Whole Foods, FTC Bury the Hatchet (finally...)

After, what, nearly two years now, the FTC and Whole Foods settled their legal battle over Whole Foods acquisition of Wild Oats.

As I wrote many times previously, I thought the heavy handed federal action was misguided because its premise -- that Whole Foods would control the natural and organic marketplace -- was flawed. They didn’t then and certainly don’t now.

So here’s what happened to the original 109 Wild Oats stores bought by Whole Foods in February 2007 for $565 million.

- 14 stores were closed and 6 were relocated.
- 35 stores were sold to Apollo Management in June 2007.

That left 54 stores, 12 of which are now for sale (plus one additional Whole Foods Market store) under the deal. If the stores don’t sell in one year, then Whole Foods gets to keep them. If they do sell, then Whole Foods ends up with 42 of the original 109 stores it bought.

In addition, the closed stores -- which total 19 if you include those shuttered by Wild Oats before the deal -- will be sold, along with Wild Oats trademarks. Presumably those shuttered stores were already on the auction block.

The FTC said:

The consent order will restore competition in 17 geographic markets that were impacted by the acquisition. In addition to requiring the transfer or divestiture of all rights to 32 stores, Whole Foods also is required to divest related Wild Oats intellectual property, including unrestricted rights to the “Wild Oats” brand, which retains significant name recognition and loyalty among consumers. These assets will allow one or more Commission-approved buyers to re-establish competition with Whole Foods in the majority of the markets in which the agency alleged the acquisition would reduce competition and harm consumers through higher prices and reduced quality and services.

But the way I see it, this battle costing untold millions came down to 12 operating Wild Oats stores  -- or 11% of the total Whole Foods acquired. Those stores created a monopoly? Go figure.

- Samuel Fromartz

How Much Water Does it Take to Make a Latte? A Lot

There's an interesting thread I blogged on over at Beyond Green about the amount of water in a latte. How much? Over 200 liters for one cup, according to WWF (via Marc Gunther's blog.)

Does this mean we should stop drinking lattes? No, but it does mean we should start thinking more intelligently about water usage. One commenter mentioned that the data requires no action. That's true on the consumer level perhaps, but awareness and knowledge breeds action upstream with producers.

Image source: Economist

White House Garden by this Summer?

Neil Hamilton, a law professor long active in the local food movement, predicts that the White House will have a vegetable garden by this summer.

"I believe that by this summer there will be a garden – another garden,a vegetable garden – on the White House lawn,” Hamilton said at a weekend legal seminar at Yale University.

If he's right, a lot of activists and foodies - from Alice Waters on down - will be quite happy. My only question is who the farmer in chief will be and whether the Obamas will upset the produce industry by going organic.

My guess: the garden will use "sustainable," low-input practices, but won't be fully organic to side-step the issue. But either way, it will be a boon for the community garden movement in this nation, showing that it ain't real hard to grow your own greens, tomatoes, peppers and okra.

So what unusual variety should the Obamas grow? My vote is for the long Asian cucumber and would suggest that Sooyow Nishiki variety sold at Kitazawa Seed Company. Sweet and prolific, one cuke can make a nice lunch salad.

Big Win for Sustainable Ag! Merrigan tapped for No. 2 Post at USDA

President Obama named Kathleen Merrigan, a Tufts professor and a central figure for more than two decades in organic and sustainable farm policy, to the No. 2 position at USDA.

This amounts to a major win for organic, sustainable and local food advocates, since Merrigan is not only well-versed in these issues but has been a tireless advocate for them. Most notably, she wrote the Organic Food Production Act -- the law that governs the entire organic food sector -- as a staffer for Vermont Sen. Leahy back in the 1980s, then worked at USDA and the Wallace Center, before moving to Tufts.  

Although she had put forth her name for an undersecretary position -- I blogged about her here -- I hadn't heard any talk that she was in the running for the No. 2 position. 

"Sustainable and organic farmers are excited ... that someone who has been associated with these issues her whole career is going to be at that level in the department," said Ferd Hoefner of the National Sustainable Agriculture Coalition.

That sentiment will be echoed far and wide.

- Samuel Fromartz

Fish on the dish in a warming planet

Global warming has started to erode coral reefs, churn up more storms and drive salt water into fresh water sources - such as this threat to the Ganges in India.

Now a new study shows that while fisheries in the northern hemisphere may bear the brunt of the impact environmentally, people in the poorest countries will suffer the most hardship as fish populations decline. Worldwide, more than 2.6 billion people rely on fish for at least 20 percent of their protein intake. 

Two-thirds of the 33 most vulnerable nations are in Africa, where fish accounts for half of all protein intake in many countries. Angola and the Democratic Republic of Congo were most at risk, though Russia stood out ranking third. Peru and Colombia in South America; and Bangladesh, Pakistan and Vietnam in Asia also made the list.

Add this report to the pressures from overfishing - from the hungry demand of Asian and European nations -- and Africa may well be at the leading edge of unsustainable fisheries.

For another perspective check out this video of a lecture by researcher Daniel Pauly, a fisheries biologist who studies populations trends. 

- Samuel Fromartz

On the Mall at Obama's Inauguration

I was on the mall in D.C. yesterday, in the frigid temperatures, in the packed crowds, with a five-year-old on my shoulders getting a glimpse of a historic moment. When I asked my daughter today what she thought about the inauguration, she said: "music, music, speaking, speaking, flags wave, yeah Obama!" And that about sums up what happened. But then, I also recall the men and women crying nearby, mostly African American, the laughter when the MC said, "now you may be seated" (we had been standing for about 2 or 3 hours by then and would continue to stand); the tidal wave of cheers when Obama first appeared on the giant TV screen; the boos at Cheney and Bush; and the loud, "yes!" and "you're right!" during Obama's inaugural remarks.

So yes, it was a historic occasion, unlike anything I can recall, having lived in DC for more than a decade now, and having come down here as a child to participate in very different kinds of gatherings on the mall - the peace demonstrations during the Vietnam War. This was far bigger, far more moving, far more inviting than anything I've seen and it literally turned our town upside down.

We live 2 blocks from the Capitol dome, our street the first one outside the security perimeter, which meant that buses were chugging down our block all Monday night. I woke up at 5 a.m. and looked out the window to see streams of people already heading down to the mall. We let the kids sleep in, so didn't forge out into the crowds until about 8:30 and by then it was like Time Square in NYC, but with the gridlock of packed crowds on many blocks. It took over an hour to get to a place I jog to in 10 minutes on any other day.

The air was also festive, people smiling at each other, saying hello to total strangers. I was humbled by the fact that I just had blocks to walk while others traveled all night to get here and in some cases didn't make it onto the mall. In fact, early on, we were locked out of the mall by police barriers, until by a stroke of good luck we passed by the gates of the Smithsonian Castle garden just as they were unlocked. A stream of people passed through and filled up the spaces on the mall. We were among them, rushing to witness the moment before it passed.

Then we stood, sipping hot cider we had brought, listening to the remarks all of you have now heard, cheering and feeling the emotion rip through the crowd as Obama took his oath of office. We could only see it on the Jumbotron, but it wasn't what you saw so much as what you felt. A sense really of being humbled by so many people feeling exactly the same thing no matter where they came from, no matter who they were. Even my 81 year old mother, watching it on TV back at my house, said she had never seen anything like it -- not even when JFK was inaugurated.

On Sunday we had also stood through the entire concert at the Lincoln Memorial, watched my peers in the crowd sing along with Garth Brooks on "Bye Bye Miss American Pie" (while younger folks looked on somewhat clueless), sang along again with Pete Seeger, his grandson and Bruce Springsteen on "This Land is Your Land," (my daughter joining in, having learned the words in school). We just wanted her to remember, to say years later that she was there, making history.

And so were we.

- Samuel Fromartz

"We're Booming!" Says Local Pennsylvania Farmer

By Don Kretschmann

Recently on the way back from the mailbox to retrieve the newspaper, I was struck by the headline: "Bad Trend." It seemed like the 30th bad news headline in a row: "A Fight for Survival." "Some Shoppers Go Without." "Financial Genius on Verge of Disaster." It was the last straw. It's time someone heard some good news!

The local food business is thriving -- despite the "real economy."

Demand for locally produced food is far outstripping supply. In my 30 years farming and marketing locally, this was our best year ever. More telling is that there has been no big "bubble" but just steady growth over that entire time. And throughout this fall there was a steady drumbeat -- like never before -- from those wishing to buy our local produce next season. I hear from other farmers around the state and other regions the very same thing.

What is making it thrive are some fundamental factors. Certainly these would lead one to think the boom isn't some flash-in-the-pan phenomenon but a truly sustainable movement.

It all starts with a geometrically increasing consumer base which "gets it" -- that real food from local sources can, and does, promote health. That spending those food dollars for local foods promotes many things most of us want -- the freshest things the earth can provide for our table at a reasonable price; the comfort of knowing where our food has come from and how it was produced, i.e. transparency and trust; and beautiful agricultural landscapes in one's vicinity. Locally produced food does all these things while tasting so ... good.

Observing firsthand the connection between our physical world and our own sustenance, i.e. having farms nearby, gives citizens a sense of peace, security and well-being. The practice of agriculture models characteristics in the human spirit that are worth encouraging -- hard work, honesty, connectedness, thrift, adaptability, inventiveness, recognition of the divine, artistry in the aesthetics of place and responsibility.

Yes, we can try to teach these things to our children in our educational institutions, but immersion is always the best teaching method. Farming exerts far more influence on the quality of our lives than even mere dollars would suggest. People are rediscovering this and the fact they value it is attested by this explosion of local food sales.

Agriculture is well-known for recycling dollars many times over as they percolate through the local economy. According to a Penn State University study, farms exact less in terms of municipal services per dollar of tax collected than any other type of land use. Using Ross Perot's words, local farms don't create a "giant sucking sound" of jobs leaving the country, but just the reverse.

Now, I said earlier that this local food is provided at a "reasonable" price. This is not the same as food provided inexpensively.

The willingness of the consuming public to pay a fair price for food reflects a fundamental change. They see nutritious food is actually a bargain when compared with purchasing cheap food which is deleterious to health, or food which is shipped astronomical distances incurring hidden costs of environmental degradation and energy dependency.

Several factors can impede this unfolding ag revolution and opportunity. One is the loss of local, small-scale food processing facilities -- slaughterhouses and butcher shops, particularly. And the other is the loss of young people to enter the field (no pun intended) who've had the experience of growing up on farms.

The first might be addressed with revamping inspection regulations and would be an excellent place to spend some of those federal infrastructure dollars. Both impediments will be addressed as talent is drawn to the good agricultural and ag infrastructure opportunities.

Maybe that other economy could take some lessons from the simple economics of good old-fashioned horse sense.

I'm always amazed how deep the real pockets of our diversified Pennsylvania farmers are. It's not paper wealth that has been created but the durable hard capital of topsoil, woodlots, cattle, orchards, fences, barns and machinery.

It's pretty typical of these farmers not to live beyond their means, to be adverse to borrowing, to take responsibility, to see beyond rhetoric and schemes too good to be true, and rather than expecting a free lunch, they provide it. Instead of spending their grandchildren's inheritance, they build it.

The "real" economy seems to have forgotten these basic lessons.

Don Kretschmann is an organic farmer from New Sewickley Township in Beaver County, Pennsylvania. He serves on board of directors of Pennsylvania Association for Sustainable Agriculture. This article first appeared in the Pittsburgh Post-Gazette.

Postcard from a Slaughterhouse: The Ones that Got Away

By Joe Cloud

One of the more fascinating things about working as a meat processor for a large number of small farmers is the diversity of their livestock. I never quite know what to expect from day to day.

On New Years’ Eve alone we had heritage Gulf Coast and Highland Cheviot sheep; Berkshire, Duroc, and Tamworth hogs; and Black and Red Angus cattle.  One Gulf Coaster was a large ram with an excellent curling rack of horns, which his owner had us save for his sons.

I completely understand that sentiment: visitors to my home are met at the end of the driveway by a large bony skull with great down sweeping horns, placed strategically where it can scare the bejesus out of unsuspecting guests when the glare of their headlights catches the thing on a dark night. The skull is what remained of a small group of Scottish Highland cattle that passed through the T&E plant.

A few weeks ago we had two of the most unusual animals I have ever seen in our barn. The owner had called to say that he had a couple of mature Texas Longhorns and asked if we’d be able to process them. “Sure, bring ‘em in" was our reply.  I wasn’t at T&E Meats when they arrived, but I was definitely impressed when I finally saw them.  Most cattle have prosaic numbered ear tags, but the tags on these animals set them—and their owner — apart. They had names, not numbers.  The black and white female was “Queen of Spades,” and the magnificent yellow-brown bull was “Gingerbread Boogie.”

His horns were an amazing 62” from end to end. And don’t think for a minute that he didn't know where those tips were. When I first went out to see him, he walked up to the door of the pen. I had heard that he was tame, so I put my hand through boards, thinking he might want his chin scratched. Well, he jumped back with a snort, glared at me, then very deliberately and slowly swung his head, bringing the left horn tip to where my hand had been. “Bam!” He slammed the tip against the stall door with impressive power.  He deliberately brought the right horn tip around and repeated the  gesture, then stared at me as if to say, “Now we understand each other, don’t we?” 

Queen of Spades lifted her tail and had a pee. I watched as Gingerbread Boogie tasted her urine, sticking his tongue in the stream, then curling his lips back and inhaling deeply to catch the fine aromas, like a wine aficionado with a premier cru Burgundy.  Bulls do this to see if the cow is coming into heat. Here he was in the abattoir, and he was enthusiastically thinking of one last fling. I admired his spirit.

We ran the kill floor the following day when I was away at a meeting. I called in for a progress report, and my staff told me that things hadn’t gone well. Gingerbread Boogie’s horns were too long to make it up the lane into the knock box, so they had called his owner to come take them back home.

I can’t say I was sorry to hear that they were back on pasture.  We have work to do, but we admire the animals and their beauty too.

Joe Cloud is a partner in True & Essential Meats, a small slaughterhouse in Harrisonburg, Va.

Organic Heavyweights Back Vilsack

In an interesting move, a number of heavyweights in the organic food and farming world have launched a website supporting the nomination of Tom Vilsack as secretary of agriculture.

The people behind this effort include Denise O'Brien, the organic farmer who ran for secretary of agriculture of Iowa; Walter Robb, co-president of Whole Foods; Gary Hirshberg, founder and CEO of Stonyfield Farms; Bob Scowcroft, executive director of the Organic Farming Research Foundation; Wayne Pacelle, CEO of the Humane Society of the United States; and many others.

I'm curious that this coalition felt compelled to take this step -- presumably to counter the criticism of groups like the Organic Consumers Association and possibly to leave open the door to Vilsack's office, once he is confirmed. As Scowcroft says on the site:

In recent weeks I have spoken to many of my colleagues in Iowa and toothers in the sustainable and organic agriculture communities nationwide. They spoke of a governor who listened seriously to their concerns and when politically possible provided workable solutions. Mind you I have no illusions concerning how “Washington works” and the challenges facing a USDA (never mind the nation and the world!) mired in systems that are unsustainable and in many cases broken beyond repair. The agro-industrial status quo will not easily give up its hold on power. Nevertheless many of us are working hard to advance highly qualified candidates for the Deputy Secretary and the under secretary positions. Governor Vilsack and the Obama Transition committee have taken our nominations seriously, and I believe they are working to bring a number of these candidates into the new USDA leadership.

Have Your Say: Organic Grazing Rule Comment Due Dec. 23

By Samuel Fromartz

If you've finished your holiday shopping and want to get your activist juices flowing, consider this for a minute: a crucial deadline is coming on Tuesday for comment on regulations for grazing organic livestock.

Grazing? Regulations? Before you click away, consider that organic dairy farmers have been fighting for at least 8 years to get a regulation in place that insures products like organic milk, remain organic. And that is important for a lot of people who drink organic milk -- the best-selling product in the organic market.

Here's the gist. We think of organic animals out on pasture, munching grass on an organic farm. But in the past, organic regulations required only that cows have "access to pasture" which was less than the words suggest. Some big operations flouted the rules, keeping their cows confined rather than out munching good, fresh grass. Access was a gate that was sometimes open, but mostly closed.

OK -- so after years of fighting, regulation writing, comment periods in which dairy farmers descended on Washington and asked for tougher regulations, the USDA's National Organic Program actually came up with one.

Parts of it are quite good, requiring at least 120 days on pasture and 30% nutrition from fresh grass. Farmers applauded. I called it a "big win for organic integrity" in a couple of media interviews.

I still view it that way -- but it needs some basic changes, ones which if they aren't made will actually have the effect of knocking the majority of organic livestock farmers out of the business.

How so?

Well, first off, the proposed regulation would require that cows be outside all year long. The common practice of putting them in a barn or a livestock pen in the winter when no grass is growing has been written off in favor of keeping them on land called "sacrificial pasture" during the non-grazing season.

That means that when the ground is frozen or covered in snow, the animals will be corralled onto a piece of pasture that is then sacrificed. The word is well chosen because the ground will be trodden, manure will accumulate and a good section of pasture will be lost probably for good due to soil compaction.

In rainy regions, like northern California or the Pacific Northwest, the situation may well be worse. Cows will be kept in muddy fields, causing manure runoff into streams, and potentially endangering the health and welfare of the animals.

"There's no recognition of regional or climate variations," Albert Straus, the owner of Straus Organic Dairy in Marin County, California, said. "If this goes through, there is a good chance we will no longer be organic."

He noted that keeping the animals out on pasture year-round contradicts state environmental regulations meant to prevent manure run-off during the winter rainy season.

In the northeast, the sentiment is much the same.  "Very few farmers use something like sacrificial pasture during the non-grazing season because they just don't have the land base, or the right soil type," said Ed Maltby, executive director the Northeast Organic Dairy Farmers Alliance, who was a vocal proponent for a new pasture regulation.

Instead, in places like Vermont and Maine, many organic dairy farmers bring their animals into barns for the coldest winter months, or keep them in barn yards where manure can be removed and fresh hay bedding provided. Then, when the grass is growing again in the spring, the cows are put out in fields.

In short, while many proponents were overjoyed that the USDA finally acted on getting a new pasture regulation, "it was way too perscriptive," said Jim Riddle, a longtime trainer of organic certifiers who served as chairman on the National Organic Standards Board that recommended new pasture regulations.

"To require an animal to graze during the grazing season does not require the level of detail in this proposed rule," he said.

There are many other issues with the regulation, but I will mention just one more -- a requirement that does away with grain finishing of organic livestock. Now, although I'm a proponent of grass-fed beef, a requirement that limits does away with grain finishing of organic beef animals would quash the organic meat market. (It does so by requiring 30% nutritional intake from pasture during the finishing period as well.) 

The result would be to block a lot of farmers from raising organic livestock and further shift the market to overseas producers in Australia and Uruguay who export organic meat to the U.S. market. (Yes, even with the growth and awareness of local foods).

Why do some U.S. organic farmers finish their animals on grain? Because they want to receive the premium they get with a "choice" USDA label, which requires the fat marbling that comes with grain finishing. They can avoid that if they raise grass fed animals and sell them direct to the public, but as much as I applaud that nascent movement, it is a minute portion of the market. Many Americans still want marbled beef, even if they are looking for the organic label.

"If the regulation stands, a lot of livestock farmers tell me they're going to get out of organic," said Dave Carter, another former NOSB chairman and executive director of the American Bison Association.

But it isn't just an economic issue. Riddle said that animals can be raised responsibly and organically and still be finished 120 days on grain. "An organic animal finished on grain is significantly different than a conventional animal finished on a CAFO," he said, because of organic requirements that ban antibiotics, hormones, and ensure environmental and humane animal treatment.

The National Organic Coalition came up with a compromise that allows grain finishing for 120 days but also requires the animals have access to pasture. At first glance, this imperfect compromise makes sense.

The main point -- the new regulation is a good one: it requires that animals graze. But it should be rewritten to be less prescriptive, so that farmers can actually meet its requirements and it achieves its broader goal; that is, getting animals out on grass but also protectng their health and the environment during the non-grazing season.

A number of organizations have the means for commenting to the USDA (with proposed language). Here are a few:

- Northeast Organic Dairy Farmers Alliance
- National Organic Coalition
- Organic Farming Reseach Foundation
- Organic Consumers Association
- Cornucopia Institute

But remember, comment is due Tuesday, so read this and act.

Image link: NODPA

Obama's USDA Secretary "Maybe Won't Suck?"

Obama's pick of former Iowa governor Tom Vilsack as Agriculture Secretary set off a round of criticism in the blogusphere, because many of us were hoping that a more progressive leader would have a shot. It wasn't to be. 

Unlike his visionary pick of Steven Chu as Energy Secretary, Obama tapped a centrist with a long cozy relationship with Monsanto -- the GMO king -- a soft touch on CAFOs (factory animal farms) and a taste for corn ethanol. These might be called the three deadly sins of sustainable agriculture.

The indefatigable Kerry Truman over at Huffington Post has a fine round up of all the criticism, but then does one better: she actually contacted someone who worked with Vilsack for years, Denise O'Brien, the organic farmer who ran for Iowa's Secretary of Agriculture in 2006. O'Brien's comments are illuminating, because she actually tried to shift the status quo in the heart of corn country. She found Vilsack listened, and even offered his support when she had a shot at state office. Sadly, she lost.

I won't summarize her sentiments -- just click on over on the link. The upshot?  Maybe the dial shifts a bit with Vilsack. But for it to go further, advocates of a very different vision of food and farming will have to keep up their work. Recall, after two decades of pushing for reform, it's still the early innings on the national stage.

Organic Sustainable Department of Food?

Jim Riddle, a former chair of the National Organic Standards Board who is now organic outreach coordinator at the University of Minnesota, tells me he is actively seeking a position at the USDA.

If he is named as organic adviser to the secretary, or head of the Agricultural Marketing Service, this would be a big gain for sustainability. Riddle worked tirelessly for years on the NOSB, trying to keep organic food truly organic. And he did that while working in partnership with the USDA -- not an easy feat. He has trained organic inspectors since the late 1980s and walks the talk.

"My wife, Joyce, and I have lived off the grid since 1984, producing all of our power from the sun, wind, and woods, living in our owner-built, energy-efficient earth-sheltered home. We raise a big garden and put up much of our food. For us, sustainability and green living are not just slogans – they are a way of life," he says.

I already noted that Kathleen Merrigan of Tufts is angling for a major post in the department. If Obama is serious about change -- in the food and agricultural sector -- these are the type of appointments his team should make, mirroring the encouraging news of Nobel Laureate Steven Chu to head the department of energy.

As for agriculture secretary, Nicholas Kristof put it well in the NY Times -- it's time for Obama to shift the focus of the department away from agribusiness interests and put it squarely on food.

He also linked to a petition advocating several names to head the department -- which I previously signed. The Ethicurean blog also has a good post summing up the leading candidates, the gist of which is that no front-runner has emerged.
- Samuel Fromartz