Are Natural Foods $elling Out?


Odwalla started making juice in 1980 in California. Working from a small shed, three musician friends delivered small batches of fresh OJ in their Volkswagen van. Their mission was simple: “Make great juice, do good things for the community, and build a business with heart.” Today, Odwalla is the nation’s leading natural health beverage company and has, for the last four years, operated as a subsidiary of the Coca-Cola Company.

There are dozens of natural food companies that share a similar history. Since 1997, large corporations have gobbled up many of the leading brands. You may be surprised to see some of your favorites among them. For instance, General Mills now owns Cascadian Farms and Muir Glen. Kellogg’s owns Kashi. Dean Foods owns White Wave and Horizon Organic. Kraft owns Boca Burger. Heinz owns 20% of Hain Celestial who owns Earth’s Best, Imagine Foods (Rice Dream/Soy Dream), Walnut Acres, Deboles, Millina’s Finest, Westbrae, Breadshop, Garden of Eatin’, Nile Spice, and more. As absurd as it may sound, Seeds of Change, a company with the mission of promoting organic agriculture, is now a wholly owned subsidiary of the M&M/Mars candy company. Wondering what’s going on here?

Simply put, it is good business sense that has caused the sales of natural foods to have grown 20% annually in the last decade. Organic foods have catapulted from a one billion dollar market to nearly $15 billion. These sales figures and the upside potential for more growth have attracted major food corporations. Even Walmart has gotten on board. In fact, industry analysts forecast that Walmart will soon be the leading organic retailer in the U.S. (currently they sell 15% of ALL groceries, organic and conventional combined).   

So what do these changes mean for natural foods? What can we expect when large multinational corporations swallow socially responsible businesses? How will these changes affect the quality of natural foods and the future of organics? Can we assume that the same companies who made their fortunes selling white flour, hydrogenated oils, high fructose corn syrup, and yellow dye #5 are now committed to upholding a higher standard?

The word organic conveys a trusted image of natural food of the highest quality. A major concern among natural food consumers, however, is that legislators will dilute the definition of organic behind closed doors. Loosening organic standards would drive down production costs making the organic industry more profitable. In 1997, when the national organic standards were released, the USDA proposed that the existing organic definition be changed to include the use of genetic modification, irradiation, and municipal sewage sludge. The proposed initiatives triggered the largest protest since the Vietnam War – over 275,000 calls, emails, and faxes were sent to legislators. The initiatives were quickly rescinded and the original definition of organic was maintained. In April 2005, without any input from the National Organic Program, the USDA announced that organic would be changed to allow the use of certain pesticides, growth hormones, and antibiotics. Met with more fervent opposition, the proposed changes were withdrawn.

On the upside, Walmart’s (and other large companies’) entry onto the natural foods scene will make organic food more accessible. The U.S. Organic Trade Association says that this added exposure “will result in more land under organic production, regardless of the size of the operation. And that will be better for the environment, local communities, and the planet.”

The entry of larger corporations will make the organic industry more competitive and more efficient, undoubtedly making organic foods more affordable - but at what price?  We’ve witnessed how intensive agriculture has driven down both the costs and the American perception of what food (even high quality food) should cost. Relative to income, we currently spend half the amount that Europeans spend on food. The challenge will be to sell to Americans the idea that their health depends on paying more for quality (organic) foods. The alternative and more likely future for organics, however, is that it becomes a shadow of its original self, a kind of blend of original organics with today’s conventional farming.

As discouraging as the trends within the natural food industry may seem, organics today are still healthy and the ideals are for the most part being maintained. With the renewed interest in natural foods, an exciting shift has emerged. Local farmers markets are popping up in cities across the country. In your own community, you are likely to find farmers who are committed to producing sustainable animal products, produce, and other goods. Seek them out and support their efforts, and feel confident knowing that your purchases are still the most effective way to shape agricultural practices. Buy a share in a CSA (community supported agriculture) cooperative and strive to spend twice as much this year at the local farmers market as last year. At the same time we are supporting local agriculture, it is critical that more of us become informed and stay abreast of the issues in Washington by visiting websites like organicconsumers.org. Our collective voice does make a difference, so speak up and spread the word that quality foods are indeed worth the price. More on mergers at:
www.organicconsumers.org/Corp/mergers.cfm

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