Barriers to Entry…
Is certification worth it for wine importers?
If you are a wine importer with only one pallet of organic wine coming into the US each year, certification is not worth it unless you're committed to increasing sales to cover the annual cost.
A few days ago, we got a call from a specialty wine importer that exports bottles from Spain, France, and Slovenia. They desperately needed organic certification to be able to import Spanish red wine labeled as ‘Made With Organic Grapes’ into the USA.
I called several of the major organic certification agencies that are experienced with wine importers and who also offer quick turnaround on organic certification. None of them had the capacity to expedite a new certification request. Of the organic certification agencies I talked to, the fastest turnaround time for a new applicant was 60 days.
The wine importer admitted that they had known about the new regulatory requirement for organic import certificates, but they hadn’t had any issues importing the Spanish wine until recently. They asked me why it takes so long to get organic certification, and I explained that the new Strengthening Organic Enforcement (SOE) rules that went into effect in the spring of 2024 had jammed up the certification superhighway.
How backed up did organic certification agencies get in 2024?
I analyzed the data in the USDA Organic Integrity Database to compare the number of first-time organic certifications by year for the past ten years. The chart I created was shocking. It shows an increase of 9,429 new certifications in 2024 – an increase of almost 200% compared to 2023 when 4918 new certifications were granted. The dramatic increase helps to explain slow certification times and complaints of burnout from seasoned organic certification professionals. The 74 USDA accredited organic certification agencies are still caught in stop-and-go traffic almost a year after SOE implementation, which basically required thousands of previously exempt operations like importers and brokers to get organic certification.
New certifications by year; Data from the Organic Integrity Database
Beefed Up Record Keeping and Fraud Prevention
The implementation of the new SOE rules has put strain on the entire organic sector. Almost every certified producer is affected by the new rules because they require more recordkeeping and fraud prevention planning. Many previously certified organic businesses are experiencing long delays in the renewal of their 2024 organic certifications. These types of delays are inevitable considering the crush of new applicants for organic certification in 2024. But as we move into 2025, many certification agencies are still reeling from 2024. Staff are stressed and fatigued yet onsite inspections and certification decisions are performed annually – the certification wheel never stops, and more businesses are seeking new organic certifications in 2025.
The wine importer not so delicately expressed frustration with having to get certified, lamenting that their company doesn’t even handle or take physical possession of the product. They only facilitate the importation and sale of wine made with organic grapes. They asked me if the company would be required to have an onsite inspection or if they could just provide the organic inspector with online access to purchase and sales records. I explained that the inspection would have to be in-person, even if the records were merely files on a laptop. The primary contact works remotely and an inspector would have to fly out to her home in North Carolina to inspect records on her laptop. The USDA NOP doesn’t allow virtual audits for importers. They asked me how much it would cost to get the organic certification, and I explained that if thye could get expedited certification, it would cost about $3000 plus about $1500 for the inspection and I suggested she budget at least $5000 for the first year. They asked me how hard it would be to fill out the application for certification. I explained that they would need to complete an application with the certification agency, which would also serve as the company’s Organic System Plan. The application typically spans over 20 pages of detailed questions and requires several supporting documents to outline the products they seek to certify as organic, along with a comprehensive plan to prevent fraud within the supply chain. I mentioned that they would have to work with the organic certifier to get organic import certificates in advance of receiving any shipments of wine. I explained that it’s never been easy to obtain organic certification, and it takes time.
These days, it takes even more time than you might think.
Link to NOP's FAQ on Strengthening Organic Enforcement - https://www.ams.usda.gov/rules-regulations/strengthening-organic-enforcement/faq