Government Marketing Order For Cut Flower Growers
POTENTIAL USDA MARKETING ORDER FOR USA CUT FLOWER GROWERS: OPINION PIECE
Please read if you are a small-scale US flower farmer, or if you make more than $100k (or plan to within the next 3-7 years) from cut flowers!
I took the time to put together some information on the current floral board and marketing order discussion. There are many facets of this topic I could discuss, but there are a few points I feel very strongly about and have a connection to.
As a former USDA employee of 7 years, I have seen firsthand the effects these marketing orders have on small-scale growers in other industries (dairy, beef, veg, fruit). USDA marketing orders are always to the benefit of very large businesses, and small businesses almost always suffer.
Currently, there are members of the cut flower industry that are proposing to create a US floral board through a USDA FLORAL MARKETING ORDER in order to promote cut flower consumption.
A marketing order is a USDA mandatory program in which USDA regulates and enforces certain rules and regulations within a geographic area. Marketing orders and agreements may sound innocent, as they are advertised as a way to allow producers to promote orderly marketing through collectively influencing the supply, demand, or price of a particular commodity. Research and promotion is financed with pooled funds from all eligible growers. However, marketing orders always have “unintended” consequences: as seen with the dairy industry and others, it puts small farmers out of business.
Marketing orders are legally binding on all handlers of the commodity within the geographic area of the regulation. Marketing orders may be used to promote products (such as the dairy milk “Got Milk” campaign, or in our case, promote the general consumption of flowers), and also may limit the quantity of goods, influence marketing, establish grades/sizes, quality regulations, or regulate the prices of goods. The Agricultural Marketing Service (AMS) of the USDA uses marketing orders to regulate the sale of dairy products, fruits, and vegetables…and now, possibly flowers.
Generally, marketing orders are put into place when funds of a certain amount cannot be voluntarily obtained for a specific purpose – marketing orders force producers who may not wish to participate to contribute and pay.
Cut flowers remains as one of the only “commodities” without an industry marketing order. Once we have a marketing order, it may open the door to huge amounts of USDA regulation within our industry, which will only lead to huge financial and logistical burdens on smaller growers. Please take some time to consider all other US agricultural industries and the vast amounts of burdensome regulation that has been placed on them (dairy, beef, small ruminants, veg, fruit). Marketing orders are federal regulations, and are published in the Code Of Federal Regulations.
Current marketing orders can be viewed here: https://www.ecfr.gov/current/title-7/subtitle-B/chapter-IX
More information about USDA marketing orders can be found here: https://www.ams.usda.gov/rules-regulations/moa
Under the current draft of the floral board marketing order, it states that any growers who sell a minimum of $100,000 of cut flowers or greens will be included. This means that if you are a domestic grower that sells $100,000 or more of cut flowers/greens (or plan to within the next few years) you will MANDITORILY have to participate in this program by paying USDA .5% of your revenue each year. (I believe this assessment will be paid quarterly). This money will be used for promoting general cut flower consumption in the US, but the board can use the money as they see fit.
As a small grower, I fail to see how the hundreds to thousand(s) of dollars I would pay towards this marketing campaign would end up back in my pocket – and isn’t that the purpose of it, isn’t that what marketing is supposed to do? In the end these marketing dollars will fuel purchases from large importers, and will discourage purchases from small, specialty (more expensive) farms. I already pay enough in unnecessary government fees, taxes, and required insurances that I will likely never use. I do not intend to invite yet another burdensome cost onto my small business. I want to be able to pay my employees (and myself!) a fair living wage, and provide the best possible service to my customers as possible. I can’t do that if the government keeps forcibly taking money away from my business. I work my butt off to do my own marketing, I don’t intend to give my hard earned money to marketing for large, wealthy floral importers.
With payments to USDA by regulation, comes paperwork and logistical headaches. Although the board has not directly addressed these logistical issues (they “feel” there will not be additional reporting-but they do not have a say in it), I am sure that USDA will need a breakdown of our sales or some kind of reporting requirements. For example, if you sell both dahlia tubers and dahlia cut flowers, only the revenue from the cut flowers will be included. This will not be “on the honor system” – the government does not work that way, I can guarantee that there will be additional paperwork.
Personally, I am, of course, absolutely in favor of promoting the use of cut flowers in the US. However, I am NOT in favor of being forced to pay for marketing dollars that will be used to promote behemoth flower importers. Within the marketing order, there is no specific marketing for locally grown or domestic cut flower growers.
According to the floral board, any grower (of any size) that wishes to donate to the marketing order may do so, but as it currently stands, producers who earn $100,000 or more are forced to pay into the marketing order, whether they believe in what the money is being used for or not.
Additionally, I personally am against additional regulation under the USDA within our industry. If this marketing order proceeds, it may open the door to much more regulation that will benefit large growers and will hurt small growers (as with most other USDA programs, please trust me on this one!). Cut flowers will become much more of a commodity (like milk, grain, etc.) and much less of a specialty product, meaning that quality, boxing/packaging, pricing etc. standards could be implemented and enforced.
I would hate to see all of us smaller, specialty cut local cut flower growers forced to foot the bill for very large importers to market imported cut flowers. In my opinion, we are worlds apart in terms of the product we sell. Imported carnations, roses, etc. seem to be a completely different product than locally grown dahlias and specialty zinnias. I do not want to be regulated within the same group as large importers, nor do I want to help pay for the marketing dollars they will use to promote flower use. We, small specialty cut growers seem to do an excellent job of marketing ourselves, and if we want to, we all could pool our own money voluntarily to promote locally cut flowers (as many associations we are a part of do: ASCFG, slow flowers, CAL flowers, etc.). The board does not have a plan to ensure smaller growers needs will be met.
Moving on, as I understand it, here is how the process works:
The folks who are pushing for the floral board will present the marketing order draft to the USDA. The USDA will post the marketing order in the federal register (found here), in which people can publicly comment on it for a specified amount of time.
Following the federal register comment period, the USDA will hold a referendum, and after that the marketing order will be voted on. No one has been able to tell me how the votes are collected or what the voting process is, I have a few calls into friends at the USDA, I’ll see what they say.
As it stands, the floral board does not have a comprehensive list of potential voters and does not have a solid plan to collect representative voter information (when asked this question, they said they will rely on participants in webinars to collect voter info). The voter information they collect can easily be skewed to benefit their objective, and may not honestly represent domestic flower growers and importers.
The floral board website is here: https://www.floralboard.org/
The current draft of the marketing order is found here: https://www.floralboard.org/sites/default/files/pdfs/Draft_Order-211105.pdf
I urge anyone who does not wish to see this go through write a letter or email to Christine Bolt (info here) asking to please only include domestic farms to pay assessments that earn a minimum of AT LEAST $500,000 in sales, as well as express your opinion whether you are for or against the marketing order as a whole.
If anyone wants to talk amongst ourselves about potential consequences of this order, I am able to hold a zoom call this week or next. Please let me know if you would like to participate.
Again, USDA policy generally caters to very large corporations, and generally hurts small business. This is true for the dairy industry, the beef industry, slaughter/abattoirs, small ruminants, vegetables, and fruit. It will also be the case for flowers. USDA intervention means aiding very large business and “unintended” consequences of hurting small business. I have witnessed this countless times.
A very famous example of a USDA marketing order is the milk processor boards “Got Milk” campaign. Here is a timeline of that order:
1992: There were 131,509 licensed US dairy farms.
1993: The “Got Milk” campaign launched.
2003: (10 years later) There were only 70,375 licensed US dairy farms.
At the end of the campaign in 2014, there were just 45,344 US dairies. That is a 66% drop during that time.
Between this time, the national herd size increased 177% due to smaller farms going out of business and being absorbed by very large farms. Another source, the NFU, states that from 1992-2018, over 94,000 family dairies closed their doors, at a rate of 10 farms per day.
Interestingly enough, according to the New Yorker and the Marketing Service Bulletin, fluid milk consumption actually DECREASED during the campaign. The New Yorker states that daily consumption declined from .96 cups per person in 1970 to .59 cups per person in 2011. The marketing service bulletin (fmmacentral) stated that consumption of fluid milk decreased from 261 pounds per person in 1975 to 204 pounds per person in 2003, a decline of 21.8%.
Similar consequences may happen with the floral industry if a marketing order occurs. “Good intentions” from giant corporations generally always have unintended consequences for small businesses.
If you have a similar story about how a marketing order has affected small growers in another industry, please share the experience here.
Finally, I want to stress that I believe in the promotion of cut flower consumption in the USA, however, I do not believe in the government forcing small farmers participation in the order, who will most likely not see great benefit from it. I believe that all farmers should have the choice to contribute money if they wish, but should not be forced to. I also believe that this could potentially open the door to large amounts of (completely unnecessary) government regulation in our industry, which will favor large importers and will hurt small, domestic growers. I want my businesses to remain independent and outside of further government control.
Please write to Christine Bolt of the floral board here to make your opinions known.