Wal-Mart vs. Organic Farmers

The Cornucopia Institute, the most aggressive organic farming watchdog in the US, has accused Wal-Mart of cheapening the value of organics by sourcing products from Third World Countries and industrial-scale farms. Earlier this year, Wal-Mart announced that they would increase the number of organic products and price them at 10 % above the cost for conventional food.

Mark Kastel, Senior Farm Policy Analyst for the research group, stated that many press inquiries had been received over the past months asking for a statement towards the organic expansion of Wal-Mart. The answer was clear – if Wal-Mart intends to apply their standard business model to Wal-Mart organics, then everybody will lose.

Cornucopia’s white paper called “Wal-Mart Rolls out Organic Product - Expansion or Market Delusion?” claims that Wal-Mart is ready to drive down the price of organic food by inventing a new definition of “organic”. Organic farmers in the US could lose their means of subsistence like many industrial workers saw their waged disappear as production was shifted to China and other low-wage countries.

Wal-Mart is already partnering with the giant milk processor Dean Foods (Horizon Organic) and recently introduced their own private-label organic milk packaged by Aurora Organic Dairy, which faced a lot of organic industry criticism and negative press for operating industrial-scale dairies with thousands of cows confined in feedlot-like conditions. Currently, this is the subject of USDA investigations.

Steve Sprinkel, industry observer and columnist for the leading sustainable agricultural journal, Acres USA, claims that partnering with Dean / Horizon and Aurora should not leave any question as how Wal-Mart is approaching its organic initiative. Large percentages of milk come from factory farms without the required access to pasture. Also, the companies have been accused of bringing non-organic cows onto their farms.

The Cornucopia Institute released a rating of approx. 70 organic dairy products in April this year. Almost 90 % received a very high rating, but Horizon and Aurora did not participate in the study and therefore received the lowest score. And in a poll of their 800,000 members, the Organic Consumer Association moved to boycott Horizon and Aurora dairy products.

The study also reported about the decision to lower the per unit cost basis on organic products by collaborating with its long-time trading partner China. Mr. Kastel stated that even if it were not for serious concerns about the property of the certification process in China, burning fossil fuels and undercutting domestic farmers does not meet the consumers’ traditional definition of “organic”.

At the same time Whole Foods Market announced plans to expand their offerings of locally grown produce. Mr. Cummins comments this move – between Whole Foods and hundreds of cooperatively owned natural food groceries, the country is set up for a “clash of the titans”. The question is whether consumers choose cheap industrial food or continue to support ethical processors and family farmers.

Cornucopia Institute sent a letter to Wal-Mart’s CEO, suggesting that Wal-Mart’s approach would undermine the corporation’s campaigns to attract upscale shoppers to their store. It also stated that Wal-Mart is miscalculating their move to “organics” and underestimating their knowledge and commitment of the organic consumer. Furthermore, the letter mentioned an example of Wal-Mart selling mislabelled conventional yoghurt as organic and the retailer selling organic baby formula made with questionable synthetic ingredients and processing materials.

http://www.cornucopia.org/