By MATTHEW D. ERNST

Missouri Correspondent

ST. LOUIS, Mo. — Organic food manufacturers and grain merchandisers are upping efforts to prevent food fraud, especially from conventional crops fraudulently inserted into the organic supply chain, according to presenters at the Organic and Non-GMO Forum in St. Louis on Oct. 29.

Bad actors are seeking profits. “It’s no wonder that organic is becoming a popular place (for fraud), because organic has the premium price,” said Gwendolyn Wyard, vice president of Regulatory and Technical Affairs for the Organic Trade Assoc. (OTA). “But there is an equation that is very simple, and it goes: Organic fraud equals eroded consumer trust.”

The United States must import organic feed grains to meet domestic demand, and fraudulent organic shipments have been documented. But fraud is not confined to imports – three Nebraska farmers, who knew grain that had grown conventionally was being marketed as organic, in October pled guilty in federal court to felony wire fraud charges.

Organic industry groups appreciate the ongoing federal investigation into the Iowa-based business that allegedly brokered the grain. “Fraud cannot be tolerated in the organic system, inside or outside the United States,” said Wyard.

At the conference, she described how an OTA-led task force developed guidance for companies to guard against fraudulent claims. The Global Organic Supply Chain Integrity (GOSCI) task force, supported by more than 40 companies in the organic supply chain, developed detailed guidance for organic grain buyers on how to check and verify organic grain and oilseed claims.

The task force also made recommendations to the USDA’s Agricultural Marketing Service, which oversees the National Organic Program. The top recommendation is to require certification for brokers, traders and ports presently excluded from organic inspections.

“Part of the farm bill priority that we’ve been working on will require USDA to carry out rulemaking and change regulations to require that everybody in the (organic) supply chain is certified,” said Wyard. “More specifically, the (rulemaking will) limit the exclusions.”

Some exclusions will still be provided, according to the task force recommendations, she explained.

A second recommendation is to verify areas that are shipping organic grains are where organic production is really occurring. “Currently we don’t have the means to total up yields and acreage on a country-by-country basis,” said Wyard.

The OTA is advocating for a database that could truth-test organic grain shipment totals by country, based on organic production history.

Blockchain tech could help

Some major organic grain handlers are already looking to new technology to fight fraud. Blockchain technology could help, said Emma Weston, co-founder of Agridigital, an Australian firm developing methods to store data about grain shipments. Weston provided a primer on blockchain in her presentation at the conference.

She said the nature of the grain supply chain creates many possibilities for fraud, as well as contamination of organic grain. An Agridigital pilot project with a large Australian grain exporter found about 250 proof points on the journey of organic oats from the farm to the retail shelf.

“In order to actually establish the provenance of those oats, and to prove that not only were they organic at the time of leaving the farm, but they were still organic when on the shelf – that nothing had occurred in the supply chain that would remove that organic status – was really, really hard,” said Weston.

Blockchain creates a more secure database that can document the journey of a specific product along a supply chain. Approved users log data about a commodity’s journey throughout the supply chain. The potential even exists to verify the exact fields used to grow food ingredients, as well as the inputs applied.

Consumers that want to know where their food comes from want such information. But the ability to create a secure, detailed database is also valuable to industry, Weston said.

“Definitely we know that consumers are driving this change, but increasingly it’s not just consumers. It’s buyers, it’s regulators, there are many of us that contribute to this overwhelming desire for provenance.”

It will be up to industry to invest in the data tools necessary to verify organic claims and combat fraud, she noted. “The thing we do know about consumers in the main is that many of them are not going to be willing to pay for this. So, if we’re going to implement a technology that delivers this level of information to the consumer, it needs to be (industry bearing) cost.

“In fact, many consumers would say that this is how they believe the supply chain should work anyway. You should be able to get all this information. You shouldn’t have to pay for it,” Weston said.