Does temporary land retirement promote organic adoption? Evidence from expiring conservation reserve program contracts

Abstract

The Conservation Reserve Program (CRP) is a temporary land retirement program that allows producers to remove environmentally sensitive farmland from agricultural production in exchange for a yearly rental payment. While enrolled in the CRP, land is, by definition, not being used for production and therefore typically complies with standards for organic certification. In order for an operation to become certified organic, producers must comply with organic practices for 36 months prior to when production can be labeled organic. Among other requirements, operators transitioning to organic production cannot apply synthetic pesticides or fertilizers to the land. However, some of the costly three-year transition period can be avoided through participation in the CRP as land enrolled in the program may be eligible to become certified organic in the year that it exits the program. In this paper, we study the extent to which CRP enrollment promotes organic certification. We find that CRP contract expiration leads to increases in organic adoption, and estimate a 0.157 percent increase in new organic operations in response to a 10 percent increase in expiring CRP contracts.