Farms.com Home   News

Some Food Hubs Are Not Qualified End Users Under The FSMA Produce Safety Rule

Many growers think they are eligible for a qualified exemption under the Food Safety Modernization Act Produce Safety Rule because they sell to a food hub. A recent response from the FDA says this may not be the case.
 
Many small growers who sell produce that is covered under the Food Safety Modernization Act (FSMA) Produce Safety Rule may be counting on a special type of exemption based on them selling more than half their gross sales to a qualified end user. The rule defines qualified end users as the consumer of the food or restaurants and retail establishments within a certain distance (local sales). These can be buyers at a farmers’ market, Community Supported Agriculture (CSA) shareholders, a restaurant, grocery store or school cafeteria. What was unclear until recently was conditions where a food hub would be considered a qualified end user.
 
We now definitely know some food hubs do not count as qualified end users under the FSMA Produce Safety Rule. In response to Case 00202034, the Food and Drug Administration’s (FDA) Technical Assistance Network indicated food hubs with a farm-to-business model are unlikely to meet the definition of qualified end user, while those with a farm-to-consumer business model may meet the definition.
 
This excerpt from the response helps describe the situation, “Sales to the food hub would only be sales to a ‘qualified end-user’ if the food hub fits the definition of a retail food establishment or a restaurant, and meets the location requirements.”
 
As a reminder, farmers who grow more than $25,000 in total produce sales and particular kinds of produce covered under the FSMA Produce Safety Rule need to comply with the Produce Safety Rule. If a grower sells less than $500,000 in total food sales and the majority of sales are to a qualified end user, they can be eligible for a qualified exemption. So long as they maintain the qualified exemption, these farms are required to follow just a few key pieces of the Produce Safety Rule.
  1. All qualified-exempt produce farms need to perform and document an annual review of their exemption eligibility that includes records (three years of sales records with the dates of sales on them). The individual receipts don’t need to be signed or initialed by the farmer, but the annual review document does need to be signed. If a farmer is claiming eligibility for a qualified exemption based on local sales, the records need to include information supporting qualified end user status of the buyer.
  2. All exempt produce farms need to have their farm name and business address displayed at the point of sale. This can take the form of a sign at a farmers’ market or can be on a label as part of a CSA box or a bundle sold at a local grocery store.
If you grow fresh fruits and vegetables for commercial sale and don’t know whether you need to follow the requirements of the FSMA Produce Safety Rule, consider taking a free class by Michigan State University Extension. As part of Produce Safety Rule provision 112.22(c), “One supervisor or responsible party for each farm must have successfully completed food safety training at least equivalent to that received under standardized curriculum recognized as adequate by the FDA.” This is a full-day training that takes a comprehensive look at how the FSMA Produce Safety Rule affects how you grow and harvest fresh fruits and vegetables.
 

Trending Video

2024 AGM Day 1 Panel - Succession Planning & Risk Management

Video: 2024 AGM Day 1 Panel - Succession Planning & Risk Management

Statistics Canada’s 2021 Census of Agriculture indicates that 75% of all farms operating in Canada operate as sole proprietorships or family partnerships. While incorporated farms make up just over a third of Canadian farm operations most of those are also family-run corporations. If the issue of farm succession planning is not on the minds of Canadian farm producers, it probably should be. That same Statistics Canada Census of Agriculture indicates that the average age of a Canadian farmer is 56 years of age with the 55 plus age group becoming the fastest growing segment in Canadian agriculture.

Despite these statistics, the same Census reports that only 1 in 10 Canadian farm operations have a formal succession plan. While each farm has its unique issues when it comes to transferring the business to the next generation, there are some common topics that almost all farmers must address. Join financial, legal, and tax experts to learn about how to begin the process, key tips on ensuring a smooth transition from one generation to the next, and how to manage the strong emotions the topic can create within the family.