The Parallel Production Ban: A Necessity or an Inconvenience?

by Vigne Sridharan

What is Parallel Production?

Parallel production is defined in the Canadian Organic Standards (COS) as the simultaneous production or preparation of organic and non-organic crops, including transitional crops, livestock and other organic products of the same or similar, visually indistinguishable varieties. This essentially means that the same crop is produced organically and non-organically at the same time. For instance, producing the same variety of organic and non-organic dark hilum soybean is considered parallel production, but producing visually distinct varieties, such as dark hilum soybean and light hilum soybean would not.

Parallel production in organic farming has been a contentious issue for years. It is currently prohibited in under the Canadian Organic Standards. Exceptions apply to perennial crops (already planted), agricultural research facilities and production of seed, vegetative propagating materials and transplants. It is important to note the distinction between parallel production and split production. Parallel production refers to visually indistinguishable crops being produced together and split production refers to visually distinguishable crops produced together. Split production is allowed under the standard while parallel is not.

The goal of prohibiting parallel production is to prevent contamination, commingling and fraud. The standards also specifies that enterprises should work towards a complete transition to becoming certified organic. This specification, in addition to the prohibition on parallel production, makes transitioning to organic challenging for many farmers. The prohibition is particularly inconvenient for annual crop farmers who farm crops with little or no visually distinguishable varieties. Hence many organic stakeholders want to see a change in the parallel production regulation. Every five years, when the COS is under review, the Canadian General Standards Board (CGSB) Committee on Organic Agriculture receives a number of petitions to lift the ban on parallel production.

Exceptions to the Rule

The parallel production definition applies differently for manufacturing and processing plants, which are allowed to process organic and non-organic products in the same facility under the condition that they are operated on separate lines. In these circumstances, certifying bodies closely inspect documentation and labelling.

Similarly, livestock farmers are permitted to raise both organic and non-organic animals with the condition that they are kept in separate production units and the animals are identified and labelled accordingly.

The exception for perennial crops exists because unlike annual crops that can be turned over quickly, transitioning non-organic perennial crops, which in most cases take years to mature, is challenging and inconvenient without the the ability to produce in parallel.

So what’s the problem?  

Given the variance in how parallel production is applied to different aspects of the organic sector, some are concerned about the fairness of its regulation in the organic standards. For instance, since it is completely banned for annual crops, transitioning to organic can be very difficult for field crop farmers. Processors or livestock farmers, however, do not face these barriers given the allowances that they are afforded.

Hugh Martin, former Ontario Ministry of Agriculture, Food and Rural Affairs (OMAFRA) Organic Specialist Lead and the Chair of the Canadian Organic Standards Interpretation Committee, says the prohibition is necessary in the case of annual crops that are visually indistinguishable because it can be difficult to track these crops, thereby increasing risk for contamination.

“It would only take a mistake as simple as a bin of one grain load getting mixed with the wrong bin” Martin says.

The prohibition is meant to prevent fraud, especially in Western provinces where the scale of grain production, and consequently the risk of mistakes, is much higher.

Exceptions for processors and livestock farmers are also based on the long term nature of these endeavours. Crop farmers can change their production techniques annually, while this is not the case for processors or livestock operations.

“The Standard allows parallel production where it is most inconvenient to prohibit it. Forcing a prohibition on parallel production for processors would result in far fewer processed organic products and much higher prices. Similarly, forcing perennial crop and livestock producers to spend multiple years transitioning their entire livelihood to an unknown production system and somewhat unpredictable market for organic products would increase the business’s long-term risk” says Joel Aitken, Inspection Coordinator with Ecocert Canada.

How Does it Affect Certification?

The prohibition also creates variances in the organic certification process, specifically relating to the credibility of inspections. Some farms, especially larger ones, will create two separate legal entities – organic and non-organic – to get around the parallel production ban. In this case, the organic inspection or application only applies to the organic operation – its fields, equipment, documentation, sale records etc. – while there is no oversight or assessment for contamination or fraud in the non-organic operation.

“An organic certifier is only contracted by the organic legal entity and by extension of their contract, only has access to audit the organic entity but not the conventional one. This restricts the certifier’s access to information.” Aitken says.

“Certifiers can only require operators to provide information about the production of crops that are owned by the legal entity that is applying for certification. And legal entities are required to submit information about all the agricultural crops that they own (organic and conventional). If the non-organic production is owned by a separate legal entity, they are not required to provide any information to certifiers” says Simon Jacques, an Inspector and Input Review Officer for Ecocert Canada.

The only instance in which a certifier can inspect both organic and non-organic productions is if they are both registered under a single legal entity. The certifier will then have the added auditing and documenting requirements to assess for the additional risks presented by such an operation.

Hence, producers are incentivized to create two separate legal entities to avoid the additional burden and oversight of keeping all their production under a single legal entity.

“This is the paradox of the parallel production rule: it is only relevant if the operator is dishonest, but it relies entirely on the honesty of the operator to be enforced.  If I inspect Farmer Jane’s organic corn field, I have no idea if the 500 acre conventional corn field around the block is hers unless she tells me. If we could audit her full tax return we would be able to catch it, or maybe by looking at crop insurance submissions (assuming she gets crop insurance on both her organic and non-organic crops). But even a full tax audit or crop insurance audit would not catch substitution if the operator had created a separate company, because the conventional company would be filing a separate return. So by pushing operators to create separate companies, we are actually making it harder for certifiers to catch fraud” Jacques adds.

Resources for Transitioning to Organic

The purpose of prohibiting parallel production is to encourage producers to work toward complete transition of their operation and ensure that it is certified by a single certifier. However, parallel production can also ease the transition process for farmers with non-organic operations.

Mike MacGillvary of Kirkview Farms says that transitioning his farm without parallel production has been a challenge, especially given the lack of resources and funding in Ontario for farmers interested in transitioning.

“I depend on the expertise of other farmers who have successfully transitioned to organic. It hasn’t been easy and I would support a lift on the prohibition” MacGillivray says.

Aitken says that in addition to the prohibition on parallel production, Ontario’s lack of transitional certification, marketing opportunities and pre-certification increase barriers to achieving an initial organic certificate. He adds that the system also lacks the support needed for organic farmers to overcome these barriers.

Some resources that currently exist on transitioning include the OMAFRA’s Transition to Organic, Canadian Organic Growers Transitioning to Certified Organic Farming and the Organic Council of Ontario’s blog on transitioning and certification costs.

While most people acknowledge that there are strong arguments on both sides of the parallel production debate, some stakeholders like Joel Aitken believe that it is high time the prohibition be eliminated.

“Across the board, producers will be able to produce more appropriate crops in various circumstances, less money would be diverted out of production into setting up and managing legal entities, there would be a decrease in certification costs and potential risks for fraud and one less confusing obstacle for an organic farmer.”

How Can You Have Your Say?

If you would like to voice your opinion on parallel production and inform the Canadian Organic Standards, now is the time! The COS is currently under review in preparation for their 2020 renewal.

This year, yet again, a petition has been submitted to eliminate the ban on parallel production.

OCO is running a webinar which will include a panel of experts discussing the issue, and what the pros & cons of eliminating the parallel production rule might be. Join us!

If you’re curious about how revisions to the organic standards are made, consult OCO’s blog on the standards review process and watch OCO’s webinar “How to Have Your Say on the Organic Standards Review”. Although the petition process has now officially ended, industry groups can continue to share member feedback with the Organic Federation of Canada until the review process is completed in 2020.