The Agricultural Marketing Service (AMS) promotes the sale and distribution of American agricultural products, including five commodity programs: dairy, fruit and vegetable, livestock and seed, poultry, and cotton and tobacco. AMS provides testing, standardization, grading, and market news services, and oversees marketing agreement and orders. The agency aims to help U.S. farmers gain greater participation in domestic and overseas agricultural markets, while ensuring fair trade practices. Additional functions include administering research and promotion programs, purchasing commodities for federal food programs, and administering standards for organic agricultural products. The AMS also enforces the Perishable Agricultural Commodities Act and the Federal Seed Act. The current Acting Administrator of the AMS is David R. Shipman, who took office in November 2011.
The numerous precursors to the Agricultural Marketing Service (AMS) date as early as the late 1800s, but it was the Office of Markets, established in 1913, that first standardized the egg market and introduced the system of grading in the United States. The use of the federal grade standards evolved slowly and was fully adopted only during World War II, when food meant for soldiers had to be inspected and graded because of the inconsistent quality of foods. The use of grading and inspection services, along with better pricing of products through market news, helped the industry better market and merchandise their products. These functions were later consolidated into AMS programs.
In July 1939, the marketing service, research, and regulatory functions of several agencies, including the Bureau of Agricultural Economics, Bureau of Animal Industry, Bureau of Plant Industry, Bureau of Dairy Industry, and Food and Drug Administration, were transferred to the newly established Agricultural Marketing Service.
Most AMS functions were later consolidated into the Agricultural Marketing Administration in 1942, before it was shifted again several times in the 1940s and 1950s. The agency was once again named the AMS from 1953-1965, before it was named the Consumer and Marketing Service. In April 1972, the current structure of the AMS was officially established under the Department of Agriculture. More recently, the AMS has taken on enforcing provisions of the Organic Food Production Act of 1990.
The Agricultural Marketing Service (AMS) administers commodity standardization, grading, and inspection programs, and disseminates market information to five commodity programs: dairy, fruit and vegetable, livestock and seed, poultry, and cotton and tobacco. The agency also enforces marketing agreements and orders as well as federal laws such as the Perishable Agricultural Commodities Act, which regulates the buying and selling of fresh and frozen fruits and vegetables, and the Federal Seed Act, which requires accurate labeling and purity standards for seeds.
Other functions include administering research and promotion programs, purchasing commodities for federal food programs, and working with stakeholders and specialists to solve problems of domestic and foreign agricultural transportation. The agency also runs the AMS National Organic Program, which develops, implements and administers production, handling and labeling standards for organic agricultural products. The National Organic Program also certifies inspectors of organic production and handling operations to certify the facilities meet USDA standards.
The AMS is divided into numerous divisions and programs, each with its own responsibilities. For example, the agency’s Microbiological Data Program monitors alfalfa sprouts, cantaloupe, spinach, tomatoes, and lettuce for bacterial contamination. The Science and Technology Program provides centralized laboratory support to AMS programs, including analyses, quality assurance, coordination of scientific research conducted by other agencies for AMS, and statistical and mathematical consulting services. The Science and Technology Division also runs the Plant Variety Protection Office, which issues certificates of protection for new varieties of plants in compliance of the Plant Variety Protection Act that protects breeders of new plant varieties. The Division also collects and analyzes data about pesticide residue levels in agricultural commodities and administers a pesticide recordkeeping program that requires all certified private applicators of federally restricted-use pesticide to maintain records of all applications.
The Transportation and Marketing Program administers grants to states for marketing improvements and provides information about the nation’s food transportation system to producers, producer groups, shippers, exporters, rural communities, carriers, government agencies, and universities with the aims of improving market access for growers with farms of small to medium size and promote regional economic development.
From the Web Site of the Agricultural Marketing Service
The Agricultural Marketing Service (AMS) spent $9.8 billion on nearly 15,000 contracts from 2002-2011, according to a query of USASpending.gov. The five top products or services contracted by AMS were meat, poultry and fish ($5.9 billion); fruits and vegetables ($3.8 billion); transportation and relocation ($8.9 million); condiments and related products ($1.7 million); and bags and sacks (about $900,000).
The five top contractors and the total amount spent for their services by AMS during the past decade include:
1. Tyson Foods, Inc. $647,897,489
2. Caviness Beef Packers, Ltd. $426,240,360
3. Hormel Foods Corp. $423,122,957
4. Seneca Foods Corporation $374,940,340
5. Pilgrim’s Pride Corporation $359,249,477
Tyson Foods, the agency’s largest contractor, is the world’s largest processor and marketer of chicken, beef, and pork. Hormel Foods is a 121-year-old company with nearly 20,000 employees with annual revenues of $7.9 billion in 2011. Pilgrim’s Pride is a leading manufacturer of chicken, turkey, and egg products. It employs 42,000 people in the United States and Mexico, with annual revenues of nearly $7 billion in 2010.
National Leafy Greens Marketing Agreement Could Drive Organic Farmers Out of Business
The Agricultural Marketing Service (AMS) provoked anger among organic farmers in 2011 after it unveiled its National Leafy Greens Marketing Agreement (NLGMA). The AMS was accused of conspiring with large agricultural producers to establish new rules that favored traditional growers at the expense of small and organic farmers.
A common criticism of the NLGMA was its “one-size-fits-all rules” that could prove expensive for smaller operators to implement and consequently could help put them out of business. Critics added organic producers would have the choice of abiding by the NLGMA or being shut out of wholesale markets.
Proposed National Leafy Green Marketing Agreement Released (National Sustainable Agriculture Coalition)
Petition (Food Democracy Now!)
Tell USDA to Leave Leafy Greens Alone! (The Monthly National Legislation Report)
USDA Trying to Run Organic Leafy Green Growers Out of Business (NaturalNews.com)
USDA Inspector General Recommends Greater Enforcement of AMS National Organic Program
In March 2010, the United States Department of Agriculture (USDA) Inspector General audited the National Organic Program of the AMS to determine if the agency was properly administering corrective actions in response to a prior 2005 Office of Inspector General (OIG) audit, and to determine if additional recommendations were needed due to the rapid growth of the organic industry. The OIG found that the AMS made improvements to most of the 2005 recommendations, such as establishing protocols for working with the National Organic Standards Board, but found that 14 additional improvements were necessary, including greater enforcement of serious violations, strengthening oversight of certifying agents and organic operations, improving regulation enforcement, implementing a plan to achieve compliance from California’s state organic program, and establishing procedures to track complaints and any subsequent enforcement actions. The AMS agreed with the OIG recommendations.
Tighten oversight of organic farmers, USDA warns California (by Michael Doyle, McClatchy Newspapers, March 26, 2010)
Oversight of the National Organic Program Audit Report (USDA Office of Inspector General, March 2010)
Agricultural Marketing Service’s National Organic Program Audit Report (USDA Office of Inspector General Northeast Region, July 2005) (pdf)
Federal Order “Make-Allowance” Criticized by Dairy Producers
In January 2006, U.S. dairy interests met with representatives from the Agriculture Department, the AMS, and other federal agencies to protest “make-allowance”—the federal term for the amount of money, on a cent-per-pound basis, which a processor of cheddar cheese, butter, nonfat milk, dry milk, and dry whey, may hold out before returning the rest of the money to milk producers. Dairy producers wanted changes made to these rules to reflect changes in manufacturing and transportation costs.
Margin Wars: Why the Federal Order “make-allowance” is under fire (by Cameron Thraen, Ohio State University) (pdf)
Origin Labeling for Meat Producers Stirs Controversy
In June 2003, critics of labeling meat products according to their country of origin met with the House Agriculture Committee in Washington D.C. More than a dozen witnesses from the AMS and industry groups testified and answered pointed questions from the committee. Origin labeling covering produce, meats, fish, and peanuts was to be mandatory by September 30, 2004. Meat processors in particular, said that the voluntary guidelines issued by the Food and Drug Administration were impractical to meet. The Florida Fruit and Vegetable Association also urged the USDA to expedite the rulemaking process for mandatory origin labeling.
Hot Issues and Cool Rules (by Bradley D. Lubben, Kansas State University) (abstract)
Organic Food Producers Clash with AMS Over Proposed Labeling
The AMS oversees and administers a National Organic Program as part of the Organic Foods Production Act of 1990 that defines standard organic farming practices. A national list of acceptable organic production criteria is used and it is illegal for anyone to use the word organic on a product if it does not meet these standards. The act also called for the establishment of a 15-member National Organic Standards Board to help develop these standards. In the 1990s, organic farmers raised concerns that the USDA was blurring the distinctions between conventional and organic agriculture. Senators announced that the USDA would make revisions to its proposed national organic standards as a result of these concerns.
Organic Foods and the Proposed Federal Certification and Labeling Program (by Jean M. Rawson, Congressional Research Service report for Congress)
Rayne Pegg, July 2009-August 2011
Rayne Pegg was appointed the administrator of the Agricultural Marketing Service (AMS) at the age of 33. The daughter of Philip Clayton-Thompson and Donna Pizzi, who own an advertising agency in Portland, Oregon, Pegg earned her Bachelor of Arts in psychology from the College of Notre Dame of Maryland. She first worked as a project manager for Convergent Communications and then as an assistant account executive at Opus Creative Group in Portland. Next, she became director of governmental relations for the Agricultural Council of California. In June 2004, Pegg joined the National Affairs and Research Division of the California Farm Bureau Federation (CFBF) as director of international trade and plant health. The California Department of Food and Agriculture then hired Pegg to serve as deputy secretary of legislation and policy. Pegg represented the department before the state legislature and participated in negotiations with the World Trade Organization and involving the U.S. South Korea Free Trade Agreement. After leaving the AMS, she rejoined the CFBF in August 2011.
Jim Link, November 2008-July 2009
Prior to serving as the Administrator of the AMS, James E. “Jim” Link was the Administrator of the USDA’s Grain Inspection Packers and Stockyards Administration where he successfully led the Agency through Congressionally mandated reforms and directed a variety of programs to facilitate the marketing of agricultural products and promote fair and competitive trading practices. Link holds a bachelor’s degree in business administration from Emporia State University and an MBA from Texas Christian University. Link has been in the cattle business for most of his life, most recently as the owner, along with his wife, of the Link Cattle Company of Crowley, Texas. After leaving office, Link returned to his cattle business, where he concentrates on stocker/feeder cattle.
Lloyd Day, August 2005-November 2008
California native Lloyd C. Day attended Stanford University, receiving both bachelors and master’s degrees. He also attended Glasgow University in Scotland, where he earned a second master’s degree. From 1992 to 1994, Day worked for the California Governor’s Office of Community Relations, coordinating outreach to California’s Hispanic, European, and Native American communities. From 1994 to 1999, Day served in a number of trade policy positions and eventually was appointed deputy secretary of the California Trade and Commerce Agency, where he managed five state-based offices and nine foreign offices to promote international trade and investment priorities for the state. From 1999 to 2002, Day was a business development director and industry marketing manager for Tumbleweed Communications Corporation in California.
Since August 2011, the administrator of the Agricultural Marketing Service at the US Department of Agriculture (USDA) has been David R. Shipman, who has more than thirty-five years’ experience in agricultural administration.
Rayne Pegg served as the administrator of the Agricultural Marketing Service (AMS) from July 6, 2009, until August 2011. She was appointed, at the age of 33, to the position by Agriculture Secretary Tom Vilsack. The AMS is responsible for administering programs that promote the sale of American agricultural products, including overseas sales.