California Ag Network

Category: Ag Economics

  • Senate Committee Rejects SB 628, Blocking Tax Credit Relief for Ag Overtime Wages

    On April 23rd, with a party-line vote, the Senate Committee on Labor, Public Employment and Retirement defeated SB 628 (Grove, R-Bakersfield). This bill was co-sponsored by the California Association of Winegrape Growers (CAWG) and would have created a tax credit to help agricultural employers cover the cost of overtime wages paid to farm workers.

    “It is disappointing that the California State Senate failed to show the same bipartisan leadership we’ve seen in New York and Oregon,” said Natalie Collins, President of CAWG. “SB 628 would have provided a dollar-for-dollar tax credit on overtime wages paid to farmworkers, delivering targeted relief for growers, supporting workers, and strengthening the rural communities that rely on a strong agricultural economy. This isn’t an untested idea; it’s a proven, common-sense solution. We urge the California Legislature to reconsider this legislation as soon as possible.”

    Mountains of research and data show that agricultural employees have experienced a decline in their take-home pay since California’s ag overtime law took effect. The reality is that most growers simply cannot afford to pay overtime wages, and as a result, available overtime hours have been significantly reduced.

    According to a 2023 study by the University of California, Berkeley, California farm workers have made less money since the Phase-In Overtime for Agricultural Workers Act of 2016 became law. The study concluded, “This early evidence suggests that the law may not be benefiting the workers they aim to protect.”

    In September 2024, Governor Gavin Newsom stated, “Farmworkers are the backbone of California’s nation-leading agricultural industry and play a critical role in ensuring the stability of the state, nation, and world’s food supply. Investing in their well-being is investing in California’s success.”

    “CAWG co-sponsored SB 628 because we share the Governor’s belief that supporting farmworkers is essential,” said Collins. “With California’s agricultural economy in steep decline, our workforce is feeling the strain. SB 628 was a modest, targeted fix that would have directly benefited those employees while offering stability for the growers who employ them. Finding solutions that support both growers and the agricultural workforce will remain one of CAWG’s highest priorities.”

    Conversely, in opposing SB 628, the California Labor Federation stated, “At a time when the California legislature is debating how to allocate tax dollars to fund all the state’s priorities in education, housing, health and human services, infrastructure, energy, etc., this proposal is additionally harmful.”

    Collins added, “This bill was never about choosing between priorities like education or infrastructure. It’s about recognizing that investing in agriculture and the people behind it is an investment in California’s long-term stability and resilience.

    While we’re disappointed by the outcome, we are deeply grateful to Senator Shannon Grove for her leadership in authoring this legislation and to our co-sponsor, the California Farm Bureau, for their shared commitment and partnership. We also thank Senator Melissa Hurtado for her support of this bill and extend our sincere appreciation to the 35 farmworkers who took time out of their day to stand in support of SB 628.

    About the California Association of Winegrape Growers: CAWG is a statewide nonprofit trade association advocating for California’s winegrape growers to ensure the sustainability of the winegrape industry. CAWG promotes the industry’s long-term success by advancing the adoption of sound public policies and fostering awareness and understanding of winegrape growers’ contributions to the economy, environment, and California communities. Learn more at cawg.org.

  • Could Farmers Get a Tax Credit for Paying Employees Overtime?

    Could farmers in California get a tax credit for paying their employees to work overtime?  Other states have already implemented this to alleviate the pressures of inflating wage costs burdening ag employers. Watch this brief interview as Michael Miiller from the California Association of Winegrape Growers (CAWG) joins Matthew Malcolm on California Ag Network to share how CAWG is working with the California Farm Bureau and Senator Shannon Grove through SB628 to support California ag employers and make this happen.
     

    Please thank this video’s sponsor SIPCAM AGRO USA for their industry support.

  • Tariffs Compound Economic Anxiety Among US Consumers and Businesses Amid Fears of Economic Slowdown

    Consumer and business sentiment regarding the U.S. economic outlook continues to deteriorate after dropping sharply over the past few months. Rapidly worsening expectations about everything – from inflation and personal income to business and labor market conditions – are elevating concerns among business owners, investors and consumers alike.

    So far, the hard data on key economic indicators like unemployment, job creation, weekly payrolls and consumer expenditures suggest the U.S. economy remains fairly strong. Even the recent stock market pullback is a symptom of flagging confidence about the future rather than a reflection of current business performance. The question on the minds of investors, businesses and corporate boards is whether the declining expectations will soon translate into slower spending and tightening profit margins.

    According to a new quarterly report from CoBank’s Knowledge Exchange, the answer to that question will likely come into view by the end of June, if not sooner. Historic data suggests that declines in consumer spending begin to become apparent three to five months after a sharp decline in economic sentiment. Consumer spending accounts for about 70% of all U.S. economic activity.

    “Not including the brief pandemic-related recession, which was overwhelmed by massive government stimulus, the previous three U.S. recessions in 1990, 2000 and 2007 were all forewarned by weakening sentiment that led to a steep decline in consumer spending,” said Rob Fox, director of CoBank’s Knowledge Exchange. “The next set of hard data from reports on retail sales and consumer spending should begin to provide some guidance as to which way the economy is heading.”

    Despite a 90-day partial reprieve, the new tariff regime remains likely to increase inflation and cut economic growth, Fox added. “While the severity of the near-term effects is up for debate, the longer-term impact of capricious U.S. trade policy is the likely loss of trust abroad in U.S. policymaking, something that will be very hard to regain.”

    Until recently, most observers viewed the administration’s tariff campaign as a short-term negotiating tactic. It now appears a primary objective is to bring more manufacturing capabilities back within U.S. borders, which will take time. But unpredictable tariff policy could stand in the way of achieving that goal, as businesses are unlikely to invest millions or billions of dollars based on expectations of a policy that’s subject to change at any moment.

    U.S. Government Affairs
    With the whole country watching the impact of President Trump’s sweeping tariffs, Congress has yet to act on this economic gambit. Currently equity and commodity markets are weakening, and the patience of the American people is being tested. Many individuals and businesses are hoping to see the tax law extended, several industries need meaningful immigration reform, and agriculture still demands a Farm Bill. The American public will ultimately demand a functioning Congress.

    Grains, Farm Supply & Biofuels
    Uncertainty over trade and biofuel policy pulled corn, soybean and wheat prices down last quarter, despite the tailwind of a weakening U.S. dollar. Trade concerns weighed most heavily on wheat prices as world buyers have multiple exporters at their disposal. U.S. grain stocks on March 1 revealed a strong usage pace for corn and soybeans, but wheat usage continued to fall. Farmers intend to plant the largest corn acreage in the U.S. since 2013 as corn offers the greatest margin opportunity.

    Crop production expenses are expected to continue trending downward, but they remain elevated in relation to lower commodity prices. While fertilizer prices have fallen, last year’s wet fall will require heavier spring applications and rising corn acreage signals more demand for nitrogen. Ag retailers and farm supply cooperatives head into the spring agronomy season facing labor challenges and obstacles sourcing crop chemicals from China. Growth in biologicals remains a bright spot for cooperatives.

    Renewable diesel and biodiesel production has scaled back to find stability in the absence of the blender’s tax credit, pushing prices above petroleum. Domestic production was down 41% year-over-year for January and February as margin pressure exceeded projections. Establishment of the renewable volume obligations under the Renewable Fuel Standard and decisions on the Clean Fuel Production Credit will largely determine the trajectory of biofuels demand and production.

    Animal Protein & Dairy
    Record high prices across the beef cattle sector remain amid continuing herd liquidation and delayed rebuilding. Despite volatility in the U.S. cattle herd, the beef sector has been able to maintain production to meet strong consumer demand. Through the third week of March, U.S. beef production was up slightly compared to 2024. Weekly dressed cattle weights have pushed 3% to 6% higher than a year ago, hitting a record 882 lbs. per head in late January. Packer margins remain squeezed as feeder cattle prices are continuing their upward trajectory.

    The U.S. pork sector is positioned for moderate growth this year, which should support hog prices and keep pork an affordable protein alternative to beef. Growing export opportunities and strengthening domestic interest in pork are moving U.S. hog prices higher. Lean hog and cutout prices were up to start 2025 and early signs of an upward turn in the production cycle are emerging. Pork producer margins have been positive for 11 consecutive months through February 2025.

    Strong broiler prices and low inventory levels are fueling optimism in the poultry sector. Production metrics have yielded a moderately favorable outlook for 2025. Chick placements are up 2.5% year-to-date. Breast meat prices have been on the rise. But with beef prices chasing record highs, food service outlets have ample incentive to center feature activity on white meat chicken. That bodes well for broiler integrators and consumers as the chicken segment tends to attract shoppers seeking value.

    The potential for prolonged trade disputes with Mexico, Canada and China threatens the outlook for U.S. dairy demand. Combined, the three countries account for one-half of all U.S. dairy exports. Market uncertainty has sent futures contracts tumbling. From early January to early April, April-to-June Class III milk futures fell by $2.57 per cwt. Class IV dropped even further, losing $2.73 over 100 days. Despite the headwinds, dairy continues to have some bright spots, most notably lower feed costs.

    Cotton, Rice & Sugar
    U.S. cotton farmers are struggling with the lowest cotton prices in five years. Slowing consumer demand, ample world supplies and trade policy concerns have driven prices lower. Total U.S. cotton export commitments at the end of the first quarter were down 4.6% year-over-year. Purchases from China – the world’s top cotton buyer – were down 82.6%. China harvested its biggest cotton crop in 11 years. Brazil, the world’s top cotton exporter, is also set to harvest a record crop.

    The flood of Indian rice onto the world market following the country’s lift on export restrictions has pulled U.S. long-grain prices to four-year lows. U.S. rough rice stocks on March 1 were down 3.6% year-over-year due to strong export demand from Mexico. But the durability of last quarter’s swift export pace is under scrutiny. Uncertainty over trade policy is showing signs of curbing demand for U.S. rice abroad.

    Despite tightness in world sugar supplies, the large U.S. sugarbeet harvest last fall has capped price rallies. Sugar imports from Mexico are expected to be the lowest since 2007/2008 as Mexico struggles with drought and lower cane sugar production. U.S. sugarbeet farmers are expected to expand planted acreage this spring with USDA forecasting acreage to climb to 1.132 million, the highest in three years.

    Food & Beverage
    Food and beverage manufacturers are revising their sales and earnings expectations downward as consumer sentiment has soured. Prices remain a top concern for consumers, who continue to pull back on grocery spending. More than 80% of U.S. consumers anticipate tariffs will raise prices, with groceries expected to see the highest increases. Recognizing that more price increases could lead to volume attrition, food and beverage manufacturers are aiming to improve efficiencies and demonstrate value. Growth in private label grocery sales, which reached record levels in 2024, is expected to continue.

    Power & Digital Infrastructure
    Surging power demand and a faster replacement cycle for aging infrastructure is causing electricity prices to outpace inflation for consumers. Even greater cost escalation could lie ahead, as critical elements of the electricity supply chain face new import tariffs and accelerating trade headwinds. Spending on delivering electricity has been increasing at the fastest clip in decades, with a growth rate of 50% over the past five years. The U.S. power grid needs substantial investment, but with much of the supply chain imported, the price tag is rising.

    The Trump administration is expected to loosen requirements for the $42.5 billion Broadband Equity, Access and Deployment program. Changes will likely include a more technology-agnostic approach to how the money is allocated, which will benefit wireless technologies. Under the previous administration, the BEAD program took a fiber-first approach to “future proof” networks built in rural America. Reduced emphasis on fiber means fixed wireless access and low earth orbiting satellites could play a larger role in rural America’s broadband access and accelerate connectivity.

    Read The Quarterly. Each CoBank Quarterly provides updates and an outlook for the Macro Economy and U.S. Agricultural Markets; Grains, Biofuels and Farm Supply; Animal Protein; Dairy; Cotton and Rice; Specialty Crops; Food & Beverage industries and Rural Infrastructure.

    About CoBank

    CoBank is a cooperative bank serving vital industries across rural America. The bank provides loans, leases, export financing and other financial services to agribusinesses and rural power, water and communications providers in all 50 states. The bank also provides wholesale loans and other financial services to affiliated Farm Credit associations serving more than 78,000 farmers, ranchers and other rural borrowers in 23 states around the country.

    CoBank is a member of the Farm Credit System, a nationwide network of banks and retail lending associations chartered to support the borrowing needs of U.S. agriculture, rural infrastructure and rural communities. Headquartered outside Denver, Colorado, CoBank serves customers from regional banking centers across the U.S. and also maintains an international representative office in Singapore.

  • Opportunities for U.S. Dairy Exports Despite Trade and Tariff Uncertainty

    Our California and U.S. dairy industry as a whole has come to rely heavily on exports, and continues hitting record sales with key trade partners and growing commodities, such as cheese. Despite the uncertainty accompanying the Trump administration and looming retaliatory tariff threats, the US Dairy Export Council remains committed to growing export market opportunities for the U.S. dairy industry. Rebecca Nyman, current Chair of the US Dairy Export Council, met on California Ag Network with Matthew Malcolm to share the council’s recent work optimism for current and future prospects for increasing oversea dairy shipments. Read more in California Dairy Magazine.

  • Emerging Data Begins to Quantify Value Beef and Dairy Crossbred Cattle Bring to US Beef Supply Chain

    New data from the USDA Agricultural Marketing Service is beginning to shed light on the impact of beef and dairy crossbred cattle on the beef supply chain. While limited in scope, the data collected to date suggests the growing number of beef-on-dairy animals is contributing to higher cattle prices for producers and delivering added value to feedlots and processors.

    The practice of using beef genetics in dairy reproductive programs, commonly referred to as “beef on dairy” within the industry, has steadily increased as the U.S. beef cow herd has contracted. Historically, cattle market analysts had limited pricing data to quantify the impact of beef-on-dairy on the cattle market. That changed in March 2024 when USDA began tracking beef-on-dairy animals sold at public auctions.

    According to an analysis outlined in a new CoBank Knowledge Exchange report, the slaughter auction prices for beef-on-dairy cattle were slightly higher than for beef cattle and significantly higher than for dairy cattle. The weight of beef-on-dairy animals fell between the ends of the beef and dairy cattle spectrum.

    USDA-AMS, CoBank

    “The data also showed that beef-on-dairy cattle maintained the largest proportion of their value from feeder price to slaughter cattle auction price on a per hundredweight basis,” said Abbi Prins, livestock analyst with CoBank. “That’s an important financial metric for feedlots. We’ll have to see if these patterns hold over time as additional data becomes available. But preliminarily, it reaffirms the value proposition beef-on-dairy brings to the wider beef sector.”

    The U.S. beef cow herd is at historically low levels due to prolonged drought and poor grazing conditions. Tight supplies amid robust consumer demand for beef have pushed cattle prices to record highs. Dairy producers are capitalizing on the opportunity to capture higher prices and an additional revenue stream by producing more beef-on-dairy calves for sale into the beef market.

    While beef-on-dairy breeding is not a new phenomenon, additional opportunities to track and analyze these animals using performance metrics throughout their life will enhance efficiencies and profitability in the cattle sector, Prins added.

    Beef Quality is Surging
    U.S. beef quality has undergone a near complete transformation over the last decade. Prime beef production has increased 140% to reach more than 2 billion pounds annually. Production of Choice grade beef, which makes up over three-quarters of the market, grew 20% with nearly 16 billion pounds produced in 2024. Meanwhile, production of lower-grade meat like Select decreased 37% since 2014 to land at 3.17 billion pounds in 2024.
    While the dairy industry’s contributions to meat quality are not easily discernable from publicly sourced data, many of the animals from dairy programs that utilize native beef genetics such as Angus can now qualify for branded premium programs.

    “Purebred beef cattle will remain the dominant source of the U.S. beef supply, and that’s not going to change,” said Prins. “But considering the added value crossbred dairy-beef animals are bringing to market for all participants in the supply chain, it is unlikely the trend will slow any time soon.”

    Read the report, Beef-on-Dairy Data Suggests Opportunity for Feedlots and Processors.

    About CoBank

    CoBank is a cooperative bank serving vital industries across rural America. The bank provides loans, leases, export financing and other financial services to agribusinesses and rural power, water and communications providers in all 50 states. The bank also provides wholesale loans and other financial services to affiliated Farm Credit associations serving more than 77,000 farmers, ranchers and other rural borrowers in 23 states around the country.

    CoBank is a member of the Farm Credit System, a nationwide network of banks and retail lending associations chartered to support the borrowing needs of U.S. agriculture, rural infrastructure and rural communities. Headquartered outside Denver, Colorado, CoBank serves customers from regional banking centers across the U.S. and also maintains an international representative office in Singapore.

  • Growth & Opportunities Ahead for U.S.-Dominican Republic Ag Trade

    The United States is a major trading partner with the Dominican Republic (DR). The DR is the largest economy in the Caribbean and the seventh-largest economy in Latin America. Since the Dominican Republic-Central America Free Trade Agreement (CAFTA-DR) went into effect for the DR in 2007, U.S. agricultural exports to the DR have increased from $1 billion in 2007 to $2 billion in 2024. The schedule called for the elimination of all tariffs on U.S. exports to the DR as of January 1, 2025. Consumer-oriented products comprise the largest percentage of U.S. agricultural exports to the DR, with potential for further growth as the DR’s economy continues to expand.

    Macroeconomic Perspective

    The DR is the largest economy and the third-most-populous country in the Caribbean. The DR is the 14th-largest export destination for U.S. agricultural products, importing $2.2 billion in 2024, a 6-percent increase from 2023. Further stabilization of the economy from the COVID-19 pandemic will increase demand for imported agricultural products. The Economist Intelligence Unit highlights that the DR has experienced rapid growth during the past decade, with a projected real gross domestic product rise of 2 percent in 2024 and a forecast of 5 percent for 2025. The DR saw a 5-percent decrease in inflation in 2024, and experts forecast further declines.

    The DR has transitioned from an agriculture-dependent economy to a hybrid economy, bolstered by tourism, services, manufacturing, and telecommunications. Government support has spurred urbanization and expanded the middle class, according to the World Bank. According to the Central Intelligence Agency World Factbook, 84 percent of the DR’s 10.8 million inhabitants live in urban areas. These developments create favorable conditions for U.S. agricultural exports to the DR, supported by a growing middle class, a booming tourism sector, and an increasingly sophisticated retail food distribution system.

    Consumption Trends and Market Drivers

    Supermarkets account for only 25 percent of retail sales in the DR, with most consumers preferring traditional channels like colmados (neighborhood “mom and pop” convenience stores), public markets, and warehouses that focus on locally produced goods. However, internet and broadband infrastructure investments are paving the way for e-commerce, which is expected to grow 18 percent by 2027, according to Euromonitor.

    With lower- and middle-income consumers primarily using traditional purchasing channels, most U.S. agricultural exports target the hotel, restaurant, and institutional (HRI) sectors and the food processing industry. The Central Bank of the DR valued the country’s food processing industry at $3 billion as of September 2024, driven mainly by meat processing, wheat milling, bakery products, and dairy processing. The United States remains a significant supplier of meats, dairy products, and other key ingredients to this industry.

    The HRI sector is a key economic driver, with more than 11 million visitors in 2024, 53 percent of whom were U.S. passport holders, boosting demand for premium products like beef, pork, and craft beer. The Global Agriculture Information Network’s Food Service – HRI Annual provides more details.

    Prospects for U.S. Agricultural Exports

    Pork and Pork Products
    In 2024, U.S. exports of pork and pork products to the DR totaled $277 million, which tripled since 2020. The United States is the leading supplier of pork and pork products, with 85 percent of the total pork exports to the DR. Pork and pork products are the top agricultural export from the United States to the DR. Increased U.S. exports to the DR have continued to account for a major share of domestic consumption since 2022, following the impacts of African swine fever on domestic production as well as steady consumption growth.

    Dairy Products
    In 2024, U.S. exports of dairy products to the DR reached $135 million, a 47-percent increase since 2020, making the United States the second-largest dairy supplier after the European Union (EU), holding a 25-percent market share. The food processing industry uses U.S. dairy exports for ultra-pasteurized milk and confectioneries, while the HRI sector and retail outlets also favor them. According to the U.S. Department of Agriculture’s Foreign Agricultural Service (FAS) Santo Domingo, variety and quality make U.S. cheeses competitive compared to domestically produced cheese. U.S. cheese has 38 percent of the market share compared to the EU’s 59 percent share. The full implementation of the CAFTA-DR should give the U.S. dairy industry a competitive advantage in relation to the EU.

    Beef and Beef Products
    In 2024, U.S. exports of beef and beef products to the DR totaled $120 million, quadrupling since 2020. The United States supplied 96 percent of the total beef and beef products exports to the DR. Geographic proximity and the demand for high-quality cuts, particularly in food service and retail, contribute to the rise in exports. Additionally, with U.S. passport holders making up more than 50 percent of visitors in 2024, there is a strong demand in the Dominican HRI sector to provide U.S. beef and beef products.

    Poultry and Poultry Products
    In 2024, U.S. exports of poultry and poultry products to the DR totaled $128 million, a 57-percent increase since 2020. This was primarily due to higher prices, with the United States supplying 74 percent of total poultry imports. Meat processors primarily use poultry, with rising demand in the HRI sector and retail and in use for meat processing. The influx of U.S. and Canadian visitors has led many restaurants and resorts to import U.S. poultry due to high quality and preference. Additionally, Dominicans are shifting to poultry due to increased prices in both beef and pork locally. The DR also primarily uses imported meat in meat processing.

    Baked Goods
    U.S. exports to the DR rose 10 percent between 2020 to $50.9 million in 2024 for bakery goods. Corn chips and frozen pastries lead the way. According to S&P Global, there is a growing popularity for less traditional options, such as baguettes, milk bread (bread made using milk instead of water), and croissants, especially in modern grocery outlets and e-commerce. There will be a rise in demand for nontraditional breads, especially breads that consumers consider healthier, such as whole-grain or multigrain products. With a growing youth population in the DR, there has been an upward trend in the consumption of snacks, particularly chips.

    Fresh Fruit
    U.S. exports of fresh fruit to the DR increased fourfold from 2020 to $51 million in 2024, making the United States the leading supplier with a 58-percent market share. Other top suppliers are Chile and Peru. The DR primarily imports apples, pears, and grapes. According to FAS Santo Domingo, the United States mostly exports apples, with a 91-percent share of the Dominican market. However, the United States is not the top exporter of pears or grapes to the DR. Chilean pears and Peruvian grapes account for 51 percent and 61 percent of their respective markets. The U.S. will phase out tariff rates on fresh fruit exports in 2025, while Chile and Peru will continue to face a 21-percent tariff rate on fresh fruit, creating an opportunity for U.S. exporters.

    Distilled Spirits
    U.S. distilled spirit exports to the DR rose 98 percent from 2020 to $32 million in 2024. The United Kingdom is the top supplier, with a 62-percent market share, while the United States has a 5-percent market share. Other top suppliers are the EU, Mexico, and Costa Rica. Euromonitor predicts a rising demand for distilled spirits due to economic stabilization and increased tourism. Demand for dark rums and whiskies, especially bourbons, is recovering to pre-pandemic levels, with potential growth in vodka and gin, as local consumers shift from white rum to a greater variety of distilled spirits.

    Trade Policy

    The CAFTA-DR Agreement includes the United States, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the DR. This agreement has liberalized trade, leading to a 126-percent increase in U.S. agricultural exports to the DR since the agreement entered into force for the DR in 2007. The CAFTA-DR Agreement scheduled for the elimination of all tariffs for U.S. exports by January 1, 2025. However, the DR has not phased out a tariff-rate quota for U.S. rice.

    As reported by the U.S. Department of Commerce’s International Trade Administration, the DR has joined free trade agreements with the Caribbean Community and the Caribbean Forum-European Community and has a preferential trade agreement with Panama. However, CAFTA-DR is the most significant agreement for the DR. With limited competition from other agreements and most tariffs on agricultural goods scheduled to be phased out by 2025, the United States maintains a competitive edge in the DR’s agricultural import market.

    Conclusion

    The DR is a key trading partner for the United States, being the largest in the Caribbean and the seventh-largest trading partner in Latin America. The full implementation of CAFTA-DR in 2025, along with a growing HRI sector and food processing industry, economic growth, and an expanding middle class, positions the United States as a top agricultural supplier in the coming years. There are opportunities for U.S. agricultural exports to expand, especially in meat products and healthy food options, such as whole-grain bread, fresh fruit, and vegetables.

  • USDA Awards Organic Trade Association Over $1M for Global Organic Promotion

    The Organic Trade Association (OTA) is pleased to announce it has received a total of $1,042,035 in funding from the U.S. Department of Agriculture’s Market Access Program (MAP) to promote U.S. organic products around the world in 2025.

    This funding includes $971,393 in new allocations and $70,642 in carryover funds. The award comes alongside the additional $2.5 million received at the end of 2024 from the second tranche of the Regional Agricultural Promotional Program (RAPP). This $5 million in RAPP funding paired with the new MAP funding offers critical support to bring U.S. organic companies to trade activities globally and continue to open foreign markets.

    “Consumers around the world are choosing organic,” says Sarah Gorman, Manager of International Trade for OTA. “Our activities showcase and educate key markets on the quality, integrity, and variety of USDA certified organic products available for export. This year’s activities are taking place in a wide range of markets – from our more established trading partners to new untapped markets.”

    “Since 1999, OTA has been participating in USDA’s Market Access Program and bringing the U.S. organic industry to markets throughout the globe. We’ve created new opportunities for organic businesses through international promotions, organic exporter education and business to business connections. These opportunities don’t just help organic farmers – they also create jobs and economic opportunities across all sectors,” says OTA co-CEO Tom Chapman.

    Global demand for U.S. organic continues to strengthen as American exporters introduce new products annually to consumers overseas. USDA statistics show an 18 percent increase in exports over the last year. Canada and Mexico remain the primary export destination for U.S. organic products by a wide margin, though Japan, Taiwan, South Korea, and the United Arab Emirates are also strong export markets. Within the last couple of years, Vietnam, the Dominican Republic, and India have also edged into the top 10 export destinations.

    The USDA has estimated that for each $1 invested in export market development, U.S. agricultural exports have increased by more than $24. The department is providing a total of $172.3 million through MAP for fiscal year 2025 to 70 Market Development Program Cooperators.

    OTA is showcasing American-produced organic products to a wide and diverse global audience this year, from the world’s biggest organic trade fair in Germany to trade shows and missions stretching across Europe, Asia and the Middle East.

    The year’s activities have already kicked off in a big and successful way. OTA hosted its largest pavilion ever with 18 U.S. organic companies at Biofach in Nuremberg, Germany, in early February. Biofach is the world’s largest trade fair devoted to organic, attracting thousands of international visitors. Following Germany, OTA sponsored five organic brands to the sprawling Gulfood show in Dubai, the largest food and beverage trade show in the MidEast. Next it was the big 50th FoodEx in Tokyo, where OTA showcased six organic companies. Other 2025 trade promotion activities on the calendar are Food & Hotel Asia in Singapore, Thaifex in Bangkok, Anuga in Germany, and FiE in Paris.

    With this robust 2025 funding, OTA plans to continue its consumer promotion activities in Japan, Canada, and Hong Kong, along with launching new promotions in Southeast Asia, Europe, and Latin America.

    The Regional Agricultural Promotional Program (RAPP) was launched in 2023 by USDA to diversify and expand market opportunities for U.S. food and agricultural products into new markets in parts of the world where the middle class is growing and the desire for high-quality food and farm products is increasing. Activities have focused on boosting U.S. organic exports to Southeast Asia, Africa, the Middle East, Latin America and the Caribbean. The newest allocation includes the EU, where OTA is planning a new consumer promotion campaign, as well as support for its traditional trade promotion programming.

    RAPP funding allowed for OTA’s first engagement in Africa in 2024, where OTA sponsored four U.S. organic companies in a USDA Agriculture Trade Mission to Casablanca, Morocco to initially explore and open the markets of Morocco and West Africa for U.S. organic exports. This mission created key partnerships with local buyers, the American Chamber of Commerce in Morocco, and other cooperators attending the mission. Participating companies learned more about this still niche market and consumer preferences, and took an important first step into exploring the region and creating future opportunities.

    OTA’s member companies provide the bulk of all U.S. organic exports. The market promotion activities administered by the association are open to the entire organic industry, however, not just members. For more information or to sign up for activities, visit OTA’s website.

    About the Organic Trade Association
    The Organic Trade Association (OTA) is the membership-based business association for organic agriculture and products in North America. OTA is the leading voice for the organic trade in the United States, representing organic businesses and producers across the nation. Its members include growers, shippers, processors, certifiers, farmers’ associations, distributors, importers, exporters, consultants, brands, retailers and others. OTA’s mission is to promote and protect ORGANIC with a unifying voice that serves and engages its diverse members from farm to marketplace.

  • Central Valley Farmer Responds to Initial 2025 Water Allocation

    On February 25, the Central Valley Water Project announced an initial farm water allocation of 35%. This comes as welcome news to farmers that were hampered last year around the same time by an initial allocation of only 15%.  Watch this brief interview with pistachio/carrot grower and Director at Westlands Water District William Bourdeau, as he shares his perspective on the announcement on California Ag Network with Matthew Malcolm.

  • Historic, Low California Grape Crush Reported: Analysis with Turrentine Brokerage on American Vineyard Live (Recording)

    American Vineyard Magazine hosted a special livestream webcast on February 21st, featuring representatives from Turrentine Brokerage providing a detailed analysis on the 2024 CDFA Grape Crush Report. The webcast was recorded and can now be viewed for free here. Watch now as Turrentine representatives share key insights on using the results of the report to make informed, critical business decisions moving forward, with wine market perspectives from the North Coast, Central Coast, Northern Interior and Central Valley wine regions.

  • Opportunities for Tree Nuts, Dairy & Wine in Upcoming Peru Agribusiness Trade Mission

    The U.S. Department of Agriculture’s Foreign Agricultural Service is accepting applications for its agribusiness trade mission to Lima, Peru, scheduled for June 9-12, 2025. Current and potential U.S. exporters interested in participating must apply by March 12, 2025.

    “Consumers in Peru are eager to stock their pantries with world-class, high-quality food and farm products, and this mission offers a unique opportunity for U.S. exporters to meet that growing demand,” said Foreign Agricultural Service Administrator Daniel Whitley. “It will also help our agricultural community forge meaningful partnerships and unlock new avenues for growth in South America.”

    Peru is the third-largest market for U.S. agricultural exports in South America. Since the 2009 U.S.-Peru Trade Promotion Agreement, bilateral agricultural trade has risen from $1.46 billion to $5 billion in 2023, a 242.5 percent increase. In 2023, the United States was Peru’s second-largest agricultural supplier with a 13-percent market share.

    Peru and its South American trade partners offer robust logistics, distribution, processing, and cold chain capabilities, creating opportunities for exporters across industry sectors, including:

    • Beef, pork, poultry and related products
    • Dairy products
    • Tree nuts
    • Snack, bakery and confectionery products
    • Wine and distilled spirits
    • Condiments and sauces
    • Dog and cat food
    • Health-conscious foods (low-sodium, low-sugar, low-fat)
    • Ethanol
    • Live animals and feed ingredients
    • Bulk products, including pulses

    During the trade mission, participants will join buyers from Peru, Bolivia, and Ecuador for targeted business-to-business meetings to explore and discuss potential business opportunities in each country. Foreign Agricultural Service staff and regional experts will also provide in-depth market briefings, lead informative site visits, and host networking events.

    For more information or to apply, visit www.fas.usda.gov/topics/trade-missions/peru-june-2025. The application deadline is Wednesday, March 12, 2025.

    The trade mission to Peru is one of several USDA-led export promotion opportunities in 2025, with additional missions planned to Côte d’Ivoire, the Dominican Republic, Mexico, and Taiwan. The agency will announce application details for these missions soon.