The United States Department of Agriculture, Agriculture Marketing Service, Fruit and Vegetable Programs division (USDA, AMS) helps buyers and sellers market their perishable products in the most efficient manner possible through distribution channels. The AMS Fruit and Vegetable Programs division partners with State agencies to benefit growers, shippers, brokers, receivers, processors and the foodservice industry nationwide.
AMS Grading, Certification and Verification
At the recommendation of the USDA Fruit and Vegetable Advisory Committee, USDA's Fresh Products Branch has developed a long-range plan to review the U.S. standards for fresh fruits and vegetables to ensure that they meet the needs of the produce industry. This recommendation was delivered to former USDA Secretary Ann Veneman as part of an overall package of recommendations that the Advisory Committee believed would help productivity and efficiencies of the produce industry. Since 1928, USDA has developed 158 official grade standards for 85 fresh fruits, vegetables, tree nuts, peanuts, and related commodities. They describe the quality requirements for each grade of commodity, giving industry a common language for buying and selling. Public input from the produce industry is solicited to determine if a grade standard needs to be updated, and if so, which elements should be updated.
Perishable Agricultural Commodities Act (PACA)
The Perishable Agricultural Commodities Act (PACA) promotes fair and ethical trading practices in the marketing of fresh produce and frozen fruits and vegetables in interstate and foreign commerce. It prohibits unfair and fraudulent practices and provides a means of enforcing contracts. Under the PACA, anyone buying or selling a threshold amount of commercial quantities of fruit and vegetables must be licensed by the U.S. Department of Agriculture.
To apply for a license, to obtain more specific information about licensing requirements, or to find out if a firm is a licensee, one may contact the USDA's Agricultural Marketing Service, the agency that administers the PACA licenses, at (800) 495-7222.
In addition United Fresh's "User Guide to the PACA" provides a complete overview of and clear explanation of how to operate legally under the Perishable Agricultural Commodities Act. The newest edition of this essential reference source includes discussion of recent expansions of the PACA trust to include restaurants and cruise lines, the fallout of the Hunts Point inspection scandal, the New Dispute Resolution Corporation, the latest PACA rulings on commercial bribery, recent court decisions, and much more.
PACA Trust
On April 12, 2011, USDA issued a final rule on revising the Perishable Agricultural Commodity Act (PACA) regulators regarding post-default agreements for payments. The rule took affect on April 13. As part of the final rule, the new regulation will reverse a series of court decisions holding that post-default payment agreements eliminated PACA Trust protections.
Sellers may now enter post-default payment agreements without raising the concern that such agreements fall outside payment terms that qualify for PACA trust protection. According to the final rule, such agreements may be oral or in writing (the proposed rule would have required written agreements). Finally, the underlying PACA debt will remain subject to the Trust, assuming that the PACA Trust was properly perfected prior to the default. For additional Information:
Fruit and Vegetable Industry Advisory Committee
Since its inception in 2001, this Advisory Committee has met up to two times per year to develop recommendations for submission to the Secretary of Agriculture on issues affecting the U.S. produce industry. AMS officials ensure this Advisory Committee is administered according to the Federal Advisory Committee Act, and plan Advisory Committee meetings.
AMS Fruit, Vegetable and Specialty Crop Purchasing Program
The Commodity Procurement Branch of the Fruit and Vegetable Programs buys fresh and processed fruits, vegetables and specialty items from industry vendors.
Marketing Orders and Agreements
USDA’s Agricultural Marketing Service also administers Federal Marketing Orders and Agreements. According to USDA’s website, federal marketing orders are locally administered by committees made up of growers and/or handlers, and often a member of the public. Marketing order regulations, initiated by industry and enforced by USDA, bind the entire industry in the geographical area regulated if approved by producers and the Secretary of Agriculture. In addition, marketing orders and agreements (1) maintain the high quality of produce that is on the market; (2) standardize packages and containers; (3) regulate the flow of product to market; (4) establish reserve pools for storable commodities; and (5) authorize production research, marketing research and development, and advertising.
National Leafy Green Marketing Agreement
On Friday, April 29, 2011, the Agricultural Marketing Service issued a proposed rule in the Federal Register recommending the establishment of a national marketing agreement to regulate the handling of leafy green vegetables. There will be a 90-day comment period for the Federal Marketing Agreement. Key components of the proposed rule include:
- The agreement would be voluntary in nature therefore you would not have to sign up for this agreement if you chose not to do so.
- Produce areas would be divided into 8 zones to recognize groups of states with similar climate and production environments.
- There would be a 26 member governance board comprised of 12 handlers, 10 farmers, 1 importer, 1 retailer, 1 food service, and 1 public participant.
- There would be also be a Technical Review Committee that would be charged with developing standards that met U.S. Food and Drug Administration (FDA) Good Agricultural Practices (GAPs) and Good Manufacturing Practices (GMPs), and U.S. Department of Agriculture (USDA) Good Handling Practices (GHPs) requirements.
- The Technical Review Committee would also include government representation from USDA's National Organic Program, Agricultural Research Service, Natural Resources Conservation Service, National Institute of Food and Agriculture, as well as the U.S. Environmental Protection Agency, FDA Center for Food Safety and Applied Nutrition, and Department of Interior's Fish and Wildlife Service.
- Assessments would be recommended by the Board and could not exceed $0.05 per 24-pound carton.
- Fees could be used for research and education programs along with verification of compliance with standards.
United Fresh is pleased that USDA has initiated this step by releasing a proposed rule for leafy greens. It is now time for the industry to carefully review this proposal and decide if the merits of this proposed rule can validate a process that enhances the safety of fresh leafy greens across the country. United Fresh will initiate immediately a forum for a broad discussion about this proposal and will engage members aggressively to learn their views about this effort.
Industry Resources
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