21 - 2009

News – White Wave Shifting From Organic To Natural

Today I saw this story in my local Denver Business Journal online, titled “WhiteWave shifts from organic to natural soybeans.” I’m not sure if you can read the entire story if you are not a subscriber, but here’s the focus:

With the cost of producing organic soybeans on the rise and consumer demand flattening, Broomfield-based WhiteWave Foods Co. — a subsidiary of Dean Foods of Dallas — ditched organic in favor of conventional soybeans in all but three of its Silk Soymilk products.

But it turns out the change is costing WhiteWave in reputation among some of its consumers.

The Organic Consumers Association has called for a boycott of WhiteWave products, which also includes Colorado’s Horizon Organic-brand dairy.

Apparently, Horizon Organic Dairy (note the “Organic” in the name) is also getting ready to roll out a “natural” rather than organic milk.
Why? Money, honey:

Industry advocates argue the introduction of natural products by leading organic companies blurs the line between natural and organic.

WhiteWave spokeswoman Sara Loveday said the company wanted to be able to continue offering its products at a competitive price, and is diversifying to meet changing consumer demand, which has been gravitating towards lower-priced, conventional milk in a broader recessionary trend of “trading down.”

Supposedly, the company is making the change to make products more affordable for consumers, but to me, the move smacks of “trading down” on the company’s ethical commitment to cleaner food.

What’s the difference? Check out this clear description from Grist magazine, quoted on the Organic Consumers Association Web site:

To speak broadly and bluntly, “natural” is meaningless and “organic” is meaningful. Tell your sister that although you won the argument, it’s actually good news for her. She can stop paying more for “natural” products and change over to certified organic products that have substantiated environmental and health benefits.

That paragraph explains about what I suspect … switching from “organic” to “natural” will allow the company to make more money by buying or raising cheaper milk or soybeans, eliminating the costs of oversight related to organic certification, and then charging the consumer more than for conventional food. Better profit margin, happier investors — and consumers will never notice, right?

What do you think about this slick move by WhiteWave?

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