Organic Consumers Association

Corporate Double-Speak on their Organic Food Lines

Omaha World Herald (Nebraska)
November 16, 2003
Food companies selling to both sides of the issue
By Mark Kawar

Big food companies are having their genetically modified cake and eating it,

Leading players in the food industry can make money twice from GM foods:
first, by taking advantage of the increased crop yields and lower prices of
such crops; and second, by responding to some people's distrust of genetic
modification technology to sell at a premium organic products that do not
contain these ingredients.

To navigate the GM landscape, companies must tread carefully. They must
persuade some consumers to pay more for non-genetically modified products
while not scaring others away from their mainstay products, many of which
have genetically modified ingredients.

Organic products have always been priced at a premium. But for years,
organics were the exclusive province of small independent producers who made
nothing else.

Large food companies started making organic foods only in the 1990s.

In the past two years, Campbell Soup Co., Pepsi Co.'s Frito-Lay unit and
other food industry giants created their own organic products. Neither
Campbell's Organic Tomato Juice nor any of Frito-Lay's organic chips claim
to be healthier than the companies' non-organic equivalents. They market
themselves as catering to people who were already seeking organics.

Several such consumers, interviewed at Omaha's Wild Oats supermarket, said
they preferred to buy organic food products from companies that do not also
make non-organic items.

"It sounds like the big food companies are trying to get their fingers in
all the pies," said Sandra Clifton of Omaha, standing by a shelf of Heinz
Organic Ketchup. "I want to support the same organic companies that have
always been organic."

Organic products, as defined by the U.S. Department of Agriculture, must be
free of genetically modified foods and must have been grown without
synthetic fertilizers and pesticides.

According to a study by the Organic Consumers Association, a group that
promotes organic foods, consumers are willing to pay about 50 percent more
for foods that have not been genetically modified.

At Omaha grocery stores, products like Organic Tostitos Salsa, Heinz Organic
Ketchup and Natural Lay's organic potato chips cost between 3 and 100
percent more than their non-organic equivalents from the same company. The
amount of revenue these companies make from their organic products is a tiny
fraction of their total sales.

"As long as people are willing to pay a premium for organics, you can't
fault the food companies for wanting to make a profit," said Judith
Kjelstrom, acting director of the University of California at Davis'
biotechnology program and a supporter of genetically modified foods.
"There's nothing wrong with organics. There just isn't any improved
nutrition that would justify the added cost."

Genetic modifications lower the cost of food by making crops more resistant
to insects and herbicides, thus boosting yields and eliminating the expense
farmers incur to purchase and apply chemicals, or to pay people to manually
weed fields.

About 40 percent of corn, 80 percent of soybeans and significant amounts of
other crops grown in the United States are genetically modified. Both
supporters and opponents of genetic modification agree that almost all
packaged foods not labeled "organic" contain at least some GM ingredients.

According to the National Center for Food and Agriculture Policy, a research
organization that supports genetically modified crops, such crops created a
net value increase of $ 1.5 billion to the food industry in 2001. The
savings were shared by farmers, who saw better crop yields, and food makers,
who paid less for the more abundant crops.

The group estimated that if additional genetically modified crops, which
already have been developed, had been used, they would have added another $
1 billion.

Top GM soybean producing states

(Total acres of GM crops planted and percentage of all crops that are GM in
June 2003.)

North Dakota: 2,294 74%

South Dakota: 3,731 91%

Nebraska: 4,042 86%

Kansas: 2,349 87%

Minnesota: 6,004 79%

Iowa: 8,736 84%

Missouri: 4,109 83%

Arkansas: 2,436 84%

Wisconsin: 1,344 84%

Illinois: 8,162 77%

Mississippi: 1,210 89%

Michigan: 1,533 73%

Indiana: 4,752 88%

Ohio: 3,256 74%

Top GM corn producing states

South Dakota: 3,375 75%

Nebraska: 4,160 52%

Kansas: 1,363 47%

Minnesota: 3,763 53%

Iowa: 5,580 45%

Missouri: 1,239 42%

Wisconsin: 1,184 32%

Illinois: 3,108 28%

Michigan: 805 35%

Indiana: 912 16%

Ohio: 311 9%

Percentage of world genetically modified crop production:

U.S.: 66%

Argentina: 23%

Canada: 6%

China: 4%

Other: 1%

SOURCES: World Trade Organization; U.S. Dept. of Agriculture; N.A.S.S.
Acreage Reports, 2003

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