion Period US - 3 years, no exceptions EU - Generally 2 years annuals, 3 years perennials; - Some exceptions

16. LIVESTOCK • US- Prohibits Antibiotics • EU – Antibiotics Allowed 3 Times Per Year

17. PROCESSING US - Detailed Handling Regulations EU - Certifier Verified Compliance

18. MATERIALS • US • Naturals Allowed unless Prohibited • Synthetics Prohibited unless Allowed • EU • Closed List • Generally Must be Listed

19. Key Organic PrinciplesCaptured in Standards : • Organic value originates on the farm • Inspection protects integrity from farm to table • Production standard certifies process • Organic production promotes continuous improvement • Oversight protects organic integrity in all categories SUSTAINABLE STRATEGIES

20. The Organic Market • Growing at More Than 20% • Topping $20 Billion in 2005 • Customers Include Broad Demographic Segments • Certified Organic Programs Bring Clarity For Consumers and Manufacturers

21. Organic Agriculture • Improves Soil Fertility • Reduces Agricultural Pollution • Recycles within System • Increases Bio-Diversity • Creates Domestic & Global Markets SUSTAINABLE STRATEGIES / Wolf & Associates, Inc.

22. Organic Production Sustains Agricultural Economies • Adds Value On Farms • Encourages Diversity • Stimulates: • Fruit,Vegetable, Livestock, Fiber and Processing Industries • Contributes to Developing Export Trade • Improves the Environment • Adds to Rural Economies

23. International Landscape • Global Access to US thru NOP Accredited Certifiers • Trade Policies and Objectives • Grains/Oil Seeds • Fruits, Vegetables and Processed Foods • WTO Disputes Impact Food • Global Health Issues Impact Trade

24. ORGANIC TRADE NEGOTIATIONS • Free Trade Agreements - • United States Trade Representative (USTR) • Agricultural Trade Agreements • Foreign Agriculture Service (FAS) • US National Organic Program (NOP) • US Politics • Trade Promoting Administration • US Trade Policy • Staff Rotations • War • Natural Disasters • Political Distractions

25. Trade Terms • Recognition Agreement • Applying the NOP Standards in Foreign Countries • USDA Recognitions • British Columbia • Canada – Standards Council of Canada • Denmark • India • Israel • New Zealand • Quebec • United Kingdom

26. Trade Terms • Equivalency Agreement • Standards Negotiated as Equal • Japan • One Way Letter of Agreement • Export Arrangement with Japan

27. European Union • EU Organic Plan for the Future • Proposed Revised Standards • Third Country Recognition

28. Switzerland • Interested in beginning Equivalency Talks • Swiss Rule Mirrors EU

29. Japan • Current One –Way Letter of Agreement • “Equivalency” Concepts • Trade Realities • JAS Revised Regulations • Revised Crops & Processing Standards • Added Livestock Standards

30. Japan • Trade Negotiations are ongoing • FAS & NOP met with MAFF in January ‘07 • Japan may pursue Recognition as step towards Equivalency negotiations

31. Korea • Free Trade Agreement Talks Are Ongoing • Industry Adamant that Organic is Included • Challenging Trade Environment • 0% Tolerance for Adventitious GMOs • Transparency and Inconsistency at Customs • Do Not Accept Trader Certificates • Percentage Ingredients w/ Trade Documents • Positive Materials List

32. USA & Canada • Largest Trading Partners • Often Overlooked • Similar Cultures • US • NOP in Place • Canada • Organic Rule Published

33. CANADA • CANADA Organic Regulation • OTA Canada Organic Task Force • Bilateral Membership • Assisted Canadians in developing recommendations on proposed regulations • 2006 Implemented 2008 • Canada Organic Regulations Final 12/06 • Fully Implementation December 21, 2008

34. Mexico • Organic Legislation in Place • Organic Regulations in Development

35. NAFTA Opportunities • N. American Security and Prosperity Initiative • North American Organic Trade Zone • North American Negotiation Strategies

36. Increased Global Competition • Double Edged Sword • EU Balkan Ascension • South America • United States • Canada • Mexico • Pacific Rim – • Australia • Japan • China • Korea • India

37. Tightening Enforcement • GMO’s • GMO’s challenge Organic in Global Markets • EU • Japan • Korea • Food Security • US Bioterrorism Act • Global Responses

38. CHALLENGESGrowth in Organic Production Faces Some Unique Challenges • Access to Markets • Supply Constraints • Added Costs • Court Decision

39. OutlookGLOBAL CHALLENGES • Competition • Traceability • Heightened Enforcement • Bioterrorism

40. Outlook GLOBAL OPPORTUNITIES • Expanding Markets • International and DOMESTIC • Global Ingredient Sources • NA Security and Prosperity Initiative • Trade Agreements • Dynamic Period of Organic Trade Talks

41. Resources • Organic Trade Association • www.ota.com • Foreign Agriculture Service • www.fas.usda.gov • National Organic Program • www.ams.usda.gov/nop • US Agricultural Attaches • State Regional Trade Organizations • Food Export USA, MIATCO, SUSTA, WUSATA • State Departments of Agriculture

42. Robert Anderson SUSTAINABLE STRATEGIES Advisors in Food & Agriculture 314 South Burrowes Street State College, PA USA 16801 814.574.1063 bobanderson1217@yahoo.com

43. USDA Market Access Program Funded Activities Tiffany Landry, Landry Consulting Project Manager Guided by input from the Advisory group, survey results, meetings with State Regional Trade Groups, State Departments of Agriculture and our technical advisors the annual Unified Export Strategy is developed and implemented.

44. Market Access Program Activities • Trade Show presence (Taiwan, UAE, EU, Japan, Korea) • Citrus campaign in Canada • Reverse Trade Mission at All Things Organic™ • New market research reports • Generic branding program • Export Directory online • Domestic trade shows (Expo West, Expo West, All Things Organic) • Industry Assessment survey • Promotional materials

45. OTA Membership Involvement Opportunities • Forum Discussions (281 members registered) • Task Force Participation • Update meetings at industry events (3/year) • Special meetings with USDA (forthcoming) • Periodically scheduled conference calls • Contact staff or advisors • www.ota.com/export.html