This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

23455 

Vol. 80, No. 81 

Tuesday, April 28, 2015 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 205 

[Document Number AMS–NOP–11–0009; 

NOP–11–04PR] 

RIN 0581–AD08 

National Organic Program; Origin of 

Livestock 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Proposed rule. 

SUMMARY: The U.S. Department of 

Agriculture’s Agricultural Marketing 

Service (USDA AMS) proposes to 

amend the origin of livestock 

requirements for dairy animals under 

the USDA organic regulations. This 

proposed action would specify that a 

producer can transition dairy animals 

into organic production once. This 

proposed action would clarify that, after 

completion of this one-time transition, 

any new dairy animals that 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. This 

proposed action would also clarify how 

breeder stock should be managed on 

organic livestock farms. 

DATES: Comments must be received by 

July 27, 2015. 

ADDRESSES: Interested parties may 

submit written comments on this 

proposed rule using one of the following 

methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

• Mail: Scott Updike, Agricultural 

Marketing Specialist, National Organic 

Program, USDA–AMS–NOP, Room 

2646—So., Ag Stop 0268, 1400 

Independence Ave. SW., Washington, 

DC 20250–0268. 

Instructions: All submissions received 

must include the docket number AMS– 

NOP–11–0009; NOP–11–04PR, and/or 

Regulatory Information Number (RIN) 

0581–AD08 for this rulemaking. 

Commenters should identify the topic 

and section of the proposed rule to 

which their comment refers. All 

commenters should refer to the 

GENERAL INFORMATION section for 

more information on preparing your 

comments. All comments received will 

be posted without change to http://

www.regulations.gov. 

Docket: For access to the docket, 

including background documents and 

comments received, go to http://

www.regulations.gov. Comments 

submitted in response to this proposed 

rule will also be available for viewing in 

person at USDA–AMS, National Organic 

Program, Room 2646—South Building, 

1400 Independence Ave. SW., 

Washington, DC, from 9 a.m. to 12 noon 

and from 1 p.m. to 4 p.m., Monday 

through Friday (except official Federal 

holidays). Persons wanting to visit the 

USDA South Building to view 

comments received in response to this 

proposed rule are requested to make an 

appointment in advance by calling (202) 

720–3252. 

FOR FURTHER INFORMATION CONTACT: 

Andrew Perry, Director, Standards 

Division, Telephone: (202) 720–3252; 

Fax: (202) 205–7808. 

SUPPLEMENTARY INFORMATION: 

Executive Summary 

A. Purpose of Proposed Rule 

This proposed rule would create 

greater consistency in the 

implementation of a standard for the 

transition of dairy animals into organic 

production and for the management of 

breeder stock. AMS has determined that 

the current regulations regarding the 

transition of dairy animals and the 

management of breeder stock on organic 

operations need additional specificity 

and clarity to improve AMS’ ability to 

efficiently administer the National 

Organic Program (NOP). A stated 

purpose of the Organic Foods 

Production Act of 1990 (OFPA) 

(7 U.S.C. 6501–6522) is to assure 

consumers that organically produced 

products meet a consistent and uniform 

standard (7 U.S.C. 6501). This action 

would facilitate and improve 

compliance with and enforcement of the 

USDA organic regulations (7 CFR part 

205) and maintain consumer trust in the 

consistency of the Organic seal. 

B. Summary of Provisions 

This proposed rule would update the 

regulation by explicitly requiring that 

milk or milk products labeled, sold or 

represented as organic be from dairy 

animals organically managed since at 

least the last third of gestation, with a 

one-time exception for transition. This 

exception would allow a producer, as 

defined by the regulations, to transition 

nonorganic dairy animals to organic 

milk production one time, under 

specific conditions. 

This proposal would specify that a 

producer (e.g., an individual or 

corporation starting or operating a dairy 

farm) could transition nonorganic dairy 

animals to organic milk production one 

time over a single twelve-month period. 

The proposal would require that all 

transitioning animals end the transition 

process at the same time. This twelvemonth period is consistent with OFPA’s 

requirement that there be a minimum 

period of one year of organic 

management before milk from dairy 

animals can be sold as organic (7 U.S.C. 

6509(e)(2)). 

This proposal would specify that, 

once the transition into organic 

production is complete, that a producer 

would not be allowed to conduct any 

additional transitions. After the 

transition, the producer would only be 

able to expand the number of dairy 

animals or replace culled dairy animals 

on any dairy farm in two ways: (1) Add 

dairy animals that had been under 

continuous organic management since 

the last third of gestation, or (2) add 

transitioned dairy animals that had 

already completed the transition on 

another dairy farm during that 

producer’s one-time transition. 

The proposal would define a dairy 

farm as a specific premises with a 

milking parlor where at least one 

lactating animal is milked. For the 

purpose of this definition, a milking 

parlor should be considered a physical 

structure (e.g., barn, parlor) in which 

dairy animals are milked. Because the 

dairy farm definition, in part, drives the 

eligibility for a producer to transition 

animals to organic production, this 

action would mean that producers that 

only raise heifers for organic dairy farms 

would not be eligible to transition 

conventional animals to organic. Such 

producers do not milk animals and, 

therefore, would not be considered 

eligible for the one-time transition 


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exception. However, such producers 

could continue raising heifers for 

organic dairy farms as long as the 

animals were under continuous organic 

management from the last third of 

gestation. 

This proposed rule reiterates that 

breeder stock may be brought from a 

nonorganic operation onto an organic 

operation at any time. While the 

regulations prohibit organic livestock 

from being removed and managed on a 

nonorganic operation and subsequently 

returned to an organic operation (i.e., 

cycling in and out of organic 

production), this provision does not 

extend to nonorganic breeder stock that 

are themselves not certified or eligible 

for slaughter, sale, and labeling as 

organic. Further, OFPA specifically 

allows breeder stock to be purchased 

from any source if the stock is not in its 

last third of gestation. Consistent with 

OFPA and USDA organic regulations, a 

producer has flexibility in its sourcing 

and its management of nonorganic 

breeder stock after its organic calf is 

weaned and before it begins the last 

third of gestation for the next offspring. 

However, a producer must continue to 

prevent commingling of organic and 

nonorganic products and prevent 

contact of any organic production or 

products with prohibited substances (7 

CFR 205.201(a)(5)). AMS is proposing 

additional provisions for organic 

management of breeder stock during the 

time when the breeder stock is directly 

contributing to the nourishment of 

organic offspring, from the last third of 

gestation through the end of the nursing 

period. 

C. Costs and Benefits 

AMS estimates the following costs 

and benefits of this proposed rule. 

Costs (range) Benefits 

$288,000–$935,000 ..................................................................................

This range indicates the estimated costs for dairy producers to purchase organic replacement heifers instead of transitioned heifers. 

(AMS had no data to estimate costs for dairy sheep and goat farms) 

AMS believes the lower bound is a conservative estimate of the 

costs and actual costs could be less. The upper limit accounts for an 

assumed organic premium for organic heifers. The difference between the lower bound and upper limit is believed to be an intra-industry transfer of costs and benefits, not a net cost.

Will create a consistent, level playing field for all existing organic dairy 

producers, regardless of how they transitioned into organic production. 

Facilitates more consistent enforcement of organic dairy standards. 

Maintains consumer confidence in the USDA organic seal. 

Table of Contents 

I. General Information 

A. Does this action apply to me? 

B. What should I consider as I prepare my 

comments for AMS? 

II. Background 

A. Dairy Transition 

B. Breeder Stock 

C. Development of Existing Standards 

D. Discussion of Past Comments Received 

III. Overview of Proposed Amendments 

A. Dairy Transition 

i. Implementation Considerations 

B. Breeder Stock 

C. Additional Clarifications 

D. Other Amendments Considered 

IV. Related Documents 

V. Statutory and Regulatory Authority 

A. Executive Order 12866 and 13563 

i. Need for the Rule 

ii. Baseline 

iii. Alternatives Considered 

iv. Costs of Proposed Rule 

v. Benefits of Proposed Rule 

vi. Conclusions 

B. Executive Order 12988 

C. Regulatory Flexibility Act 

D. Executive Order 13175 

E. Paperwork Reduction Act 

F. Civil Rights Impact Analysis 

VI. List of Subjects in 7 CFR Part 205 

I. General Information 

A. Does this action apply to me? 

You may be potentially affected by 

this action if you are engaged in the 

dairy industry. Potentially affected 

entities may include, but are not limited 

to: 

• Individuals or business entities that 

are considering starting a new dairy 

farm and that plan to seek organic 

certification for that farm. 

• Existing dairy farms that are 

currently certified organic under the 

USDA organic regulations. 

• Existing conventional dairy farms 

that are considering converting their 

farm to certified organic production. 

• Businesses engaged in raising 

heifers for sale to certified organic 

operations. 

• Certifying agents accredited under 

the USDA organic regulations to certify 

organic livestock operations. 

• Certifying agents accredited under 

the USDA organic regulations who may 

seek to certify transitioned dairy 

animals or transitional crops. 

This listing is not intended to be 

exhaustive, but rather provides a guide 

for readers regarding entities likely to be 

affected by this action. Other types of 

entities not listed in this section could 

also be affected. To determine whether 

you or your business may be affected by 

this action, you should carefully 

examine the proposed regulatory text. If 

you have questions regarding the 

applicability of this action to a 

particular entity, consult the person 

listed under FOR FURTHER INFORMATION

CONTACT. 

B. What should I consider as I prepare 

my comments for AMS? 

Your comments should clearly 

indicate whether or not they support the 

action being proposed for any or all of 

the items in this proposed rule. You 

should clearly indicate the reason(s) for 

the stated position. Your comments 

should also offer any recommended 

language changes that would be 

appropriate for your position. Please 

include relevant information and data to 

further support your position (e.g. 

scientific, environmental, industry 

impact information, etc.). 

Specifically, AMS is requesting 

comments on the following topics: 

1. The cost and benefit analysis 

presented, including assumptions and 

estimates, of limiting dairy transition to 

a one-time exception for a given 

producer; 

2. Procedures that certifying agents 

would use under this proposal to 

determine whether a producer is eligible 

for the one-time transition; and 

3. The proposed implementation 

approach for this rule. 

II. Background 

A. Dairy Transition 

AMS’ National Organic Program 

(NOP) is authorized by OFPA. Through 

the NOP, AMS oversees national 

standards for the production and 

handling of organically produced 

agricultural products. This action is 

being taken by AMS to create greater 

consistency in the implementation of 

the origin of livestock requirements for 

organic dairy animals, and to facilitate 

and improve compliance with and 

enforcement of the USDA organic 

regulations. This action is also being 

taken to satisfy consumer expectations 


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1The July 2013 Office of Inspector General (OIG) 

audit report on organic milk operations may be 

accessed at the following Web site: http://

www.usda.gov/oig/webdocs/01601-0002-32.pdf. 

2National Organic Standards Board April 2003 

Recommendation on Breeder Stock: Clarification of 

Rule. Available online at: http://

www.ams.usda.gov/AMSv1.0/

getfile?dDocName=STELDEV3104547. 

3A complete listing of related documents and 

NOSB recommendations is found in Section III 

below. 

4 62 FR 65850; 65 FR 13512. 

5 65 FR 80548. 

6 71 FR 32803. 

7NOSB Final Recommendation, 2 June 1994. 

Available online at: http://www.ams.usda.gov/

AMSv1.0/getfile?dDocName=stelprdc5058940. 

that organic livestock meet a consistent 

and uniform standard. 

Section 6509 of OFPA authorizes the 

USDA to implement regulations 

regarding standards for organic livestock 

products, including the transition of 

dairy animals into organic production. 

OFPA establishes that in general, 

organic livestock will be managed 

organically since the last third of 

gestation (7 U.S.C. 6509(b)). As an 

exception for dairy animals, OFPA 

requires a minimum period of one year 

of organic management before milk from 

non-organic dairy animals can be sold 

as organic (7 U.S.C. 6509(e)(2)). OFPA 

also addresses the use of breeder stock 

on livestock farms (7 U.S.C. 6509(b)). 

Furthermore, OFPA authorizes the 

creation of the National Organic 

Standards Board (NOSB) to advise 

USDA about the implementation of 

standards and practices for organic 

production (7 U.S.C. 6518). 

The USDA organic regulations 

regarding the origin of livestock (7 CFR 

205.236(a)) require that all livestock 

products (e.g., meat, fiber) sold, labeled, 

or represented as being organic must be 

from livestock under continuous organic 

management from the last third of 

gestation onward. For dairy animals, the 

USDA organic regulations provide an 

exception at section 205.236(a)(2) that 

allows for the transition of a dairy herd 

into organic production as long as they 

are under continuous organic 

management for the one-year period 

prior to production of organic milk or 

milk products. During this one-year 

period, dairy animals may consume 

crops and forage from land which is in 

the third year of organic management 

and included in the organic system 

plan, but has not yet been certified 

organic (7 CFR 205.236(a)(2)(i)). Section 

205.236(a)(2)(iii) requires that once an 

entire distinct herd has transitioned to 

organic production, all dairy animals 

shall be managed organically from the 

last third of gestation. 

While the regulations allow for the 

transition of a conventional herd to 

organic milk production after one year 

of organic management, the regulations 

do not define a herd. As such, 

stakeholders have interpreted the term 

‘‘herd’’ in a variety of ways. For 

example, some operations and certifying 

agents consider a herd to include all of 

the animals on the farm, whereas others 

consider a herd to be a group of animals 

on a farm that are managed together 

over time. 

Additionally, organic operations and 

certifying agents have interpreted the 

USDA organic regulations differently 

regarding when the transition of a herd 

into organic production should be 

considered complete. Some dairy 

operations continuously transition 

conventional dairy animals as new 

‘‘distinct’’ herds into organic 

production. This can be a cost savings 

to a farmer because he or she does not 

have to purchase organic dairy animals 

to either expand their herd or replace 

their cull animals. Other dairy 

operations have only used the transition 

exception once when they initially 

converted a ‘‘herd’’ to organic 

production. Current practice also does 

not always align with the intent of the 

May 2003 NOSB recommendation and 

the regulations that dairy herd transition 

be used only one time, when a producer 

with a farm initially transitions from 

conventional to organic production. 

AMS is updating the transition 

exception through this proposed 

rulemaking. 

In July 2013, the USDA Office of 

Inspector General (OIG) published an 

audit report on organic milk operations 

stating that certifying agents were 

interpreting the origin of livestock 

requirements differently.1 According to 

the OIG report, three of the six certifiers 

interviewed by OIG allowed producers 

to continuously transition additional 

herds to organic milk production, while 

the other three certifiers did not permit 

this practice. 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. This 

proposed rule responds to the OIG 

finding on this issue. 

B. Breeder Stock 

OFPA states that breeder stock may be 

purchased from any source if such stock 

is not in the last third of gestation (7 

U.S.C. 6509(b)). The USDA organic 

regulations define breeder stock as 

female livestock whose offspring may be 

incorporated into an organic operation 

at the time of their birth (7 CFR 205.2). 

OFPA and the regulations limit breeder 

stock to nonorganic females who may 

produce organic offspring if certain 

conditions are met. The regulations 

specify that such breeder stock may be 

brought from a nonorganic operation 

onto an organic operation at any time (7 

CFR 205.236(a)(3)). If breeder stock is 

gestating and its offspring are to be 

raised as organic, the regulations require 

that the breeder stock be brought onto 

the facility no later than the last third 

of gestation and be under continuous 

organic management until the offspring 

are weaned from the breeder stock (7 

CFR 205.236(a)). 

Stakeholders, through public 

comment to the NOSB and comments to 

NOP have expressed concern that some 

operations may bring breeder stock onto 

an organic operation, manage them 

organically for the last third of gestation 

so that the breeder stock can produce 

organic offspring, and then return that 

breeder stock to nonorganic 

management. Some stakeholders, 

including the NOSB, have suggested 

that such a practice does not align with 

a regulatory provision that prohibits 

livestock removed from an organic 

operation and subsequently managed on 

a nonorganic operation to be sold, 

labeled, or represented as organically 

produced (section 205.236(b)).2

C. Development of Existing Standards 

Between 1994 and 2006, the NOSB 

made six recommendations regarding 

origin of dairy animals; several of which 

included recommendations on the 

management of breeder stock.3 Between 

1997 and 2000, AMS issued two 

proposed rules and a final rule 

regarding national standards for 

production and handling of organic 

products, including livestock and their 

products. 4 5 AMS also issued a 

proposed rule and final rule 

implementing congressional 

amendments to the OFPA regarding feed 

for transitioning dairy animals.6 The 

NOSB as well as the public commented 

on these rulemakings with regard to the 

origin of livestock and exception for 

transition. Key points from these actions 

that led to the development of the 

existing standards on origin of livestock 

are summarized below. 

(1) In June 1994, the NOSB 

recommended a series of provisions to 

address the source of livestock on 

organic farms. Within this 

recommendation, the NOSB stated that 

dairy stock be fed certified organic feeds 

and raised under organic management 

practices for not less than 12 months 

prior to the sale of their milk as 

organic.7

(2) On December 16, 1997, AMS 

responded to the June 1994 NOSB 


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8 62 FR 65850. 

9 Due to the volume and content of public 

comments submitted in response to the 1997 

proposed rule, AMS withdrew the proposal and 

issued a second proposed rule prior to the final rule 

that established the National Organic Program 

(NOP) (published December 21, 2000). 

10NOSB Committee Report and Adopted 

Recommendations, 16 March 1998. Available 

online at: http://www.ams.usda.gov/AMSv1.0/

getfile?dDocName=stelprdc5058929. 

11 65 FR 13512. 

12 65 FR 80548. 

13 65 FR 80570. 

14National Organic Standards Board May 2003 

Recommendation on Origin of Livestock: 

Recommendation for Rule Change (document dated 

April 2003). Available online at: http://www.ams.

usda.gov/AMSv1.0/getfile?dDocName=STELDEV

3104546. 

15National Organic Standards Board May 2003 

Recommendation on Breeder Stock: Clarification of 

Rule (document dated April 2003). Available online 

at: http://www.ams.usda.gov/AMSv1.0/getfile?dDoc

Name=STELDEV3104547. 

16Harvey v. Veneman, 297 F.Supp. 2d 334 (D. 

Maine 2004). 

17 Harvey v. Veneman, 396 F.3d 28 (1st Cir. 

2005). 

18Harvey v. Johanns. Civil No. 02–216–P–H. 

Consent Final Judgment and Order, 9 June 2005. 

Available online at: http://www.ams.usda.gov/

recommendation through publication of 

a proposed rule.8 The language 

contained within that proposed rule 

echoed the NOSB’s recommendation. 

The proposal would have required that 

dairy animals must be on a certified 

organic facility beginning no later than 

12 months prior to the production of 

milk or milk products sold, labeled, or 

represented as organic. The 1997 

proposed rule also proposed that all 

feed provided to organic dairy livestock 

consist of organically produced and 

handled agricultural products, 

including pasture and forage. However, 

the proposed rule included a provision 

to allow nonorganic feed up to a 

maximum of 20 percent of the animal’s 

diet. The 20 percent level was roughly 

representative of the nutrients provided 

from supplemental grain feeding, in 

addition to nutrients provided by 

pasture and forage. The proposed 

language also contained a provision 

that, if necessary, a herd of dairy 

livestock converting to organic 

management for the first time could be 

provided with nonorganic feed until 90 

days prior to the production of organic 

milk or milk products. This proposed 

rule was never finalized.9

(3) In March 1998, the NOSB 

provided a second recommendation 

reaffirming its 1994 recommendation on 

the source of livestock.10 The March 

1998 NOSB recommendation also 

recommended that livestock comprising 

part of a mixed crop/livestock operation 

should qualify to be certified organic at 

the end of the transition period. 

(4) On March 13, 2000, AMS 

published a proposed rule that would 

establish the USDA organic 

regulations.11 Within this proposed 

rule, AMS responded to the NOSB’s 

March 1998 recommendation on the 

source of livestock. AMS proposed to 

require that livestock be under 

continuous organic management 

beginning no later than one year prior 

to the production of organic milk or 

milk products. Unlike AMS’ 1997 

proposal, the 2000 proposed rule did 

not include a provision for the 

allowance of nonorganic feed during the 

12-month transition period. 

(5) On June 12, 2000, the NOSB 

commented on the second proposed 

rule with respect to the origin of dairy 

livestock. The NOSB stated that 

livestock should be under organic 

management for one full year prior to 

the sale of organic milk with an 

exception for conversion of an entire, 

distinct herd into organic production. 

The NOSB laid out the following three 

conditions for conversion of a herd into 

organic production: 

• For the first nine months of the 

final twelve-month dairy herd transition 

period, animals must be fed at least 80 

percent feed that is either organic or 

self-raised transitional feed. The 

remaining 20 percent could be 

nonorganic during those nine months. 

• For the final three months, animals 

must be fed 100 percent organic feed. 

• Once a dairy operation has been 

converted to organic production, all 

dairy animals shall be under organic 

management from the last third of 

gestation, except that transitional feed 

raised on the farm may be fed to young 

stock up to 12 months prior to milk 

production. 

(6) On December 21, 2000, AMS 

published a final rule establishing the 

USDA organic regulations.12 Through 

this action, AMS finalized the origin of 

livestock provision, including a 

requirement that organic milk be 

produced from animals under organic 

management beginning no later than 

one year prior to the production of milk 

or milk products sold, labeled, or 

represented as organic. The rule further 

incorporated the exceptions 

recommended by the NOSB by allowing 

80 percent organic feed and 20 percent 

nonorganic feed (i.e., the ‘‘80/20’’ rule) 

for transitioned animals. AMS did not 

include NOSB’s recommendation 

allowing young stock to be fed 

transitional feeds. In the preamble to the 

final rule, AMS explained that such a 

provision would allow animals to 

transition at different times, rather than 

as a herd, thereby making it 

incompatible with the notion that the 

whole herd transition was a distinct 

one-time event.13 AMS further 

described that the exception to 

transition is a one-time opportunity for 

producers to implement a conversion 

strategy for an established discrete dairy 

herd in conjunction with the land 

resources that sustain it. This rule went 

into effect on February 20, 2001, and 

was fully implemented on October 21, 

2002. 

(7) In October 2002, the NOSB 

recommended that all replacement and 

expansion dairy animals be raised as 

organic from the last third of gestation 

onward. The NOSB believed that this 

would ensure consistency with the 

current regulations at section 

205.236(a)(2)(iii). Their 

recommendation also included a 

provision for breeder stock (7 CFR 

205.236(a)(3)) requiring that breeder 

stock remain under organic management 

indefinitely after their introduction onto 

an organic farm; that is to say, the 

recommendation was to prohibit 

breeder stock from rotating in and out 

of organic management. 

(8) In May 2003, the NOSB 

recommended that following a 

transition, all dairy livestock, including 

replacement stock, remain under 

organic management from the last third 

of gestation onward.14 Concurrently, the 

NOSB made a separate recommendation 

regarding breeder stock.15 They 

recommended a requirement for 

operations to continuously manage all 

breeder stock as organic if they were 

brought onto an organic farm to produce 

organic offspring. The NOSB further 

advocated that the NOP issue guidance 

in the form of questions and answers to 

clarify the management of breeder stock 

to the industry. 

(9) In October 2003, a legal challenge 

was filed against USDA stating that, 

among other things, the OFPA required 

organic dairy animals be fed 100 percent 

organic feeds, and thus, the 80/20 rule 

for the transition of dairy animals was 

in violation of the statute.16

(10) On January 26, 2005, the U.S. 

Court of Appeals for the First Circuit 

issued a decision in the case.17 The 

court upheld the USDA organic 

regulations in general, but remanded the 

case to the lower court, for, among other 

things, the entry of a declaratory 

judgment with respect to the 80/20 

dairy transition allowance, then 

codified in section 205.236(a)(2)(i) of 

the regulations. The lower court found 

the 80/20 dairy transition provisions at 

section 205.236(a)(2)(i) to be contrary to 

the OFPA and in excess of the 

Secretary’s rulemaking authority.18


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AMSv1.0/getfile?dDocName=STELDEV3013564&

acct=noprulemaking. 

19 71 FR 24820. 

20 71 FR 19131. 

21 71 FR 24820. 

22 71 FR 32803. 

23National Organic Program, Origin of Livestock 

Statement. April 11, 2003. Available online at 

www.regulations.gov under ‘‘Related Documents’’ 

for docket number AMS–NOP–11–0009. 

(11) On November 10, 2005, Congress 

amended the OFPA to allow a special 

provision for transitioning dairy 

livestock to organic production (7 U.S.C. 

6509(e)(2)(B)). This amendment 

provided a new provision to allow crops 

and forage from land included in the 

organic system plan of a farm that was 

in the third year of organic management 

to be consumed by the dairy animals on 

the farm during the 12 month period 

immediately prior to the sale of organic 

milk and milk products. 

(12) On April 27, 2006, AMS 

published a proposed rule entitled 

‘‘Revisions to Livestock Standards 

Based on Court Order’’ to address the 

November 2005 amendments to 

OFPA.19 AMS received nearly 12,400 

comments on the issue of dairy animal 

replacement during the comment period 

for this proposed rule. Additionally, in 

response to the April 13, 2006, 

advanced notice of proposed 

rulemaking on access to pasture, AMS 

received over 325 comments on the 

issue of dairy animal replacement.20

Neither of these actions intended to 

address the dairy replacement or 

transition issue as an objective. 

Accordingly, the comments were not a 

part of subsequent rulemaking for either 

action as they were beyond the scope of 

these rules. They are, however, 

acknowledged and discussed in this 

proposed rule. 

(13) On May 12, 2006, the NOSB 

commented on the ‘‘Revisions to 

Livestock Standards Based on Court 

Order (Harvey v. Johanns) and 2005 

Amendment to the Organic Foods 

Production Act of 1990’’ proposed rule 

published April 27, 2006.21 The NOSB 

amended its May 2003 dairy 

replacement recommendation to read: 

‘‘Once a dairy operation has been 

converted to organic production, all 

dairy animals, including all young stock 

whether born on or brought onto the 

operation, shall be under organic 

management from the last third of the 

mother’s gestation.’’ 

(14) On June 7, 2006, AMS published 

a final rule entitled ‘‘Revisions to 

Livestock Standards Based on Court 

Order’’ to implement the November 

2005 statutory change.22 The 

amendments reflected the new OFPA 

allowance permitting transitioning dairy 

animals to be fed feedstuffs from 

transitioning lands in their last of the 

three-year period (7 CFR 

205.236(a)(2)(i)), as well as setting a 

termination date of June 9, 2007, for the 

existing 80/20 feed conversion rule (7 

CFR 205.236(a)(2)(ii)). In the preamble 

to the 2006 final rule, AMS noted that 

additional clarity could be provided 

regarding the transition of dairy animals 

into organic production. 

D. Discussion of Past Comments 

Received 

The approximately 12,725 combined 

comments received on the April 2006 

proposed rule addressing the court 

order and the April 2006 advanced 

notice of proposed rulemaking on access 

to pasture provided AMS with 

information needed to develop this 

proposed action. In general, comments 

requested greater clarity on the 

parameters for transitioning dairy 

animals into organic production, and 

called for elimination of the ‘‘two-track’’ 

system. The ‘‘two-track’’ system refers to 

an April 2003 NOP statement that once 

an entire, distinct herd transitioned 

using the 80/20 provision (20% 

nonorganic feed in the 12 months before 

milking), all offspring then had to be 

managed organically and no 

transitioned replacements could be 

purchased.23 The NOP also stated that, 

for those that did not use the 80/20 

provision, the dairy animals only 

needed to be under continuous organic 

management starting no later than 12 

months prior to production (i.e., 

producers could continue to transition 

animals into organic over time). 

The majority of commenters stated 

that the ‘‘two-track’’ system could be 

addressed by conveying that, once a 

dairy operation is certified organic, 

regardless of how that operation 

transitioned into organic, all new dairy 

animals added to that operation should 

be managed organically from the last 

third of gestation. Commenters stated 

that this principle should apply to those 

animals born on the farm and those 

purchased as replacement and 

expansion animals to increase herd size. 

Commenters stated that only allowing 

organic dairy operations to add animals 

who have been managed organically 

since the last third of gestation supports 

consumer confidence in the organic 

milk sector. They reiterated that 

consumers expect that organic milk is 

produced without the use of excluded 

methods and substances prohibited 

under the regulations (i.e., hormones, 

antibiotics, and certain animal 

medications), and believe that greater 

clarity on how animals can transition 

into organic production is needed. Some 

commenters stressed that organic dairy 

products were keystone products for 

consumer confidence and a major 

stepping-stone to additional purchases 

in other organic categories. 

Commenters stated that continued 

transition of conventional animals 

increases the supply of animals able to 

produce organic milk, depresses the 

value of organic heifers and limits the 

incentives to produce organic 

replacement animals. They also stated 

that the allowance to transition a large 

number of animals, rather than 

purchasing or raising animals as organic 

from last third of gestation, results in 

surplus organic heifer calves being sold 

into the conventional market. Some 

commenters stated that the practice of 

allowing some operations to transition 

conventional animals on a regular basis 

encouraged development of heifer 

development farms. They based this 

belief on the position that it is easier 

and cheaper to purchase transitioned 

animals from heifer development farms 

than it is to raise animals that are 

organic from birth. Commenters claimed 

that raising organic dairy animals is 

twice as expensive as raising 

conventional dairy animals during their 

first year of life. They contended that 

producers who sell organic calves and 

replace them with transitioned 

conventionally raised heifers, have an 

economic advantage over those who 

raise animals organically from birth, due 

to lower cost of conventional feed and 

ability to shorten the interval before 

milk production by purchasing older 

animals. Commenters believed that for 

the organic heifer market to develop, 

and for there to be more organic stock 

available at an appropriate market 

value, greater clarity is needed in the 

regulations to convey that organic 

heifers are required in every case, 

except for the one-time initial transition 

of a dairy operation. 

At the time of the 2006 proposed rule, 

commenters stated that at least nine 

U.S.-based certifying agents were 

requiring the dairy operations they 

certified (approximately 1,100 certified 

and 150 transitioning operations) to 

manage all replacement dairy animals 

organically from the last third of 

gestation. This accounted for roughly 

50% of the organic dairy operations at 

that time. Other certifying agents were 

allowing the other approximately 50% 

of dairy operations to transition 

conventional animals to organic on a 

continual basis. Commenters stressed 

that a main purpose of the OFPA was 

consumer assurance that organically 

produced products met a consistent 


asabaliauskas on DSK5VPTVN1PROD with PROPOSALS
23460 Federal Register / Vol. 80, No. 81 / Tuesday, April 28, 2015 / Proposed Rules 

24USDA AMS. July 2011. Milk for Manufacturing 

Purposes and its Production and Processing. 

Recommended Requirements. Dairy Programs. 

standard and that the current origin of 

livestock standard needs further 

specificity to meet that purpose. 

Since receiving these comments in 

response to the 2006 proposed rule, 

diverse stakeholders including trade 

associations, organic dairy producer 

groups, consumer organizations, and 

certifying agents continue to submit 

letters to NOP requesting greater clarity 

on the origin of livestock provisions of 

the regulations. In response to those 

requests, NOP engaged stakeholders in 

ongoing discussions over the last two 

years related to potential changes and 

any associated costs and benefits of 

these changes. AMS developed this 

proposed rule in response to the public 

comments and feedback we have 

received regarding the origin of 

livestock provisions. 

III. Overview of Proposed Amendments 

A. Dairy Transition 

AMS is proposing to add five new 

terms: Organic management, dairy farm, 

transitioned animal, transitional crop, 

and third-year transitional crop to those 

defined at section 205.2. Organic 

management would be defined as 

management of an organic production or 

handling operation in compliance with 

all applicable production and handling 

provisions under the regulations. 

Stakeholders have questioned whether 

the term ‘‘organic management’’ in the 

regulations is related to compliance 

with the regulations or to some other 

generic use or understanding of the 

term. Providing a definition for this 

term would confirm that its use is 

directly tied to the regulations. For 

example, the regulations allow crops 

and forage in their third year of organic 

management to be fed to livestock 

transitioning to organic production. In 

the case of crops and forage in their 

third year of organic management, this 

means that the land they are grown on 

must meet certain requirements of the 

regulations as it transitions into certified 

organic production (e.g., per section 

205.202(b), no prohibited substances 

applied to land). Further, during the 

transition period for dairy animals, they 

must be under organic management in 

compliance with the regulations. This 

means producers need to meet all of the 

livestock requirements during that 

transition period (e.g., per section 

205.237, provide animals with a 

specified amount of dry matter from 

pasture during the farm’s grazing 

season). 

Under this proposal, AMS would 

define a dairy farm as a premises, which 

must have a milking parlor, where one 

or more lactating animals raised on that 

premises are milked. This definition is 

similar to the definitions of a dairy farm 

used by the AMS Dairy Grading 

Program.24

This proposal would define a 

transitioned animal to clarify which 

animals are eligible to produce organic 

milk, but are not eligible for certification 

as organic slaughter stock or eligible for 

certification for purpose of organic fiber 

production. This definition supports the 

current requirement that meat or fiber 

come from animals under continuous 

organic management since the last third 

of gestation (7 CFR 205.236(a)). The 

transitioned animal definition and its 

relevance to this action are discussed in 

more detail below. 

This proposal would define a 

transitional crop as any agricultural 

crop or forage from land, included in 

the organic system plan of a producer’s 

operation, that has had no application of 

prohibited substances within one year 

prior to harvest of the crop or forage. 

Based upon this definition, AMS would 

add a related definition for third-year 

transitional crop. A third-year 

transitional crop would be defined as 

crops and forage from land, included in 

the organic system plan of a producer’s 

operation, that has had no application of 

prohibited substances within 2 years 

prior to harvest of the crop or forage. 

Third-year transitional crops need to 

meet all other requirements of the 

regulations (e.g., soil fertility and crop 

nutrient management practice standard 

(section 205.203); use of organic seed if 

commercially available (section 

205.204)). OFPA and the regulations 

currently allow producers to feed these 

third year transitional crops to dairy 

animals in transition (7 U.S.C. 

6509(e)(2)(b); existing section 

205.236(a)(2)(i)). 

AMS is proposing to amend the 

introductory text at section 

205.236(a)(2) to reflect that the one-time 

exception to transition to organic dairy 

production would be limited to a given 

producer. A producer is defined under 

the regulations as ‘‘a person who 

engages in the business of growing or 

producing food, fiber, feed, and other 

agricultural-based consumer products’’ 

(section 205.2). The regulations also 

define a person as an ‘‘individual, 

partnership, corporation, association, 

cooperative or other entity’’ (section 

205.2). This definition is based on the 

definition of person under OFPA (7 

U.S.C 6502(15)). A producer must be a 

person as described in section 205.2 to 

be eligible for a one-time transition. 

Because the one-time transition is tied 

to the producer (i.e., a farm or business), 

employees of that producer are not 

themselves considered a producer 

utilizing a one-time transition. Under 

the proposal, such employees would 

retain their ability to establish a new 

business entity as a producer that may 

be eligible for its own one-time 

transition. 

In addition, while the definition of 

person includes cooperatives, 

cooperatives would not themselves seek 

a one-time exception to transition 

animals into organic production. There 

are business entities, including 

cooperatives, within the organic dairy 

sector that are typically certified as 

organic handlers, not as organic 

producers, and who would not meet the 

definition of a dairy farm. Instead, these 

entities contract with multiple organic 

producers for their milk supply. Under 

this proposal, the eligibility for a onetime transition is tied to a producer, as 

specified on an organic certificate, and 

they would need to meet the definition 

of a dairy farm and other proposed 

requirements. 

Dairy producers with multiple farms 

would need to make a decision about 

how to transition to organic production. 

Producers with multiple farms have a 

single twelve month period in which 

they may transition conventional dairy 

animals to organic milk production. 

During this transition period, these 

producers may transition all animals on 

all the farms, some of the animals on 

some of the farms, all the animals on 

one of the farms, or some of the animals 

on one of the farms. The producer 

would initiate the transition to organic 

milk production at least 12 months prior 

to completing the transition and 

obtaining organic certification. 

However, once the transition period 

ends, the producers may not themselves 

transition any additional animals into 

organic production. Instead, they would 

need to source animals as organically 

managed since the last third of gestation 

or those already transitioned to organic 

production on a different producer’s 

dairy farm. 

The proposed amendments would 

replace the current text at section 

205.236(a)(2) to specify that each 

producer would be able to conduct one 

transition. To be eligible for a transition, 

the proposal language specifies that the 

producer must start a new organic dairy 

farm or transition an existing 

conventional dairy farm to organic 

certification. This transition would need 

to occur over a single, continuous 12- 

month period prior to production of 

milk or milk products that are to be 

sold, labeled, or represented as organic. 


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25 65 FR 80569–80570. 

26 7 U.S.C. 6509(e)(2)(A). 

After completing a transition, that 

producer would not be able to transition 

any new animals into organic 

production. 

For example, if producer A already 

completed a transition on dairy farm A, 

then producer A would not be eligible 

to transition animals into organic 

production on dairy farm B. Under this 

proposal, once a producer completes its 

transition of dairy animals into organic 

production, a producer would have two 

options for bringing any new dairy 

animals onto a producer’s organic dairy 

farm(s) (whether for expansion or 

replacement purposes): (1) Add animals 

that are under continuous organic 

management from the last third of 

gestation; or (2) add transitioned 

animals sourced from a certified organic 

dairy producer. 

Because the dairy farm definition, in 

part, would drive the eligibility for a 

producer to transition animals to 

organic production, producers that only 

raise heifers for organic dairy farms 

would not be eligible to transition 

conventional animals to organic. Such 

producers do not milk animals and, 

therefore, would not be eligible for a 

transition. Such producers could 

continue raising heifers for organic 

dairy farms as long as the animals were 

under continuous organic management 

from the last third of gestation. 

AMS considered alternatives to our 

proposal that would link the 

transitioned exception to a producer. 

These alternatives included linking the 

one-time transition exception to a dairy 

farm, an operation, persons responsibly 

connected, and the current unit of 

regulation, a herd. We did not choose 

the dairy farm by itself as the criterion 

for eligibility to transition because it 

would allow a given producer to 

transition dairy animals on multiple 

dairy farms over time. This proposal 

was drafted to create greater consistency 

in the implementation of the transition 

mechanism so that it is not used as a 

continual means of producing organic 

milk without purchasing organic stock 

once a producer has converted to 

organic production. Furthermore, AMS 

could not identify how a producer and 

a certifying agent could verify that a 

transition had not already occurred on 

a given dairy farm. This would be 

especially difficult as time went on and 

a dairy farm may have changed 

ownership multiple times. By linking 

the transition to a given producer, a 

producer (e.g., an individual or a 

corporation) can attest to a certifying 

agent as part of their application for 

certification that they have not already 

completed a dairy transition and 

certifying agents could verify such 

attestations by checking past 

certification records associated with that 

producer. 

AMS also considered linking the 

transition exception to the operation. 

Based on stakeholder feedback and past 

NOSB recommendations, the term 

‘‘operation’’ is used at times, as is the 

term ‘‘producer’’, to describe how a onetime exception to transition into organic 

dairy production could be structured. 

Upon review, AMS is proposing to link 

the transition to a given producer rather 

than an operation because both 

producer and person are already defined 

under OFPA and the implementing 

regulations. 

Other stakeholders suggested limiting 

the transition such that after an 

operation completed its one-time 

transition, any persons responsibly 

connected to that operation could not 

transition additional animals into 

organic production. ‘‘Responsibly 

connected’’ is defined under the current 

regulations as ‘‘any person who is a 

partner, officer, director, holder, 

manager, or owner of 10 percent or more 

of the voting stock of an applicant or a 

recipient of certification or 

accreditation’’ (7 CFR 205.2). This 

approach would require a person with 

an operation to list all persons 

responsibly connected to that operation 

to document the relationship various 

individuals had to the dairy farm. This 

approach would be difficult to 

document and difficult for a certifier to 

verify for the purpose of certification. 

This approach also would be overly 

prescriptive. For example, under this 

approach, new managers on a farm, who 

had never been part of a transition, 

would be restricted from starting a new 

dairy farm on a different location and 

completing their own transition of dairy 

animals into organic production. This 

approach could also restrict the ability 

for children of organic dairy producers 

to transition animals into organic 

production. Children could be 

‘‘responsibly connected’’ to their 

parents’ farm if they served as managers 

or partners. If their parents had already 

completed a transition, then these 

children, who were managers or 

partners, could not transition any 

additional animals if they bought that 

farm because they would be considered 

‘‘responsibly connected’’ to the parents’ 

operation. For these reasons, AMS is not 

proposing this approach. Rather, under 

the proposed language that a one-time 

exception is tied to a given ‘‘producer’’, 

employees, such as managers or 

partners, including children, could start 

up a new business entity with a dairy 

farm and be eligible for their own onetime transition. 

AMS also did not choose the current 

herd standard because a given operation 

can have a new herd every year, or even 

multiple per year, allowing farmers to 

transition new animals annually, if not 

more often. The intent of our proposal 

is to provide a clear, consistent standard 

that when implemented will reflect the 

NOSB recommendation to allow for a 

producer to use a one-time transition of 

animals into organic milk production. 

Providing a producer with a one-time 

exception to transition dairy animals to 

organic milk production best captures 

the intent of the NOSB’s 

recommendation. It also supports the 

concept discussed in the 2000 final rule 

establishing the USDA organic 

regulations that transition to organic 

dairy should be a distinct, one-time 

event for a producer.25

Under the proposed amendments, any 

transition would need to meet certain 

conditions. Proposed section 

205.236(a)(2)(i) would specify that dairy 

animals must be under continuous 

organic management during the 12- 

month transition period. This aligns 

with the provision in OFPA which 

requires that dairy animals be managed 

as organic for at least 12 months prior 

to the production of organic milk.26

During the 12-month period, proposed 

section 205.236(a)(2)(ii) would specify 

that the producer should describe its 

transition approach as part of the 

organic system plan already required at 

section 205.200. Under existing section 

205.401, the producer must submit this 

organic system plan as part of an 

application for certification to a 

certifying agent. We are proposing this 

provision to ensure that applicants for 

organic certification can demonstrate 

their ability to comply early on in the 

certification process. The intent is to 

support communication between the 

applicant and the certifying agent about 

the transition approach and to minimize 

situations in which a producer 

approaches a certifying agent after 12 

months of transitioning animals only to 

realize that they did not complete the 

transition as specified in the 

regulations. 

This proposal would make minor 

revisions to a provision under the 

current regulations that allows dairy 

animals undergoing transition to 

consume ‘‘third-year’’ crops. The 

proposed provision would appear at 

section 205.236(a)(2)(iii) and would 

specify that, during the 12-month 

transition, dairy animals may consume 

third-year transitional crops which this 

proposal would define at section 205.2. 


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23462 Federal Register / Vol. 80, No. 81 / Tuesday, April 28, 2015 / Proposed Rules 

27 7 U.S.C. 6509(e)(2)(B). 28Organic slaughter stock is defined in the 

regulations as any animal intended to be 

slaughtered for consumption by humans or other 

animals (7 CFR 205.2). 

During the development of this 

proposed rule, the exception for 

transitioning dairy animals raised the 

question about the eligibility of those 

animals and their offspring for 

certification as organic slaughter stock 

or for the purpose of organic fiber. 

Third-year crops and forages are 

allowed by OFPA as feed for 

transitioned animals that will produce 

organic milk.27 However, these crops 

are not yet certified organic and should 

be treated as nonorganic feeds when 

determining if an animal has been 

raised organically since the last third of 

gestation. 

Therefore, to clarify the status of 

offspring born during and just after the 

transition period and whether they 

would be eligible for certification as 

organic slaughter stock or for organic 

fiber, AMS is proposing to add a 

definition for a transitioned animal at 

section 205.2. Transitioned animal 

would be defined as: (1) Any dairy 

animal that transitioned during the onetime transition exception to organic 

milk production after 12 months of 

continuous organic management; (2) any 

offspring born during or after the 12- 

month transition period to a 

transitioned animal that, during its last 

third of gestation, consumes crops and 

forages in the third year of organic 

management; or (3) any offspring born 

during the one-time transition exception 

that themselves consume crops and 

forages in the third year of organic 

management. The proposed definition 

specifies that such animals must not be 

sold, labeled, or represented as organic 

slaughter stock or for the purpose of 

organic fiber.28 The current regulations 

already require that slaughter stock and 

livestock, with the exception of poultry 

and certain dairy animals, be under 

continuous organic management since 

the last third of gestation (7 CFR 

205.236(a)). This proposed rule does not 

change, but rather reiterates how that 

requirement applies to animals that 

were part of a dairy transition. This term 

is used in proposed section 

205.236(a)(2)(iv) which specifies that 

offspring must be considered 

transitioned animals if they were born 

during or after the 12-month dairy herd 

transition period and not fed certified 

organic feed from the last third of 

gestation onward. 

For a producer and certifying agent to 

determine whether offspring is eligible 

for organic dairy, meat and/or fiber, the 

length of gestation for different dairy 

animals (e.g., cows, goats, sheep) and 

feed source must be considered. For 

offspring to be certified organic for meat 

and fiber, it must be under continuous 

organic management, including 

receiving certified organic feed, from the 

last third of gestation (7 CFR 

205.236(a)). This requirement is 

reiterated through proposed section 

205.236(a)(2)(v). A practical summary of 

how certifying agents and producers 

would apply the proposed amendments 

about the status of offspring at sections 

205.236(a)(2)(iv)–(v) is shown in 

Table 1. 

TABLE 1—STATUS OF OFFSPRING PART OF A DAIRY TRANSITION

Type of feed consumed by offspring during transition or during its last third 

of gestation 

Is it considered a 

transitioned animal? 

Could it be certified 

to produce organic 

milk? 

Could it be certified 

to produce organic 

meat or fiber? 

Third year transitional crops ........................................................................... Yes .............................. Yes ........................ No. 

Certified organic crops ................................................................................... No ............................... Yes ........................ Yes. 

Proposed section 205.236(a)(2)(vi) 

would require that all dairy animals for 

a given producer end the transition at 

the same time. AMS considered 

allowing dairy animals to have 

staggered transition periods, but chose 

not to allow that option as it could 

complicate the transition process. As a 

practical matter, a staggered transition 

would create more difficulty in animal 

management for the producer since 

animal transitions would start and end 

at different times. Furthermore, it would 

require more advanced records 

management creating a greater burden 

on the producer, more difficulty in 

overseeing the process, and increased 

room for error or potential violation. If 

a producer wants to bring in additional 

animals after the producer completes its 

transition, then the producer may use 

breeder stock or source organic dairy 

animals (either last third gestation 

animals or transitioned animals from a 

certified organic dairy farm that already 

completed its transition). If a producer 

decides to increase the number of 

animals undergoing transition during a 

one-time transition period, then the 

producer could (1) source organic dairy 

animals, or (2) source nonorganic 

animals and extend the transition 

period for all animals undergoing 

transition such that they end their 

transition together after 12-months of 

organic management. 

Proposed section 205.236(a)(2)(vii) 

would specify that dairy animals that 

completed the 12-month transition are 

transitioned animals as defined under 

section 205.2. In practical terms, this 

would mean that these dairy animals 

can produce organic milk, but are not 

eligible for certification as organic 

slaughter stock or for the purpose of 

organic fiber. This is consistent with the 

existing requirement at section 

205.236(a) that, with the exception of 

poultry and dairy, livestock products 

must be from animals that are under 

continuous organic management since 

the last third of gestation. 

Proposed section 205.236(a)(2)(viii) 

would specify that, after the 12 month 

transition period, transitioned animals 

may produce organic milk on any 

organic dairy farm as long as the animal 

is under continuous organic 

management at all times on a certified 

organic dairy farm. Movement of 

transitioned animals to other certified 

organic dairies would not affect the 

status of the animals to produce organic 

milk. Based on some stakeholder 

comments, AMS considered limiting 

transitioned animals to produce organic 

milk only on the dairy farm upon which 

they were transitioned. However, AMS 

believes that some movement or interfarm sales of transitioned animals is 

reasonable and expected. For example, 

if an existing organic dairy producer 

purchased an adjoining organic farm, it 

may be necessary for that farmer’s 

transitioned animals to leave their 

original premises of transition to take 

advantage of the new adjoining 

pastureland. Similarly, if an organic 

dairy producer wanted to move his/her 

operation to an updated organic facility 

on another property, it would create an 

excessive burden if transitioned animals 

were not permitted to move to the new 

facility. This provision will also allow 


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Federal Register / Vol. 80, No. 81 / Tuesday, April 28, 2015 / Proposed Rules 23463 

29National Organic Program. March 2011. 

Organic Livestock Plan Template, Origin of 

Livestock: L2-page 1. Available online at: http://

www.ams.usda.gov/AMSv1.0/

getfile?dDocName=STELPRDC5091032. 

30NOP 2606. July 22, 2011. Available online at: 

http://www.ams.usda.gov/AMSv1.0/

getfile?dDocName=STELPRDC5087115. 

the transitioned dairy animals to 

continue producing organic milk if there 

is a change in ownership to a different 

producer, provided the dairy animals 

are under continuous organic 

management throughout this time. 

AMS is also proposing new section 

205.236(ix) to specify that, after the 12- 

month period ends, any new dairy 

animal brought onto a producer’s dairy 

farm(s) must be an animal under 

continuous organic management from 

the last third of gestation or a 

transitioned animal sourced from a 

certified organic dairy farm. This 

provision would ensure that, after a 

producer completes one transition on a 

dairy farm, that producer would not be 

allowed to themselves transition 

additional dairy animals into organic 

production on any dairy farm. This 

requirement supports the NOSB’s intent 

that transition should be a one-time 

event for producers to transition to 

organic dairy and is intended to create 

one standard that would be equally 

applied to all dairy operations once they 

have transitioned to certified organic 

production. 

Implementation Considerations 

Certifying agents would have certain 

responsibilities under this proposed 

rule. Certifying agents would need to: 

• Establish and maintain procedures 

for determining whether or not a 

producer (e.g. a new applicant for 

certification) is eligible to transition 

dairy animals into organic production 

and for determining whether offspring 

that are part of a transition are eligible 

to produce organic milk, meat or fiber; 

• Ensure that certified organic dairy 

producers maintain sufficient records (7 

CFR 205.103) to identify all organically 

managed animals, including whether 

they are transitioned animals and, thus, 

not eligible for certification as organic 

slaughter stock (7 CFR 205.236(b)(2) and 

205.236(c)); 

• Hire and/or train sufficient, 

qualified staff (7 CFR 205.501(a)(4)) to 

examine production and certification 

history of certified organic dairy 

producers or applicants for certification 

which involve the transition of dairy 

animals from conventional to organic 

production; and 

• Maintain records of applications for 

certification or certified operations, 

including records pertaining to the 

origin of all livestock, for at least 10 

years from the date of their creation, 

pursuant to section 205.510(b)(2). 

Certifying agents already address 

many of these responsibilities through 

the current regulations. For example, 

certifying agents should have 

procedures in place to ensure that 

operations identify whether dairy 

animals are organically managed from 

the last third of gestation and, thus, 

potentially eligible for certification as 

organic slaughter stock, or transitioned 

into organic production, and, thus, not 

eligible as organic slaughter stock 

(section 205.236(b)(2) and (c)). The 

primary new responsibility for 

certifying agents will be establishing 

and implementing a procedure for 

determining whether a producer is 

eligible for a one-time transition. AMS 

is seeking comments from certifying 

agents on how these responsibilities are 

best implemented given the proposed 

action. 

In addition, organic livestock 

producers are already required to 

maintain records that fully disclose all 

activities and transactions of the 

certified operation in sufficient detail as 

to be readily understood and audited (7 

CFR 205.103(b)(2)). Under existing 

regulation, section 205.236(c), organic 

producers must already maintain 

records sufficient to preserve the 

identity of all organically managed 

animals. Examples of records to verify 

compliance with the origin of livestock 

requirements include livestock purchase 

records, organic certificates for livestock 

purchased as organic, animal 

reproduction: breeding, birth and/or 

hatch records, and herd conversion/

organic management records.29 Under 

this proposed rule, organic dairy 

producers would need to maintain the 

same records. There are no new records 

that would be required under this 

proposal. In accordance with Office of 

Management and Budget (OMB) 

regulations (5 CFR part 1320) that 

implement the Paperwork Reduction 

Act (44 U.S.C. 3501–3520) (PRA), the 

information collection requirements 

associated with the NOP, including the 

recordkeeping and reporting 

requirements related to origin of 

livestock, have been previously 

approved by OMB and assigned OMB 

control number 0581–0191. 

AMS also recognizes that some 

producers and certifying agents will 

need time to implement any regulatory 

changes. Over the last several years, the 

NOSB and stakeholders have been 

engaged in extensive discussion about 

how organic dairies would need to 

change their practices as a result of any 

modification to the current USDA 

organic regulations. AMS is considering 

and seeking public comment on the 

following implementation proposal: 

Producers who are certified as of the 

effective date for any final action would 

be allowed to complete any transition 

that was already approved under their 

organic system plan by a certifying 

agent. However, as of the effective date, 

producers who are certified would be 

required to source or raise any new 

animals from last third of gestation or 

source animals already transitioned 

under another producer’s one-time 

exception. As of the effective date, 

producers who are new applicants for 

organic certification (i.e., startup organic 

dairies or nonorganic dairies 

transitioning to organic production) 

would be allowed to use the transition 

exception once when first applying for 

organic certification. 

Under the current regulations at 

section 205.672, organic dairy animals 

can return to organic milk production if 

a Federal or state emergency pest or 

disease treatment program requires use 

of a prohibited substance. This 

allowance for re-transition is 

independent of the transition exception 

being proposed here. A dairy farm, that 

had not used its one-time exception to 

transition based on section 205.236, 

would retain that one-time exception to 

transition even if the farm used the 

section 205.672 allowance to retransition after an emergency pest or 

disease treatment. 

Under the current regulations at 

section 205.290, organic producers, 

through their certifying agent, can 

request a temporary variance from the 

livestock practice standards for reasons 

such as natural disasters, severe weather 

and other business interruptions. The 

NOP Instruction on Processing Requests 

for Temporary Variances (NOP 2606) 30

clarifies the policy that variances will 

not be granted for feeding non-organic 

feed to livestock. 

B. Breeder Stock 

Under this proposal, AMS would 

restructure section 205.236(a)(3) to 

reiterate that breeder stock may be 

brought from a nonorganic operation 

onto an organic operation at any time 

and to further clarify how breeder stock 

should be managed for the purpose of 

producing organic offspring. 

Consistent with an April 2003 NOSB 

recommendation on breeder stock, AMS 

considered amending the regulations at 

existing section 205.236(a)(3) to require 

that breeder stock that was brought onto 

an organic farm, but subsequently was 

removed from organic management, be 

prohibited from returning as breeder 


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31National Organic Standards Board 

Recommendation May 2003 on Breeder Stock: 

Clarification of Rule. Available online at: http:// www.ams.usda.gov/AMSv1.0/

getfile?dDocName=STELDEV3104547. 

stock for the purpose of organic 

production. The NOSB recommendation 

suggests that allowing breeder stock to 

return to organic management after a 

period of nonorganic management does 

not align with a regulatory provision 

that prohibits livestock removed from 

an organic operation and subsequently 

managed on a nonorganic operation to 

be sold, labeled, or represented as 

organically produced (7 CFR 

205.236(b)).31

However, OFPA states that breeder 

stock may be purchased from any source 

(7 U.S.C. 6509(b)); there is no 

requirement in OFPA that the source be 

organic. Further, while the current 

regulations at section 205.236(b)(1) 

prohibit livestock from being removed 

and subsequently managed on a 

nonorganic operation (i.e., cycling in 

and out of organic production), this 

provision does not extend to nonorganic 

breeder stock that are themselves not 

certified organic or eligible for 

slaughter, sale, and labeling as organic 

(7 CFR 205.236(b)(2)). Therefore, AMS 

does not believe that restrictions on how 

nonorganic breeder stock are managed 

outside of the last third of gestation 

through weaning of organic offspring are 

warranted. 

At proposed sections 205.236(a)(3) 

and 205.236(a)(3)(i), AMS is reiterating 

that breeder stock may be brought from 

a nonorganic operation onto an organic 

operation at any time as long as such 

breeder stock are on the organic 

operation no later than the last third of 

gestation. In practical terms, this means 

that between the end of nursing its 

organic offspring and the beginning of 

the last third of gestation for the next 

organic offspring, nonorganic breeder 

stock may be managed as the producer 

chooses. If a producer is managing 

nonorganic breeder stock on its organic 

operation, the current regulations 

already require that they implement 

practices to prevent contact of organic 

animals with prohibited substances 

(e.g., from certain fly tags that might be 

used with nonorganic breeder stock) (7 

CFR 205.201(a)(5)). 

AMS is proposing a provision related 

to organic management of breeder stock 

only when the breeder stock is directly 

contributing to the nourishment of 

organic offspring, from the last third of 

gestation through the end of the nursing 

period. Under proposed section 

205.236(a)(3)(ii), such breeder stock 

would need to be managed organically 

throughout the last third of gestation 

and the lactation period during which 

time they may nurse their own 

offspring. Allowing organic calves to 

nurse on nonorganic breeder stock as 

long as they are all under organic 

management supports the natural 

behavior of the animals (7 CFR 

205.239(a)). Breeder stock may not be 

used as nurse cows on dairy farms to be 

a source of milk for other organic calves, 

though inadvertent suckling by nonoffspring would not cause loss of 

organic status to the calves. 

C. Additional Clarifications 

In conjunction with the proposed 

amendments discussed above, AMS is 

proposing additional amendments to 

provide greater clarity on the 

restrictions at sections 205.236(b)(1) and 

205.236(b)(2). Section 205.236(b)(1) 

states that livestock or edible livestock 

products that are removed from an 

organic operation and subsequently 

managed on a nonorganic operation may 

not be sold, labeled, or represented as 

organically produced. We are proposing 

the addition of ‘‘non-edible’’ to this 

provision to specify that non-edible 

animal products, such as animal fiber, 

are also subject to this provision. 

Section 205.236(b)(2) is proposed to be 

amended to specify that transitioned 

animals must not be sold, labeled, or 

represented as organic slaughter stock. 

This change is needed for consistency 

with the proposed definition for 

transitioned animal and the proposed 

provisions for dairy transition. 

We are also proposing a change to 

section 205.236(c) to reiterate that 

producers are responsible for 

maintaining records that show whether 

a dairy animal is a transitioned animal 

and, therefore, not eligible for 

certification as organic slaughter stock 

or for the purpose of organic fiber. 

Producers should already be tracking 

whether an animal is eligible for organic 

slaughter or fiber given the last third of 

gestation requirement. Table 2 provides 

an overview of all the proposed 

amendments. 

D. Other Amendments Considered 

AMS recently received requests from 

stakeholders to consider providing an 

exception to transition fiber producing 

animals to organic fiber production, just 

as dairy animals can be transitioned to 

organic milk production. OFPA 

authorizes a transition for dairy animals 

entering organic milk production. As 

such, AMS is not proposing a transition 

for fiber under this proposed rule. In 

practical terms, this means that 

producers can transition sheep from 

conventional milk production to organic 

milk production, but would need to 

source animals organically managed 

since the last third of gestation in order 

to produce organic wool. 

TABLE 2—PROPOSED ACTION—ORIGIN OF LIVESTOCK

Section title Current wording Type of action Proposed action 

205.2 ....................................................... N/A ................................................ New terms added ................ Dairy Farm, Organic Management, Third-Year Transitional 

Crop, Transitional Crop, 

Transitioned animal. 

205.236(a) .............................................. Livestock products that are to be 

sold, labeled, or represented as 

organic must be from livestock 

under continuous organic management from the last third of 

gestation or hatching: Except, 

That: 

No Change .......................... N/A—Included for Completeness. 

205.236(a)(1) .......................................... Poultry. Poultry or edible poultry 

products must be from poultry 

that has been under continuous 

organic management beginning 

no later than the second day of 

life; 

No Change .......................... N/A—Included for Completeness. 


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TABLE 2—PROPOSED ACTION—ORIGIN OF LIVESTOCK—Continued 

Section title Current wording Type of action Proposed action 

205.236(a)(2) .......................................... Dairy animals. Milk or milk products must be from animals that 

have been under continuous organic management beginning 

no later than 1 year prior to the 

production of the milk or milk 

products that are to be sold, labeled, or represented as organic, Except, 

Revision ............................... Dairy animals. A producer as defined in § 205.2 may transition 

dairy animals into organic production only once. A producer is 

eligible for this transition only if 

the producer starts a new organic dairy farm or converts an 

existing nonorganic dairy farm 

to organic production. A producer must not transition any 

new animals into organic production after completion of this 

one-time transition. This transition must occur over a continuous 12-month period prior to 

production of milk or milk products that are to be sold, labeled, 

or represented as organic, and 

meet the following conditions: 

205.236(a)(2)(i) ....................................... That, crops and forage from land, 

included in the organic system 

plan of a dairy farm, that is in 

the third year of organic management may be consumed by 

the dairy animals of the farm 

during the 12-month period immediately prior to the sale of organic milk and milk products; 

and 

Revision ............................... During the 12-month period, dairy 

animals must be under continuous organic management; 

205.236(a)(2)(ii) ...................................... That, when an entire, distinct herd 

is converted to organic production, the producer may, provided no milk produced under 

this subparagraph enters the 

stream of commerce labeled as 

organic after June 9, 2007: (a) 

For the first 9 months of the 

year, provide a minimum of 80- 

percent feed that is either organic or raised from the land included in the organic system 

plan and managed in compliance with organic crop requirements; and (b) Provide feed in 

compliance with § 205.237 for 

the final 3 months.

Revision ............................... During the 12-month period, the 

producer should describe the 

transition as part of its organic 

system plan and submit this as 

part of an application for certification to a certifying agent, as 

required in § 205.401; 

205.236(a)(2)(iii) ..................................... Once an entire, distinct herd has 

been converted to organic production, all dairy animals shall 

be under organic management 

from the last third of gestation.

Revision ............................... During the 12-month period, dairy 

animals and their offspring may 

consume third year transitional 

crops; 

205.236(a)(2)(iv) ..................................... N/A ................................................ New section added .............. Offspring born during or after the 

12-month period are 

transitioned animals if they consume third-year transitional 

crops during the transition or if 

the mother consumes third year 

transitional crops during the offspring’s last third of gestation; 

205.236(a)(2)(v) ...................................... N/A ................................................ New section added .............. Offspring born from transitioning 

dairy animals are organic if they 

are under continuous organic 

management and if only certified organic crops and forages 

are used from their last third of 

gestation; 

205.236(a)(2)(vi) ..................................... N/A ................................................ New section added .............. All dairy animals must end the 

transition at the same time; 


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TABLE 2—PROPOSED ACTION—ORIGIN OF LIVESTOCK—Continued 

Section title Current wording Type of action Proposed action 

205.236(a)(2)(vii) .................................... N/A ................................................ New section added .............. Dairy animals that complete the 

transition are transitioned animals and must not be used for 

organic livestock products other 

than organic milk; 

205.236(a)(2)(viii) ................................... N/A ................................................ New section added .............. After the 12-month period ends, 

transitioned animals may 

produce organic milk on any organic dairy farm as long as the 

animal is under continuous organic management at all times 

on a certified organic operation; 

and 

205.236(a)(2)(ix) ..................................... N/A ................................................ New section added .............. After the 12-month period ends, 

any new dairy animal brought 

onto a producer’s dairy farm(s) 

for organic milk production must 

be an animal under continuous 

organic management from the 

last third of gestation or a 

transitioned animal sourced 

from another certified organic 

dairy farm. 

205.236(a)(3) .......................................... Breeder stock. Livestock used as 

breeder stock may be brought 

from a nonorganic operations 

onto an organic operation at 

any time: Provided, that, if such 

livestock are gestating and the 

offspring are to be raised as organic livestock, the breeder 

stock must be brought onto the 

facility no later than the last 

third of gestation.

Revision ............................... Breeder stock. Livestock used as 

breeder stock may be brought 

from a nonorganic operation 

onto an organic operation at 

any time, Provided, That the following conditions are met: 

205.236(a)(3)(i) ....................................... N/A ................................................ New section added .............. Such breeder stock must be 

brought onto the operation no 

later than the last third of gestation if its offspring are to be 

raised as organic livestock; and 

205.236(a)(3)(ii) ...................................... N/A ................................................ New section added .............. Such breeder stock must be managed organically throughout the 

last third of gestation and the 

lactation period during which 

time they may nurse their own 

offspring. 

205.236(b) .............................................. The following are prohibited: No Change .......................... N/A—Included for Completeness. 

205.236(b)(1) .......................................... Livestock or edible livestock products that are removed from an 

organic operation and subsequently managed on a nonorganic operation may not be 

sold, labeled or represented as 

organically produced.

Revision ............................... Livestock, edible livestock products, or nonedible livestock 

products such as animal fiber 

that are removed from an organic operation and subsequently managed on a nonorganic operation may not be 

sold, labeled, or represented as 

organically produced. 

205.236(b)(2) .......................................... Breeder or dairy stock that has 

not been under continuous organic management since the 

last third of gestation may not 

be sold, labeled, or represented 

as organic slaughter stock. 

Revision ............................... Breeder stock, dairy stock, or 

transitioned animals that have 

not been under continuous organic management since the 

last third of gestation may not 

be sold, labeled, or represented 

as organic slaughter stock. 

205.236(c) .............................................. The producer of an organic livestock operation must maintain 

records sufficient to preserve 

the identity of all organically 

managed animals and edible 

and nonedible animal products 

produced on the operation. 

Revision ............................... The producer of an organic livestock operation must maintain 

records sufficient to preserve 

the identity of all organically 

managed animals, including 

whether they are transitioned 

animals, and edible and nonedible animal products produced on the operation. 


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32 71 FR 32804. 

33The July 2013 Office of Inspector General (OIG) 

audit report on organic milk operations may be 

accessed at the following Web site: http://

www.usda.gov/oig/webdocs/01601-0002-32.pdf. 

34Caswell, Julie A. and Eliza M. Mojduszka. 1996. 

‘‘Using Informational Labeling to Influence the 

Market for Quality in Food Products.’’ American 

Journal of Agricultural Economics. Vol. 78, No. 5: 

1248–1253. 

35Zorn, Alexander, Christian Lippert, and 

Stephan Dabbert. 2009. ‘‘Economic Concepts of 

Organic Certification.’’ Deliverable 5 for Project 

CERTCOST: Economic Analysis of Certification 

Systems in Organic Food and Farming. http://

www.certcost.org/Lib/CERTCOST/Deliverable/D11_

D5.pdf. 

36The Hartman Group, Inc., The Organic and 

Natural Consumer 2013: Traits and Trends. The 

Cultural Context Around Behavior. Of 1,569 

respondents responding in 2012 to the question, 

‘‘From the following list, what properties do you 

think are implied or suggested by the term 

‘‘organic’’? 

IV. Related Documents 

Documents related to this proposed 

rule include the Organic Foods 

Production Act of 1990, as amended, (7 

U.S.C. 6501–6522) and its implementing 

regulations (7 CFR part 205). The NOSB 

deliberated and made the 

recommendations described in this 

proposal at public meetings announced 

in the following Federal Register 

Notices: (1) 67 FR 19375, (May 7, 2002); 

(2) 67 FR 54784, (September 17, 2002); 

(3) 67 FR 62949, (October 19, 2002); and 

(4) 68 FR 23277, (May 13, 2003). AMS 

also considered NOSB 

recommendations from June 2, 1994, 

and March 20, 1998, in the development 

of this proposed rule. NOSB meetings 

are open to the public and allow for 

public participation. 

AMS published a series of proposed 

rules that addressed, in part, the origin 

of livestock provisions at: (1) 62 FR 

65850, (December 16, 1997); (2) 65 FR 

13512, (March 13, 2000); and (3) 71 FR 

24820, (April 27, 2006). Past final rules 

relevant to this topic were published at: 

(1) 65 FR 80548, (December 21, 2000); 

and 71 FR 32803, (June 7, 2006). 

V. Statutory and Regulatory Authority 

The Organic Foods Production Act of 

1990, as amended, authorizes AMS to 

administer the NOP (7 U.S.C. 6501– 

6502). Under the NOP, AMS oversees 

national standards for the production 

and handling of organically produced 

agricultural products. One of the 

purposes of OFPA is to assure 

consumers that organically produced 

products meet a consistent standard (7 

U.S.C. 6501(2)). Section 6509 of the 

OFPA also requires that livestock to be 

slaughtered, sold or labeled as organic 

be managed in accordance with the Act, 

allows for the use of breeder stock, and 

provides for an exception to transition 

dairy stock to organic milk production. 

A. Executive Orders 12866 and 13563 

Executive Orders 12866 and 13563 

direct agencies to assess all costs and 

benefits of available regulatory 

alternatives, and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). Executive Order 13563 

emphasizes the importance of 

quantifying both costs and benefits, of 

reducing costs, of harmonizing rules, 

and of promoting flexibility. This rule 

has been designated as a ‘‘significant 

regulatory action’’ under section 3(f) of 

Executive Order 12866, and, therefore, 

has been reviewed by the Office of 

Management and Budget (OMB). 

Need for the Rule 

This action is necessary to create 

greater consistency in the 

implementation of a standard for the 

transition of dairy animals into organic 

production and for the management of 

breeder stock. AMS has determined that 

the current regulations regarding the 

transition of dairy animals and the 

management of breeder stock on organic 

operations need additional specificity 

and clarity to improve AMS’ ability to 

efficiently administer the NOP. A stated 

purpose of the OFPA is to assure 

consumers that organically produced 

products meet a consistent and uniform 

standard (7 U.S.C. 6501). This action is 

being taken to facilitate and improve 

compliance and enforcement and to 

satisfy consumer expectations that 

organic livestock meet a consistent and 

uniform standard, regardless of how a 

producer transitioned into organic 

production. 

In a 2006 final rule related to this 

issue, AMS acknowledged that the 

regulations provide different allowances 

for replacing organic dairy animals 

dependent on how a producer 

transitioned to organic production.32

AMS further stated that, given the 

almost 13,000 comments on the 2006 

proposed rule, the issue remained a 

significant concern of the organic 

community, including organic dairy 

producers, certifying agents, trade 

organizations, and consumers. AMS 

developed this proposal in response to 

this stakeholder feedback. 

Further, as cited in the July 2013 OIG 

audit of organic milk operations,33

implementation of the origin of 

livestock requirements continues to 

differ across producers and certifying 

agents. As part of this audit, some 

certifying agents conveyed that the 

current regulations create challenges in 

implementation such that some organic 

dairy producers may have a competitive 

advantage over others. Similarly, 

certifying agents and organic operations 

have recommended more detail in the 

regulations on the management of 

breeder stock to support 

implementation across the organic 

sector. 

This action is also necessary to 

address the persistent requests to AMS 

for further developed origin of livestock 

standards that meet the expectations of 

the NOSB and the majority of 

stakeholders. Setting an enforceable 

practice standard would ensure 

consistency across the industry. Because 

organic products cannot be 

distinguished from nonorganic products 

based on sight inspection, consumers 

rely on process verification methods 

such as certification to a uniform 

standard to ensure that organic claims 

are true. For this reason, organic 

products have been described as 

‘‘credence goods’’ in the economics 

literature.34 35 Credence goods have 

properties that are difficult to verify, 

both before and after purchase. Organic 

dairy products are an example of a 

‘‘credence good’’ for which consistent 

implementation of a common 

production standard across the sector 

supports continued consumer 

confidence. This action would help 

maintain consumer trust in the organic 

seal. ‘‘Customers’’ includes both 

consumers purchasing organic milk, 

yogurt, butter, ice-cream, and cheese at 

retail markets and organic livestock 

producers purchasing organic dairy 

animals for their own operations. 

While a dairy transition is permitted 

by the OFPA, this proposed rule would 

limit dairy animal transition. As 

discussed, AMS received extensive 

comments in 2006 on the issue of dairy 

transition. Commenters stated that 

consumers expect that organic milk is 

produced without the use of excluded 

methods and substances prohibited 

under the regulations such as hormones, 

antibiotics, and certain pesticides. 

Market research suggests that these 

comments are indicative of a customer 

base who expects ‘‘organic’’ to be 

produced without the use of such 

substances. In 2013, a report assessing 

trends in the organic market stated that 

consumers identified ‘‘absence of 

pesticides’’, ‘‘absence of growth 

hormones’’, and ‘‘absence of antibiotics’’ 

as properties they associate with the 

term ‘‘organic’’ in 64%, 59%, and 55% 

of the responses respectively.36 Over 


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23468 Federal Register / Vol. 80, No. 81 / Tuesday, April 28, 2015 / Proposed Rules 

37 Ibid. Of 1,036 respondents responding in 2012 

to the question about the reasons why they continue 

to purchase organic products, 38% stated to avoid 

products that rely on pesticides or other chemicals, 

34% stated to avoid genetically modified products, 

34% stated to avoid products that rely on growth 

hormones, and 29% stated to avoid products that 

rely on antibiotics. 

38The most recent list of certified operations may 

be found at the following link: http://

apps.ams.usda.gov/nop/. 

39Organic Trade Association (OTA)/Nutrition 

Business Journal, 2014 Organic Industry Survey. 

Nutrition Business Journal conducted a survey 

between Jan 27, 2014 and April 5, 2014 to obtain 

information for their estimates. Over 200 organic 

firms responded to the survey. NBJ used secondary 

data from SPINS, Nielsen, and IRI to supplement 

the survey and build market statistics. 

40The NASS survey may be found at the 

following link: http://usda.mannlib.cornell.edu/

MannUsda/

viewDocumentInfo.do?documentID=1859. 

41The ERS ARMS survey information may be 

found at the following link: http://

www.ers.usda.gov/data-products/arms-farmfinancial-and-crop-production-practices.aspx. 

42The ERS 2013 Summary of Organic Production 

may be found at the following link: http://

www.ers.usda.gov/data-products/organicproduction.aspx. 

43OTA 2014 Organic Industry Survey. 

44Organic Trade Association (OTA)/Nutrition 

Business Journal, 2013 Organic Industry Survey. 

Private label arrangements allow businesses to offer 

or sell their products under another company’s 

brand name, often a store brand. 

45Economic Research Service. 2009. 

Characteristics, Costs, and Issues for Organic Dairy 

Farming (pg. 33). Report by William McBride and 

Catherine Greene. Statistics based on 2005 ARMS 

data. Report available online at: http://

www.ers.usda.gov/publications/err-economicresearch-report/err82.aspx. 

thirty percent of those surveyed for this 

report indicated that avoidance of 

prohibited substances motivated them 

to buy organic products.37 Based on past 

comments, stakeholders argue that 

sourcing or raising animals as organic 

from last third of gestation is better 

aligned with the expectation that 

animals producing organic milk have 

never received prohibited substances 

such as antibiotics or growth hormones. 

Baseline 

This baseline focuses on the current 

market and production of heifers and 

cows as the predominant portion of the 

industry that would be affected and for 

which data is available. The baseline 

and subsequent calculations do not 

include quantitative estimates for dairy 

production related to sheep or goats. 

AMS used multiple data sources to 

describe the baseline and build 

quantitative estimates for this proposed 

rule. The first source is the NOP list of 

all certified operations. In January of 

each calendar year, every certifying 

agent is required to submit an annual 

list of their certified operations to the 

NOP (7 CFR 205.501(a)(15)(ii)). The 

NOP consolidates this information once 

per year into a public, searchable 

database.38 Another source of data is the 

Organic Trade Association’s (OTA) 2014 

Organic Industry Survey. The Nutrition 

Business Journal conducts this survey 

on behalf of OTA to summarize market 

information and trends within the 

organic industry across food and nonfood sectors.39 AMS also utilized 

information from the National 

Agricultural Statistics Service (NASS) 

2011 Organic Production Survey.40 The 

NASS data includes acreage, production 

and sales data for organic crops and 

livestock. USDA’s Economic Research 

Service (ERS) also conducts the 

Agricultural Resource Management 

Survey (ARMS), which includes 

questions about organic production 

practices.41 In 2010, ERS conducted a 

supplemental ARMS that focused on 

organic dairy operations. AMS worked 

with ERS to analyze recent ARMS data 

and develop an estimation of organic 

dairy production practices and costs for 

this proposed rule. Finally, AMS used 

summary information from a 2013 ERS 

report on organic production.42 The ERS 

report was based on data from state and 

private certifying agents. 

The Organic Dairy Market 

According to the 2013 Organic Trade 

Association (OTA) Industry Survey, 

U.S. organic food, fiber, and agricultural 

product sales were over $32 billion in 

2013, up 11.4 percent from 2012.43

Organic dairy is the second largest 

sector in organic retail sales (15.2%), 

after fruits and vegetables (36%). Sales 

of organic dairy products, including 

milk, cream, yogurt, cheese, butter, 

cottage cheese, sour cream, and icecream, reached almost $4.2 billion in 

2012. Table 3 shows the organic dairy 

market characteristics by subcategory. 

TABLE 3—ORGANIC DAIRY MARKET—RETAIL SALES BY SUBCATEGORY

Subcategory 2013 Sales 2013 Growth 

(percent) 

Percentage of 

organic dairy 

sales a

Milk/Cream ................................................................................................................................... 2,813 7.3 62.7 

Yogurt .......................................................................................................................................... 1,021 ¥0.2 22.8 

Cheese ......................................................................................................................................... 331 18.9 7.4 

Butter/Cottage Cheese/Sour Cream ............................................................................................ 261 17.9 5.8 

Ice-Cream .................................................................................................................................... 60 19.1 1.3 

aWhile Organic Trade Association’s 2014 Organic Industry Survey included eggs as a subcategory for its summary on organic dairy sales, we 

have excluded the data on eggs from this table. 

While the majority of organic dairy 

products are marketed under regional or 

national brands, sales of products under 

private label arrangements accounted 

for between 30–40% of the organic dairy 

market in 2013.44 Both OTA’s 2013 and 

2014 Organic Industry Surveys cite 

drought and feed costs as the key 

constraints on market growth. However, 

constraints to market growth vary 

regionally and across different size 

operations. According to a 2009 ERS 

report that analyzed 2005 ARMS data, 

55% of farms in the West reported 

sourcing inputs as the most difficult 

aspect of organic milk production 

versus only 24% of farms in the Upper 

Midwest region and 19% of farms in the 

Northeast.45 This is likely correlated 

with size of operation since organic 

dairies in the West tend to be larger in 

size and, therefore, have increased feed 

demand. Certification and compliance 

were cited as the most difficult aspect 

of organic milk production for farms in 

the Upper Midwest and Northeast (51% 

and 32% respectively). 

Overview of Organic Dairy Production 

Current dairy production and 

husbandry practices provide important 

context for the baseline and cost 

analysis. This section describes 

nonorganic and organic heifer 

development and highlights how they 

differ. Principles of management for 

other species would be similar, but the 

timing will be different. For example, a 

goat begins its first lactation at 1 year of 

age while a cow begins its first lactation 

at 2 years of age. 


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46USDA APHIS. NAHMS Dairy 2007 Part I: 

Reference of Dairy Cattle Health and Management 

Practices in the United States, 2007. This survey 

included both nonorganic and organic dairy 

animals. Available online at: http://

www.aphis.usda.gov/wps/portal/banner/

help?1dmy&urile=wcm%3apath%3a%2Faphis_

content_library%2Fsa_our_focus%2Fsa_animal_

health%2Fsa_monitoring_and_surveillance%2Fsa_

nahms%2Fct_nahms_dairy_studies#dairy2014. 

47USDA NASS. 2011. Census of Agriculture— 

Organic Production Survey. Available online at: 

http://usda.mannlib.cornell.edu/MannUsda/

viewDocumentInfo.do?documentID=1859. 

When a heifer calf is born on a dairy 

farm, the producer ensures that the calf 

receives colostrum, either from a bottle 

or nursing her dam. The heifer calf is 

then separated from the dam and placed 

in group, pair, or single housing. Some 

larger dairy producers contract with 

heifer development farms to raise 

replacement heifers. These heifer 

development farms pick up the heifer 

calves and raise them at another 

location until they are within a month 

or two of their first lactation. Heifer 

calves are raised on a diet of milk 

replacer or liquid milk with free choice 

roughages and grains. Once the calves 

have learned how to eat grains and 

roughages, the calves are weaned from 

the milk. 

After weaning, the heifers are 

developed to grow at a moderate pace 

until they are ready to be bred. During 

this time, the heifers may be raised on 

pasture, fed a complete ration or a 

mixture of both. Once the heifers are 

about 14 or 15 months of age, they are 

bred, gestate for about 9 months, and 

calve around 2 years of age. Usually 

once the heifers are bred or ‘‘settled,’’ 

they will be fed a diet which allows 

them to slowly grow in terms of frame 

size and body weight. As the heifer 

approaches her due date, she is termed 

a ‘‘springer’’ or is described as 

‘‘freshening.’’ After she calves, she 

begins lactating, is moved to the milking 

herd and called a ‘‘first calf heifer.’’ 

Organic producers follow similar 

timelines, but use some different 

practices. Organic producers must 

provide a feed ration comprised of 

certified organic agricultural feedstuffs. 

At this point in time, AMS is not aware 

of any certified organic milk replacer 

produced in the US. As a result, 

organically raised dairy calves must be 

fed organic milk. This makes the 

practice of sending young calves to 

heifer development farms less feasible 

for organic producers as these heifer 

development farms may not have access 

to certified organic milk. In addition, 

organic regulations require that all 

organically managed ruminants receive 

30% of their dry matter intake from 

pasture during the grazing season, 

though dairy calves under 6 months of 

age are excluded from this provision. By 

the age of 6 months, dairy calves must 

be on pasture during the grazing season. 

Nonorganic calves do not have a pasture 

requirement. 

Organic producers must also follow 

certain health care practices. For 

example, organic producers may not use 

antibiotics to prevent disease. Instead, 

organic producers must prevent the 

animals from getting sick using other 

management practices such as 

vaccinations. However, if an animal 

does get sick, organic producers are 

required to use medication to restore the 

animal to health even if the animal loses 

organic status. Once the animal loses 

organic status, the animal could return 

to organic milk production only as part 

of a one-time transition with another 

producer. 

Organic producers also may not use 

hormonal methods to synchronize 

estrus. Nonorganic producers may use 

hormonal products to both initiate 

estrus and synchronize estrus among the 

heifers to aid in conception. Certain 

synchronization protocols allow for a 

timed breeding method that does not 

require observation of a standing heat to 

identify estrus. 

Dairy farms and heifer development 

farms which produce transitioned dairy 

animals are able to raise the heifer 

calves nonorganically until 12 months 

before organic milk production begins. 

The pre-weaning phase of life is the 

time in which heifer calf mortality is the 

highest and the diet is the most 

expensive on a per calorie basis. 

Nonorganic practices to reduce 

mortality and expense during this preweaning phase include the use of milk 

replacer and, at times, antibiotics. By 

the time the dairy heifer reaches one 

year of age, most health threats are past 

and the animal is consuming a less 

expensive diet. 

AMS is not aware of any national 

survey that compares the culling rate of 

organic dairy animals with nonorganic 

dairy animals. In 2007, the USDA 

Animal and Plant Health Inspection 

Service (APHIS) conducted the National 

Animal Health Monitoring System 

(NAHMS) survey for dairy animals; a 

follow-up is planned for 2014.46 In this 

survey of dairy animals, the national 

rate of permanently removing a dairy 

animal from a farm was 23.6 percent. 

However, this included animals that 

were sold as replacement females to 

other dairies. This also excluded the 

percentage of animals which died. The 

percentage of cows culled did not vary 

depending upon the size of the producer 

nor did it vary depending upon the 

region of the U.S. in which the dairy 

was located. Most dairy cows were 

removed for udder problems or 

reproductive problems, followed by 

lameness or poor milking ability. 

Overall, mortality rates were 7.8% for 

un-weaned heifers, 1.8% for weaned 

heifers, and 5.7% for cows. 

From this information, an average 

dairy farm would sell 23.6% of its 

milking cattle and would lose 5.7% of 

its milking cattle to death. This would 

require that the average dairy farm in 

the U.S. be able to raise or purchase 

females that represent about 30% of the 

farm’s herd size just to maintain current 

size. Based on this average national 

need for replacements, the overall U.S. 

dairy herd (both nonorganic and 

organic) would have excess replacement 

females available for development. At 

this rate, the organic milking herd 

should be able to be maintained by last 

third gestation replacement females. In 

addition, the organic milking herd 

should also provide a sufficient quantity 

of females if market conditions lead to 

an expansion of the number of organic 

dairy animals. 

Specific to organic production, the 

U.S. had approximately 1,850 organic 

dairy farms that milked 200,000 cows in 

2011.47 Of these farms, 1,823 farms were 

producing organic milk from dairy cows 

and 19 farms were producing organic 

milk from goats. The number of certified 

organic sheep, buffalo, and bison dairy 

operations for that period is not known. 

This proposed action would apply to 

any animals (e.g., heifers/cows, goats, 

sheep) that produce milk for an organic 

operation. The baseline discussion and 

the following cost analysis focus on 

heifers and cows as the predominant 

portion of the industry affected by this 

proposed action and due to the limited 

data available on other types of dairy 

animals. 

Based on the NASS survey, Table 4 

shows that the highest concentration of 

organic dairy farms is in the Northeast 

and Upper Midwest. 


asabaliauskas on DSK5VPTVN1PROD with PROPOSALS
23470 Federal Register / Vol. 80, No. 81 / Tuesday, April 28, 2015 / Proposed Rules 

TABLE 4—TOP STATES WITH ORGANIC DAIRY FARMS COMPARED TO PRODUCTION

Number of 

organic dairy 

farms 

Percent of 

U.S. of organic 

dairy farms 

Milk 

production 

(pounds) 

Percent of 

U.S. milk 

production 

United States ........................................................................................... 1,823 ........................ 2,797,845,926 ........................

Wisconsin ................................................................................................. 397 21.7 313,991,661 11.2 

Pennsylvania ............................................................................................ 236 12.9 148,704,869 5.3 

New York ................................................................................................. 235 12.9 218,597,110 7.8 

Vermont ................................................................................................... 180 9.9 149,649,913 5.3 

Texas ....................................................................................................... 8 0.4 423,558,952 15.1 

California .................................................................................................. 72 3.9 469,148,296 16.8 

The four states with the largest 

number of certified organic dairy farms 

(Wisconsin, Pennsylvania, New York, 

and Vermont) account for 57 percent of 

the total farms. However, those states 

represent less than 30 percent of 

national organic milk production. By 

contrast, the West and Southwest 

account for the highest milk production 

per farm. The two highest-producing 

states (California and Texas) represented 

only 4.3 percent of total certified 

organic dairy farms, while producing 

31.9 percent of the total organic milk 

nationally. According to 2010 ARMS 

data, the mean size of an organic dairy 

farm nationally was 77 cows. In the 

Northeast and the Upper Midwest, the 

mean number of organic cows per farm 

was 64. In the West, the mean number 

of organic cows per farm was 288. Both 

ARMS and NASS surveys demonstrate 

similar distributions of both farms and 

milk production. The 2010 ARMS data 

also shows that organic dairies averaged 

about 13,900 pounds of milk annually 

per cow, or a daily average of 46 pounds 

of milk per cow (assuming a 300-day 

lactation period). 

According to 2010 ARMS data, nearly 

99 percent of the dairies responding to 

the organic dairy survey reported using 

replacement heifers that were born on 

the farm, with 96.5 percent reporting 

that the heifers were both born and 

raised on their operation. For the only 

3.5 percent of dairies that did not raise 

their replacement heifers on their 

operation, they presumably hired heifer 

development farms to raise the heifers 

prior to rejoining the herd. Of the farms 

reporting using replacement heifers 

born on the farm, the average number of 

replacement heifers sourced by this 

method was 31 head per farm. These 

heifers, born in 2010, would have been 

added to the milking herd in 2012. 

Some dairy operations also bought 

replacement heifers. It is unknown 

whether these replacement heifers were 

certified organic when purchased or 

were nonorganic animals then 

transitioned into organic production. 

We would expect a mixture of certified 

organic heifers and transitioning heifers 

entering organic production that is 

dependent on the producer’s current 

transition approach. Of the farms 

responding to the ARMS, 7.3 percent 

reported purchasing dairy cows and 5.3 

percent reported buying replacement 

heifers. Farms that purchased milk cows 

purchased an average of 8 cows per farm 

and those that purchased heifers bought 

an average of 15 head. 

Overall, in 2010, organic dairy farms 

added 58,500 cows and heifers to their 

operations, with 95.7 percent of those 

born on the operation. The remainder of 

animals came from off farm sources and 

included milk cows, 1,100 head (1.8 

percent), and heifers, 1,425 head (2.5 

percent). 

Most organic dairies (91 percent) 

reported selling cull cows. Some dairy 

farms also reported selling milk cows 

and replacement heifers. Of the farms 

responding to the ARMS, 17.0 percent 

reported selling milk cows and 17.0 

percent reported selling replacement 

heifers. Farms that sold milk cows sold 

an average of 14 cows per farm and 

those that sold replacement heifers sold 

an average of 11 head. Overall, dairies 

sold 4,400 milk cows and 3,500 

replacement heifers. Farms could have 

sold these animals into the nonorganic 

or organic market. 

Information on how many of 

replacement heifers bought were 

transitioned heifers and how many were 

managed organically from the last third 

of gestation is not available, and, 

therefore, AMS is not able to quantify 

the baseline. Certifying agents do not 

maintain aggregated data on what 

transition approach producers are 

currently implementing. Therefore, we 

do not have data on how many 

producers are bringing heifers into 

organic production as nonorganic 

animals and transitioning them into 

organic versus sourcing and managing 

animals as organic from the last third of 

gestation. However, the two largest 

producers of branded organic fluid milk 

both require their supplying dairies to 

supply milk from organic cows, as 

opposed to transitioning new 

nonorganic animals into organic 

production. Based on discussions with 

the industry, AMS assumes that, 

qualitatively, the vast majority of 

replacement heifers purchased is 

managed organically from the last third 

of gestation and, therefore, would not 

need to change practices due to this 

proposed action. We seek comment on 

this assumption and data on current 

industry practice to help refine our 

estimates. 

As discussed in the BACKGROUND 

section, under the current baseline, we 

know that producers differ in their 

transition strategies dependent on how 

the term ‘‘herd’’ in the regulations is 

interpreted and applied. The difference 

in transition approach across producers 

is, as previously discussed, due to both 

a lack of definition for what a ‘‘herd’’ is 

and different interpretations of when 

the transition of a herd into organic 

production should be considered 

completed. Within the existing industry, 

there are some organic producers who 

transitioned a single ‘‘herd’’ of animals 

into organic production, consider their 

transition complete, and only source 

animals that are managed organically 

from the last third of gestation. There 

are other organic producers who 

transitioned their operation to organic, 

but continue to expand their operation 

by bringing nonorganic animals into 

organic production as additional 

‘‘herds’’. In some cases, these operations 

have multiple fields on a given location 

or multiple locations under their 

business and, therefore, consider the 

herd in a given field or location as 

distinct for the purpose of their 

transition approach. For producers 

using this kind of multi-herd approach 

for their operation, the proposed action 

would require them to source organic 

animals or previously transitioned 

animals across all of their herds, 

regardless of location or multi-herd 

management strategy. This will, in turn, 

increase their costs as discussed in the 

cost analysis that follows. 


asabaliauskas on DSK5VPTVN1PROD with PROPOSALS
Federal Register / Vol. 80, No. 81 / Tuesday, April 28, 2015 / Proposed Rules 23471 

Alternatives Considered 

As required by E.O. 12866, various 

alternatives were considered to achieve 

the objectives of this rule. The 

alternatives considered include: (Option 

A) revising the standard to allow 

producers to transition dairy animals 

into organic production over a 12-month 

period on a continuous basis; and 

(Option B) revising the standard to 

clearly convey that a producer with a 

dairy farm has a one-time exception 

over a 12-month period to transition 

dairy animals into organic production. 

These options are shown in Table 5 

below. 

TABLE 5—ALTERNATIVES CONSIDERED

Alternative Description 

Option A—Continuous Transition .............. Revise standard to allow a producer to transition dairy animals into organic production over a 12- 

month period on a continuous basis. 

Option B—Use ‘‘Dairy Farm’’ as Unit of 

Regulation.

Revise standard to tie the one-time transition exception to a given dairy farm (premises) over a 12- 

month period. 

Option C—Proposed Rule ......................... Revise standard to tie the one-time transition exception to a given producer with a dairy farm over a 

12-month period. 

As discussed, maintaining the status 

quo (i.e., the baseline unit of regulation 

as a ‘‘herd’’) does not further our 

objective to provide additional guidance 

to the organic dairy industry and, 

therefore, was not considered as a viable 

alternative. Since 2006, vast stakeholder 

comments have requested that AMS 

engage in rulemaking to support greater 

consistency in the application of the 

origin of livestock requirements across 

certifying agents and operations. In 

addition to stakeholder comments, the 

OIG identified this issue in its July 2013 

audit of organic milk operations and 

recommended that AMS undertaking 

rulemaking. 

Option A 

The first alternative considered 

(Option A) would amend the regulations 

to specify that a producer could 

transition dairy animals into organic 

production over a 12-month period on 

a continuous basis. Under OFPA, a 

dairy animal from which milk or milk 

products will be sold or labeled as 

organically produced must be raised in 

accordance with OFPA for not less than 

the 12-month period immediately prior 

to the sale of such milk and milk 

products (7 U.S.C. 6509(e)(2)(A)). AMS 

could allow transition of any dairy 

animal into organic production, without 

further limitation, as long as it is 

organically managed for a 12-month 

period prior to the sale of organic milk 

or milk products. In effect, this would 

mean that a producer could 

continuously transition conventional 

dairy animals into organic production 

on an ongoing basis, as opposed to 

allowing a producer to transition 

animals into organic production once. 

While this alternative could achieve 

the regulatory objective by setting a 

consistent and uniform standard across 

the organic dairy industry, numerous 

NOSB recommendations and 

stakeholder comments have not 

suggested this approach. Further, in 

assessing the baseline, this approach 

would increase the number of 

nonorganic animals transitioned into 

organic production. If the demand shifts 

to nonorganic animals for transition into 

organic production, this would reduce 

the current demand, and, thus, value of 

organic heifers. Further, because 

consumers expect milk to be produced 

without the use of certain inputs that 

can be used in nonorganic animals (e.g., 

antibiotics), this approach could have 

unknown, but likely negative, impacts 

on consumer confidence in the growing 

organic dairy sector. 

Option B 

The second alternative considered 

(Option B) would amend the regulations 

to specify that a dairy farm, as defined 

by the regulation, could transition dairy 

animals into organic production onetime over a 12-month period. This 

would mean that a transition could 

occur only once on a given premises. 

Under this alternative, a producer could 

transition dairy animals on multiple 

dairy farms over time as long as animals 

had not been previously transitioned on 

a given premises. For example, if dairy 

farm location X, Y, and Z had never had 

animals transitioned to organic on their 

respective premises, then producer A 

could conduct transition on each 

location (X, Y, and Z) once. If producer 

B then purchased these dairy farms from 

producer A, producer B could not 

complete a transition on these premises 

because the location had already 

experienced a one-time transition to 

organic. 

We did not choose this alternative 

because it would only meet the intent of 

this regulatory action in a limited way. 

While it would reduce the number of 

transitions over time, it would allow a 

given producer, with a single organic 

certificate, to transition dairy animals 

on multiple dairy farms. As discussed in 

the BACKGROUND section, this 

proposal was drafted to create greater 

consistency in the implementation of 

the transition mechanism so that it is 

not used as a continual means of 

producing organic milk without 

purchasing organic stock once a 

producer has converted to organic 

production. Furthermore, AMS could 

not identify how a producer and a 

certifying agent could verify that a 

transition had not already occurred on 

a given dairy farm. This would be 

especially difficult as time went on and 

a dairy farm may have changed 

ownership multiple times. 

Option C 

The third alternative considered, and 

selected for this proposed action, would 

provide a limited exception (i.e., a onetime opportunity for producers) to 

transition dairy animals into organic 

production that aligns with both OFPA 

and the NOSB recommendations. While 

the NOSB recommendations do not 

provide the level of specificity needed 

to implement this approach, the intent 

of the NOSB is to require that, once an 

operation is certified organic, any new 

animals added to that operation should 

be organically managed since last third 

of gestation. This proposed rule would 

address the NOSB recommendation, 

adding specificity to ensure successful 

implementation of a uniform and 

consistent standard. AMS considered 

many options for how to best 

operationalize a one-time exception to 

transition dairy animals into organic 

production. These options include 

linking the one-time exception to a 

dairy farm, an operation, persons 

responsibly connected, and the current 

unit of regulation, a herd. For the 

reasons previously discussed in the 

OVERVIEW OF PROPOSED 

AMENDMENTS section, AMS is 

proposing to link the transition 

exception to a producer. 


asabaliauskas on DSK5VPTVN1PROD with PROPOSALS
23472 Federal Register / Vol. 80, No. 81 / Tuesday, April 28, 2015 / Proposed Rules 

48Conversation with Dr. Bob Parsons, Extension 

Associate Professor at University of Vermont, June 

4, 2013. 

49Conversations with Dr. Bob Parsons, Extension 

Associate Professor at University of Vermont, June 

4, 2013; Bradley J. Heins, Assistant Professor of 

Organic Dairy Production at University of 

Minnesota, June 5, 2013; and A. Fay Benson, Small 

Dairy Support, Cornell University SCNY Regional 

Team, June 6, 2013. 

50A springer is a heifer that is 7–9 months 

pregnant and will begin producing milk within 2 

months. 

51The markets are the Mammoth Cave Dairy 

Auction, Smiths Grove, KY; Springfield Livestock 

Marketing Center, Springfield, MO; Producers 

Auction Yards, Norwood, MO; New Holland Sales 

Stables, New Holland, PA; and Toppenish Monthly 

Dairy Replacement Sale, Toppenish, WA. 

52 Dairy cattle are classified into four categories: 

Supreme, Approved, Medium, and Common. The 

most common category of springers sold is 

Approved. 

Based on NOSB recommendations 

and almost 13,000 stakeholder 

comments, this approach would retain 

the opportunity for new producers to 

transition into organic dairy production 

and ensure that organic products meet 

a consistent standard to support 

consumer confidence. This approach 

would require a small number of dairy 

farms to change their current practices 

for sourcing dairy animals and, as a 

result, would impose some limited 

costs. This approach is also the more 

pragmatic to implement through the 

certification and verification process as 

compared to linking the one-time 

transition to a dairy farm (Option B). By 

linking the transition to a given 

producer (Option C), a producer (e.g., an 

individual or a corporation) can attest to 

a certifying agent as part of their 

application for certification that they 

have not already completed a dairy 

transition and certifying agents could 

verify such attestations by checking past 

certification records associated with that 

producer. 

The costs and benefits of this 

approach are discussed in more detail 

below. 

Costs of Proposed Rule 

The proposed rule has the potential to 

increase production costs on dairy 

producers who currently purchase 

transitioned dairy animals as 

replacements, assuming that 

transitioned animals are currently being 

sold at a discount to organic 

replacement animals. Organic dairy 

farmers who regularly purchase 

transitioned dairy animals as 

replacements and organic operations in 

the process of expansion are likely to 

face higher costs of production if this 

rule were finalized as proposed. The 

cost of implementing the proposed rule 

will fall primarily on organic dairies 

that currently purchase transitioned 

heifers, although dairies currently 

purchasing organic heifers would be 

expected to pay higher prices in the 

short-term due to increased competition 

for these animals. Farms that sell their 

excess organic replacement heifers may 

see an increase in demand for their 

heifers while farms that exclusively 

raise their own organic replacement 

heifers would not be affected by the 

proposed rule. 

Overall, this cost analysis uses 

existing data on the number of 

replacement animals purchased on 

organic operations to estimate costs. 

Using data by organic operation differs 

from the proposed unit of regulation, 

which is by producer (i.e., a business 

entity). We do not have data explicitly 

available by producer. However, we 

believe that this analysis using data by 

organic operation would be similar to 

any analysis by producer because, in 

many cases, the operation and producer 

are functionally one in the same. 

Further, while we do not have data on 

multi-herd producers, this analysis 

assumes that costs will be equivalent on 

a per cow basis. We are seeking 

comment on these assumptions and any 

data relevant to sheep and goat dairy 

production. 

Estimated Costs for Dairies 

The ARMS included the total amount 

spent on replacement heifers, but the 

survey did not distinguish between 

organic and transitioned heifers. For 

purposes of this analysis, we will 

assume that 25% to 50 percent of all 

purchased heifers are transitioned 

heifers, or between 360 and 720 head. 

This is a broad estimate though we 

believe that the proportion is likely 

smaller than 50% based on discussions 

with organic dairy producers. The 

survey results indicated that the average 

replacement heifer cost approximately 

$898. The University of Minnesota Farm 

Financial Database (FINBIN) includes 

the average replacement cost for organic 

heifers; between 2006 and 2012 the cost 

per head ranged between $1,200 and 

$1,900. Extension officials at the 

University of Vermont estimated that 

organic replacement heifers typically 

cost between $1,600 and $2,000.48 Data 

on the cost of transitioned heifers is not 

available. Using the upper end of these 

ranges ($2,000), the cost of purchasing 

organic replacement heifers of all 

weights would be $7.6 million per year. 

This is the total cost, not the additional 

cost of purchasing organic heifers 

instead of transitioned heifers, so the 

incremental costs will be considerably 

less. These costs only reflect dairy 

cattle. Costs for purchasing dairy sheep 

and goats are not included in this 

analysis. 

AMS previously contacted several 

state extension dairy experts who 

explained that supplies of organic 

replacement heifers and milk cows were 

in excess supply creating a soft 

demand.49 In addition, the ARMS shows 

that organic dairy farms retained 56,000 

replacement heifers while selling 32,000 

head as cull cattle, milk cows, or 

replacement heifers, indicating that 

there are ample supplies of replacement 

heifers available. Therefore, the 

additional demand for organic 

replacement heifers is not expected to 

lead to an increase in the price of 

replacement heifers. However, to be 

conservative in estimating the 

additional costs of the proposed rule, 

the analysis will assume that the 

increased demand will increase the cost 

of an organic replacement heifer by 25 

percent, or $500. 

Because the price of transitioned 

heifers is not available, the analysis will 

use the cost of conventional springers 50

as a substitute. Since the cost of a 

transitioned heifer is likely to be more 

than the cost of a conventional heifer, 

using the conventional springer price 

will generally overstate the cost of 

compliance with the proposed rule and 

so provide an upper bound of costs 

incurred. 

AMS Livestock, Poultry, and Grain 

Market News reports on five dairy 

auction markets 51 in the U.S. Using the 

reports from the period May 6, 2013 to 

June 5, 2013, the average auction price 

for Approved 52 springers was $1,200 

per head. The difference in cost between 

organic heifers and conventional heifers 

is $800 per head. As discussed, we 

assume that the cost of transitioned 

heifer is, at a minimum, equivalent to a 

conventional heifer. With the assumed 

$500 increase in cost of organic heifers, 

the total difference will be $1,300. The 

difference in cost between a transitioned 

heifer and an organic heifer is 

summarized in Table 6. 


asabaliauskas on DSK5VPTVN1PROD with PROPOSALS
Federal Register / Vol. 80, No. 81 / Tuesday, April 28, 2015 / Proposed Rules 23473 

53Between April 2012 and December 2013, AMS 

staff contacted 8 organic dairy producers of various 

sizes to determine the extent to which heifers are 

raised or purchased on their farms. 

TABLE 6—DIFFERENCE IN COST BETWEEN A TRANSITIONED HEIFER AND AN ORGANIC HEIFER

Low end of 

range 

High end of 

range Value used 

Cost of organic replacement heifer ............................................................................................. $1,200 $2,000 $2,000 

Increased premium for organic heifer due to increased demand (assumed) ............................. ........................ ........................ 500 

Total cost of organic replacement heifer .............................................................................. ........................ ........................ 2,500 

Cost of conventional heifer (used as lower bound for cost of transitioned heifer) ..................... 1,000 1,435 1,200 

Cost difference per heifer ..................................................................................................... ........................ ........................ 1,300 

According to the NASS 2011 Certified 

Organic Production Survey, the U.S. 

had approximately 1,850 organic dairy 

farms that milked 200,000 cows. Based 

on the NASS survey results for the total 

number of organic dairy operations and 

ARMS data on the number of 

replacement heifers purchased, we 

estimate the total increase in cost of 

purchasing organic heifers instead of 

transitioned heifers at a maximum of 

$935,000 per year with the assumption 

that 50% of replacement animals 

purchased are transitioned dairy 

animals and $468,000 per year with the 

assumption that 25% of replacement 

animals purchased are transitioned 

dairy animals. If the cost of organic 

replacement heifers does not increase 

due to current market conditions, the 

estimate of the total increase in cost is 

significantly less at $576,000 for the 

50% assumption and $288,000 for the 

25% assumption. The additional cost of 

purchasing organic heifers for 

replacement purposes is summarized in 

Table 7. 

TABLE 7—ADDITIONAL COST INCURRED TO PURCHASE ORGANIC HEIFERS

Price difference used 

Total additional cost for dairy producers 

25% Assumption 50% Assumption 

Low Estimate ................ Uses $800 difference between conventional 

and organic heifers.

$288,000 ..................................... $576,000. 

High Estimate ............... Uses $1,300 difference ($800 above plus $500 

in assumed organic premium).

$468,000 ($180,000 of which is 

an intra-industry transfer).

$935,000 ($359,000 of which is 

an intra-industry transfer. 

The cost difference between the low 

and high estimate ($359,000 or 

$180,000) should not be considered a 

net cost, but rather an intra-industry 

transfer. While some producers who 

need to purchase organic heifers will 

have additional costs if there is a $500 

premium for these animals, this 

premium will stay within the organic 

dairy sector as a benefit to those 

producers supplying organic heifers. 

Any intra-industry transfer is expected 

to benefit small operations as such 

operations tend to have more flexibility 

in capacity (e.g., available pasture) to 

accommodate raising organic 

replacement heifers for the organic 

market. This flexibility is less apparent 

for large operations. Furthermore, the 

actual costs of this action may be 

considerably less than the low estimate. 

This analysis is based on a conservative 

assumption that 50 percent of all 

purchased heifers are transitioned 

heifers. Based on discussions with 

organic dairy producers, we believe that 

this proportion is likely smaller which 

would decrease the low cost estimate.53

The costs of the proposed action will 

vary by size of operation because the 

proportion of dairies that source at least 

some of their replacement heifers from 

their own calves also varies by size of 

operation. Of the largest operations in 

the ARMS data, those with 200 or more 

cows, 96 percent reported that at least 

some of their replacement heifers were 

born on their operations. All operations 

with between 100 and 199 cows 

reported that at least some of their 

replacement heifers were born on their 

operations, and 99 percent of operations 

with fewer than 50 cows and those with 

between 50 and 99 cows reported that 

at least some of their replacement 

heifers were born on their operations. 

Purchases of milk cows and 

replacement heifers also vary by size. 

Ten percent of operations with fewer 

than 50 cows reported purchasing milk 

cows, and the average number 

purchased was 6 head. Five percent of 

operations with between 50 and 99 

cows reported purchasing milk cows, 

and the average number purchased was 

14 head. Three percent of operations 

with between 100 and 199 cows 

reported purchasing milk cows, and the 

average number purchased was 10 head. 

No operations with 200 or more cows 

reported purchasing milk cows. 

The pattern is different for purchasing 

heifers. Four percent of operations with 

fewer than 50 cows reported purchasing 

heifers, and the average number 

purchased was 10 head. Seven percent 

of operations with between 50 and 99 

cows reported purchasing heifers, and 

the average number purchased was 10 

head. Three percent of operations with 

between 100 and 199 cows reported 

purchasing heifers, and the average 

number purchased was 5 head. Eight 

percent of operations with 200 or more 

cows reported purchasing heifers, and 

the average number purchased was 76 

head. Based on a cost difference of 

$1,300 per head between transitioned 

replacement heifers and organic 

replacement heifers, and assuming that 

half of replacement heifers currently 

purchased are transitioned, dairies with 

fewer than 50 cows would pay an 

additional $270,000, dairies with 

between 50 and 99 cows would pay an 

additional $280,000, dairies with 

between 100 and 199 cows would pay 

an additional $30,000 and dairies with 

200 or more cows would pay an 

additional $355,000. The costs by size of 

operation are summarized in Table 8. 


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54Organic Trade Association. 2013. U.S. 

Families’ Organic Attitudes and Beliefs: 2013 

Tracking Study. www.ota.com. 

TABLE 8—COSTS BY SIZE OF OPERATION FOR PURCHASING ORGANIC HEIFERS

Fewer than 50 

cows 50–99 cows 100–199 cows 200 or more cows 

Size of Operation 

Percent of operations that purchased replacement heifers 4% ......................... 7% ......................... 3% ......................... 8%. 

Average number of replacement heifers purchased ......... 10 head ................. 10 head ................. 5 head ................... 76 head. 

Total cost for purchase of replacement heifers across 

size class.

$270,000 ............... $280,000 ............... $30,000 ................. $355,000. 

Cost per operation (25% to 50% transitioned heifers) ...... $3,250–$6,500 ...... $3,250–$6,500 ...... $1,600–$3,250 ...... $29,700–$49,400. 

Effects on Heifer Development 

Operations 

Heifer development operations raise 

heifers either from wet calves or weaned 

calves and generally sell them as 

springers at about 24 months of age. To 

raise organic or transitioned heifers, 

these operations must have organic 

pasture available for the heifers to graze. 

Operations that raise transitioned 

heifers may have to increase their 

ownership or leasing of organic pasture 

to continue to operate at their current 

capacity since organic heifer calves will 

need access to organic pasture for a 

longer period than transitioned heifers 

will need access to pasture. 

Since the locations, numbers, and 

sizes of heifer development operations 

are not known, it is not possible to 

estimate the increased costs this will 

entail. However, it is possible that, to 

the extent that organic heifers sell at a 

premium to transitioned heifers, the 

increased costs may be at least partially 

offset by increases in revenues from 

selling organic replacement heifers. We 

are seeking data related to the likely 

impacts on heifer development 

operations and those for sheep and 

goats. 

Effects on Consumers 

Nearly 99 percent of all dairies report 

that they source at least some of their 

replacement cows from their own 

calves, and only 4.3 percent of all 

dairies purchase replacement heifers. 

The 95.7 percent of producers that do 

not purchase replacement heifers would 

not see an increase in costs. To replace 

purchased transitioned heifers, dairies 

would have to either raise their own 

replacements or buy them from an 

operation that sells organic replacement 

heifers. Since the current market for 

replacement heifers is soft and there are 

ample supplies, as detailed above, it is 

unlikely that the proposed rule would 

significantly increase producer, and 

therefore, milk costs to the consumer. 

Benefits of the Proposed Rule 

This proposed rule would bring 

specificity and clarity to the regulations 

relating to the origin of dairy livestock 

and the management of breeder stock. 

Greater clarity and specificity will 

create uniform application of the 

practice standards applied in organic 

production and in turn will help 

maintain consumer confidence in 

purchasing organic products. 

The Organic Trade Association’s 

(OTA) 2013 U.S. Families’ Organic 

Attitudes and Beliefs tracking study 

identified that 13 percent of organic 

buyers surveyed who saw or heard a 

negative news story about organic chose 

to buy less organic foods. Further, 

nearly half of non-buyers of organic 

products surveyed displayed a decrease 

in their average level of trust in organic 

products’ authenticity from 5.3 on a 10- 

point scale in 2012 to 4.4 in 2013.54

Conclusions 

A clear and consistent standard for 

transition of dairy animals into organic 

production is needed and anticipated by 

dairy producers, consumers, trade 

associations, certifying agents, and the 

OIG. This proposed rule would provide 

a foundation for compliance and 

enforcement in support of fair 

competition among dairy producers 

through a single, well-defined standard. 

AMS is pursing the regulatory option 

that retains the opportunity for new 

producers to transition into organic 

dairy production once. In the event of 

emergencies, producers, through their 

certifiers could apply for a temporary 

variance provided for in section 

205.290(a). 

AMS is seeking comments on the 

actual economic impacts, both costs and 

benefits, of this action on the industry. 

We are specifically interested in 

validating the accuracy of the number of 

farms impacted, validating the accuracy 

of the estimated number of replacement 

animals, and understanding the number 

and size of heifer development 

operations that may be affected by this 

action. The costs and benefits are 

summarized in the Executive Summary 

and were described in detail in this 

section. 

In addition, and in support of our 

validation efforts, we also are requesting 

comments on or submissions of 

applicable farm or industry data, data 

sources, reports, research and other 

relevant information that would help us 

better understand the full range of 

impacts of the rule on farm income and 

profitability. 

B. Executive Order 12988 

Executive Order 12988 instructs each 

executive agency to adhere to certain 

requirements in the development of new 

and revised regulations in order to avoid 

unduly burdening the court system. 

This proposed rule is not intended to 

have a retroactive effect. 

States and local jurisdictions are 

preempted under the OFPA from 

creating programs of accreditation for 

private persons or State officials who 

want to become certifying agents of 

organic farms or handling operations. A 

governing State official would have to 

apply to USDA to be accredited as a 

certifying agent, as described in section 

6514(b) of the OFPA. States are also 

preempted under sections 6503 and 

6507 of the OFPA from creating 

certification programs to certify organic 

farms or handling operations unless the 

State programs have been submitted to, 

and approved by, the Secretary as 

meeting the requirements of the OFPA. 

Pursuant to section 6507(b)(2) of the 

OFPA, a State organic certification 

program may contain additional 

requirements for the production and 

handling of organically produced 

agricultural products that are produced 

in the State and for the certification of 

organic farm and handling operations 

located within the State under certain 

circumstances. Such additional 

requirements must: (a) Further the 

purposes of the OFPA, (b) not be 

inconsistent with the OFPA, (c) not be 

discriminatory toward agricultural 

commodities organically produced in 

other States, and (d) not be effective 

until approved by the Secretary. 

Pursuant to section 6519(f) of the 

OFPA, this proposed rule would not 


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55The determination of a cost difference of $1,300 

per head and the assumption about the proportion 

of replacement heifers that are transitioned is 

discussed in the RIA. See section on EO 12866 and 

13563. 

alter the authority of the Secretary 

under the Federal Meat Inspection Act 

(21 U.S.C. 601–624), the Poultry 

Products Inspection Act (21 U.S.C. 451– 

471), or the Egg Products Inspection Act 

(21 U.S.C. 1031–1056), concerning meat, 

poultry, and egg products, nor any of 

the authorities of the Secretary of Health 

and Human Services under the Federal 

Food, Drug and Cosmetic Act (21 U.S.C. 

301–399), nor the authority of the 

Administrator of the EPA under the 

Federal Insecticide, Fungicide and 

Rodenticide Act (7 U.S.C. 136–136(y)). 

Section 6520 of the OFPA provides 

for the Secretary to establish an 

expedited administrative appeals 

procedure under which persons may 

appeal an action of the Secretary, the 

applicable governing State official, or a 

certifying agent under this title that 

adversely affects such person or is 

inconsistent with the organic 

certification program established under 

this title. The OFPA also provides that 

the U.S. District Court for the district in 

which a person is located has 

jurisdiction to review the Secretary’s 

decision. 

C. Regulatory Flexibility Analysis 

The Regulatory Flexibility Act (RFA) 

(5 U.S.C. 601–612) requires agencies to 

consider the economic impact of each 

rule on small entities and evaluate 

alternatives that would accomplish the 

objectives of the rule without unduly 

burdening small entities or erecting 

barriers that would restrict their ability 

to compete in the market. The purpose 

is to fit regulatory actions to the scale of 

businesses subject to the action. 

The RFA permits agencies to prepare 

the initial RFA in conjunction with 

other analyses required by law, such as 

the Regulatory Impact Analysis (RIA). 

AMS notes that several requirements to 

complete the RFA overlap with the RIA. 

For example, the RFA requires a 

description of the reasons why action by 

the agency is being considered and an 

analysis of the proposed rule’s costs to 

small entities. The RIA describes the 

need for this proposed rule, the 

alternatives considered and the 

potential costs and benefits of this 

proposed rule. In order to avoid 

duplication, we combine some analyses 

as allowed in section 605(b) of the RFA. 

As explained below, AMS expects that 

the entities that could be impacted by 

this proposed rule would qualify as 

small businesses. In the RIA, the 

discussion of alternatives and the 

potential costs and benefits pertain to 

impacts upon all entities, including 

small entities. Therefore, the scope of 

those analyses is applicable to the RFA. 

The RIA should be referred to for more 

detail. 

AMS has considered the economic 

impact of this proposed action on small 

entities. Small entities include 

producers transitioning into organic 

dairy production, existing organic dairy 

producers, and producers that raise 

replacement animals for organic dairies. 

AMS believes that the cost of 

implementing the proposed rule will 

fall primarily on organic dairies that 

currently purchase transitioned heifers, 

although dairies currently purchasing 

organic heifers would be expected to 

pay higher prices in the short-term due 

to increased competition for these 

animals. Farms that sell their excess 

organic replacement heifers may see an 

increase in demand for their heifers 

while farms that raise their own organic 

replacement heifers would not be 

affected by the proposed rule. AMS 

believes there may be a limited number 

of heifer development operations who 

could be impacted by this action. 

However, since the locations, numbers, 

and sizes of heifer development 

operations are not known, it is not 

possible to estimate the number of such 

entities and any increased costs for 

those entities. 

This proposed rule would also affect 

certifying agents that certify organic 

dairy operations. The Small Business 

Administration (SBA) defines small 

agricultural service firms, which 

includes certifying agents, as those 

having annual receipts of less than 

$7,000,000 (North American Industry 

Classification System Subsector 115— 

Support Activities for Agriculture and 

Forestry). There are currently 84 USDAaccredited certifying agents; based on a 

query of the NOP certified organic 

operations database, there are 

approximately 53 certifying agents who 

are currently involved in the 

certification of organic dairies. AMS 

believes that these certifying agents 

would meet the criterion for a small 

business. While certifying agents are 

small entities that will be affected by 

this proposed rule, we do not expect 

these certifying agents to incur 

significant costs as a result of this 

action. Certifying agents already must 

comply with the current regulations, 

e.g., maintaining certification records 

for organic dairy operations. Their 

primary new responsibility under this 

proposal will be to determine, through 

the existing application process for 

organic certification, a producer’s 

eligibility for a one-time transition into 

organic production. 

For the RFA analysis, AMS focused 

on estimating how different size organic 

dairy operations (small versus large) 

would be impacted as a result of 

purchasing all organic dairy 

replacement animals. As discussed 

above, we do not have data on heifer 

development operations that raise dairy 

replacement heifers and are unable to 

estimate the impacts on these entities. 

As defined by the SBA (13 CFR 

121.201), small agricultural producers 

are defined as those having annual 

receipts of less than $750,000. AMS 

used this SBA criterion to identify large 

organic dairy operations, those with 

cash receipts of more than $750,000, 

and small operations, those with cash 

receipts of $750,000 or less. The ARMS 

dataset estimates that 95 percent had 

cash receipts below $750,000 and 5 

percent had cash receipts above 

$750,000. Using the NASS estimate for 

the total number of organic dairy 

operations, AMS estimates that, in 2011, 

there were 91 large operations and 1,756 

operations that would be considered 

small under the SBA criterion. 

AMS notes that there is little variation 

in the proportion of organic dairies that 

source at least some of their 

replacement heifers from their own 

calves. Of the large operations, 96 

percent reported that at least some of 

their replacement heifers were born on 

their operations. About 99 percent of 

small operations reported sourcing at 

least some of their replacement heifers 

from calves born on their operations. 

While the frequency of purchases of 

replacement heifers varied little by size, 

our analysis shows that the mean 

number of replacement heifers 

purchased was significantly different 

across size categories. Small operations 

were slightly less likely to buy 

replacement heifers (5.3 percent versus 

5.5 percent). Of the small operations 

that purchased replacement heifers, the 

average number purchased was 10 head, 

compared with an average purchase of 

107 head for large operations. For this 

cost analysis, we assumed a cost 

difference of $1,300 per head between 

transitioned replacement heifers and 

organic replacement heifers and 

assumed that half of replacement heifers 

currently purchased are transitioned.55

Based on our analysis, AMS estimates 

that, under the proposed rule, small 

operations would collectively spend an 

additional $588,000 for heifers. Large 

operations would collectively pay an 

additional $347,000 for heifers. Of the 

operations that purchased heifers, the 

average additional cost per operation 

would be $6,300 for small operations 


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and $70,000 for large operations. AMS 

notes that this analysis assumed that 

there is no difference in the cost per 

head paid by large and small operations 

for purchases of replacement heifers. 

Table 9 summarizes the cost analysis 

using the SBA criterion for small 

businesses (i.e., producers with less 

than $750,000 in cash receipts). 

TABLE 9—COST OF ORGANIC REPLACEMENT HEIFERS BY SBA CRITERION FOR SMALL BUSINESSES

Small operations 

(<$750,000) 

Large operations 

(>=$750,000) 

Total cost (all operations) ............................................................................................................................ $588,000 $347,000 

Per operation purchasing replacement heifers (25% to 50% transitioned replacements) ......................... 3,150–6,300 35,000–70,000 

To understand the potential costs in 

context, we used the higher average cost 

estimate per operation from Table 9 for 

the purchase of organic replacement 

heifers (i.e., $6,300 for small; $70,000 

for large) and compared it to the average 

gross cash farm income for each size 

category. In 2011, the average gross farm 

cash income for small operations was 

$211,375, and $2,348,345 for large 

operations. For both small and large 

operations, the average additional costs 

imposed by the requirement to purchase 

organic replacement heifers accounts for 

approximately 2.9 percent of an 

operation’s average gross cash farm 

income. AMS believes that any costs 

incurred by producers in complying 

with this proposed action would be 

offset by a stronger marketplace for 

organic dairy products. If implemented, 

this action would, as discussed in the 

benefits portion of the RIA, ensure that 

consumer expectations are met and 

support the growing market for these 

organic products. AMS believes that, 

over the long run, the economic impact 

on producers of not implementing this 

proposed rule would be greater than the 

economic impact of this proposed rule 

due to the need for greater consistency 

in applying the origin of livestock 

standard across the organic dairy sector. 

In addition, AMS has not identified 

any relevant Federal rules that are 

currently in effect that duplicate, 

overlap, or conflict with this proposed 

rule. This action provides additional 

clarity on the origin of livestock 

requirements that are specific and 

limited to the USDA organic 

regulations. 

D. Executive Order 13175 

This proposed rule has been reviewed 

in accordance with the requirements of 

Executive Order 13175, ‘‘Consultation 

and Coordination with Indian Tribal 

Governments.’’ Executive Order 13175 

requires Federal agencies to consult and 

coordinate with tribes on a governmentto-government basis on policies that 

have tribal implications, including 

regulations, legislative comments or 

proposed legislation, and other policy 

statements or actions that have 

substantial direct effects on one or more 

Indian tribes, on the relationship 

between the Federal Government and 

Indian tribes or on the distribution of 

power and responsibilities between the 

Federal Government and Indian tribes. 

AMS has assessed the impact of this 

rule on Indian tribes and determined 

that this rule may have tribal 

implications that require tribal 

consultation under EO 13175. If a Tribe 

requests consultation, AMS will work 

with the Office of Tribal Relations to 

ensure meaningful consultation is 

provided where changes, additions and 

modifications identified herein are not 

expressly mandated by Congress. 

E. Paperwork Reduction Act 

No additional collection or 

recordkeeping requirements are 

imposed on the public by this proposed 

rule. Accordingly, OMB clearance is not 

required by the Paperwork Reduction 

Act of 1995, 44 U.S.C. 3501, Chapter 35. 

F. Civil Rights Impact Analysis 

AMS has reviewed this proposed rule 

in accordance with the Department 

Regulation 4300–4, Civil Rights Impact 

Analysis (CRIA), to address any major 

civil rights impacts the rule might have 

on minorities, women, and persons with 

disabilities. After a careful review of the 

rule’s intent and provisions, AMS has 

determined that this rule would only 

impact the organic practices of organic 

producers and that this rule has no 

potential for affecting producers in 

protected groups differently than the 

general population of producers. This 

rulemaking was initiated to clarify a 

regulatory requirement and enable 

consistent implementation and 

enforcement. 

Protected individuals have the same 

opportunity to participate in the NOP as 

non-protected individuals. The USDA 

organic regulations prohibit 

discrimination by certifying agents. 

Specifically, section 205.501(d) of the 

current regulations for accreditation of 

certifying agents provides that ‘‘No 

private or governmental entity 

accredited as a certifying agent under 

this subpart shall exclude from 

participation in or deny the benefits of 

the NOP to any person due to 

discrimination because of race, color, 

national origin, gender, religion, age, 

disability, political beliefs, sexual 

orientation, or marital or family status.’’ 

Paragraph 205.501(a)(2) requires 

‘‘certifying agents to demonstrate the 

ability to fully comply with the 

requirements for accreditation set forth 

in this subpart’’ including the 

prohibition on discrimination. The 

granting of accreditation to certifying 

agents under section 205.506 requires 

the review of information submitted by 

the certifying agent and an on-site 

review of the certifying agent’s 

operation. Further, if certification is 

denied, section 205.405(d) requires that 

the certifying agent notify the applicant 

of their right to file an appeal to the 

AMS Administrator in accordance with 

section 205.681. These regulations 

provide protections against 

discrimination, thereby permitting all 

producers, regardless of race, color, 

national origin, gender, religion, age, 

disability, political beliefs, sexual 

orientation, or marital or family status, 

who voluntarily choose to adhere to the 

rule and qualify, to be certified as 

meeting NOP requirements by an 

accredited certifying agent. This 

proposed rule in no way changes any of 

these protections against discrimination. 

List of Subjects in 7 CFR Part 205 

Administrative practice and 

procedure, Agriculture, Animals, 

Archives and records, Imports, Labeling, 

Organically produced products, Plants, 

Reporting and recordkeeping 

requirements, Seals and insignia, Soil 

conservation. 

For the reasons set forth in the 

preamble, 7 CFR part 205 is proposed to 

be amended as follows: 

PART 205—NATIONAL ORGANIC 

PROGRAM 

■ 1. The authority citation for 7 CFR 

part 205 continues to read: 

Authority: 7 U.S.C. 6501–6522. 

■ 2. Section 205.2 is amended by adding 

in alphabetical order definitions for 


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‘‘dairy farm,’’ ‘‘organic management,’’ 

third-year transitional crop,’’ 

‘‘transitional crop,’’ and ‘‘transitioned 

animal’’ to read as follows: 

§ 205.2 Terms defined. 

* * * * * 

Dairy farm. A premises with a milking 

parlor where at least one lactating 

animal is milked. 

* * * * * 

Organic management. Management of 

a production or handling operation in 

compliance with all applicable 

production and handling provisions 

under this part. 

* * * * * 

Third-year transitional crop. Crops 

and forage from land, included in the 

organic system plan of a producer’s 

operation, that has had no application of 

prohibited substances within 2 years 

prior to harvest of the crop or forage. 

* * * * * 

Transitional crop. Any agricultural 

crop or forage from land, included in 

the organic system plan of a producer’s 

operation, that has had no application of 

prohibited substances within one year 

prior to harvest of the crop or forage. 

Transitioned animal. A dairy animal 

that was converted to organic milk 

production in accordance with 

§ 205.236(a)(2); offspring borne to a 

transitioned animal that, during its last 

third of gestation, consumes third year 

transitional crops; or offspring borne 

during the one-time transition exception 

that themselves consume third year 

transitional crops. Such animals must 

not be sold, labeled, or represented as 

organic slaughter stock or for the 

purpose of organic fiber. 

* * * * * 

■ 3. Section 205.236 is revised to read 

as follows: 

§ 205.236 Origin of livestock. 

(a) Livestock products that are to be 

sold, labeled, or represented as organic 

must be from livestock under 

continuous organic management from 

the last third of gestation or hatching: 

Except, That: 

(1) Poultry. Poultry or edible poultry 

products must be from poultry that has 

been under continuous organic 

management beginning no later than the 

second day of life; 

(2) Dairy animals. A producer as 

defined in § 205.2 may transition dairy 

animals into organic production only 

once. A producer is eligible for this 

transition only if the producer starts a 

new organic dairy farm or converts an 

existing nonorganic dairy farm to 

organic production. A producer must 

not transition any new animals into 

organic production after completion of 

this one-time transition. This transition 

must occur over a continuous 12-month 

period prior to production of milk or 

milk products that are to be sold, 

labeled, or represented as organic, and 

meet the following conditions: 

(i) During the 12-month period, dairy 

animals must be under continuous 

organic management; 

(ii) During the 12-month period, the 

producer should describe the transition 

as part of its organic system plan and 

submit this as part of an application for 

certification to a certifying agent, as 

required in § 205.401; 

(iii) During the 12-month period, 

dairy animals and their offspring may 

consume third-year transitional crops; 

(iv) Offspring born during or after the 

12-month period are transitioned 

animals if they consume third-year 

transitional crops during the transition 

or if the mother consumes third year 

transitional crops during the offspring’s 

last third of gestation; 

(v) Offspring born from transitioning 

dairy animals are organic if they are 

under continuous organic management 

and if only certified organic crops and 

forages are used from their last third of 

gestation; 

(vi) All dairy animals must end the 

transition at the same time; 

(vii) Dairy animals that complete the 

transition are transitioned animals and 

must not be used for organic livestock 

products other than organic milk; 

(viii) After the 12-month period ends, 

transitioned animals may produce 

organic milk on any organic dairy farm 

as long as the animal is under 

continuous organic management at all 

times on a certified organic operation; 

and 

(ix) After the 12-month period ends, 

any new dairy animal brought onto a 

producer’s dairy farm(s) for organic milk 

production must be an animal under 

continuous organic management from 

the last third of gestation or a 

transitioned animal sourced from 

another certified organic dairy farm. 

(3) Breeder stock. Livestock used as 

breeder stock may be brought from a 

nonorganic operation onto an organic 

operation at any time, Provided, That 

the following conditions are met: 

(i) Such breeder stock must be 

brought onto the operation no later than 

the last third of gestation if its offspring 

are to be raised as organic livestock; and 

(ii) Such breeder stock must be 

managed organically throughout the last 

third of gestation and the lactation 

period during which time they may 

nurse their own offspring. 

(b) The following are prohibited: 

(1) Livestock, edible livestock 

products, or nonedible livestock 

products such as animal fiber that are 

removed from an organic operation and 

subsequently managed on a nonorganic 

operation may not be sold, labeled, or 

represented as organically produced. 

(2) Breeder stock, dairy stock, or 

transitioned animals that have not been 

under continuous organic management 

since the last third of gestation may not 

be sold, labeled, or represented as 

organic slaughter stock. 

(c) The producer of an organic 

livestock operation must maintain 

records sufficient to preserve the 

identity of all organically managed 

animals, including whether they are 

transitioned animals, and edible and 

nonedible animal products produced on 

the operation. 

■ 4. Section 205.237 is amended by 

revising paragraph (a) to read as follows: 

§ 205.237 Livestock feed. 

(a) The producer of an organic 

livestock operation must provide 

livestock with a total feed ration 

composed of agricultural products, 

including pasture and forage, that are 

organically produced and handled by 

operations certified to the NOP, except 

as provided in § 205.236(a)(2)(iii), 

except, that, synthetic substances 

allowed under § 205.603 and 

nonsynthetic substances not prohibited 

under § 205.604 may be used as feed 

additives and feed supplements, 

Provided, That, all agricultural 

ingredients included in the ingredients 

list, for such additives and supplements, 

shall have been produced and handled 

organically. 

* * * * * 

■ 5. Section 205.239 is amended by 

revising paragraph (a)(3) to read as 

follows: 

§ 205.239 Livestock living conditions. 

(a) * * * 

(3) Appropriate clean, dry bedding. 

When roughages are used as bedding, 

they shall have been organically 

produced in accordance with this part 

by an operation certified under this part, 

except as provided in 

§ 205.236(a)(2)(iii), and, if applicable, 

organically handled by operations 

certified to the NOP. 

* * * * * 

Dated: April 23, 2015. 

Rex A. Barnes, 

Associate Administrator, Agricultural 

Marketing Service. 

[FR Doc. 2015–09851 Filed 4–27–15; 8:45 am] 

BILLING CODE P 


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