Big Business Follows the Green

The labels on some of your favorite organic products are the very picture of Mother Earth. Sunlight streams over fields, birds perch in trees, rows of bright crops glisten on the hills. But read the fine print and you may find that the organic garbanzo beans or fresh apple juice you enjoy is brought to you by a conventional food processor not known for its environmental stewardship – companies such as General Mills, Heinz and Philip Morris's Kraft.

Today a significant – and growing – percent of organic foods are owned by corporations more often associated with the predations of agribusiness than with the ideals of sustainable farming. The increasing presence of conventional food processors in the organic industry is raising debate among farmers, shoppers and consumer advocates about whether the values of organic agriculture and the motives of big business can co-exist.

Does the mainstreaming of organics represent a victory for farmers and the environmentally minded, or is it a case of corporate co-optation? Can success be reconciled with the organic movement's original intent, or will the very term "organic" be rendered meaningless? How can the organic food industry be at once popular and principled?

Who Benefits Most?

"There's this image that 'organic' means local, family-owned farms," said Ryan Zinn, campaigns coordinator for the Organic Consumers Association, a nationwide network that promotes organic and fair trade foods.

"But the reality is that mainstream food processors have set up front groups," he continued. "The big point of contention is whether this is co-optation, or if the organic movement is the victim of its own success. The biggest beneficiaries are consumers, who have more access to affordable organic foods. But in the long run there's a lot of downsides. As corporate consolidation increases, you'll see a reduction of choice as small and medium-sized operations are simply pushed out of the market."

Figures supplied by the Organic Consumers Association reveal the degree to which conventional food processors have penetrated the organic market. General Mills owns the organic brands Cascadian Farms and Muir Glenn. Heinz holds a 20 percent equity share in food distributor Hain, which owns Rice Dream soy milk, Garden of Eatin', Celestial Seasonings, Earth's Best, and Health Valley, along with 15 other organic brands. Kellogg owns Sunrise Organic, while Kraft owns Boca Foods, maker of the popular vegetarian Boca Burgers. The largest organic seed company, Seeds of Change, is controlled by M&M/Mars. Your morning Odwalla is now brought to you by Coca-Cola.

The large conventional food processors aren't entering the organic market simply because they think it's a nice thing to do. They are buying up organics enterprises because it's smart business. Although organics represent just a sliver of all food spending in the U.S. – about two percent of the market – organics are the only sector of the food industry experiencing sustained growth.

Since 1997, total U.S. food sales have grown between two and four percent, according to the Organic Trade Association. During that same time, sales of organic foods grew about 20 percent. Total organic sales – food plus personal care products, pet food and household cleaners – are now at $13 billion, and projected to reach $30 billion by 2007. General Mills and Heinz are simply doing what any savvy business does: They are following the green.

We've Come a Long Way

Clearly the organic movement has come a long way from its roots. What started out as fringe effort inspired by back-to-the-land types who wanted to live in greater harmony with nature is now firmly in the mainstream, with some 58 percent of US households having purchased organic products, according to a 2002 survey. Organic foods used to be available only at local co-ops or self-described health food stores. Now you can find organic products at Safeway, Albertson's, Kroger's and even Wal-Mart.