Organic company wrestles with U.S. customs over cracked corn

A Saskatoon company is dealing with a 25,000 tonne headache.

Sunrise Foods, one of the largest wholesalers of organic feed and food ingredients in the world, has a shipment of 25,000 tonnes of organic corn currently at sea. That’s because United States Customs and Border Protection rejected the shipment at a California port in March.

The decision spawned rumours in North America’s organic food industry. Some believe the corn, grown in Moldova, Russia, and Kazakhstan, was rejected because it wasn’t actually organic.

Jake Neufeld, Sunrise Foods chief executive officer, said those rumours are false.

“This was certified organic product,” he said from his Saskatoon office. “It’s certified to the NOP (National Organic Program) standard, which is the U.S. standard…. It would have to have been certified on the farm…. To be NOP certified you have to be certified everywhere.”

Neufeld is correct, as U.S. Customs and the U.S. Department of Agriculture rejected the shipment because it contained too many kernels of raw corn, not because of its organic credentials.

Neufeld was surprised by the decision because Sunrise had successfully imported 12 shipments of organic cracked corn into the U.S. between December and March.

Cracked corn is corn processed into smaller corn particles by running the grain through a roller mill. It’s used as livestock feed.

In April, Neufeld and Sunrise Foods challenged the rejection of the cracked corn shipment. The company filed a lawsuit against the USDA and U.S. Customs, asking a U.S. district court for a temporary restraining order.

The court documents state:

* Sunrise procured the corn from its Turkish supplier, Tiryaki Agro.

* The organic corn, grown in Moldova, Kazakhstan and Russia, was cracked in Turkey.

* On Feb. 26, a merchant vessel, the Mountpark, arrived at the Port of San Francisco with the 25,000 tonnes of corn.

* On March 7, the shipment of cracked corn, after sampling and testing, was cleared for entry.

* The vessel sailed to the Port of Stockton to unload.

* On March 12, U.S. Customs notified Sunrise Foods that the organic corn on the Mountpark was prohibited because it didn’t meet the requirements for cracked corn. Therefore, they considered it raw material. The U.S. prohibits the import of unprocessed corn from many countries, including Moldova, Russia and Kazakhstan.

Sunrise argued, in its legal case, that the USDA didn’t follow department guidelines on defining cracked corn.

“From a USDA grading standard, our product was cracked corn,” Neufeld said. “In them (the guidelines) they explicitly say (that) cracked corn is allowed. Doesn’t matter where it is grown.”

On April 20, a U.S. district court judge denied Sunrise’s request, saying the company failed to demonstrate that a “sufficient urgency exists” to justify a restraining order.

The judge denied the request despite the financial impact on Sunrise. Court documents say the shipment has a value of $8.2 million and that Sunrise Foods had to pay $11,500 a day to keep the vessel in port.

Following the decision, the Mountpark left California and is now bound for another destination.

Neufeld wouldn’t say where it is headed but the organic corn won’t be imported into the U.S. unless the USDA reverses its decision.


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