ChewsWise Blog

ChewsWise Blog

Price War Coming in Organic Milk?

One question I have had was whether the coming glut of organic milk will lead to lower prices for consumers. Well, the company that owns Horizon Organic, the largest organic milk company in the nation, thinks the answer is yes and that admission sent the stock of parent Dean Foods down nearly 10 percent today.

According to a report in Bloomberg News:

Dean Chief Executive Officer Gregg Engles said organic milkoutput may surge 40 percent this year, creating ``a wall'' of supplies that will prompt rivals to try ``to stimulate demand through lower prices." Dean Foods, the biggest organic milk producer in the U.S., will counter with increased investment in Horizon Organic, its most profitable brand, Engles said.         

What is less clear is whether organic dairy farmers will take a hit and suffer lower prices at the farm-gate. I've heard that Organic Valley is holding the line on prices and have also seen other anecdotal reports that processors are trying to hold back supplies. ''We don't want to harm the viability of organics and the price point that farmers need to make a decent living,'' Organic Valley CEO George Siemon told the New York Times.

Why are supplies jumping 40 percent in a year? Because farmers had until last June to begin the year-long conversion to organic production before more stringent rules took effect. As a result, many jumped into the market at the same time and now all those supplies are starting to come on line.

- Samuel Fromartz

BIG Organic Java Victory

Organic Coffee is safe, for now.

In a victory for organic farmers in the developing world, the USDA's National Organic Program has backed down and said that for now there will be no immediate change in the way these farmers are certified.

The NOP had previously announced that it was changing certification procedures for these farms. The change would have increased costs sharply and choked off the supply of organic coffee, cocoa and other crops grown by farming co-ops in the Third World, an issue I wrote about on Salon.com.

In a statement issued Wednesday, the NOP said it would work closely with the National Organic Standards Board -  the citizens advisory panel on organic regulations - before making any changes. This comes after a petition campaign which generated thousands of signatures, even in the absence of any major media coverage.

For those who think organic regulations have been compromised by big business, this shows - as other actions have in the past - that transparency and advocacy work.

The NOP statement can be read in full here.

- Samuel Fromartz

Eastern Market: After the Burning

By Samuel Fromartz

In the pre-dawn hours of Monday morning, Eastern Market, the 134-year-old food market just blocks from my home in Washington, D.C., burned down. No one was hurt but lost in the embers of the three-alarm fire were neighborhood businesses - several butchers, a fish monger, two vegetable stands, a cheese vendor, a pasta maker, a bakery and a market lunch counter – 14 market stands in all. Together they made up the heart of a community, a place where you could step out of the frenzied politics of Washington and eat a decent crab cake sandwich. You would  run into friends and neighbors at the market during the weekend, or find yourself rushing there in the evening to grab homemade ravioli, a few bratwurst, or a pleasant conversation with the vendors. It's hard to put a value on the place, but you certainly realize it when it's gone.

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Built in 1873, Eastern Market reeked of character, with huge steel beams in the high vaulted ceiling, tall glass windows, and old freezer cases where the vender's goods were displayed. Down on one end of the hall, you could buy sweet, chewy, rugelach, or roast chicken on a spit, and down the other end, crab cakes, fried fish and oysters, and French fries. On weekend mornings, the breakfast line at the Market Lunch counter wound out the creaky wooden doorways and down the block. The line was nearly as long at lunch - the slowest fast-food in Washington.

These weren't high-end gourmet retailers selling rare artisan foods, nor were they local food purveyors pushing a 100-mile diet. But they were the antithesis of the bland suburban shopping mall, with longstanding relationships with neighbors on Capitol Hill. The small businesses worked in a very traditional way: they bought from wholesalers and resold the food in the market, with a smile and a free banana thrown in your bag. I've been to a few other old markets that had a same feel, whether the Soulard Market in St. Louis (built in 1843), the Reading Terminal Market in Philadelphia (1892) or Pike Place Market in Seattle (1907), which was the most touristy of the lot. Although Eastern Market attracted tourists, it was primarily a working market and the soul of Capitol Hill.

Outside, on the weekend, a mishmash of produce sellers lined the street under the permanent steel awning (which was just reconstructed in the last year or so). There was the old woman in the lawn chair sitting next to her portable heater who has been there for eons, offering goods from the wholesale market. But there were local growers, too, who made a point to show up, with tomatoes, peppers, asparagus and greens. Then there were specialty food sellers like Uncle Brutha, with his superlative hot sauce, who recently expanded into a nearby store. On Sunday, the craft vendors took over, selling jewelry, paintings, furniture, hats and assorted bric-a-brac. Lately, the market seemed to be more vibrant, but that may have reflected the general upswing in the neighborhood, which has been seeing a renaissance, especially among businesses.

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I rode my bike by the market both Monday and Tuesday. The street was still cordoned off, fire trucks present. You could see inside the battered windows at the charred and twisted remnants of the place, though the brick shell was intact. The roof had collapsed in a few places, and vendors were standing outside being interviewed by the media. Most put on a stoic face, though neighbors wondered aloud how a public building, owned by the city, could have been allowed to operate without a basic sprinkler system. Considering the hundreds if not thousands who made their way into the market each weekend, the city was lucky the fire occurred in the off hours. Plus, everyone was worried about the loss of this landmark. A row house across from the market hung a banner outside, "We love our vendors."   

The fear now is that the center of the neighborhood will be gone, or rather is gone, up in smoke. The mayor has promised to rebuild the place, but that will take up to $30 million and 18-24 months before it is finished. Our non-voting representative in Congress, Eleanor Holmes Norton, is seeking federal funds for the project. The neighborhood has rallied and within 24 hours was collecting money for the businesses and employees whose entire livelihood was based on the market, the great fear being they will move on before the place is rebuilt.

Hopefully, they will not. Hopefully, Eastern Market will be rebuilt in a timely fashion and in a way that keeps true to its hardscrabble and neighborly character and not become just another culinary destination for the well-heeled. At the same time, I would acknowledge that its character had some costs, since the building was clearly wanting of a paint job and a deep cleaning; it also apparently needed workable electrical wiring (the likely culprit in the fire). So perhaps this will present an opportunity for the landlord to renovate the place without losing what was once there, so that it could become once again the vibrant heart of a neighborhood that is now sorely feeling its loss.

USDA to Rule on Organic Coffee Limits

I've written extensively about a USDA decision last year that could shut down markets for organic coffee, cocoa and bananas from the developing world. Now, it appears that this spate of publicity and activism on the issue has caused the USDA to listen.

Last Thursday, representatives from the National Organic Coalition, Equal Exchange, Rural Advancement Foundation International USA, and the National Cooperative Grocers Association met with the USDA to discuss the issue. They also presented a petition with more than 300 organizations and 3,600 individual signatures objecting to the policy. (A copy of the letter and signatories is posted in a pdf here).

In an email, the National Organic Coalition said "the USDA is promising a statement of clarification very soon. We are uncertain as to what that statement will look like, and we remain concerned." In a separate statement Equal Exchange said:

The USDA assured us that they had heard from us, and you, “loud and clear” and that in “two or three days” they would issue a statement that they thought would make us “happy.” They would not share any more details other than to offer a little more explanation of how they perceived the issue.  Given the stakes, complexities and interests involved, we cannot assume that the USDA statement will completely solve the problem.  (Also, given the nature of any federal agency, it could actually be weeks, not days, before they release their statement.)

Chews Wise will report on this important ruling as soon as we get word. Updates are also available at Equal Exchange's web page.

- Samuel Fromartz

Farm Bill Insider

Keith Good, editor at FarmPolicy.com, is a farm bill insider - trolling the media for any and all reports, pulling choice quotes from dispatches, and even posting audio from Congressional hearings and from his own interviews. It's wonky but fascinating.

I was especially interested in this comment Good highlighted from a Senate Ag Committee hearing. North Dakota Senator Kent Conrad, who also chairs the Senate BudgetCommittee, complained bitterly about a series of Washington Post articles entitled ‘Harvesting Cash’ that have painted a highly critical picture of federal farm programs. (We've blogged on WaPo's reports, including one on how USDA loan payments are paying for resort town improvements, and highly recommend it).

“‘You know, one of the things that struck me about these articles - you don’t see much reference to the cost of food in this country - the lowest cost of food in this country of any country in the history of mankind,’ Conrad railed. ‘You don’t see much reference to a plentiful and healthy supply of food - you don’t see much reference to that. You don’t see much reference to the health of the agricultural sector in this country. You don’t see much reference to the fact that we are a major exporter for this nation - you don’t see much reference to that,’ he continued. ‘You don’t see much reference to what is the true status of most farm families, at least as I know it in my state.’”

Sen. Conrad's obviously not reading the same stuff we're reading about e. coli outbreaks, contaminated peanut butter, subsidies that enrich the richest farmers, including those who reside in Washington, D.C., the continued demise of smaller farmers, the depopulation of rural areas, the high rates of obesity linked to cheap processed food - the list goes on and on - much of it the result of subsidies too complex for most people to figure out, let alone care about.

To get behind the Post series - and what motivated it - check out this Mp3 audio interview Good had with Post series reporter Dan Morgan last year. "By and large, we've had a lot of positive feedback from farmers, and from the agriculture community who understand the series is not about beating up on farmers," Morgan says. "It's about trying to identify and spotlight flaws in the program, and ways that the money could be used better, to the benefit of farmers."

GM Crops Advance - Without Debate

By Stephanie Paige Ogburn

Genetically modified crops are taking root at a rate that may surprise those who don’t closely follow the acreage numbers.

Roughly 252 million acres, or 6.2 percent of the world’s total cropland, are planted with GM crops, according to 2006 figures. The growth is largely occurring in developing countries, which currently boast about 40 percent of total GM acreage.

Brazil, China, and India, leaders in many development statistics, are also the three major developing nations implementing GM crops. From 2005 to 2006, India’s GM crop acreage, mostly in cotton, increased 192 percent. But even Iran’s gotten in the game, introducing Bt rice, on somewhere between 25,000-50,000 acres. (The rice contains the genetic material of the soil bacterium, Bacillus thuringiensis, an insecticide.)

I found this out at a recent talk on the regulation GM crops given by Gregory Conko of the Competitive Enterprise Institute. It sponsored by the GM Plants Working Group, a subgroup of Yale University’s Interdisciplinary Center for Bioethics.

Conko’s a leader in the field of GM regulation, and the stats above were less the object of his talk than talking points along the way as he introduced the need for a standardized regulatory system for genetically modified crops. Conko believes that GM crops, when properly regulated, are safe and can be highly beneficial to mankind and the environment, while at the same time making some people a lot of money. In other words, he backs up Monsanto in the current debate over GM crops.

While many don’t share his faith in the safety of GM plants, Conko made the point that the crops have allowed a sharp reduction in insecticide use. In the United States, insecticide use has fallen by 8 percent in field corn, 80 percent in sweet corn, 40 percent in cotton and 60 percent in potatoes. Developing countries have also seen similar reductions in insecticide use.

Herbicides are a different story. Since what’s generally being sold are herbicide-resistant crops, farmers who use GM soy or corn (Roundup Ready or Liberty Link, for example), are spraying large quantities of glyphosate (Roundup) or glufosinate ammonium (Liberty) herbicides. These herbicides kill everything but the herbicide-resistant crops. Conko’s spin on such herbicide-resistant crops ran along familiar lines: that these are some of the least persistent herbicides around, and a transition to them is better for soil health, since they allow conservation tillage, and human health, since they are less toxic than other herbicides.

But Conko’s talk glossed over many of the oft-cited concerns with GM crops. “Every known risk of bioengineered plants also occurs in non-engineered plants,” he claimed. While I won’t argue with his science (since I’m not a molecular biologist) the essential argument he made about regulation seems flawed, since it basically says: Since we don’t highly regulate these other seed types, we shouldn't regulate GM crops either.

Conko notably omitted a discussion of the wider social and ecological impacts of widespread use of GM crops. And while the negative health and ecological impacts of GM crops may be debatable, it's irrefutable that they’ve spread to non-GM corn in Mexico, non-GMO rice in the U.S, and organic crops in Spain, at a cost to farmers. Plus, weeds are developing glyphosate herbicide resistance (see this link for a list). GM crops may not be “Frankenfoods," but these issues warrant serious discussion about how they're regulated.

Coming away from this talk, I want to make several points:

  • We need a public conversation about how GM crops in this country should be dealt with. If more than 6 percent of the world’s crops are currently genetically modified - over 135 million U.S. acres - and we’ve still not had a good debate about how to regulate this industry, something is wrong.
  • As GM crops spread, there should be discussion on whether research should focus on producing more Roundup Ready corn, or whether it should focus on crafting crops adapted to poor agricultural conditions such as drought areas or specific soil types.
  • If GM crops can have positive environmental outcomes, then they are worth real exploration. As long as they are decried but not addressed in the public sphere, the private sector will control the way these crops are developed.

It’s a tragedy that GM crops have become so mainstreamed without any serious discussion. Two hundred fifty-two million acres of GM crops is a lot of land, and this transformation has largely happened out of the public eye. This fact alone makes biotech seem sneaky and underhanded, and naturally leaves one less inclined to trust the soothing assurances of the biotech advocates.

Stephanie Paige Ogburn is a graduate student at the Yale School of Forestry and Environmental Studies

Senate Hearing Abuzz on Bees

By Samuel Fromartz

The Senate Agriculture Committee held another in its series of hearings on the farm bill Tuesday, with the focus on specialty crops. But it was a beekeeper from Waxahachie, Texas, that caught my ear.

Mark Brady, who has raised bees for 30 years, told the panel about the recent and sharp decline in bee populations - so-called Colony Collapse Disorder (CCD) - and mentioned some chilling figures:

  • that a third of all food crops rely on bees for pollination;
  • that California almonds - 80 percent of the global crop - require more than 1 million bee hives for pollination.
  • that the American honey bee population has dropped 30 percent over the past two decades;
  • that domestically produced honey accounts for only 31 percent of all sales, a figure that has been steadily declining.

The question, of course, is why have the bees been disappearing?

Senator Amy Klobuchar, a Minnesota Democrat, asked whether cells phones might be a cause.

"On the cell phone issue, we took all the phones away from the bees," Brady quipped. But he quickly turned serious and mentioned concerns about "cumulative low-dose pesticides" that sit on pollen and nectar and which bees bring back to their hives. He noted that the EPA has studied pesticides that kill bees immediately, but it hasn't looked at low-dose toxicity.

"One of the things we're looking really hard at is the cumulative effect of pesticides," said Brady, who was representing the American Honey Producers Association. As bees work during the summer, they pick up pollen and nectar and store it in the hive. When the weather turns colder, the bees consume what's in the hive. "That's one of our big concerns - that there may be pesticides in that pollen," Brady said. "We're beginning to wonder now if that's causing a delayed effect on some of these colonies dying."

The New York Times had a report on the issue Tuesday, delving into a number of potential causal factors, including pesticides.

Among other theories, Brady also mentioned "stress" as a cause, since bee colonies are transported across the nation to pollinate crops in California; the introduction of foreign bees for the first time in 85 years (to make up for population declines); or a combination of factors leading to a tipping point.

Brady made clear that there is no definitive answer to the question, which is why he was appealing to the panel to increase USDA funding on bee research by $1 million. It seems a small price to pay when the pollination of apples, avocados, oranges, melons, broccoli, tangerines, cranberries, strawberries, alfalfa, soybeans, sunflower, cotton - in all, some 90 food and fiber crops - are at stake.

Wal-Mart Tinkers with Organic

It's not easy to maneuver a battleship to hit a floating cork, but that appears to be what Wal-Mart is doing in the organic market. On that score, I just came across this Reuters interview with a Wal-Mart executive about its experience in the organic market. It was published on Friday. (See what happens when I miss one day of reading Ethicurean's news digest?). Here are some choice bits from a chat with Ron McCormick, Wal-Mart vicepresident of produce and floral. He's talking about problems with getting supply:

"The growers were straining to meet our volume, which I think also pushes you into an unenviable position in produce," he said.

"Whenever growers are straining to meet your volume it means they're forced almost into selling you something that would not be their best crop because they're desperate to get you something to meet your demand."

McCormick said Wal-Mart continues to fiddle with its organic strategy, trying to figure out the premium that its shoppers will pay for organic produce. It is also focused on developing a consistent supply of products.

"We're now trying to build a network of good suppliers that will be able to grow with us and be consistent. Our ideal supplier is one that has a passion for what they're doing and also has the ability to grow as we grow, so you don't have thousands and thousands of suppliers," he said.

I found that last point particularly interesting, since it underscores the point that Wal-Mart will source from larger growers rather than "thousands of suppliers." That's not necessarily bad, since it means other competing retailers can differentiate by sourcing from smaller, local growers in the market - and succeed.

Coffee Organizers

The article I wrote in Salon, highlighting a recent USDA decision that raises costs severely for smaller organic growers in the Third World, has continued to gain attention. Several petition campaigns are going, including one on Equal Exchange, the organic and fair trade coffee company.

They have also posted several letters at their Web site explaining the issue, including this from a growers co-operative in Chiapas, Mexico.

From CIRSA in Mexico

We were very surprised to hear about US government’s decision [to disallow group organic certification]. Honestly, it will mean a huge challenge that we as small-scale producers will now have to face; precisely because our philosophy as small-scale producers is to work together in groups in an organized and just manner.

Individual certification would truly place an obstacle on group processes, on our way of working with the grassroots, on all our efforts to strengthen our organization. A system in which many would be forced to start to work in an individual fashion and to sustain themselves in this way would change our entire way of working.

We do not agree with these decisions or with the bias of the National Organic Program, which appears to lean towards strengthening the big farmers, the big estate and plantation owners and would only serve to make us, cooperatives of small scale producers, to make our lives more difficult and costly.

We wholeheartedly support Equal Exchange’s letter to NOP opposing this decision; we must add to and join more forces from the grassroots, from the organized communities to make the system work and to resist all these types of challenges, especially given the circumstances and governmental policies which currently prevail in your country and that each day are turning more and more into cumbersome and complicated decisions and laws.

… from the southeast of Mexico, the indigenous and marginalized communities of Chiapas, we send cordial greetings to the Equal Exchange team. May God continue to give us strength in our struggle.

Filiberto M.

The National Organic Coalition - an umbrella of various sustainable agriculture groups - was behind the letter and petition effort. On the following page, I am posting a link to their letter to the USDA, as well as links to more documents on this issue.

- Samuel Fromartz

For a copy of this letter with its attachments:
http://www.agmatters.net/Organic/Short_ltr_to_Johanns21.doc

USDA/NOP Recent Decision:
http://www.agmatters.net/Organic/RECENTGGC_DECISION_BY_USDA.doc or go to the USDA website:
http://www.ams.usda.gov/nop/Compliance/AppealsSummaries/Sept05-Mar07.pdf

The NOSB - a citizens advisory panel to the USDA considered the matter of grower groups in 2002 and made a recommendation to the USDA - it was never acted upon. National Organic Standards Board 2002 Grower Group Recommendation:
http://www.agmatters.net/attachments/f2002_NOSB_GGC_Recommendation.doc

More Information on the National Organic Coalition:
http://www.agmatters.net/Organic/NOC_Public_MissionJan07.doc

Buzzing around

This story about the possible role of mobile phones in the collapse of bee colonies has been buzzing around and finally got my attention. (Thanks Lisa for the link). The Independent in the UK reports:

The theory is that radiation from mobile phones interferes with bees' navigation systems, preventing the famously homeloving species from finding their way back to their hives. Improbable as it may seem, there is now evidence to back this up.

The article points out that "German research has long shown that bees' behaviour changes near power lines."

Now a limited study at Landau University has found that bees refuse to return to their hives when mobile phones are placed nearby. Dr Jochen Kuhn, who carried it out, said this could provide a "hint" to a possible cause.

Dr George Carlo, who headed a massive study by the US government and mobile phone industry of hazards from mobiles in the Nineties, said: "I am convinced the possibility is real."

Exception to Organic Shortages: Coming Glut in Milk

I should have made clear in the previous post that there is no shortage of organic milk, or there won't be soon. A record number of farmers started to transition last year to organic production and will be done within a year, producing a glut. The Burlington Free Press had the story last Saturday and the New York Times caught up with it today.

The Times story makes clear that the rush of dairy farmers to transition to organic was largely the result of a lawsuit brought by Arthur Harvey, a Maine blueberry farmer. (He won the suit for stricter dairy regulations that will take effect this June). In the article, Nancy Hirshberg of Stonyfield Farm called the jump in organic milk supplies "a gift from above." Considering how much the organic industry spent to fight Harvey and his lawsuit, which I discuss in my book, Organic Inc., I found this quote highly ironic, to say the least. But the fact is, Stonyfield and others needed milk. At one point last year, Stonyfield CEO Gary Hirshberg said he could increase output of organic yogurt by 100 percent if he could get the milk. (As it turns out, Stonyfield is now buying 48 percent more organic milk this spring).

What neither story mentions is that this farm conversion is going to lead to a severe shortage of organic livestock feed in the fall of 2007 and into 2008 -- so any farmers out there might want to investigate this issue. Organic Valley is suggesting farmers take land out of conservation reserves (where it has not been cultivated) and putting it into organic production immediately. A press released issued by Organic Valley and the grain co-op OFARM states:

The growth of organic livestock across the country over the last two years has been estimated to be 50 percent, while organic feed acres have increased by only 8-10 percent. This rate of growth, combined with the increase in conventional grain prices, has meant that on farm prices for organic goods have continued to stay strong.

"For those farmers new to organic methods, taking land coming out of CRP (the Conservation Reserve Program) and putting it into certified organic production is an easy way to enter the organic marketplace," said Organic Valley CIEIO Geoge Siemon. He noted that land must be free of synthetic pesticides and fertilizers for a three year transition period in order to be certified organic. CRP land usually qualifies immediately and provides the organic premium to the grower in the first year of production.

Next winter, after all, the newly converted cows will need to eat and the lush pasture grasses they graze upon during the growing season won't come up until the spring.

- Samuel Fromartz