ChewsWise Blog

ChewsWise Blog

Mainstream Cooling on Organics

I've been contending for awhile that the push of organic food into the mainstream was not a slam dunk.

A lot of commentators last year worried about the impact of Wal-Mart getting into the organic market - both on standards and on supplies. But no one really considered what would happen if Wal-Mart's move into organics did not work out. That's a question to consider now, especially with a large potential ramp up in supplies. There are shortages now as products come on line but what happens if the "mainstream" customers don't show up? Will farmers get stuck with a lot of excess organic acreage ... and milk?

Choice quotes of mainstream food execs in a Reuters story:

"Wal-Mart asked everyone for organic (food). At the end of the day consumers buy benefits and it's not exactly clear what the benefits are from organic. They might end up being niche propositions."
- Alan Jope, Global Food Group Vice President at Unilever Plc

"It's not as rapid as Wal-Mart might have liked or as any of us might have liked, but it is definitely growing."
- Cindy Hennessy, senior vice president of innovation at Cadbury Americas beverages.

"We believe the natural market is the larger opportunity."
- Hormel CEO Jeffrey Ettinger

Note that "natural," as a term, is largely undefined by the USDA (applying only to "minimally processed" meat without artificial additives).

This story will continue to unfold in the coming months, as large companies adjust their expectations and demand, potentially, eases a bit.

- Samuel Fromartz

Organic "Power Brokers" Hit D.C.

We're outing the power lobbyists of organic farming!

But first a few questions.

Do they work on the famed "K St." corridor in Washington, D.C.? No. Are they on a first-name basis with senior lawmakers in Congress? No. Do they have a big Washington association behind them filled with former administration officials and congressmen? No. Do they stay at expensive hotels in town? No.

Actually, they're farmers who had to stay in a hotel way out in Maryland.

Organic
Left to right: Tony Azevedo, Double T Acres, Stevenson, Calif.; Kathie Arnold, Twin Oaks Dairy, Truxton, N.Y.; Maureen Knapp, Cobblestone Valley Farm, Preble, N.Y. all certified organic farmers.

As Azevedo says: "We go in the front door and get a nice reception but I imagaine that there's other people going in the back door."

Azevedo and others were in town suggesting that Congress allocate more money for organic farming in the current round of the farm bill -- at least to a level commensurate with its growing role in agriculture. The Modesto Bee had a good piece on the issue. The farmers seek

- a $50 million-a-year grant program to assist farmers in adopting organic practices (which would be a new program)

- $5 million annually to help farmers offset the cost of attaining organic certification (refunding an existing program now out of money). This is the only subsidy specifically for organic farmers, amounting to a grand total of $500 per farm, to offset the costs of organic certification.

- a $25 million-a-year organic farming research program (about double the level currently).

Right now organic food is about 3 percent of the food supply. So if it were to get 3 percent of the $2 billion USDA research budget, that figure would amount to $60 million. Azevedo and others don't think that will happen. They even worry that the $25 million they're seeking now is a long shot.

How much does organic research get now? About $12 million in total, according to Mark Lipson of the Organic Farming Research Foundation.

Genetic Mystery: Contaminated Rice Seed

Editor's note: We welcome Dan Charles, an author and occasional NPR reporter and editor, as a new contributor to Chews Wise.

By Dan Charles

The most mysterious case of genetically engineered guests showing up, uninvited and unwelcome, in farmers’ fields just got more mysterious this week.

There's no genetically engineered rice for sale in the U.S., but tests of conventional rice seed, starting more than a year ago, have found traces of three separate genetically engineered strains.

The latest case, announced by the USDA this week, hit just as farmers began spring planting in Louisiana.

The case shows just how difficult it is to prevent the spread of genes, or seeds, from one field to another. In rice, the cases of contamination have shut down rice exports to Europe and forced seed companies to take two popular rice varieties off the market.

What everybody in the rice industry wants to know is, How how did genetically engineered plants end up in stocks of conventional seeds?

Here's what happened in the latest case.

Samples of a popular rice variety called Clearfield 131 tested positive for a DNA sequence that's commonly used in many genetically engineered varieties. Then inspectors tested for other DNA sequences, ones that are found in the three specific strains of genetically engineered rice that have been approved for sale but not yet on the market. These tests came back negative.

So the gene that's loose in Clearfield 131 appears to be from non-approved line of genetically engineered rice.

As a result, the USDA banned farmers from planting Clearfield 131 -- one of the most popular rice varieties. Planting in some areas was already underway, though. An industry source says at least two fields were planted with the now-banned variety. Those seedlings will presumably have to be destroyed.

Insiders think the contamination probably occurred at an agricultural research station near Crowley, Louisiana, (the “rice capital of America”) operated by Louisiana State University.

This research station conducted field trials, a few years ago, with several different lines of genetically engineered rice. Most of them were products developed by Bayer CropScience, engineered to tolerate doses of the herbicide Liberty, also sold by Bayer.

Simultaneously, this research station was breeding new conventional varieties of rice and growing small harvests of "foundation seed" -- the ultra-pure stocks that seed companies use in growing the seed that they sell to farmers.

The most popular varieties that this research station has released in recent years are called Cheniere and Clearfield 131. These are also the varieties contaminated with traces of genetically modified rice. (Cheniere was pulled from the market last fall.)

Evidently, pollen from the genetically engineered field trials, or a few stray kernels of rice, found a way to cross the few hundred yards that separated these fields. Perhaps harvesting equipment carried the kernels from one field to the other.

Rice pollen doesn't usually travel from one plant to another, but a windstorm might produce a freak instance of cross-pollination. However it happened, the genetically modified material did end up in foundation seed that this research station released to seed companies.

USDA inspectors have been going through the records of this LSU research station, testing every sample of seed that's been stored, trying to figure out where, and when, the genetic contamination happened. Evidently, it happened at least three separate times.

Rice farmers and exporters, at this point, are wishing they'd never heard of genetic engineering. Exports haven’t actually dropped overall; most countries have agreed to accept U.S. rice exports, as long as the industry appears to be making an effort to fix the problem. But the rice industry is worried that will change.

The lesson appears to be that the agricultural system simply isn't able to ensure pristine separation of different genetic lines of grain. Farming is a messy business; grain and pollen get mixed up.

It's been a tough few months for Steven Linscombe, director of the LSU research station in Crowley. Considering the scrutiny he's under, Linscombe has been notably open and willing to discuss exactly what he did in those field trials.

He's learned a few things. Last fall, when I interviewed him for an NPR story on this saga, he said that he'll never again grow genetically engineered rice on the same research farm with conventional foundation seed. Any field trials of genetically engineered rice will take place at a separate location, with separate cultivation and harvesting equipment.
---
Dan Charles is the author of Lords of the Harvest: Biotech, Big Money, and the Future of Food

Quick Bite: Organic Dairy

'FOOD' FIGHT
A reader points out that we missed the significance in this item of the formation of a new lobbying group by organic dairy farmers, FOOD (Federation of Organic Dairy) Farmers. Not since the 1980s has a group of organic farmers come together in a national lobbying group.

With the growth of organics, more marginalized players in the 'organic coalition' are going to step up to have a more potent voice in policy. Until now, that voice has been largely represented by the Organic Trade Association, which includes food companies, retailers and consultants. But not all farmers have felt that the OTA represented their interests. Now, the organic dairy farmers - who have shown tremendous consensus on issues like the importance of grazing - are doing something about it.

Where is Organic USA?

The Organic Farming Reserach Foundation posted a nifty little map, showing the location of all certified organic operations in the United States. It also linked the data into Google Earth, so that you can zoom into your neighborhood. Not surprisingly, the majority of operations are concentrated on the West Coast, Upper Midwest, and Northeast. But these only refer to certified operations, so a tofu plant in Watsonville, California gets the same size dot as a 1,500-acre wheat farm in Montana.

Organic USA map

Channeling Woody Allen at the Farm

In this youtube video, first seen via Megnut a few days ago, Chef Dan Barber related a hilarious story about his stud pig that has, well, shot its wad.

The question: What to do with Boris?

In this talk at the Taste3 conference (which we actually don't know much about), he relates all the various answers he got from the staff at Stone Barns Center for Food and Agriculture (where he has a restaurant), and, in a neurotic, New York kind of way, ends up channelling a bit of Woody Allen.

The Boris saga actually begins with another story about a carrot that appeared in the New York Times magazine recently. So if you're time-pressed, and want to hear about poor Boris, jump to 6:15 into the clip and hit play. It lasts another 15 minutes but is well worth it. Click on the picture to view it.

Pig_1

A Local Foods Boom: A Few Facts

Whole Foods local produce sales in 2006: $163 million (1)

Percentage of WF's total produce sales that were local in 2006: 16.8 percent (1)

Percentage of WF's total produce sales that will be local in 2007: 20 percent (1)

Percentage of WF's total produce sales that will be local in 2010: 25 percent (1)

WF's total produce sales in 2006: $970 million (2)

Percentage of WF's total produce sales that were organic in 2006: 50 percent (3)

WF's total organic produce sales in 2006: $485 million (2)

Percentage of WF's sales that are fresh produce: 17 percent (2)

WF's total sales 2006: $5.6 billion (4)

WF's expected sales in 2010: $12 billion (1)

Estimated local produce sales at WF in 2010: $510 million (2)*

Estimated annual growth rate in WF's local produce sales until 2010: 33 percent

(1) Comments by CEO John Mackey at 2007 annual meeting, March 5, 2007
(2) My estimates extrapolating from Whole Foods data and projections
(3) Comments by Mackey
(4) Annual Report
*Assuming that $12 billion in sales will be reached, produce remains 17 percent of total sales, and local is 25 percent of all produce sales.

FOOD fight for Tougher Organic Rule

Organic dairy farmers, who for several years have been trying to get a tougher organic grazing regulation, formed a group last week to get this measure passed.

Organic dairy farmers from Maine to California met in LaCrosse, Wisconsin - home of the Organic Valley dairy co-op - on February 23rd and formed FOOD Farmers (Federation of Organic Dairy Farmers).

Why is this an issue? Because some larger-scale dairies have been loosely interpreting the requirement that livestock have "access to pasture." The regulation is so vague it allows some operations to feed their cows primarily on feedlots - not on pasture.

The group is pushing for a regulation for organic dairy animals to consume at least 30% of their food needs (dry matter intake) from pasture for the entire growing season, but for no less than 120 days. The USDA’s National Organic Program is currently in the process of more clearly defining the current standard that requires all ruminant animals, which includes dairy cows, to have access to pasture. "The addition of feed and time requirements will result in a verifiable nationwide standard unlike any other organic standard in the world," the group said.

Let's cut to the chase: this proposed regulation has been around since 2005, but the USDA has so far dragged its heels on implementing it. The vast majority of organic dairy farmers want it. Consumers support it. The only thing standing in the way is the regulatory machinery of the government.

So expect a FOOD fight to make it happen.

Considering Local in a World of Pesticides

By Samuel Fromartz

While you chew over the Time magazine cover story on local and organic foods, consider the latest report from the USDA on pesticide residues. The watchdogs over at Beyond Pesticides - an NGO long fighting against pesticides in our food supply, homes, workplaces and, yes, golf courses - reports on the latest pesticide data from the USDA.

Every year, the USDA grinds up food samples around the country and then measures the pesticide residues it finds. Beyond Pesticides looked over the Pesticide Data Report:

In fruits and vegetables, 73 percent of fresh and 61 percent of processed produce had detectable residues. Drinking water analyses primarily found widely used herbicides and their metabolites; forty-eight different residues were found in untreated intake water and 43 in treated water.

It doesn't end there. Sixteen percent of bottled water samples had pesticide residues. So did 22 percent of soybeans, 75 percent of wheat, 98 percent of apples and 99 percent of heavy cream.

Milk generally contains pesticide residues, primary DDE (the substance that DDT breaks down into when it is metabolized). Why does it show up in milk? Because long-lasting pesticides like DDT concentrate in fatty tissues. This is still the case, even though DDT has been banned since 1972. Since it exists in the soil, plants take it up and then it is consumed by cows. (The FDA, however, says these detectable levels do not pose a health risk). DDE was in 85 percent of milk samples, which is about the same level when the USDA last tested milk.

The PDP report, incidentally, is one of the data sets that Environmental Working Group relies upon to find the foods with the most pesticide residues. They take this data, crunch the numbers, and then come up with a list of the foods with the highest and lowest numbers. That way you can try to make an intelligent choice about what organic foods to buy if you can only afford a few items.

Studies show organic food has lower pesticide residues. A widely publicized study in 2002, looking at 94,000 food samples from 1994-1999, found that organic had about two-thirds less residues than conventional food. It would be interesting if this study were repeated, especially now that so much more food is available organically.

In light of this rather consistent body of data, I've argued elsewhere that the choice between local and organic is a false one: both are good choices for different reasons. And both are such a tiny fraction of the food supply that choosing between them is virtually meaningless.

What's Behind Whole Food's VC Fund?

By Samuel Fromartz

Whole Food's CEO John Mackey this week let drop another news nugget in his discussion with Michael Pollan - a new $30 million venture fund to back "artisanal" food companies.

So what's the thinking behind this money? Is Whole Foods just trying to nurture the Slow Foodies of the world?

If you step back, you can see a couple of things. First off, Whole Foods is facing increasing competition in organic foods from mainstream retailers. Sales growth has slowed. (That's why the stock took a hit this year - not because of the unflattering things Pollan had to say about them in his book). Secondly, those competing retailers are getting into this business by stocking many products that initially got their start at natural food retailers like Whole Foods.

Think of how this works from Whole Foods point of view: Hundreds of entrpreneurs are constantly knocking on your door, trying to get their products on your store shelf. You like some of them. You give them a shot in the store. Customers like them too - and start buying them.

Suddenly, the little start-up that got its first leg up from Whole Foods isn't so little anymore. Now, the start-up says, "Let's go for the bigger opportunity - in Target, Wal-Mart, Safeway." Start-ups have to do that because they are usually backed by investors who are looking to cash out, and they can only cash out if the company gets large enough to generate a sufficient return.

Essentially, what Whole Foods has done is offered that first crucial distribution pipeline for these young companies, in a sense, legitimizing them, and then they move on.

Well, guess what? Whole Foods is pissed about that. "We feel like we're being used," one insider said.

That's why you see some Whole Foods stores removing products from their shelves that are also appearing in Wal-Mart.

This dynamic could change, though, if Whole Foods actually had a stake in its suppliers. Not only would they be providing capital to money-starved entrepreneurs and artisans but they would also keep them in the tribe. It's like the Japanese kieretsu model of business that links companies with their suppliers in long-term relationships.

Unlke a traditional venture capitalist, Whole Foods wouldn't need to cash out to get a return. The "return" is measured in having a pipeline to great products.

Plus, Whole Foods can afford to do it: they generate $500 million or so in cash a year.

Whether it will give them enough of edge, well, that's the big question down the road.

Mackey-Pollan Smackdown Turns Love Fest

By Carmel Wroth

AMUSE-BOUCHE: Local, of course

The pre-event reception to the Michael Pollan-John Mackey discussion drew quite a crowd.

Hungry (and penniless) graduate students rubbed shoulders with well-heeled foodies, including superstar chef Alice Waters of Chez Panisse, nutritionist and best-selling author Marion Nestle, and Bill Niman, co-founder of Niman Ranch meats.

Of course you’re wondering what there was to eat.

Guests munched on goat cheese fritata, artisanal salami, and crostini, decked with green olive tapenade, warm hedgehog mushroom spread with fresh grated romano, and duck liver pate.

All locally sourced, naturally!

Conversation buzzed—everyone was excited to see the two food luminaries talk. Or maybe they were just pleased they had scored tickets (people were soliciting them on Craig’s List before the event.)

Whole Foods employees had come from far and wide to see their boss.

“John Mackey is cool,” said Elizabeth Wade, a team leader at the Petaluma, California, store.

David Evans, Marin Sun Farms’ owner, who sells his grass-fed meat locally (and not in Whole Foods), said he hoped the Pollan-Mackey conversation would shed light on how “small farms can access a bigger market without sacrificing integrity.”

Yes, indeed, the question of the night.

FIRST COURSE: History Lesson

To start things off, John Mackey - co-founder and CEO of Whole Foods - gave the crowd of nearly 2000 people a 45-minute food history lesson, complete with colorful Powerpoint slides.

He walked us through the entire history of food procurement and production. Six discreet stages of food history from hunting and gathering to Whole Foods Market!

Okay, that’s not entirely fair. Mackey believes that a new era of food is emerging to replace industrial agriculture--what he calls ecological agriculture--and naturally it’s bigger than Whole Foods.

He seems to think his company is the heart of the movement (it may well be), and he clearly articulated a vision for a sustainable alternative to industrial food.

He also broke some news (as he seems to do every time he appears with Pollan). Whole Foods has established a $30 million venture capital fund to make equity investments in artisanal food companies. This presumably comes on top of a $10 million fund set up for farmers last year.

Secondly, the company is launching a “Whole Trade Guarantee” fo the company’s commitment to source certified ethically traded products.

How can you be cynical about this man?

SECOND COURSE: Smack-down Letdown

As the dialogue got under way, there was a rustling of expectation in the audience. The provocative debate was about to begin, right?

After all, these were the two men who disagreed so strongly about whether the organic food business was lapsing into industrialism that they conducted a heated, months-long online argument. (See our previous post for links on the debate)

In person, though, they were almost painfully gentle with one another. They sparred, a little, I guess, but it was more like couple's counseling than a duel.

For starters, there were admissions of mutual gratitude and admiration. Mackey had learned from Pollan. Pollan appreciated Mackey.

The denouement came when Pollan asked Mackey if he blamed the company’s recent stock devaluation on his less than flattering chapter on the Whole Foods. It went like this:

“Well you probably cost us about $2 billion,” said the natural foods tycoon. “Easy come, easy go.”

(Audience laughs)

“Seriously???” (Culinary poet laureate grimaces painfully).

Mackey described how a flurry of unflattering press followed the book, including frequent comparisons to Wal-Mart.

Pollan looked contrite.

Mackey melted: “Aw, I’m just pulling your chain a little bit, Michael!”

What are righteous eco-consumers to make of this not-so-spirited interchange? If you want to see a debate, as one audience member suggested, invite people who are really on opposing sides of an issue.

Pollan and Mackey originally did have their differences, but when Pollan came up with his eloquent critique, Mackey moved rapidly to turn Whole Foods' sustainable battleship in line with Pollan’s vision—or to emphasize the ways it already was already doing so (sourcing more local foods in stores and moving forward with supporting domestic grass-fed meat, for example).

Pollan, for his part, politely closed ranks with perhaps the most influential man in organic and natural food circles, which is, you'll recall, the alternative to 98 percent of the food supply.

Mackey had his own criticism of Pollan, saying “big organic” is not as big and bad as the author claimed.

“You exaggerated the extent of industrialization of organic,” he said, even adding his most contentious comment, “you’ve done some damage!”

Pollan said he “didn’t intend to demonize” big organic. Organic Coca-Cola would be fine by him. (Say what?)

Which leads us back to a fundamental question raised by the evening's discussion, can organic scale up without selling out? Is there a way to produce and distribute enough organic food to reach the vast majority of the population, or will organic food remain in its gilded 2 percent niche?

DESSERT: A challenge

With all these weighty issues on our minds, Mackey asked one last question.

“What is your contribution going to be? What are you going to do to support ecological agriculture?”

Other than shopping at Whole Foods and the farmers' market? We're still pondering that one.

(The Webcast of the event is archived here)

Tailgate Party: Mackey Comments Pre-Debate

John Mackey, the CEO of Whole Foods, made a guest appearance in Michael Pollan’s graduate level journalism class on food issues, hours before their much-anticipated discussion.

We got an inside-the-classroom look at Mackey from a new contributor, Carmel Wroth.

Pollan had cautioned the class against being too aggressive, but maybe it wasn't needed.

There was something about Mackey that makes you want to be on his side. He's so optimistic you get swept up in his good vibes and forward-looking energy. He even challenged the students to take on the mission of expanding the organic food movement beyond the 2 percent of food sales that his generation has managed to carve out.

Through a winding conversation, Mackey never let go of his theme: that natural and organic foods are in the early stages of evolution, but with imagination, faith and the entrepreneurial spirit, it can and will grow.

The subtext wasn’t hard to discern either—Whole Foods is the leader of that evolution, and deserves admiration, not criticism.

Mackey described his company’s plans to keep pushing natural foods forward, including their embrace the “Fair Trade” and “Rainforest Alliance” labels (both focusing on sustainability in the Third World) and their new “Animal Compassion Standards” which he hopes will eventually be adopted industry-wide.

In his all-embracing stance, he was quick to try to find common ground with local food supporters, like Pollan. He called it a “waste of time to have these arguments between local and organic” when both are such small niches.

He predicted a future when local agriculture would be in such a resurgence that there would be no need to fly in fresh produce from international markets (such as the much-maligned mushy asparagus Pollan described in his book The Omnivore's Dilemma). The only globally sourced goods would be things that can’t be grown locally like coffee and bananas.

Yet, somehow all the think-positive talk seemed to be blowing smoke over the very real challenges of scaling up the organic movement without betraying its ideals, or the small farmers once at its heart. Mackey simply brushed aside concerns that scaled-up large, organic farms are likely to be less in line with organic and ecological principles.

Humm ... We'll see how Mackey's positive mojo plays with the Berkeley crowd later this evening.

- Carmel Wroth