Organic Imports: 

Where things go 

wrong, and what can 

be done

NOSB Panel Organic Imports 1
NOSB Panel Organic Imports 2
NOSB Panel Organic Imports 3
NOSB Panel Organic Imports 4

Why is fraud in the organic 

industry so widespread in 

some countries?
NOSB Panel Organic Imports 5

1. Very long 

supply chains
NOSB Panel Organic Imports 6

Processor

Intermediary

Processor

Intermediary Exporter

Trader in Third 

Country

Importer

Repacker Intermediary

Retailer
NOSB Panel Organic Imports 7

2. Hot markets
NOSB Panel Organic Imports 8
NOSB Panel Organic Imports 9
NOSB Panel Organic Imports 10

3. Certifiers are 

businesses
NOSB Panel Organic Imports 11

$ Integrity
NOSB Panel Organic Imports 12

Consumers 

are distant

Lack of 

supervision

Social 

hierarchy

Corruption

Competition

Personal 

Integrity

Counterprodu

ctive 

remuneration 

models

Fear of 

losing 

reputation

Fear of losing 

accreditation
NOSB Panel Organic Imports 13

Consumers 

are distant

Lack of 

supervision

Social 

hierarchy

Corruption

Competition

Personal 

Integrity

Counterprodu

ctive 

remuneration 

models

Fear of 

losing 

reputation

Fear of losing 

accreditation
NOSB Panel Organic Imports 14

Some things that are being 

done in the EU to deal with 

fraud:
NOSB Panel Organic Imports 15

Compulsory 

Certificates of 

Inspection
NOSB Panel Organic Imports 16

OFIS
NOSB Panel Organic Imports 17
NOSB Panel Organic Imports 18

Stope Sale in 

Case of 

Suspicion Where a control body has a substantiated 

suspicion that an operator intends to 

place on the market a product not in 

compliance with the organic production 

rules, this control body can require that 

the operator may provisionally not market 

the product with this reference ... This 

decision shall be supplemented by the 

obligation to withdraw from this product 

any reference to the organic production 

method is the control body is sure that 

the product does not fulfil the 

requirements

Reg. EC 889/08, Art. 91(2):
NOSB Panel Organic Imports 19

What is not being done, 

neither by the EU 

Commission, nor by the NOP:
NOSB Panel Organic Imports 20

Consumers 

are distant

Effective 

supervision

Social 

hierarchy

Corruption

Competition

Personal 

Integrity

Counterprodu

ctive 

remuneration 

models

Fear of 

losing 

reputation

Fear of losing 

accreditation
Silke Fuchshofen 

Independent Organic 

Processing Inspector 
Disconnect 

between Departments? 

2

© Organic Insights, Inc. 
If we focus on procedures, 

1. We can determine high risk areas in ingredients, 

suppliers, operation, etc. 

2. During review of records, a well-chosen sample will 

show us, if the procedures are adhered to and if they 

are effective. 

3
3. The staff at the certified operation usually 

appreciates thorough vetting of their procedures 

because that helps them understand strengths and 

weaknesses -

4. and the operation can work on improvements and 

will be better able to fulfill their responsibility of 

maintaining organic integrity at their plant.

Certified Organic Operations can be our best allies 

when it comes to protecting organic integrity. 

4
Records vs. Procedures

understand the operation’s 

procedures

use records to verify that the 

procedures work 

5

and then 
Six Suggestions: 

1. 

That certified organic operations need to 

submit comprehensive written organic 

procedures and that reviewers and inspectors 

are trained to verify them in detail. 

6
2.

That organic processing and handler inspectors 

should be trained and authorized to take samples, if 

they encounter a high-risk situation. For example, if 

the audit trail cannot be linked back to a certified 

entity and the raw material is still in storage, we 

should be authorized, or even required, to take a 

sample. 

7
3. 

That Certifiers are required by the NOP to 

report uncertified vendors that appear to be 

repackaging or relabeling. And that the NOP 

applies the same scrutiny to those as to 

certified entities. 

8
4. 

Research and development of a system that is geared 

to identify and target high risk operations. Right now 

we are focusing on the areas where fraud had been 

discovered. If we want to be proactive, where do we 

need to look for fraud and how do we best employ 

resources? The Pareto Principle, also called 80:20 

rule, could provide a very useful tool and I hope we 

will be able to speak more about this. 

9
5. 

To address the issue of inspection qualifications, we need 

to talk about trainings, but also about the work 

environment. It is engrained in the organic industry that 

organic inspections should not cost much. Therefore, 

most organic inspectors will try to be fast. But one 

cannot rush and be thorough at the same time and the 

industry does not want quick inspections any more. This 

needs to be addressed by and with the certifiers. 

10
6. 

Higher quality inspections will come at a cost to the 

certifiers. To make it possible, a risk-based approach 

can be useful here too. Inspectors can be grouped 

into different skill levels and areas and they can be 

dispatched according to type of operation and risk 

level. High risk operations are matched with highly 

skilled inspectors. 

11
Silke Fuchshofen 

Independent Organic 

Processing Inspector 
Risk Based Approach

• We talk about risk based approach, but what does 

that mean?

• Is there a system to organize your operation and 

your resources around?

• The regular work of annual inspections needs to 

continue, so how do the extra efforts, such as cross 

checks, unannounced audits and testing fit in? 

• Right now we are reacting to cases of detected 

fraud, but how can we be pro-active? 

2
Pareto Principle 

Also called: 

80/20 Rule

Law of the Vital Few

Principle of Factor Sparsity

3
PARETO PRINCIPLE

4

20%

20%

20%

20%

20%

80% 

20%

• Sales (20% of clients account for 80% of the sales)

• Occupational health and safety (20% of hazards account for 80% of 

injuries, 

• Errors in software (Microsoft fixed 20% of the most reported bugs 

and addressed 80% of the errors)
PARETO PRINCIPLE

5

82%

11.75

2.3

1.85

1.40

Distribution of GDP 1989

• 80/20 is a rule of thumb.

• The actual distribution is a bit different. 

• It does not have to add up to 100. 
We can find 80% of the fraud in 20% of the operations. 

6

What do we need? 

• Industry Cooperation to 

• Define general high risk criteria.

• Define red flags at individual operations
We can find 80% of the fraud in 20% of the operations. 

7

• And a tool set of investigative methods:

• Sampling & testing

• Cross checks 

• Trained inspectors and reviewers

• Documents

• Complete Audit Trails

• Unannounced inspections

Thank you. 
NOSB Imports Panel

2018

Jake Lewin, President

CCOF Certification Services, LLC
Our Deep Roots

CCOF is a nonprofit organization governed 

by the people who grow and make our food. 

Founded in California more than 40 years 

ago, today our roots span the breadth of 

North America and our presence is 

internationally recognized. First CCOF logo, 1973
Three Primary Issues for Certifiers 

1. The majority of certifiers do not report acreage to NOP.

2. Certifiers are not fully collaborating with each other.

3. Certifiers are not always tracking and reporting exports. 
Solution 1

All certifiers should report crop acreage to Integrity Database
Certifiers Report Acreage to NOP Integrity Database

21,086

12,627

8,458

5,651

5,019

632

0

5,000

10,000

15,000

20,000

25,000

30,000

GLOBAL OVERALL

21%

USA 28% Rest of World

Combined 7%

Certified Operations

Regions and Percentage of Operations that Have Acreage Reported

Source: NOP Integrity Database 04/23/2018

Acreage Reporting by ACAs for Crop/Wild Crop Operations

# with NO

acreage

reported

# with

acreage

reported
Solution 2

NOP should direct certifiers to collaborate on investigations
Solution 3

Certifiers should track and report export activity to NOP. 
Organic is in a Strong Position for Oversight

• Fraud is rare, but any 

incidence must be taken 

seriously and addressed 

quickly.

• We can work together to 

create effective tools and 

solutions to prevent future 

fraudulent imports. 
Three Critical Solutions

Acreage Reporting

Trade Tracking Collaborative 

Investigations
Example of Solutions in Action

Alleged Fraudulent Activity: 

- Large shipment of grain imported from Turkey. 

NOP Action:

• NOP verifies organic acreage from region where grain grown

• Certifiers immediately share information.

• NOP looks at overall export activity in region 
Thank You!

Jake Lewin, President, 

CCOF Certification Services, LLC 

jake@ccof.org 

Arrival in Port of Stockton, CA

March 6, 2018

Origin-Turkey Corn and 

Soybeans

The Ince Atlantic is expected to arrive at the Port of Olympia's Marine 

Terminal on September 13, 2016. After unloading cargo, it is expected 

to depart around September 19, 2016. 

Steamship Line: Tiryaki

Vessel Flag: Istanbul 

Cargo: Organic Grain 

Volume: 15,000 metric tons 
Photo credit: Washington Post (May 

12, 2017)

“The labels said ‘organic’. But these massive imports of corn and 

soybeans weren’t,”
Bellingham, WA September 27, 2017
Arrival in Port of Stockton, CA

March 6, 2018. Corn and 

soybeans; Origin-Argentina

WHAT IS OFARM ASKING FOR?

1. NOP TO REQUIRE ANY ENTITY THAT 

IMPORTS GRAIN TO BE CERTIFIED

2. PUTTING A SYSTEM IN PLACE FOR 

INSPECTION AT U.S. PORTS

3. PROTOCOLS FOR RESIDUE TESTING
4. Putting in place a warning system of 

special protocols of imports from “High 

Risk” countries similar to the EU

5. Strengthen Accredidation of 

Certifiers

6. Improved transparency on the part 

of NOP

7. Examination of ships Captains Logs
8. USDA submits to an outside audit 

as called for in OFPA 

(Not skirting the issue by using peer 

review.)

9. NOP to submit a full report on 

compliance with the OIG 

recommendations.
Cost to U. S. Organic Producers

Over $400 Million

Who should be held responsible?

MISSION STATEMENT

To Coordinate Efforts of 

Producer Marketing Groups to 

Benefit and Sustain CERTIFIED 

ORGANIC PRODUCERS.
WOMA

MOFC

NFO

MOPC

KOPA
 OFARM pricing goals:

The full recovery of all input costs for grain 

and livestock

A return to labor and management that 

provides adequate family income

Return to investment

Income enhancement to provide for the 

community support for schools and churches 

Organic premium for production of healthy 

wholesome food that is environmentally 

responsible
OFARM provides services to:

Promote the exchange of pricing, contracts 

and marketing information

Facilitate negotiations and terms of the 

contracts

Educate policy makers such as legislators

Assist organic farmers with adoption of new 

crops and agronomic practices
 OFARM Success

“Organic Federation Seen As A Strategy For Family Farm Survival, 

Regional Competitiveness” USDA- Dr. Thomas Gray January 2012
 Dr. Gray cites a study by Clarkson University authors Richard 

Welsh and Amy Guptil, which concluded this:

“OFARM is the largest single 

organized block of 

producers growing organic 

field crops in North 

America.”
CHEAP GRAIN=

CHEAP MILK

MEAT

EGGS
ORGANIC IS PROJECTED TO 

GROW 

OVER THE NEXT 3 YEARS 

AT 14% ANNUALLY

CONVENTIONAL FOOD SALES AT 

2.5% PER YEAR
Concerns and Issues

Food Imported from LowGDP Nations Poses Higher 

Safety Risks Study Finds Source: PR 

Newswire 

 Jan. 26, 2015

SO WHAT ARE BUYERS SAYING ABOUT 

YOUR PRICES?

“WITH IMPORTS NOW FILLING IN THE GAPS, IT 

LOOKS AS THOUGH THERE WILL BE ENOUGH 

SUPPLY TO FILL THE GROWING ORGANIC 

DEMAND. WITH SUCH GROWTH, THE FUTURE 

FOR THE ORGANIC MARKET LOOKS STRONG 

AND PRODUCERS SHOULD CONTINUE TO SEE 

GREAT PRICE PREMIUMS COMPARED TO 

CONVENTIONAL MARKETS.”
2011-2017
2017 Soybean Import Value

Turkey India Argentina Ukraine Other

Turkey

India

Argentina

Ukraine

Other

2017 Soybean Imports Dollar Value
2017 Corn Import Value

Turkey Romania Argentina Netherlands Other

2017 Corn Imports Dollar Value

Turkey Romania

Argentina
USDA’s Foreign Agricultural Service Report 

“Turkish Organic Market Overview”

January 26, 2016 

“As organic production and consumption in Turkey, so too do the concerns about 

fraudulent organic products and lack of inspections.”

The report went on to state:

“Although inspections and transparency in the Turkish organic food sector are 

improving, the integrity of organic farming, production, shipping and marketing are 

not always guaranteed.”
ETKO DECERTIFIED

MARCH, 2016 BY THE EU

JUNE 7, 2016 BY CANADA
NOP AND ETKO 

REACHED A 

SETTLEMENT IN APRIL 

2016
OFARM FILED A FREEDOM OF 

INFORMATION REQUEST WITH USDA ON 

JANUARY 18, 2017 ASKING FOR ALL 

TRANSCRIPTS AND DOCUMENTS RELATED 

TO THE ETKO CASE.

ETKO beats USDA to a draw and settles
80% of Ukraine soy grown illegally from GM 

seed Source: Agrimoney May 24, 2016

Malta is at the center of a $220 M organics 

fraud case in Italy Source: The Independent April 12, 2016

Romania-Grown men working 12 hours per day 

for a loaf of bread Source: Arc 2020 July 2, 2014
Profits in Organic Fraud

USA $ 4 MILLION $

+

$3-$4 Million at origin

More Profits than drugs
What procedures does NOP have to assess the EU’s 

process for accreditation and certification are adequate 

to ensure the integrity of bulk shipments of 

commodities that are pooled from many farms?

Does the NOP have an adequate system to track bulk 

commodity shipments produced in other countries 

outside the EU that are certified by EU-based certifiers or 

shipped through EU countries?

What other data collection should NOP set up to 

have a better understanding of sthe source of 

imports, back to the certifier and farm level?
USDA’s Office of Inspector General

Found

“AMS was unable to provide 

reasonable assurance that NOP 

required documents were reviewed 

at U.S. ports of entry to verify that 

imported agricultural products 

labeled as organic were from 

certified foreign organic farms...”
India

No. 1 exporter of soybeans to U.S

Organic agreement with India

Put inside a nuclear treaty option 

in 2008 that is secret

No opportunity for audit
“USDA’s Pineapple 

Center Ring Organic 

Circus Fraud Continues”

The Milkweed, January, 2018

IF USDA Can’t Keep Your 

Pineapple Straight, What about 

a shipload of organic grain?
Cost to produce a bushel of organic 

corn based on our farmers numbers:

$9.50-$10.50 per bushel

Current losses

$300.00 per acre
Cost to 

U.S.Organic

Producers

Over $400 Million in losses

A verified audit trail 

back to the field on 

all organic imports!
WHAT IS NOP DOING?

1. HIDING BEHIND “EQUIVALENCY” 

AGREEMENTS OR SIMPLY TAKING WORD 

THAT COUNTRIES MEET NOP STANDARDS. 

TURKEY? UKRAINE?

2. CAN ONLY RESPOND TO 

COMPLAINTS-ENFORCEMENT RESPONSE

OFARM FILED A FORMAL 

COMPLAINTS ON SEPTEMBER 7, 2016 

AND NOV. 15, 2016
Audit Trail

Who washed the cargo hold, 

elevators, conveyors?
Importers required 

to be certified

Canada and/or the EU NOP

Just now talking about 

it. Setting up an 

NOSB Subcommittee.

Warning system of 

higher risk countries

Testing protocols 

for banned 

substances

Organic inspection at 

the ports
To the Rescue

Organic Trade 

Association

NOP

Certifiers
www.marinevessltraffic.com
LEGISLATION

AND 

RULE MAKING
WHAT ROLE MIGHT 

STATES’ ATTORNEY’S 

GENERAL PLAY IN 

ORGANIC FRAUD 

INVESTIGATION AND 

PROSECUTION?
Currently the market is signaling to 

farmers with low prices no more 

production is needed!

Additional acres needed to 

replace imports to bring stability:

Corn-200,000 acres

Soybeans-400,000 acres
If you are a buyer of organic 

grain for your farm, you 

should be asking for 

verification of whether the 

grain is produced in the U.S. 

or imported
THE IMPORT ISSUE IS NOT GOING 

AWAY ANYTIME SOON.

U.S. PRODUCERS NEED TO WORK TOGETHER 

TO BE ABLE TO PUT TOGETHER UNITS OF U.S. 

PRODUCED GRAIN IN SUFFICIENT QUANTITIES 

TO BEGIN REPLACING IMPORTS.

The future depends on 

maintaining 

“ORGANIC INTEGRITY”

Producing to the highest 

standards in the world and 

maintaining those standards!

 Filing a Formal Complaint with NOP

 Email: NOPCompliance@ams.usda.gov

Phone: 202-720-3252

Fax: 202-205-7808

 Mail: NOP Compliance and Enforcement Branch

Agricultural Marketing Service

United States Department of Agriculture

1400 Independence Avenue, S.W.

Mail Stop 0268, Room 2648-S
Currently a lot of producers in 

the face of collapsing 

conventional commodity 

prices are considering transition 

to organic

 How do we orderly transition them so they don’t put 

themselves and everyone who is aready at risk of collapsing 

organic prices?
The Milkweed
www.organicfarmersassociation.org
Organic Producers can take 

the route of being “rugged 

individualists” doing their own 

thing.

We only need to look at our 

conventional neighbors to see 

how well that has worked.
OR???

We can work 

together to solve 

these problems.

www.MarketingOrganicGrain.com
Web: www.ofarm.coop

www.ofarm.org

Facebook: Organic Farmers’ 

Agency for Relationship 

Marketing

Videos: 

www.organictherealnatural.com
 In many cases OFARM writes the terms of contracts to the 

buyers for its farm members.

 A further study done by Iowa State University shows that prices 

received by OFARM member farmers can be 22-24% higher 

than those farmers who market alone.
Organic Producers

How to get consumers to 

consienciously buy more U.S. 

organic food

75 % of global respondents cite 

country of origin as the most 

important criteria to buy
 “Farmers who do have a marketer seem to access the markets 

more fluidly. Those who don’t “seem to be less aware of the 

marketing opportunities out there.” Also, “they may not know 

what the markets are for their rotation crops. And I think that is 

where a marketer might really come in handy.”

 Nate Lewis, Organic Trade Association

 Source: Agripulse.com February, 2016


Country of Origin LabelingOFARM was one of 200 signers of a letter to Congress 

supporting COOL

GMO contamination -partnered with Food and Water Watch to 

survey our members on the costs

>USDA’s solution-organic farmers should buy crop insurance 

to protect themselves 

Organic Seed Alliance survey- asking organic farmers about 

the problems they face with obtaining organic seed
Dry Baltic Index

Say What?????
Where all the ships 

are located!
 So What Price is Grain Coming into the U.S. ?

 Corn

Country of Origin $6.50 delivered to port 

Shipping $8.00 delivered to a US port

Deliver to PA and NY $10.50

Potential Margins $2.00-$2.50/ bushel
“Eight ways to get consumers to 

buy organic.”

We asked consumers what they wanted 

to know and then found farmers to tell 

their story.

You have to tell your story in 

60-90 seconds. 
6 Shocking Reasons Why You 

Can Never Trust “Organic” 

from China

 1. Organic Products from China Can Contain an Ulimited

Amount of Heavy Metals

 2. China Has Almost No Environmental Regulations

 3. Agencies and Government Deparments in China are Not 

Operating Properly
Corn Soybeans Wheat

($1,000) ($1,000) ($1,000)

2011 41,790 695 

2012 90,177 9,528 

2013 36,620 110,237 16,037 

2014 35,700 184,341 16,663 

2015* 106,313 224,293 14,279 

Dollar Value of US 

Imports by Year
 4. Supplements and Herbs from China Are Often 

Contaminated with Lead

 5. Corruption: China Has Forged Organic Certification Label 

and Other Documents

 6. Organic Products in China are Often Certified by Third Party 

Agencies

 *NOTE: Organic products sent to the U.S. are supposed to be 

certified by a USDA Certifier, there are not enough certifiers to meet 

the need.

 Source: Althealthworks.com January 8, 2016
SOYBEAN IMPORTS-2016

1 India

Organic Soybeans Except 

Seed 7879916 6312938 11399253 9345332 7869786 7232846 6177337 4934902 3406581 3562951 3086077 6609691 77817610

2 Turkey

Organic Soybeans Except 

Seed 46768 0 155421 303228 719143 187072 46768 46768 0 748849 5873922 4838387 12966326

3Canada

Organic Soybeans Except 

Seed 751639 1469203 1525097 2019029 1737617 2626279 1631653 1114870 922222 1934605 1493438 1800027 19025679

4Argentina

Organic Soybeans Except 

Seed 380739 30960 187506 0 1039207 6963657 5330988 2574940 2240126 2600286 2992322 1714548 26055279

5China

Organic Soybeans Except 

Seed 1581040 839689 1653723 1181006 1810468 2567207 2841379 2835562 2442183 1406321 718526 990046 20867150

6Uganda

Organic Soybeans Except 

Seed 0 0 0 0 0 0 0 0 90200 180400 0 451000 721600

7Ukraine

Organic Soybeans Except 

Seed 810252 1137224 871588 8774465 9861269 18028178 12346332 1334887 14755905 941460 2918971 75278 71855809

8Brazil

Organic Soybeans Except 

Seed 0 0 0 0 73513 599313 0 0 0 0 0 0 672826

9

Hong 

Kong

Organic Soybeans Except 

Seed 0 0 52186 0 0 0 0 0 0 0 0 0 52186

10 Latvia

Organic Soybeans Except 

Seed 0 0 0 0 0 0 0 76575 0 0 0 0 76575

11

Netherlan

ds

Organic Soybeans Except 

Seed 116556 0 610964 297105 0 0 0 0 0 0 0 0 1024625

12Romania

Organic Soybeans Except 

Seed 170384 0 4530000 0 441282 0 0 0 0 0 0 0 5141666

13Russia

Organic Soybeans Except 

Seed 0 0 160066 297221 99683 440200 594822 272857 530624 380423 127333 0 2903229
1 Turkey

Organic Yellow Dent Corn, 

Except Seed 2,202,741 1,681,759 2,090,775 1,749,425 1,193,997 2,790,957 593,185 275,220 91,740 3,098,172 15,704,449 4,882,967 36,355,387

2Canada

Organic Yellow Dent Corn, 

Except Seed 650,025 597,761 728,233 828,953 589,192 803,959 368,663 286,867 452,102 512,873 843,547 773,759 7,435,934

3 India

Organic Yellow Dent Corn, 

Except Seed 180,400 0 306,901 295,240 223,080 294,315 208,360 143,660 137,808 413,788 68,904 379,280 2,651,736

4Argentina

Organic Yellow Dent Corn, 

Except Seed 319,424 124,200 660613 276,971 895841 1653085 1897669 1050390 917,832 889,172 1,318,811 298,512 10,302,520

5Romania

Organic Yellow Dent Corn, 

Except Seed 505275 636050 6,830,689 6,907,514 8,173,774 5443848 10701094 5,255,727 6,257,917 2,425,931 265,733 56,100 53,459,652

Organic Corn Imports
 Challenges:

Joint venture of ConAgra 

and Ardent Mills

35% of the flour milling 

market for all wheat 

including organic
Ardent Mills to Help 

Farmers Double 

Organic Wheat Acres 

by 2019 Source: prnnewswire.com Dec. 15, 2015




Whites Oats Group

1.4

1.6

1.8

2

2.2

Organic 

Wheat 

Premium 

over 

Conventional 

Wheat 

6-year Rolling Average Organic Premium

ANTI-FRAUD WORKSHOPS

CONDUCTED BY IOAS, MONTANA

SEPTEMBER AND DECEMBER, 2015

UKRAINE AND TURKEY
When something isn’t working, try 

more of the same?

Organic producers are looking at 

alternative crops 

Corn and soybean acreage could 

decline
WHERE IN THE WORLD 

IS 

ORGANIC

Headed?
Mike Dill

Organically Grown Company- Food Safety & Compliance Manager

Organic Produce Wholesaler Coalition- Coordinator

mdill@organicgrown.com
Typical produce packaging. Unsealed and not tamper-evident.
Bulk produce with Brand and Distributor clearly identified 
Incoming Product Inspection

- A function of every produce handler
Quality Control

- A function of every produce handler

Produce storage in a typical produce warehouse or distribution center
Receiving Produce

Shipping Produce

Generic boxes used for nonorganic and organic growers in 

Oregon and the Northwest. 

Commonly used by split 

operations and Brokers.

This is how imported

organic produce is 

shipped and handled
Organic Integrity Assurance

Presented to the NOSB by Erin L. Heitkamp

April 25, 2018 
Pipeline Foods is a global organization with a 

vision to accelerate the availability of non-GMO, 

organic and regeneratively grown food. We are 

bringing best-in-class sustainable supply chain 

solutions to build a better future for our farmers, 

customers and partners. 

We are experts in our respective areas, united by 

integrity and respect for relationships and the 

earth. Our teams promote transparent and 

collaborative business practices while working 

towards our goal to meet current demand for 

organic and non-GMO crops grown in the 

Americas.

Who We Are

5/24/2018 © Pipeline Foods - Confidential Slide 2
 Fragmented supply chain

 Lack of price transparency

 Lack of supply chain transparency

 Fraudulent product entering supply chain

 Lack of enforcement within a regulated market

Issues in Current Organic 

Supply Chains

5/24/2018 © Pipeline Foods - Confidential Slide 3
 Supply chain disruption

 Counterparty financial risk

 Recall risk

 Headline risk

Risks of Fraudulent Product

5/24/2018 © Pipeline Foods - Confidential Slide 4
What We Do

5/24/2018 © Pipeline Foods - Confidential 5

ORIGINATION FOOD BRANDS

MERCHANDISING ASSETS
 We commit to and will work to leverage new 

technologies to enable full transparency and 

traceability in all that we do.

 We ensure we have “boots on the ground” in all 

locations from which we source organic crops.

 We require transaction certificates on all product 

transfers when importing product from outside the 

U.S. or Canada.

 We third-party test all products to be imported into 

the U.S. prior to loading and shipment.

 We will assess and implement risk-based preventive 

controls.

Commitment to Organic Integrity 

5/24/2018 © Pipeline Foods - Confidential Slide 6
 Supplier Screening Program and Classification

 Audits, certification checks, flowchart checks, traceability checks, allergens, FSVP 

compliance

 Approve or deny suppliers based on the assessment 

 Classify approved suppliers into multiple categories

 Product Risk Profile

 Categorize products by specific uses and risks

 Create testing and assurance programs based on specific product risks

 Country of Origin Risk Profile

 Identify macro risks within specific countries, i.e, corruption risk, political risk

 Meet with local certifiers to determine specific risks the country is facing

 Product Inspections

 4 stage testing program: Pre-shipment, loading inspection, unloading inspection, 

continuous inventory inspection

 Analyze based on specific product risks, customer requirements, and food safety risks

Steps We Take to Ensure Organic 

Integrity
 Prosecute and hold accountable bad actors

 Close certification requirement gaps

 Require transaction certificates

 Create a system for and conduct mass 

balance reconciliation

 Investments in technology 

solutions/blockchain

 Inter-agency collaboration

 Alarm system

Recommended Agency Action

5/24/2018 © Pipeline Foods - Confidential Slide 8
 Formalize industry and organizational commitment

 Vulnerability assessment and mitigation process

 Shorten supply chains

 Transaction certificate requirements

 Physical oversight of product transactions

 Product testing at high-risk points in the supply chain

 Communicate concerns

Recommended Industry Action

5/24/2018 © Pipeline Foods - Confidential Slide 9
Contact Us

eheitkamp@pipelinefoods.com

612.900.9499

Erin L. Heitkamp
Promoting Organic Integrity

m

prepared for the 

National Organic Standards Board

Monique Marez | April 2018 | Tucson, AZ
TOP 10 IMPORTS / TOP 10 ORIGINS

• Imports reached $2.08 billion, up 21% compared to 2016 

Top 10 Countries

Mexico

Turkey

Brazil

Argentina

Spain

Italy

Peru

India

Ecuador

Canada

Top 10 Imports

Soybeans

Coffee Arabica not roasted

Bananas (fresh)

Extra Virgin Olive Oil

Avocado (fresh)

Honey

Yellow Dent Corn

Sugar

Apples (fresh)

Blueberries (fresh)
RISK FACTORS IDENTIFIED THROUGH GOSCI

 Excluded Operations - Uncertified

 Long and Complex Supply Chains

 Imports

 History of fraud (region or operation)

 Long and/or complex supply chain

 No formalized supplier approval 

process

 New supplier / short history

 Use of uncertified handlers (brokers, 

traders) in the supply chain

 Supplier handles both conventional 

and organic

 Imported from areas of known risk 

(history of fraud)

 Ingredient/product comes from 

multiple suppliers

 Ingredient/product has crossed 

multiple borders

 Ingredient/product is sourced from 

multiple sources in an open market 

with limited knowledge about the 

supplier

 Supplier will not disclose sources 

and/or provide certificates for those 

sources

 Compliance documents submitted are 

not verifiable

 Violations of fraud found by NOP from 

product type and/or region

 Sudden change in volume or market 

price

 Certified company or certifier is not 

listed on the NOP Organic Integrity 

Database

 Supplier company operates under 

multiple names

 Bulk product with a valid organic 

certificate but not identified as 

organic on paperwork

 Missing certificate from originating 

farm or intermediate handler

 Evidence of falsification – changed 

operation name on certificate to 

protect proprietary information 

 Known production challenges and 

need for use of pesticides

 Lack of clarity about whether product 

was fumigated
TOP PRIORITIES

1. NOSB  Recommend NOP require certification of currently excluded operations; 

1st Step: clear terms and definitions on operation types

2. NOSB & NOP  improve timing & communication around NOP’s complaint procedures

1st Step: develop an alert system that identifies products or regions where heightened vigilance is 

needed. 

3. NOSB  Recommend NOP require ACAs to harmonize a method & develop a report for mass balance, 

1st Step: understand existing methodologies and reporting differences. 

4. NOSB & NOP  Prioritize creation of organic HS codes

1st Step: collaborate w/ industry on identifying key products to track
EXISTING ORGANIC HTS CODES – 49 for import

1. lemons

2. oats

3. quinoa

4. soybean flour

5. dried yellow peas

6. dried green lentils

7. barley

8. specialty sugars

9. yellow dent corn

10. garlic in fresh whole bulbs

11. shelled almonds

12. bananas

13. mangoes, if entered Sept. 1 to May 31

14. mangoes, if enterd at any other time

15. ginger, not crushed or ground

16. flaxseed (linseed) for use as oil stock

17. virgin olive oil, weighing < 18 kg

18. other virgin olive oil

19. sparkling wine

20. red wine < 2 liters

21. white wine < 2 liters

22. honey

23. Greenhouse sweet bell-type peppers

24. Other sweet bell-type peppers

25. Hass & Hass-like avocados

26. apples valued over 22¢ kg

27. pears & quinces, entered 4/1 to 6/30

28. other pears and quinces

29. cultivated blueberries

30. Arabica coffee, not decaf

31. other coffee, not decaf

32. decaffeinated coffee

33. coffee, not decaf, in retail containers 2 kg or less

34. Other coffee, roasted, not decaf, in retail 

containers more than 2 kg 

35. decaf coffee in retain con-tainers weighing 2 kg or 

less 

36. green tea, of a content not exceeding 3 g, flavored

37. other green tea, of a content not exceeding 3 g, 

not flavored

38. Other green tea 

39. black tea, in packing not exceeding 3 kg,in tea 

bags

40. durum wheat, grade 1, with specified hard 

vitreous content >84%

41. durum wheat, grade 1, with specified hard 

vitreous content not exceeding 84%

42. durum wheat, grade 2, with specified hard 

vitreous content >84%

43. durum wheat, grade 2, with specified hard 

vitreous content not exceeding 84%

44. Other durum wheat

45. Other long grain rice

46. Other med. grain rice

47. Other short grain rice

48. Other mixtures of rice

49. soybeans, whether or not broken

ACTIONS w/ IMPACT

ACTIONS FOR INDUSTRY

• Adopt and implement the GOSCI Best 

Practices Guide 

• Improve and harmonize training of inspectors 

and ACAs 

• Require that all documents created by direct 

parties to an organic transaction include 

organic ID

OTHER U.S. GOVERNMENT ACTIONS

• Support HR 3871 

• Prioritize ORGANIC hs codes

• Determine whether a 332 should be pursued.

NOP PROCESS IMPROVEMENTS

• Improve the timing and communication 

around NOP’s complaint system 

• Increase coordination and access to available 

data cross border documentation systems 

administered across other 

• Better utilize the organic equivalency 

relationships to help prevent fraud. 

NOP REGULATORY IMPROVEMENTS

• Require certification of currently excluded entities 

• Require ACAs to execute and report mass balance, 

rolling up to a countrywide report. 

• Increase oversight of inspectors.