Posts Tagged ‘food system’

The weekend has arrived and it’s time to stock up the fridge and replenish the cupboards. Where do you choose to shop: the supermarket chain in your town? Whole Foods? Trader Joe’s? Or perhaps, your local food co-operative?

Many of us who are concerned about the food we eat – where it comes from, who grows it, and how it’s grown, processed, and distributed – choose to buy our groceries at the local food co-operative, where we may also choose to become members. Why favor food co-operatives over other grocery stores and supermarkets? For some, it’s to support the ideals of community control and democratic ownership. There’s a sense that the products on the shelves are healthier for us, the farmers, and the planet. Many engaged consumers also believe that food co-operatives provide a greater selection of organic, local, and Fair Trade products and will come from companies that share these principles.

For those of us who are deeply committed to these values, there’s a desire to see them reflected in our food choices: it’s just another way of voting, only in place of ballots, we’re using our consumer dollars. There’s an assumption that most, if not all, of the brands being offered also reflect this commitment to small farmers and businesses, organic and natural farming practices, and whenever possible, are locally or Fair Trade produced. I believe that most food co-op members and consumers want to know that the companies behind the products share a commitment to social change, democratic principles and are working as part of the movement to create a green and just food system.

Alas, this is not always the case. It is not even often the case.

Even natural and organic products’ origins get tricky. Check out the flow chart below, created by Dr. Phil Howard, a professor at Michigan State University who is pioneering research into the corporate consolidation of our food system.

Do you see your favorite organic brand mentioned above? Are you shocked, as I was, to see how many of those companies are actually owned by the likes of Coca-Cola, Kraft and Cargill? Is it disheartening to discover the degree to which a few corporations and their subsidiaries currently dominate the natural foods industry? Do you think that they share the same commitment to growers and consumers, workplace democracy, a transparent and fair food system (up and down the supply chain), and a healthy planet? How easy would it be even to learn this information?

On Phil Howard’s website, you can get a better view of these charts and learn more about these disturbing trends. You can also read an excellent interview with him that Equal Exchange’s marketing writer, Ashley Symons, conducted during Howard’s 4-day visit to Equal Exchange in June of this year. During our exchanges with Dr. Howard, he showed us a number of slides which graphically present how increasingly consolidated the organic industry has become. In every aspect of the supply chain – production, processing, distribution and retail – the entire food industry is in the hands of fewer and fewer multi-national companies. And so, if you thought that there was something different about the organic industry, think again.

In stark contrast, Howard has also published an “Independents” chart that represents the minimal presence of independent and cooperatively-owned businesses in the national natural foods market. You’ll see Equal Exchange on there, along with three other cooperatively owned businesses: Organic Valley, Alvarado Street Bakery, and Frontier Natural Products. Not many, are there?

Why does any of this matter?

As a co-operative business, Equal Exchange’s model shares many values with our food co-operative partners and their members and consumers. We believe in an economic model and supply chain that emphasizes small-scale farmers, independent business owners and co-operatives. We want our purchases – as a company and as individuals – to support other companies and co-operatives that are trying to restructure and revitalize our food system by strengthening democratic models, practicing sustainable agriculture methods, and whose missions share the goal of providing food for people not for the profits of a handful of food conglomerates.

What can we do about this imbalance in the food industry, now being mirrored in the organic industry? How do we “take back” our food system?

The comparison between corporate businesses versus independently-controlled brands and products is startling and bleak, but it is our belief that the actual situation is much more inspiring. The solution to corporate domination barely exists on a national level… yet. By its very nature, the hope of the organic and Fair Trade movements (as they were originally conceived) exists in co-operatives and in pockets “off the radar,” locally and regionally. Small farmers, co-operative food companies, and regional independents supply their local co-ops with produce, dairy, baked goods and bulk products. They are the real champions of a more just and environmentally-responsible food system.

Once awareness of the trends in the organic industry (which parallel similar trends in the media, banking, and other sectors) grows, it will be easier to take action. As more and more people begin to grasp the impact a corporate controlled food system is having on our lives and our planet, we believe it will be easier to take the appropriate actions – both through political arenas and through our own individual and collective behaviors.

We can take back our food system!

At Equal Exchange, we believe that the first step in fixing this broken and imbalanced food system is to understand how it currently works and who it favors. Next we can begin imagining the system we want, and working together, we can make a better, more fair system possible. This is the movement that food co-operatives, interfaith groups, and engaged consumers helped build with respect to Fair Trade, and prior to that with organics. Now it’s time to go even deeper. We believe that Phil Howard’s research and these charts are providing a great contribution to advance this movement.

We are currently working with food co-ops to help them create their own “Independents Chart” that shows the regional, independently-controlled businesses that are making a difference in their area; companies at the cusp of sustainable agriculture, community activism and social responsibility. We believe that by providing this type of information to co-op members and consumers, we can begin to help each other make more conscious choices to support the brands that are more closely aligned with these values. In this way, food co-operatives, committed to building a supply chain for people, can continue to educate members about the extent of corporate domination, but also offer an alternative – one the supports communities, co-operatives and the environment.

Nick Reid, a salesperson with our Natural Foods team, teamed up with one of our long-time food co-operative allies, Sevananda Natural Foods Market in Atlanta, Georgia, to come up with a chart that shows the local, regional and independent vendors whose products are sold in their store.

In the case of Sevananda, the choices are clear.  Consumers do have viable choices.   But informed decisions require information.  We believe that this is the starting point… where we end up is our choice. And it starts with the next trip for groceries.

What do you think?

Nick Reid contributed to this article.

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It’s a question Dr. Phil Howard, an assistant professor at Michigan State University, has spent a lot of time trying to answer. Howard’s research focuses on the food system, the changes occurring within that system, and how those changes affect communities. So why does it matter? Many consumers choose foods that come from organic small-scale or family farms, because they don’t want to buy foods from multinational food companies.Little do they know, what appears to be organically grown by a family farm, while still organic, might actually come from a major corporation like Coca Cola, Clorox or Kraft. But because parent companies aren’t required to put their name on packaging, it isn’t always obvious who actually owns the product.One of Howard’s main projects has been to figure out who has that ultimate ownership. To demonstrate his findings, Howard created several visual representations, which are available on his Web site. The charts certainly get the point across: The organic industry is becoming increasingly consolidated.After seeing Howard’s charts and hearing him speak at our Annual Retreat, I had the opportunity to ask some more questions about his research.

AS: What does the consolidation of the organic food industry mean for consumers? Why should folks care who owns what?
PH: Consolidation in the organic food industry means that fewer and fewer people are making decisions about how organic food is grown, processed, distributed and sold. If you want to have a voice in these decisions you should care whether the people involved are likely to be receptive to your concerns, or if they are only accountable to Wall Street.

AS: How does this consolidation affect food quality?
PH: It’s hard to say with certainty. Some companies that have been acquired by multinational food processors have maintained their quality, while others have worked to increase profits by cutting costs in ways that we might not be happy with. This might mean importing more organic food ingredients from countries where wages are lower. Or in the case of Odwalla after its acquisition by Coca-Cola, it could mean dramatically reducing the percentage of organic ingredients.

AS: What affect does consolidation have on organic farmers, specifically small-scale farmers?
PH: Some small-scale farmers have lost price premiums which enabled them to stay in business, as larger farms were able to achieve economies of scale and/or externalize some of their costs. Others lost markets as the retail environment changed. For example, as Whole Foods grew they centralized their distribution system. They are now much less willing to buy from a small-scale farmer for one store, when they can buy from a large-scale farmer who can supply stores in an entire region. Consolidation in retailing also makes farmers more vulnerable in price negotiations with supermarkets. Farmers without other markets may have no choice but to accept a very low price for their product.

AS: Why did you choose organic consolidation as your research focus?
PH: Like most of my research, it was the result of responding to questions people asked me. I studied consolidation in commodities, dairy and supermarkets at the University of Missouri. When I talked about these trends in California people suggested I look at the organic industry, because it was happening there, too. Then people asked me which organic companies were still independent, so I put together a short list of some of the largest, nationally distributed independent brands.

AS: “It’s a chart that’s worth a thousand words,” wrote Laura Sayre about your organic industry chart. When did you start making your consolidation flow charts? Why did you choose this visual format?
PH: I started the first chart in the summer of 2003, to accompany an article on the broader topic of food system consolidation for California Certified Organic Farmers magazine. I chose a visual format primarily because it helped me to make sense of the situation in a way that a text-based list could not. I was able to see the whole picture with just a glance. Most people are able to take in more information with their sense of vision than their other senses, even before paying conscious attention. A new field of information visualization is developing to take advantage of this capacity.

AS: In your opinion, is it better that the organic industry ‘goes mainstream,’ by superstores like Wal-Mart starting their own organic lines and making organic options more available to a large number of consumers, or does this ultimately have negative implications for the organic industry?
PH: There are some positives in terms of reducing synthetic pesticide use, which is often used to rationalize this process. Ultimately though, if you have other concerns such as social justice, ecological sustainability, humane treatment of animals, or democracy, we need to recognize that what is now called ‘organic’ does very little to incorporate these concerns. They may have been ideals at the beginning, but they didn’t make it into the USDA standard.

AS: What can consumers do to help stop the consolidation?
PH: One way is to support smaller-scale and independent farms and processors through your purchases, if you can get that information about size and ownership. Sometimes this will mean paying a bit more, because big corporations can afford to sell at a loss if it means driving competitors out of business. Political action to enforce anti-trust laws and stop subsidizing the largest players is also needed. The Agribusiness Accountability Initiative is a good source for more information on what’s happening and how to get involved with global responses to these trends.

AS: Any recent discoveries you’d like to share?
PH: Private label organics is a very recent trend, and growing very rapidly on a global basis. Safeway introduced its organic label less than three years ago, and it has grown to include 300 products. What’s most interesting is that they are licensing it to other retailers, so you can now find their O Organics products in a French supermarket chain’s stores in Taiwan.

AS: What’s the best way for consumers to stay informed on this topic?
PH: Watchdog groups like the Organic Consumers Association and the Cornucopia Institute are good sources for staying informed, particularly for efforts to weaken organic standards.

View or download Phil Howard’s consolidation charts here.

To read more about who’s behind your organic food, click here and here.

This article originally appeared in the August/September 2008 issue of What’s Brewing.  To read other issues of What’s Brewing, or to add your name to the email list to receive these e-newsletters, click here.

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In her blog, GreenLaGirl, Siel wrote about the issues presented in the Business Week article, “Is Fair Trade Becoming ‘Fair Trade Lite’?” and asked those of us at Equal Exchange why we were so opposed to the idea that plantations and multi-nationals should be operating within the Fair Trade system. Siel wondered if EE is simply nostalgic for the good ole days of co-ops, or if being a co-op means we only want to work with co-ops. Similarly, Jaqui de Carlo asks in her blog, Fair Trade Beginners, can’t fair traders be more inclusive – why can’t Chiquita sell fair trade bananas as well as Oke USA?

Both Rodney and Nicholas have written responses to Siel’s blog, so I won’t go through and repeat their arguments about why it is not just ideology, nostalgia or a desire to be exclusive, that keep us following our own path regardless of the direction being pushed by the Fair Trade certifiers. Please read their comments for some great reasons that should help clarify our position.

Personally, I think it comes down to the question of what the goal of one’s work is and how to best achieve it. Paul Rice, Executive Director of Transfair, was quoted in Business Week as stating that the goal of Fair Trade is to help poor people. While there’s nothing wrong with helping poor people – I prefer to work along side others who want to change the conditions that actually create poverty and injustice. Not just to help – but to change the system. To me, Fair Trade is more than a higher price, as important as that higher price is to the farmer who receives it. It’s more than a supply-side strategy in which the more people buying and selling Fair Trade, the better. It cannot be reduced to a seal; rather it is a holistic approach to economic development and political empowerment and self-determination.

How ironic. During the same week that Business Week came out with their article entitled, “Is Fair Trade Becoming ‘Fair Trade Lite’?” by Pallavi Gogoi, Alternet printed, “Why Fair Trade May be Our Only Hope,” by George Monbiot (originally published in the Guardian). If you want to understand why we should be supporting small scale agriculture, please read this latter article. Monbiot clearly explains why small-scale sustainable farming is the only solution to our multiple problems of environmental protection, feeding the poor, and providing for dignified livelihoods for farmers.

Here are some excerpts:

“…Though the rich world’s governments won’t hear it, the issue of whether or not the world will be fed is partly a function of ownership. This reflects an unexpected discovery. It was first made in 1962 by the Nobel economist Amartya Sen, and has since been confirmed by dozens of further studies. There is an inverse relationship between the size of farms and the amount of crops they produce per hectare. The smaller they are, the greater the yield.” (more…)

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Equal Exchange was founded 22 years ago to change the way business is carried out and trade is conducted; to expand and deepen the opportunities for consumers and producers to relate to each other; and to change an anonymous, corporate-controlled food system to one in which each participant is treated with respect and dignity, and whose contribution is recognized and valued. Integral to this vision is an economic model that builds vibrant, healthy businesses and communities.

Together, we’ve accomplished a tremendous amount and have successfully paved the way for each of these goals to be realized. Through our co-operative structure, and by supporting other co-operative business models, we are building an alternative network of democratic, mission-driven businesses that place relationships above the bottom line. Fair Trade has entered the mainstream; consumers are increasingly demanding information about where their food comes from, insisting that conditions are fair for those who grow it, and increasingly see themselves as advocates for a just food system and a healthier planet.

We’ve made enormous strides. And we’re proud. We hope those of you who have walked this path alongside us share in this pride as well. But, despite tremendous efforts and accomplishments, sadly we are still swimming upstream. The world around us continues to be dominated by corporate interests and greed. Trade agreements favor the interests of multi-national corporations and treat workers and producers as objects (and their products as commodities) to be discarded when they no longer serve. Climate change is wreaking havoc on poor communities and small-scale farmers are being disproportionately affected. Taken together, these agricultural and trade policies and changing weather patterns are threatening entire communities, the quality, quantity, and price of our food, and the planet itself. We can’t really afford to rest on our laurels. (more…)

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