Organic Integrity in the Supply Chain training video for certifiers and handlers
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Hi, I am Miles McEvoy, Deputy Administrator of the National organic Program at the USDA’s Agricultural Marketing Service. Today, I am going to speak on the importance of maintaining organic integrity across the supply chain and the responsibilities of certified organic operations in maintaining that identity and integrity of organic products. There are three modules in this training. The first module covers the organic control system that operates on a global basis. It is implemented by handlers that are involved in the organic trade and it’s verified by certifiers and competent authorities. Second, we’ll provide details on organic system plans and the specific components regarding organic system plans in the organic supply chain. In the third module, we’ll be more specific about responsibilities of certified organic handlers to verify organic ingredients that they receive and ship. The objectives of today’s presentation are to identify whether a handler in the supply chain needs to be certified. You’ll see that most handlers are required to be certified. Another ojective is to understand the requirements of the organic system plan in a way that supports integrity throughout the supply chain. We’ll review how organic handlers verify that incoming ingredients and products that they receive are organic. And, we’ll explain what records are needed to document compliance with different parts of the regulations. Let’s get started. Module one is on the organic control system. Organic trade is expanding around the world. We have worldwide production. Trade within the U.S. and European Union alone is over $80,000,000 in the organic market. This substantial market provides opportunities to thousands of farmers around the world that are involved in organic production. This benefits them in terms of organic production, and income it brings to their communities and the products they provide to the organic market. Because of this growth in the organic market and organic trade, many governments have established control systems involving organic standards and oversight of the organic sector to verify of that organic products really are produced, processed and handled under strict standards. A lot of money is being made in the market and some folks are trying to sell fraudulent product as organic. It is very important to have an effective control system that identifies any activities or fraudulent products and gets them out of the system. There is a very good system in place. The majority of organic products are legitimate, coming from certified organic farms and processors, who are certified to ensure that they comply with organic standards throughout the supply chain. But there are a fraudulent actors out there that we must make sure are taken out of the market. We must ensure that handlers follow a rigorous control system to ensure organic integrity from the farm to the marketplace. The global organic control system has four major components. First are clear standards. The standards may be a little different from country to country around the world, but they are generally harmonized and more or less the same. The U.S. and EU have the most widely used standards because of the large organic markets in those countries. The second component is the certification process – the certification of organic farms producers and handlers, and ensuring they are compliant and verifying that they are complying with the standards. The third component is accreditation of the certifiers, ensuring that they are consistent in how how they verify organic claims. They ensure that the certification process is complete and thorough. And the fourth component is enforcement. The certifiers have their role in enforcement, and so do competent authorities. They use their authority to do things like stop sale, impose fines, or otherwise penalize non compliant or fraudulent actors. The organic control system operates globally and staff oversee organic operations around the world. Witness inspections review audits and certify audit results on an ongoing basis. Here, we see an audit of organic grain production in Argentina. There are interviews of managers and auditing of records. All are parts of the oversight process within the organic control system. USDA’s National Organic Program mission is to protect the organic integrity of USDA organic products throughout the world. Our vision is organic integrity from farm to table, consumers trust the organic label. Our authority is the organic foods production act of 1990. and the USDA organic regulations. Principles within the organic control system include effective planning to ensure that farm plans and organic system plans meet all organic requirements. Another principle is traceability from farm to markets all along the supply chain, and verifiable systems including inspections and audits, and records that verify that the standards are being met. Clear audit trails enable auditors to trace products from farm to market and market to farm. And comprehensive audits and competent inspectors test that all audit trails are complete and that organic handlers have received sufficient organic products and verified their authenticity. We must verify amounts of organic products they sell. The organic foods production act states that no person may affix a label or provide other market information concerning an agricultural product if such a label or information implies either directly or indirectly that such product is produced in handled using organic methods except in accordance with this chapter. This covers any kind of organic claim on a product whether it’s direct or indirect use. The USDA organic regulations under 205.100 A state that, except for operations that are exempt or excluded, such production must be from operations that produce or handle crops livestock livestock products or other agricultural products that are intended to be sold, labeled, or represented as 100% organic, organic, or made with organic must be certified. So, the rules are clear that if you’re involved in production are handling organic products you must be certified and therefore under the supervision and oversight of an organic certifying agent, who inspects, audits, and ensures compliance with the organic standards. So if you are involved in the organic trade – selling, labeling, or representing products as organic, you must be certified unless you fall under either an exemption or exclusion from certification. So, wholesalers, traders, brokers, distributors, importers, and exporters – you’re all considered handlers if you’re involved in selling, processing, repackaging, or representing products as organic. Handlers must be certified or must meet the narrow exemptions or exclusions provided for in the regulations. So, some handlers may be excluded. Exemptions are from the organic food production act, and provide exemptions for small farms and Retail Food establishments. I want to focus on 205.101 B, that provides additional exclusions from certification. These are not included under the organic food production act, and there are fairly narrowly constructed. 101 B states that if a product is packaged and remains in the package, then the handler is not required to be certified. So we do have uncertified handlers that are involved in the audit trail in supply chains between the farm and the market. These uncertified operations may include importers and exporters, brokers and traders, who are involved in organic sales and trade, but do not package are otherwise handle organic products. Here’s some examples of the operations that may not be required to be certified, or that are excluded, and who receive product. Again as long, as that product remains in the same container, they may not need to be certified. Just a note – in the upper left hand photo there are some packets and berries, and behind, you can see some unpackaged blueberries. That particular operation looks like it may be packaging product. In that situation, the operation would need to be certified. Here’s another example of an operation that may be excluded if they sell organic products. If the flour is in a closed package and is not processed or relabeled, the handler of the tote bags could be excluded from certification. But, if they repackage the product in smaller bags, they would have to be certified. Let’s turn to the role of certifiers and what they do in the organic control system. There are really essential to the organic control system. They do the bulk of the inspections and auditing and verification. And they ensure the organic standards are being met. Certifiers do a number of things. First, they review organic system plans. They review and approve the inputs and materials that are used in products and ingredients that are received. If you accept organic ingredients, they review those and verify they meet organic standards. THey review record keeping and the practices that are being conducted by that the handler or producer, and conduct inspections. These include annual inspections as well as unannounced inspections. They also verify effective implementation of the organic system plans to ensure that those plans that are submitted and reviewed are complete and accurate and being followed. They conduct inspections and conduct product in and product out reconciliation audits. This is a very important component of the work. And they also issue certificates – annual certificates, transaction and import certificates, and also attestation statements were are relevant for Canada under the U.S. Canadian organic equivalency arrangement. Certifiers are overseen by USDA and must follow rigorous and public accreditation requirements that are in the USDA organic regulations. The National Organic Program audits the 82 accredited certifiers. They operate around the world. We audit them at least twice every five years and we review their management practices on an annual basis. Audits are quite extensive – they are at least a week in length and involve both office visits and in the field. This way, we are sure they are conducting inspections in line with the rules. We assess the effectiveness of their organic control system and target their risk areas. We also do additional compliance audits of the certifiers if needed to verify that are complying with the requirements. This shows on auditing process with a certifier. You have the certifier inspector in the forefront on the left, who is reviewing the records. You also have the parties involved in this handling facility. They are showing the records. And in the background, you have a USDA auditor that’s observing the inspection in process. OK let’s move on to module two – organic system plans. There are a number of requirements for organic system plans that are in the regulations. For the purposes of this presentation, we are focusing on these particular areas of the organic system plans first. Organic system plans must fully describe the practices and procedures that the handler is conducting, to be in compliance with the requirements. The OSP includes the inputs that are used or the organic products that are receive by the operation or ingredients received and verification of how they are determined to be organic. And, recordkeeping systems. The recordkeeping system needs to fully disclose all activities of the operation so it’s auditable and readily understood by an outside inspector. So, specifically under the regulations, 205.201a, the organic system plan must include description of the practices and procedures to be performed and maintained. There must be a list of each substance to be used as a handling input indicating its composition and source. There must be a description of the recordkeeping system that complies with the requirements and any additional information deemed
necessary by the certifying agent to evaluate compliance with the regulations. This includes being able to verify that any organic products or ingredients received by the handler are compliant with the organic requirements. Your organic system plan must show how you prevent the commingling of organic and non organic products. So, for example, it would show that you’re storing organic products above not organic products or that you have dedicated bins for organic product. You must show how you protct organic products from contacting prohibited substances. You must also ensure that containers you use for organic products are cleaned and don’t contain any prohibited substances. And you need to show how you implement proper clean out and transportation procedures. This prevents organic product from coming into contact with prohibited substances. So, all operations must have an organic system plan that lists each input, including its source. This includes all organic products and all ingredients received by the organic handler. Certified operations must also have a records keeping system that fully discloses all activities and transactions in sufficient detail to be readily understood and audited. This is a very key component of the USDA organic regulations is this recordkeeping system. Records need to be accurate fully descriptive of activities, and claearly demonstrate that the product you’re receiving is certified organic from a certified organic source. So, when that you’re importing and exporting, your organic system plan must disclose whether the operation exports or imports products and describe the records that the operation maintains for products that are imported or exported. You must identify all ingredients imported, including the source of those ingredients. The OSP needs to include the operation’s procedures for verifying the source, and the certification compliance. This includes labeling information for a product that is exported under a trade arrangement. OK, let’s move on to module three – verifying organic ingredients and incoming products. Organic system plans and records are key for input management. Organic products and organic ingredients are handling inputs and as per the regulations under 205.201 a, an organic system plan must include a list of each input that’s used as a production or handling input, indicating its opposition and source. And in addition to that, under 205.201 a4, there’s the recordkeeping system. That recordkeeping system must describe all activities, and explain how operations fully disclose all activities and transactions in sufficient detail as to be readily understood and audited. Here are examples of some of the records that may be part of your organic system plan. These are records that your organic operation would provide to a certifier inspecting or auditing your operation. Your certifier will ensure that they are complete and adequate to fully disclose the activities of the operation. So, for instance, records verifying the organic status of incoming product, organic certificates for all incoming product, ingredients, and some form of verification that the product is coming from a operation that is certified. Of course, invoices, purchase orders, bills of lading, and contracts are records that are reviewed. Handlers have certificate, certificates of analysis, product specification sheets, raw product inventory reports and records, weigh tickets, receipts, and tags. The inspector will be looking at how much product was received and any kind of shrinkage that may occur during your handling of the product. So, records that will show that, and be sufficient for the inspector to do that calculation. Clean truck and storage affidavits show that the transportation was done in a way that protects organic integrity. Phytosanitary certificates and verification of non-fumigation are key documents that need to be a component of the recordkeeping system and need to be reviewed by a certifier as part of the certification process. Certified organic operations have requirements, and must have procedures in place and records that demonstrate that all the products they receive, and all the ingredients they receive, are compliant with the USDA organic regulations. There are different ways this can be done, but it needs to be sufficient to trace it back to a certified organic operation, in terms of the quantity of product that was shipped from the certified organic operation. Examples of these would include, and this is not all inclusive, but certainly organic certificates from suppliers, organic transaction certificates, and an attestation statement would be necessary if the product is coming from Canada. And, an NOP import certificate would be necessary if it is coming from a country that we have an equivalency arrangement with. That includes the countries in the European Union, Switzerland, Japan and Korea. Certified operations may not accept organic products without verifying the source and certification status of organic product. The organic system plan must describe how they do not accept organic products or ingredients without verifying the source and certification of the products. This is especially critical to receiving products from uncertified handlers. OK, so as we described in module one, there are handlers that are not required to be certified, because they’re excluded from requirements of certification. So, some supply chains will have uncertified handlers involved in them. So, in these cases, when there uncertified handlers, who keeps the organic records? It is the responsibility of the certified organic parties to keep the records, so that would be the certified organic party that shipping the product and certified organic party that’s receiving it. Both of those would be responsible for the records, so they can be audited and inspected and verified by the certifiers when uncertified handlers are involved. The records need to be adequate to trace the product from one certified operation to another. This includes volumes and verification of sources. So, we have identified indicators of where there are weak control points – where there are weaknesses in the system. We want to be sure people understand these weaknesses and eliminate them from the organic control system. First of all, when handling bulk product, or nonretail product, when there is a certificate, but the product is not labeled, that’s a risk. The product itself needs to be identified as organic – it needs to have a clear audit trail. This is for both the shipment itself and any accompanying paperwork. Another example is a missing certificate from the originating farm or intermediate handler – that would be a weakness or of noncompliance. Another weakness is any evidence of falsification, where there could be evidence that an operation name is being changed on a certificate to protect proprietary information – we need the correct information to be able to trace the product back to a certified operation. And, if a product has crossed multiple borders, of if there is a lack of clarity about whether the product was fumigated. These are things that should be closely examined by handlers, and they are being given a close look by certifiers in this process. Certifiers play a very important role – and inspectors of a key component in terms of them doing audits. They are expected to conduct traceback audits and mass balance audits to verify traceability and to review record keeping. These audits should be happening at your operation. If it’s not happening, then please let us know -because that’s not in the spirit of of what’s required under the organic regulations. So, certifiers check a number of different things for imports and exports; you need to have procedures and they will look at those procedures and the documentation that verifies the source and certification of those products. They will also verify that any imported organic products were not fumigated at ports of entry. They will review records from the ports of entry, such as form PPO 523 and 429. Emergency action notices and fumigation records are things that should be available and reviewed by the inspectors to ensure that organic products are not fumigated at the ports of entry. Other questions that certifiers ask about imports and exports are, has the appropriate supporting documentation been provided that verifies the authenticity of the product? Is it in fact an organic product that meets the U.S. standards? Is there supporting documentation? Is it valid? And is it from an authorized source? And does the operation maintain appropriate records for the imported and exported product? Is it thorough enough? Does it explain all of the amounts and products and dates of when the product was received and where it came from? In closing, we have a number of different resources about how you can help to protect organic integrity. We have the organic integrity database. This is a list of all certified organic operations under the U.S. organic system. It has over 31,000 operations that are listed. It’s a very powerful database that we continue to make improvements to. It has very good search capabilities, so if you have any questions about the status of the certified operation, you can look up its status in the organic integrity database. You can then further check with the certifier to verify the status of a particular product or operation. We also have a lot of information on our website – We have the USDA organic regulations and we have the national organic program handbook, which provides a lot of explanation of the regulations, in terms of guidance and instructions to certifiers, and provides details of theorganic standards. There is a wide range of topics regarding organic standards and the control system on the website, www.ams.usda.gov/nop. We also have country specific pages that give you more details about our international recognition and equivalency arrangements. So, certified handlers, please reconfirm that you’re following the requirements as described in this presentation. Make sure that you have solid documentation that any organic imports that you’re receiving are certified organic from a authorized certified organic source. Request import certificates and transaction certificates from the certifier for each shipment to verify that it meets the requirements and, if you have any evidence that a product being sold, labeled, or represented as organic does not meet the requirements, please let us know. You can provide specific information to the national organic program at [email protected] Thank you very much for listening, and please get in touch with us if you have any questions. We’re here to help, and are working to protect the organic integrity of the whole system.

2 thoughts on “Organic Integrity in the Supply Chain training video for certifiers and handlers

  1. Thanks so much for a great presentation Miles! Janine Gibson of the Canadian Standards Interpretation Committee.

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