Beyond the Buzzword: Navigating the Reality of 'Organic' hemp in the Global Marketplace

In today's global marketplace, demonstrating the quality of your product is a critical component of success. While good intentions and promises are important, they are not enough to satisfy the demands of buyers and sourcing teams. These stakeholders are seeking more than just "approved" methods of production; they require validations that are specific to their individual needs.

This applies to all commodities traded globally, and the same standards should be required for industrial hemp, no matter if the crop is destined for food, feed, woven or non-woven industries. As a business operating in this industry, it is critical that you recognize and address this reality. In order to succeed, you must be able to provide evidence that the hemp you've grown meets the rigid demands, requirements and standards of your target market. By doing so, you will establish yourself as a trusted and reliable supplier, one that is committed to delivering high-quality products that meet the needs of your customers. Ultimately, this will enable you to build a strong reputation, expand your customer base, and achieve long-term success in the global marketplace.

This is particularly important in a global supply chain, where many global brands and retailers view the claims made by the global hemp movement as unsupported. For global brands and industry titans, whether in food, clothing or commercial products, it is essential to be able to differentiate between fact and fiction when making claims about their products. This is where a reliable certification scheme comes into play. A certification program that meets minimal global standards ensures that products are viewed in the same light as the farmer's intended, and this is crucial for farmers looking to sell their hemp crops in the global market.

The lack of dependable regulations is a major challenge for US hemp farmers as they prepare for the 2023 season. In addition, existing programs can be misleading, leading to mistrust among farmers, buyers, and intermediaries. This lack of trust can cause problems for farmers when they try to sell their products through their network, as the network may hesitate to provide necessary funds without credible proof of the product's quality.

It's important to note that a farmer's ability to produce a high-quality plant does not necessarily equate to meeting the global market's standards for quality. This realization can be difficult for farmers to accept, but it's crucial to understand that meeting these global standards is essential for success in the competitive hemp market and by doing so, they can gain credibility with buyers and intermediaries, leading to better prices and more significant market opportunities. Ultimately, it's essential to establish a trustworthy reputation in the global market to thrive in the competitive hemp industry.

Since 2018, US hemp farmers have been misled into thinking that the regional "organic" programs mandated by their state departments of agriculture would be sufficient to secure buyers for their hemp. However, the truth is that hemp farmers require more, they need to look towards globally recognized standards that are hemp specific, like the Responsible Hemp Standard, a voluntary certification program that meets international standards for quality, safety, and sustainability, to compete in the market. Programs like RHS will be essential to sell certified hemp products in the global market and maintain a competitive edge against other hemp producers while also instilling trust in the quality and commitment of their crop for global brands and retailers.

Since the 2018 Farm Bill in the US, Hemp farming has grown in popularity, with more farmers and processing companies entering the market. As a result, there has been an increased interest in programs that ensure quality for hemp products, particularly in relation to sustainability. However, many hemp farmers may be unaware of the differences between state-level organic certification and globally accepted certification programs, such as the Responsible Hemp Standard by Control Union. In this blog post, we will explore the misconceptions of state certification and why a globally accepted certification program matters for hemp products.

Let's examine some common misconceptions surrounding the Colorado hemp market, often regarded as the birthplace of the US hemp industry.

Misconception 1:

State Organic Certification is the Same as USDA Organic Certification One of the biggest misconceptions among hemp farmers is that state-level organic certification is the same as USDA organic certification. While state programs may have similar requirements and standards, they may not always meet the same level of scrutiny and verification as USDA organic certification. The USDA National Organic Program (NOP) develops the rules and regulations for the production, handling, labeling, and enforcement of all USDA organic products. This process involves input from the National Organic Standards Board and the public to ensure that the organic standards are upheld.

The USDA organic seal on a product indicates that it has been certified by a USDA-accredited certifying agent and meets the specific requirements set out in the USDA organic standards.

Misconception 2:

One misconception among hemp farmers is that Colorado's state certification is enough to meet global standards. However, it's important to note that different organic certification programs may have slightly different requirements and standards. For example, the Responsible Hemp Standard by Control Union is a globally accepted certification program that requires hemp farmers to meet specific environmental, social, and economic criteria.

RHS provides hemp farmers with the opportunity to demonstrate their commitment to responsible farming practices and gain access to new markets that prioritize sustainability and transparency.

Misconception 3:

Hemp farmers may assume that state-level "organic" certification programs meet the expectations of both consumers and global brands and retailers. However, consumers and businesses are increasingly aware of the differences between state-level and globally accepted certification programs. A recent study published in the journal Sustainability found that certification programs for sustainable and organic agricultural products were positively correlated with price premiums in global markets, as global brands and retailers are demanding greater transparency and sustainability from their suppliers.

By becoming recognized by a globally accepted certification program, such as the RHS, hemp farmers can not only meet consumer expectations but also gain access to new markets and meet the demands of global brands and retailers.

Food for Thought: Approved vs. Specific

While the state's definition of organic focuses on "approved methods" of production, the National Organic Program (NOP) goes further by outlining "specific requirements" that must be verified by a USDA-accredited certifying agent before products can be labeled USDA organic. The NOP's rulemaking process involves input from the public and the National Organic Standards Board, and their Handbook provides guidance and communication of the organic standards beyond just the labeling term. There is a significant difference between simply using "approved methods" and meeting the specific requirements of the USDA organic label.

Let's take a closer look at the "organic" hemp program in Colorado and why it may not hold the same value in the global marketplace as it does for farmers producing hemp under the Colorado Department of Agriculture's (CDA) "Hemp Program."

Misconception #1: The Colorado Department of Agriculture's (CDA) hemp program requires growers to comply with a third-party certification program for Good Agricultural Practices (GAP)

Reality: The CDA does not officially endorse any third-party certification program for hemp as of 2021. While some growers in Colorado may choose to pursue certification through third-party organizations such as Control Union or USDA Organic, it is not currently required or recognized by the CDA hemp program. While the Colorado Department of Agriculture (CDA) does have voluntary Best Management Practices (BMP) for hemp growers, it's essential to note that this is not equivalent to a formal voluntary certification program like the Responsible Hemp Standard (RHS). RHS has specific requirements that focus on Good Agricultural Practices (GAP), social compliance, and sustainability initiatives, including ESG and Greenhouse Gas Programs. As global brands and retailers demand more transparency and accountability from their suppliers, hemp farmers who obtain RHS certification can demonstrate their commitment to responsible farming practices and gain access to new markets that prioritize sustainability and ethical practices.

Misconception #2: The CDA certification program for hemp grown on the farm is equivalent to other globally accepted certification schemes.

Reality: It is worth noting that the CDA program for hemp production is a state-level initiative with its own unique set of standards and requirements. However, it may not be on par with other globally recognized certification programs like the Responsible Hemp Standard (RHS), which has been developed by Peterson Control Union, a highly respected name in global agricultural development. RHS is an internationally recognized certification program that adheres to a set of global standards for hemp production, while the CDA program is limited to hemp production within Colorado.

Misconception #3: The CDA has a GAP audit.

Reality: The CDA does not have a Good Agricultural Practice (GAP) formal audit that takes place on the hemp farm, these audits consist of on-site inspections and evaluations by trained and accredited auditors who verify compliance with a set of standardized criteria. This is different from the RHS certification program, which includes a formal audit process to ensure that farms meet specific GAP requirements. Without a formal audit process, the CDA program may not provide the same level of assurance to buyers and consumers regarding the quality and sustainability of the hemp products. The CDA's state-level hemp program primarily emphasizes testing and labeling requirements to ensure the quality and safety of hemp products produced within Colorado. However, it does not have a formal certification program with specific guidelines and requirements for good agricultural practices (GAPs) like other globally recognized programs. The CDA's program relies more on "approved methods" rather than a rigorous certification process.

Misconception #4: The CDA can provide a letter of attestation from an auditor.

Reality: The CDA's "organic" hemp program does not involve the participation of a third-party auditor, unlike more rigorous certification programs accepted by the global marketplace. Therefore, while farmers may be able to provide a letter of attestation that their hemp was produced in compliance with the CDA's hemp program requirements, this does not attest to meeting the minimal requirements set by the global marketplace.

Misconception #5: The CDA's attestation would meet global buyers' standards.

Reality: While a letter of attestation from the CDA may provide some assurance of compliance with certain standards, it may not carry the same weight or be as widely recognized as certification from an accredited third-party auditor or certification body. It's always a good idea to research the specific requirements of buyers and ensure that the products being sold meet those requirements.

Importance of a Globally Recognized Certifying Body's Network for Hemp Certification:

In today's global market, a widely recognized certification program is essential to ensure that hemp growers meet the highest international standards for quality, safety, and sustainability. This is particularly crucial for those looking to sell hemp products in global markets, where discerning consumers demand transparency and accountability in their purchases. With the global hemp movement still struggling with unsubstantiated claims, it is imperative for industry titans and brands to differentiate between fact and fiction when making claims on product labels. Failure to meet minimal global standards can tarnish a farmer's reputation and significantly limit their market potential. This is especially challenging for US hemp farmers as they prepare for the 2023 season. To remain competitive in the global marketplace, they must prioritize certification programs that align with international standards and meet the demands of today's discerning consumers.

In the world of agriculture, especially agriculture being bought and sold in global markets, letters of attestation by reputable certifying bodies (CBs) play a critical role in assuring buyers that they are getting what they pay for. With the increasing demand for quality products, it is essential that buyers have the confidence that the product they are purchasing meets specific criteria. This, in turn, builds trust and strengthens relationships between buyers and sellers.

Certification is not always mandatory, but for farmers who face market pressure due to tariffs and declining demand, obtaining voluntary certification can provide significant benefits. These benefits include access to new markets, better pricing, and an improved reputation. By obtaining certification, farmers can demonstrate their commitment to the farming practices required by intended buyers. This not only helps to enhance their reputation but also provides access to network-driven markets, which can help to increase sales and revenue. It is important for farmers to consider the advantages of certification, as it can provide a competitive edge in a crowded market and help to build long-term relationships with buyers.

Sidebar:

The importance of a globally recognized certifying body's network cannot be overemphasized. Factors such as market requirements, regulatory environment, and business priorities will determine the relevance of certification to individual farmers and businesses. A globally recognized certification program plays a critical role in providing buyers with assurance while also providing benefits to farmers, it's the difference between a market pricing premium and rock bottom pricing that is currently happening in the US hemp market.

So by this point you are probably saying one of two things:

This guy is making incredible sense to me!

or

This guy is full of $#!%

Great, so you're more of an intellectual type, well then let's nerd out and dive into some studies published in the almighty Google Scholar. We can explore how certification programs have been shown to increase the value and marketability of agricultural products, including hemp. Don't just take my word for it, let's back it up with some scholarly research!

Although there may not be specific research on the global hemp supply chain, studies on other crops have shown that certification can increase the value and marketability of products, particularly in the global market.

Case in point, a recent study published in the journal Sustainability in 2019 found that certification programs for sustainable and organic agricultural products were positively correlated with price premiums in global markets. Another study published in the Journal of Agricultural and Resource Economics in 2016 found that USDA organic certification was associated with a 7-13% price premium for fresh produce in the US.

In 2019 a report published by the International Institute for Sustainable Development found that Fairtrade certification provided a range of economic benefits for small-scale farmers in Africa, Asia, and Latin America, including higher prices, increased income, and improved access to markets.

Research has highlighted the positive impact of certification programs on the marketability and value of agricultural products. A study published in the Journal of Cleaner Production revealed that certification can enhance the reputation and competitiveness of agricultural products, while providing assurance to consumers and buyers of the product's quality and sustainability. Additionally, studies have shown that certified organic products under the US National Organic Program (NOP) commanded higher prices than non-certified products, particularly in the global market.

So when we suggest participating in a globally recognized certification scheme (by the way 'scheme' does not have a negative connotation as if when someone is 'scheming'), hemp growers can enhance the marketability and value of their products in the global market.

Now Back to the State of Colorado's "Organic" Hemp program

While the Colorado Department of Agriculture's (CDA) hemp program may meet certain standards and requirements, it may not necessarily be recognized or accepted by global buyers who may require certification from a globally accepted program. Participating in a globally accepted certification scheme can help to ensure that the hemp produced in Colorado meets the requirements and standards of global buyers, which can increase its value and marketability.

While state-level organic certification programs may be a good starting point for hemp farmers, a globally accepted certification program such as the Responsible Hemp Standard by Control Union can provide greater recognition and benefits. By meeting specific environmental, social, and economic criteria, hemp farmers can demonstrate their commitment to responsible farming practices and access new markets that prioritize sustainability and transparency. As the hemp market continues to grow, it's important for farmers to understand the differences between state-level and globally accepted certification programs and choose the program that best aligns with their values and goals.

Hemp farmers in Colorado, and other US States can benefit from their state's hemp programs in a regional model, but to really make it big in the global hemp market, they need to get certified by a globally accepted program. The Responsible Hemp Standard by Control Union is a good example of such a program that can help farmers meet global standards, increase their value, and expand their market.

The marketplace is seeing a growing trend where consumers hold more power in their purchasing decisions, and global brands are taking note of this. With the increasing importance of Good Agricultural Practices, Good Agricultural and Collection Practices, sustainability, and transparency, it's crucial for farmers to stay informed about their certification options and choose the one that aligns with their goals. Additionally, it's worth considering whether it's time for the government to standardize a national hemp program to meet the market's growing demand for hemp products that meet specific requirements and standards.

We understand that production has faced challenges due to declining regional market prices caused by overproduction of subpar crops. However, we would like to draw your attention to the growing significance of global demands in the hemp industry. While voluntary certification schemes may add to the farm's operations, they also offer numerous benefits. As consumers become increasingly aware of the sustainability and transparency of the products they purchase, global brands are placing greater emphasis on meeting these demands.

In order to capitalize on the potential of the global hemp market, it's essential to consider certification programs that align with global standards and requirements that meet the expectations of global buyers and increase their value and marketability of regional hemp supply chains.

Please do not hesitate to reach out to us if you have any questions or would like further information on certification programs and how they can benefit your company.