Major Supermarket Chain in UK to Go 100% Organic

Iceland Supermarket Chain To Sell Only Organic Food
June 14, 2000 (UK)

By Padraic Flanagan, PA News

Supermarket chain Iceland was today due to announce plans to switch complete
food ranges to organic - at no extra cost to the customer.

The retailer has bought up to nearly 40% of the world's organic vegetable
crop to meet a growing demand among supermarket shoppers.

The chain, which was the first to ban genetically modified ingredients from
its own brands, is to pledge that there will be no extra cost to the
consumer.

The company is also injecting £1 million into the National Trust, the UK's
biggest landowner, for a project to promote environmentally-friendly farming..

But the firm will warn shareholders that the organic move is being made at a
price, and will result in an £8 million drop in profits by December 2000.

Iceland's managing director, Russell Ford, told BBC radio that the investment
was prompted by a survey suggesting three out of four customers would prefer
to buy organic goods if they were cheaper than current prices.

The new scheme will set organic products at the same price as average
supermarket own-label products. Frozen organic vegetables will be introduced
first.

"At the moment Britain has minimal organic production due to lack of
Government investment in the organic industry in its formative years," said
Malcolm Walker, chairman of Iceland.

"We hope that our investment will help change this."

Iceland's £1m investment will support the National Trust's farming programme,
which works with tenant farmers to develop environmentally responsible
practices.

At present, only 3% of UK agricultural land is organic and all the
supermarkets are forced to rely on imports to meet the demand.

Sainsbury's is reported to have bought sites on Caribbean islands to
guarantee its organic supplies.

But with 40% of the organic crop sown up, experts say Iceland's investment
could act spur on the rest of the food industry, increase competition and cut
prices further.

Previous initiatives by the chain, which has 760 stores in the UK, such as
the GM food ban were widely welcomed by environmental campaigners like
Friends of the Earth.

Its introduction of a range of environmentally-friendly fridges and freezers
led to its products being the only ones to gain an endorsement by Greenpeace..

The new scheme may also put pressure on the government to give more financial
help to would-be organic food producers.