A critical view on “Walmarting Organics”

In 2006 The Cornucopia Institute released a report accusing Walmart of cheapening the value of the organic label by sourcing products from industrial-scale factory farms and developing countries. At the time, Walmart announced that they would greatly increase the number of organic products they offered and price them at a target of 10% above the cost for conventional food. They failed at that first attempt, eventually removing many of the organic items from their stores, the Cornucopia Institute reports.

In May 2014, Walmart announced they will once again enter the organic arena, with the goal of eliminating the premium price for organic food (we reported earlier). Cornucopia has received numerous inquiries asking if Walmart’s organic expansion is “good news or bad news” for the industry. The stock answer of Mark Kastell, Senior Farm Policy Analyst and co-founder of the institute, has been, as it was in 2006: “If Walmart lends their logistical prowess to organic food, both farmers and consumers will be big winners by virtue of a more competitive marketplace. However, if the company applies their standard business model, and in essence Walmarts organics, then everyone will lose.” As one point, organic family farmers in the USA could see their livelihoods disintegrate the same way so many industrial workers saw their family-supporting wages evaporate as Walmart, Target and other big-box retailers put the screws to manufacturers, forcing a production shift to low-wage countries.

Meanwhile, Whole Foods Market announced that they are cutting many prices to meet increasing competition from mainstream retailers like Kroger, Safeway and now Walmart, and their stock plunged nearly 19% this past May. “I don’t think consumers have any idea just how industrialized (mainstream organics) is becoming,” said best-selling food movement author Michael Pollan in an interview with the St. Paul Pioneer Press. “There are some real downsides to organic farming scaling up to this extent”. Both Pollan and Mr. Kastell worry that the expansion of Big Organic will lower food quality, weaken standards and hurt small family farms (also see our report on corporate consolidation in the organic sector). The full article of Mark Kastell is available here.