The USDA has released a long-awaited “origin of livestock” final rule establishing uniform standards for transitioning dairy cattle to organic production. The rule closes what many in the industry considered a “loophole” creating unfair organic marketing practices.
Natzke dave
Editor / Progressive Dairy

USDA’s National Organic Program (NOP) will oversee the new rule, which in general:

  • Allows a dairy livestock operation transitioning to organic, or starting a new organic farm, to transition non-organic animals one time

  • Prohibits organic dairies from sourcing any transitioned animals: Once a dairy is certified organic, animals must be managed as organic from the last third of gestation. Variances may be requested by small businesses for specific scenarios.

A copy of the rule is available here. According to the USDA website, the rule does not become official until it is published in the Federal Register. It had not been published as of March 29. More information and an infographic fact sheet about the rule are also available.

The USDA rule was originally proposed in 2015 but withdrawn in 2018. In late 2019, the USDA decided to reopen the comment period on the proposal.

As originally proposed, the rule clarifies requirements for organic dairy farms transitioning conventionally raised animals to organic production. After completion of a one-time transition, any new dairy animals a producer adds to a dairy farm would need to be managed organically from the last third of gestation or sourced from dairy animals that already completed their transition into organic production.

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“The origin of livestock final rule provides clear and uniform standards about how and when livestock may be transitioned to organic dairy production and how transitioned animals are managed within the organic dairy system,” said U.S. Secretary of Agriculture Tom Vilsack. “Now, all organic dairy livestock producers will have the confidence and certainty they are operating in a fair and competitive market.”

In a November 2019 article in Progressive Dairy (Study finds loophole puts organic dairies at a disadvantage when raising heifers), Fay Benson, project manager with the New York Organic Dairy Program, said the USDA Office of Inspector General (OIG) had published an audit report on organic milk operations stating that certifying agents were interpreting the origin of livestock requirements differently. Three of the six certifiers interviewed by OIG allowed producers to continuously transition additional animals into a herd after the initial herd made the transition to organic milk production, while the other three certifiers did not permit this practice. The OIG recommended that a proposed rule be issued to clarify the standard and ensure that all certifiers consistently apply and enforce the origin of livestock requirements.

A Cornell study compared the costs of production for organically raised calves from day one to those raised conventionally and transitioned to organic before freshening. The study showed that the loophole allowed dairies whose certifiers allowed conventional raising of the newborn calf to 1 year of age to save $884 per animal for feed and labor.

The New York Organic Dairy Program is connected with Cornell’s School of Agriculture and Life Science and Cornell Cooperative Extension. After meeting in December 2018, the New York Organic Dairy Task Force directed and provided funding for Benson to complete a study of what it costs for dairy farmers who raise dairy replacements organically. Data for the study was collected from three certified organic dairies in central New York.

Benson used a cost analysis created by Jason Karszes, farm business specialist with Cornell’s PRO-DAIRY Program. Cost and data collected included labor, feed, buildings, machinery, animal health, trucking, manure handling and culling.

Realizing that cost of feed accounts for over 50% and labor 12% of the cost of raising a dairy replacement, any changes to those dramatically impacts the total cost to raise that animal. The study showed that 18 conventional dairy heifer growers in New York averaged costs of $1,060.92 per heifer during the first year of an animal’s life. Costs of the three organic farms who took part in the study ranged from $2,312.20 to $3,638.85 per heifer.

Among practices leading to higher costs, calves raised conventionally were fed milk replacer or milk for 50 days, while heifer calves raised organically averaged 89 days (ranging from 70 to 112 days) on milk replacer or milk. Both the longer feeding period plus the higher cost of organic milk replacer or milk increased feed and labor costs on operations raising dairy heifer calves organically.

Conventional dairies averaged $3.60 per day per calf in milk replacer/milk costs and $1.50 per day per calf in labor costs, resulting in the total feed and labor cost of $255 to raise a heifer calf to weaning.

Among the three dairies raising heifer calves organically, milk replacer/milk costs ranged between $5.05 and $8.05 per calf per day, with labor ranging between $3.12 and $4.93 per calf per day. As a result, the total feed and labor cost of raising a dairy heifer calf to weaning using organic practices ranged between $698 and $1,139 per calf. The organic herd with the highest cost per calf had the longest milk replacer/milk feeding period and the smallest herd, so labor costs were spread over fewer animals.  end mark

Dave Natzke