Organic Fertilizer Development Gains Steam

Several companies are either developing, or partnering with other groups to develop, an organic fertilizer that can handle a larger quantity of crop yields. This is in response to the anti-GMO, anti-genetic engineering sentiment that has been rapidly growing within the consumers in both America and Europe in recent years.

The push to develop an organic fertilizer that is capable of this production yield stems from other scientific studies of soil. Those studies demonstrated that farmland treated with organic materials for fertilization was in more favorable growing conditions (soil microbial abundance is the official metric) than the farmland treated with nitrogen based fertilizer products.

In a report from CNBC one such company, Abundant Farms, recently hired a new director of technology who has a background in developing prototypes of organic fertilizers. The plan is for the company to test some of these products in a “scaled up” prototype scenario in test market farms in designated areas in the United States as well as in Romania in Eastern Europe.

Romania is one of the top producers of corn and some other crops in the world and will provide an excellent test market for this new organic product for crop treatment. The country distributes their crop production throughout the European Union and the world.

Abundant Farms partners with governments and farmers to provide solutions that are environmentally friendly. This is a time period of increased consumer scrutiny of food ingredients and where as well as how food is sourced and produced; the timing of these developments in organic farming is highly relevant.

Melior Resources, a company with an international presence just announced a strategic partnership with an Australian based organic products company, SOFT. The terms of the agreement essentially translate to Melior buying and distributing organic fertilizer products which SOFT will create and scale up.

The first organic fertilizer product in the pipeline for this new strategic arrangement is derived from a substance called apatite, which is a mineral sourced in Australia, among other places. The apatite from a specific mine in Australia has different properties that are not found in other versions of the mineral from other parts of the world.

The apatite that Melior/SOFT will be utilizing has no cadmium and no lead which lends itself well for use in fertilizer. SOFT has a unique technology to refine raw apatite into organic fertilizer.

In addition, according to the joint press release, this particular apatite from the Goondicum mine in Australia has a slow release phosphate effect. This slow release characteristic makes it ideal for organic fertilizer because it is not harmful to waterways or areas surrounding where it would be utilized.

The joint venture between the two companies is for ten years and the results of the combined strengths of the two partners should yield beneficial products for the consumer relative to the pushback being given to GMO containing and genetically engineered products.

The subsequent increase in organic farming necessitates the demand for more options with organic fertilizers, especially products which can handle higher yields. The expansion in supply of organic corn, soybean, and sugar beet are critical to the future of organic farming.

The LA Times produced an insightful report on the future of organic farming by taking a different perspective. The report states that the world could grow and sustain more widespread organic crop yields if our global society embraced two very important concepts: reduce food waste, and consume less meat.

This is due to the amount of land and resources required to maintain livestock for the consumption of meat. The rise in organic farming would have an environmental safety benefit because of the reduction in the use of chemical fertilizers, but organic farming is plagued by the “yield gap”.

The “yield gap” is the amount of land required to farm within organic standards. The practice of organic farming need more land because the yield level on an organic crop is smaller than a standard crop which uses nitrogen based fertilizer products. The rise in organic farming could have a potentially negative side effect when you consider the impact of deforestation to narrow the “yield gap”.

The concept of food waste is a “first world problem” but it is a significant contributor to the current food supply situation as well as a challenge to the future growth of organic crop production. The reduction in food waste can be achieved through greater awareness, through adjustments in food consumption, through more conscious food purchasing decisions, and by consistently checking your refrigerator by rotating food by expiration dates.

The ability to slash food waste is a grass roots approach, it is done at the family level which will extend to whole communities. The scientists in the LA Times feature are conducting multiple studies which examine the amount of crops and acreage are used for growing feed stock, compared to land used for growing food for human consumption. The analysis is then done to determine the conditions needed for organic farming yield targets to be attained considering demographic factors such as population growth.

One study concluded that the food waste globally would need to be cut in half from current levels, and that all the land used for feed stock would be needed for organic farming. The reduction of meat consumption to zero is an unrealistic outcome, so there are other studies targeting a 50% reduction in meat consumption by 2050.

Those are macro level changes over the long term, the micro level changes occur through more locally grown produce. The community farmers market approach is another viable method of expanding the organic foods approach.

Finally, the growth of organic fertilizers, and the commitment from the agriculture products industry to the development and scaled up production of high yield options for farmers will be a key in the movement toward more organic food in our global supply chain.

Follow Up: The GMO Labeling Debate Continues

The GMO labeling debate continues on, now almost eighteen months after the 2016 bill was signed to require food producers to disclose genetically engineered or genetically modified ingredients on the labels of consumer products.

The debate at this point centers around new legislation in Congress that the big lobbying groups, such as GMA (Grocery Manufacturers of America), are advocating for which will allow some loopholes to the disclosure of genetically altered ingredients.

This week in the news, the GMA suffered a setback when Nestle decided to join The Campbell Soup Company and withdraw from the GMA over the issue. Nestle and Campbell Soup disbanded their membership in the group over this contentious issue of GMO labeling.

Both Nestle and Campbell Soup favor more transparent disclosure of genetically modified or engineered ingredients. In a previous article I produced, the decision by The Campbell Soup Company to make a full disclosure of GMO ingredients before it was required by law brought significant traction and attention to the legislation that eventually gained passage in 2016.

The GMA group wants less transparency in the process, and the opinion of the Nestle and Campbell Soup is that direction will damage the relationship with the consumer more than just disclosing the presence of GMO ingredients up front. The average consumer today has far more information available to them and many shoppers are significantly more health conscious than in prior generations.

However, at the same time, some consumers do not care about GMO or genetically engineered ingredients in their food. Some consumers have a favorable view of GMO ingredients and feel they are safe. Many consumers are making purchasing decisions strictly based on price, and they cannot afford to stretch their budget to buy products that do not contain genetically engineered ingredients.

The other force at play here is that depending on the type of grocery item on the list, the non-GMO versions are either difficult to find or do not exist. The second most important attribute to shoppers in grocery channel surveys after price/value is time/convenience. The average shopper has a very busy lifestyle and most people have what they would term “time sensitivity” and that is a huge component in some shoppers just doing the “grab and go” without reading labels.

It should be noted that the majority of Americans have a negative opinion of GMO and genetically altered or engineered ingredients in food products. It has become an issue where the consumer is making purchasing decisions based on that one factor, which makes the labeling transparency crucial.

Some food companies have noted sluggish sales of certain product categories and are rapidly designing alternative versions that are either organic, gluten free, soy free, or GMO-free.

The current legislation regarding GMO labeling has a few different options for the food producing company with regard to the design of their label deck. The first option is to highlight the ingredient(s) that are genetically modified and then put a disclaimer below the ingredients list that the highlighted items are made with genetic engineering.

The second option is to place an asterisk next to the ingredient(s) that are modified or genetically altered and then below the ingredient list have a similar disclaimer as option one: made with genetic engineering/modification.

The third option is to not highlight or asterisk any individual ingredients on the label and put some type of bold or highlighted statement reading: this product contains ingredients made with genetic engineering.

Then what is known in the industry as “option four” which is going to become more prevalent on packaging and label decks for companies who want to be less transparent about their ingredient statement. This option allows the food producer to put the disclaimer of the genetically altered or engineered ingredients on a document that can only be found if the consumer scans the QR code on the package.

The lobbying and special interest groups for the GMO free or those against the use of genetically engineered ingredients in our food products have several issues with this option for disclosure.

The first point of contention being the obvious one, the consumer has limited time and yet they are going to have to scan a QR code on individual packages and then read the disclosure statement to determine whether or not it is genetically modified, that is an unrealistic expectation.

The other major point of concern is the elderly, the economically disadvantaged, and those with other physical handicaps do not have access to the technology needed to scan the QR code to find this information.

The option four labeling is also being used on items that the average consumer would not anticipate being genetically engineered: such as grapes, certain types of juice products, and bottled spices. This option, just at face value, seems dishonest to the consumer as well.

The role of the QR codes in the labeling of food products and disclosures in any future legislation remains to be determined. It is definitely going to be one point of contention moving forward.

The labeling of food products and GMOs took another on another aspect in the news this week, with a major news organization publishing a story based on the results of a study published in JAMA where scientists analyzed the effects of the pesticide called Roundup.

The study found that people living in Southern California in recent years have had an increased level of glyphosate in their system which is the active ingredient in that pesticide product (see my earlier article on the effects of this product and the food supply) it is increased about 500%.

The study in Great Britain of the effects of glyphosate on rats demonstrated an increased level of liver disease and liver cancer. This is something that the scientists will monitor in California with their study participants. In fair balance, it is not known whether the increased levels in Southern California are due to the ingestion of foods with higher levels of GMOs, or if the participants breathed in particles of the pesticide from nearby farms.

The use of pesticides, herbicides, and genetic engineering has altered our food and our crops. It is trending in lockstep with an increased rate of illness in Americans from higher rates of cancer, to autoimmune diseases, autism, Parkinson’s disease, and dementia.
The American public should have the right to know if the products they buy to feed themselves and their families contain ingredients that are genetically modified or altered. It should be up to the consumer to make their own choices based on having all the facts in front of them.

The debate on GMO labeling and whether or not genetically modified foods are safe will continue on, and what is left is for you to decide which side you will be on.

Follow Up: Honeybee Population Decreases In U.S.

In a follow up to a previous article, the news on Friday is not good regarding the honeybee population. In a report by USA Today about one third of the honeybee population in the United States died in the past year. This decline in the population levels can have far-reaching consequences for our domestic food supply.

The honeybee is responsible for an estimated one out of every three bites of food that the average American consumes each day. The combination of pesticides, environmental changes, and parasites have triggered a dramatic decrease in the population of this crucially important insect.

This survey does report that the winter seasonal losses were the lowest for American bees in a decade. The winter is a characteristically a period where honeybees will die in larger numbers due to the climate conditions. The experts analyzing this report stopped short of saying that the winter loss number was good news because the overall population numbers have declined so precipitously in recent years.

Some crops are almost completely dependent on the honeybee, and those shortages in supply levels are going to result in higher demand. This higher demand with smaller supply levels will result in higher prices that will passed along to the consumer. This includes items such as almonds, raspberries, and other fresh fruits or produce.

The rise in the growth of the organic and farm-to-table movements put a premium on beekeeping and balancing the protection of the bees from parasites against the utilization of harsh chemicals or pesticides. There are certain pesticides and herbicides that are widely used in agriculture that attack the central nervous system of bees causing them to die.

The greater emphasis should be placed on decreasing the chemicals and pesticides used in the production of certain crops. Some states have already initiated areas for honeybee preservation as well, so those areas have many restrictions as far as the use of pesticides and other airborne agents.

The honeybee is vitally important to our food supply and while the winter losses in 2016 were better than recent annual findings, the population is still depleted by one third. It is clear that steps need to be taken to preserve the honeybee colonies in the United States. It is unclear at this point what those steps will be moving forward.

Follow Up: Lower Food Costs and the Impact on the Restaurant Industry

In a follow up to my most recent piece on the lower cost of food commodities and the impact on the retail grocery channel; the Chicago Tribune published an interesting article on the relationship to those lower costs and the impact on the restaurant industry.

The article describes the fact that the falling food prices for staple items such as beef, eggs, and other commodity products has not translated into lower prices at restaurants. In fact, dining out is more expensive than it has been when compared to eating at home, that ratio is at the highest difference in three decades in the United States.

I was thinking about this connection myself last week when I was working on the piece on food commodities. It came about at a couple of different points last week: I had picked up some mail and the menus for some restaurants in my area were included in the ads and coupons. The prices on some of the menu items really jumped out at me for being expensive. Then, I stopped one day last week in a time crunch to pick up lunch and it was pretty expensive compared to the servings of what I had ordered.

I kept thinking about people that eat lunch out every day and how that cost will definitely add up over time. In keeping along that line, just take an example of ten dollars a day for lunch during the work week. That ends up being fifty bucks per week and two hundred dollars per month for lunch which will end up being close to two thousand four hundred dollars per year, give or take. That is for one person, for lunch, and an average cost of ten dollars. That is a lot of money for the average family.

The lower cost of food has had the reverse effect on restaurants because the cost of running and maintaining the business has not decreased. The restaurant has to be staffed and it has significant overhead costs with insurance, energy, and other costs associated with running that business.

In order to maintain profitability amid an increasingly competitive market, most restaurants have had to increase their menu prices. The other pressure point for restaurants, especially the traditional sit down places and the fast casual chains, is that the grocery store channel has become increasingly more relevant in the prepared foods area.

The local grocery store in your neighborhood and mine now has expanded upon the offerings for prepared meals to go which suit our active lives and are at a lower price point than going out to eat. I think we all can attest to a recent shopping trip where we have grabbed a cooked rotisserie chicken for dinner or put together a meal on the go from a huge selection of choices at a Whole Foods or a Shop Rite.

The numerous alternatives at the grocery store and the emergence of fast casual dining options such as Chipotle, Salad Works, and a few others have impacted the margins of the traditional restaurant channel as well. The Tribune article cites the troubles of Chili’s and a few other regional Midwestern chain restaurants in surviving this trend. The article as well as other industry resources mentions the higher minimum wage in certain states as another mitigating factor in the demise of certain restaurants in this climate.

The fast casual or traditional fast food options have lower overhead because the employees are members of a “crew” where each person is cross-trained and can complete a variety of job functions. This approach has helped them sustain profitability more than a traditional sit down restaurant but even the fast casual and fast food operators are encountering issues with falling food prices and an uncertain economy.

Many consumers are opting to save money in their budget and eliminate eating out and they are staying home. The more health conscious consumer prefers to make their own food at home with ingredients which they select, which is becoming a larger trend resulting in eroding profits in the restaurant sector.

The fast food channel has displayed several indications that they are at an oversaturation point. The industry is focused on rolling out new product offerings or seasonal products to attract new customers. The major players in the industry are putting together special promotions and full meal deals such as “4 for $4” or a “McPick Two”, to drive the value to the customer.

However, even with all of those efforts in marketing, the channel is hitting a point where it cannot grow profits. Therefore, they all made a push for breakfast and that is the final frontier, so to speak, for the fast food industry to grow profits. It is the last untapped revenue stream available to them where they can maximize the lower commodity prices for eggs and other staple items to put together a profitable set of menu offerings. The demand for a fast breakfast is also very robust for the American consumer that is seemingly always rushing around in the morning to start a very hectic day.

The traditional restaurants are going to struggle in this scenario because it is hard to compete on cost with other establishments and the fast casual/fast food/grocery prepared foods channels while maintaining their profits. It is a situation to bear in mind as the commodity pricing on food overall, and certain products such as beef and eggs in particular, will remain at a point where the restaurants and the grocery stores will feel the squeeze for the foreseeable future.

Food Commodity Prices Drop

The average shopper in America has probably noticed the changes in price for several commodity items in recent months. The falling prices are due to a combination of factors such as decreased costs of fuel and product packaging materials. Some other areas such as with meat and eggs, those commodities are in a cost reduction due to some external factors surrounding supply and demand.

The egg market segment has seen prices drop about 50% according to industry sources. The price of eggs, as many consumers will recall, increased sharply due to the avian flu epidemic. I recall going to my local grocery store and the signs that were hung just about everywhere in the cases surrounding the eggs and dairy products regarding the shortage of eggs due to the rampant spread of that illness.

The price of eggs had to adjust and correct itself when the supply levels returned back to normal levels with the increased number of hens into the system. That is the rationale behind the drop in prices for eggs as well as the shift in overall global demand for the product. The demand curve surrounding eggs in China and other parts of Asia has flattened, it has decreased over the past several months which creates a supply abundance and consequently lower prices.

The pricing shift on meat is a similar scenario. The cattle population in the U.S. had some issues between disease and other factors which impacted the population and created a supply issue. This lead to an increase in beef prices that many of us remember between the grocery store butcher department and the menus of our local restaurants.

The supply of cattle has increased over time and the supply for beef as a commodity is oversaturated due to current market demand factors. Some of this is driven by the healthier eating trends of Americans where red meat is more limited than at other points. The industry experts have reported that the supply levels of beef are so high compared to the demand that the prices will remain low until 2019.

The price points of other food products have come down in relation to supply, lower delivery costs, and a host of other scenarios. The timing on the price changes as we head into the Thanksgiving/Christmas/ Holiday Season is fortuitous for the food product suppliers, the distributors, and the retail grocery as well as club store channels.

The retail grocery channel is a low margin business structure to begin with and these price fluctuations over the past few years on certain commodities have cut into those profit margins even further. The ability for them to turn around and sell these products at the holidays is going to help their revenue forecast to close out the year.

The price points on so many other products and services are going up, I thought it would be comforting to note that our food prices are coming down, and considering the necessity of food, that is some welcome good news heading into the holiday season.

Bayer Beware: The Monsanto – Bayer Merger

I write often about mergers and corporate takeovers here on Frank’s Forum so the opportunity to offer some commentary on the largest merger of the year was an opportunity I could not miss.

In between research and drafting of other pieces I have in the pipeline, and a final draft submitted for editorial review, I was reading the mainstream coverage of this gigantic transaction on Forbes and CNN Money among others.

I am not sure what I am more surprised about: the fact that Bayer made a third attempt which was more outrageous than the first two attempts to get this deal done, or that I knew that this merger deal was going to be announced before the end of the 2016 calendar year.

I thought the Dow and DuPont proposed deal was huge and scary (which it still is) especially given the implications for the seed market. However, this move by Bayer is also very large and bold with the valuation they put on Monsanto stock ($128 per share) and the clause if the deal does not meet regulatory approval (Bayer would pay Monsanto $2 billion). All of these factors and many more make this deal the most influential merger of the year.

The total valuation when this deal is broken down means that Bayer put a value on Monsanto of $66 billion. The deal, if approved, would do two things right away: have a huge impact on the U.S. seed market where Monsanto is the top player in that marketplace and dramatically expand Bayer’s North American footprint.

American Dream or Nightmare?

The value to Bayer is undoubtedly the opportunity to enter the North American market in a top strategic position and expand upon that through other product areas and industry segments in the future. Bayer is much more recognizable in Europe and Asia than in any other areas of the world, so growth into an essential and largely untapped marketplace for some of their products was the main impetus.

In the case of Monsanto, which has been dealing with an endless onslaught of negative publicity regarding their products and GMOs, the deal makes a lot of sense when you consider that the Dow-DuPont merger looks like it is gaining traction toward approval by regulators throughout the world. That deal did hit a snag in Europe recently, but if you are Monsanto, you proceed thinking it will eventually get done and they will be a tough combined duo to compete against.

The premarket trading of Monsanto stock, as noted by CNN Money, was $104 per share and that sort of gap between that number and the merger valuation of $128, in my time of covering M&A activity usually means that Wall Street is anticipating this deal to not be approved through regulatory channels.

Bayer is thought of in America as the company that makes aspirin and Claritin, but the reality is that they are a major player in other parts of the world in petrochemicals and agricultural chemical products. They have a position in the agricultural seeds marketplace in other regions of the world as well, and from that perspective this deal makes sense.

Why Monsanto?

Although I had a strong feeling that this outcome was going to take place with regard to this merger, I still keep coming back to the question: why would Bayer want to purchase Monsanto? I understand that Bayer swung and missed at a deal for Syngenta, another major American seed manufacturer (which is in the process of being purchased by a Chinese company, ChemChina).

Monsanto has so much baggage with the P.R. nightmare over the perception of their products in the marketplace, the potential links to their products and certain cancers, and the inevitable GMO questions. It is also no secret that I hold Monsanto responsible for putting greed ahead of the health and wellbeing of people. I have read enough data and reviewed enough clinical trials to understand the effect of pesticides and herbicides on both humans and wildlife to know that my opinion of Monsanto is not very favorable, to put it diplomatically.

Bayer top executives may have felt that the Monsanto acquisition was the best pathway to getting the market share they desired in the product areas where they have synergy in order to compete with Dow-DuPont in both the North American market and the global marketplace.

Heavy Scrutiny

This deal, make no mistake about it, will be scrutinized heavily by the political powers at play here; other online news sources are already running separate stories about that aspect of this proposed merger. Bloomberg featured a story on the merger’s impact on the cottonseed industry which if the two companies joined forces they would control a staggering 70% of the market. What further complicates the deregulation of this particular market is that Monsanto sold a piece of their cottonseed business portfolio to Bayer recently to make another acquisition themselves. I am not sure who would be to purchase assets from either company in order to satisfy regulators.

The overall picture for Bayer and Monsanto joining forces is made even further complicated because they will have limited pathways to sell off assets overall because Dow-DuPont and the ChemChina deal I mentioned earlier puts all of those companies in a holding pattern as well. Those companies are not going to be undertaking any large transactions while under regulatory review themselves.

A merged Bayer and Monsanto would control an alarming amount of agricultural products and products directly related to our food supply. They would have enormous influence and power over the pricing that all of those markets are set within. In addition, they would be able to exert enormous price pressure, which could translate to cost increases that are passed along to the consumer.

The potential combined behemoth would also have a tremendous impact on the global environment through an increased number of synergies in the pesticide, herbicide, and other agro-chemical products which will have negative effects on the soil, water, and wildlife.

The potential merger of Bayer and Monsanto is, in short, bad for the consumer, bad for the environment, bad for ingredient suppliers, and bad for farmers. I hope that the analysts on Wall Street are right, and that this merger fails to meet regulatory approval.

It is a proposal with tremendous consequences on a multitude of levels which could have a detrimental impact to our society. This proposal represents greed and the unbridled pursuit of power. I am very concerned over the outcome, and I hope I have proven to all of you that you should feel the same.

Follow Up: Dow – DuPont Merger Hits Snag

The proposed merger between two global industrial chemical giants, Dow and DuPont, has reportedly hit a snag with the top European regulatory board. In a follow up to my prior article on this topic, this proposed merger had some issues from the outset, which is to be expected whenever two companies of that size are in the mix.

The European regulatory board has some significant concerns regarding the agricultural product lines particularly the seed products for crops involved in this proposal. The combined Dow-DuPont would be a major rival to the market leader, Monsanto, and if the deal was approved it would consolidate a huge majority of the seed industry into the hands of two companies.

I had mentioned this area in my prior work on this merger as being an area that should be of huge interest to the majority of the general public regarding this deal because it would place a monopoly on the seeds used to grow the global food supply. This will inevitably cause some very dangerous potential ramifications regarding the cost to grow and manufacture food and agricultural products.

The European regulators were correct in raising this concern at this point and to investigating this situation further. They also raised concerns about certain petrochemical products and the overall impact that this merger could have on innovation. The regulators explained to the media that the farmers have a reliance on the capability of being able to obtain seeds at a competitive price in order to maintain their livelihood. The statement essentially indicates that this proposed merger could leave the farmers in a situation where that cost competiveness is gone, forcing them to buy the seeds at whatever price the two top companies on the supply side dictate that price to be.

The anti-trust laws were established both in the U.S., in Europe, and in other parts of the world to provide safeguards against the very type of situations that this proposed merger presents in the context of competitive balance. The control of any commodity into the hands of the few is a problematic situation given the predisposition toward greed displayed by the large majority of publicly traded corporations.

The likely defense from Dow-DuPont is, as they alluded to when the CEOs made the rounds on the financial news networks back at the start of this circus, that they plan to split the company into three separate companies. In the reports I have read regarding the European regulatory decision today, it appears that will not be enough to satisfy their concerns because that accounting split into three companies does not change the controlling market share in seeds or petrochemicals that Dow-DuPont would maintain.

It remains to be seen what the investigation will yield, it could result in the European board “recommendation” that the proposed merged entity must divest their holdings in the seed industry segment and potential other industry segments. This would deal strictly with the European divisions of the proposed new Dow-DuPont and would be required of them to clear the hurdles to that M&A proposal in Europe.

The impact of that recommendation or the finding of this investigation could have an impact on the regulatory process in the United States. However, there is a chance that the regulators here view this as a European issue and they may have other concerns about this gigantic merger proposal.

The agricultural lobbies, both those who have interests in lobbying for farmers in the US and those who lobby for the petrochemical and agricultural supply companies, will certainly be active in the run up to the regulatory review process here in America.
This new emphasis on “clean” eating and healthy food will have interest groups from the GMO free side of the food industry certainly weighing in on this proposal as well. The renewed focus on GMO seed that companies such as Monsanto, Dow, and DuPont push for all the main staple crops in America is something that all of us should be concerned about, and the implications for the consolidation of that seed industry could deal a crushing blow to the GMO free lobby.

This investigation by European regulators could set the bar for American regulators to follow suit, which could very well lead to the breakup of the existing brand lines controlled by Dow- DuPont and lead to some significant changes to the agricultural industrial marketplace and the petrochemical marketplace globally. This matter is far from over, in fact, it looks like the process has finally started to feel like it has actually begun.

Dannon Launches GMO- Free Yogurt

Dannon announced today that the company has launched yogurt products which are free of GMOs in the United States. The changes have been made to the Dannon main brand product line and to the Oikos Greek yogurt brand product line. The company, according to industry and financial media reports, also plans on launching GMO free product versions of the Dannimals product line geared toward children.

The products that cannot be made with GMO free ingredients or GMO free milk will be labeled very distinctly that they contain genetically modified ingredients. The products that are now GMO-free have a new packaging and a distinct label indicating GMO-free.

I discovered this while shopping in my local grocery store today and picking up some Greek yogurt I noticed that the Oikos products had a new package that was clear plastic so that I could see the product. I picked it up to see what the new package indicated and noticed the GMO free label right away. I have advocated for GMO labeling on food products for a long time now, so I was very happy to see this change today.

Dannon is making an effort to source all of their milk from non-GMO sources by either late 2017 or 2018 depending on what reports you may see on this topic. I think that latitude in the time frame is also predicated on demand for the products potentially increasing and the need for more adequate supply to catch up and flatten out that curve.

Dannon is certainly going to gain customers from this change, even if it is incremental, because not all the products in the brand lines I mentioned above have hit the shelves with their GMO free versions yet. However, those that have certainly will get the attention of the consumer in a positive way.

The groups that advocate for GMO labeling and for a change to non-GMO sourcing in food products have been hammering Chobani and General Mills (Yoplait) for a long time now to make this change. The fact that Dannon was the first to market with this concept in this food product category that has exploded with the trend toward healthier eating in the U.S. bodes well for their brand image and reputation. That is all going to translate into increased sales and revenues for Dannon.

The decision to label the products that cannot be made GMO-free (at least at this point in time) is another constructive step that will push their competition to consider similar measures. The American consumer tends to look favorably upon transparency and this willingness by Dannon to comply by telling the consumer what is and what is not GMO free is a step in the right direction for proponents of stricter food labeling measures.

In the case of Dannon, my earlier article on their acquisition of White Wave Foods will only serve to enhance their capabilities in offering further GMO free product options across all their brand lines in the future, should that transaction be approved.

It is going to be interesting to see how the rest of the yogurt market responds to this move by Dannon today. It certainly sets the playing field on a bold new path. I know the consumer is going to find it favorable. In time we will know how the rest of the industry tries to respond to an ever growing trend of GMO free product demand.

Supermarket Shock: GMO Labeling & Consumers

Some of the major food companies such as Campbell’s and General Mills among others, have begun the process of labeling some of their products with disclosures relative to genetically modified ingredients. In your local grocery stores, depending on what state you live in, you may have also seen similar product labeling.

The label on the packaging will have a disclosure with a statement such as: “contains genetically engineered corn” or “made from genetically engineered soybeans”, or “contains genetically modified ingredients”. The surprising component to this scenario was that with all the reporting and commentary writing I have done regarding the subject of GMOs and the need for stricter food labeling, and knowing that this was actually going to appear on products on the shelves in stores: my wife, friends and colleagues, as well as myself all were still shocked by it.

We were all shocked by the appearance of the words on the box of cereal or the can of soup that we have purchased regularly over the years. The words, seeing them in print, make it that much more impressionable and have a pronounced impact. I wrote about this in a previous article on GMO labeling for the site known as Medium where I explored the potential consumer reaction and subsequent ramifications for the food industry.

One of the potential responses that was mentioned in other news coverage on GMO labeling of food products was most troubling to consumer packaged goods company executives: the shock value to the shopper. This shock factor with shoppers was also detailed in articles regarding the financial segment’s valuation of Campbell Soup Company stock after they determined that the consumer reaction would adversely impact product sales.
It is certainly a shock for many consumers to see the widespread presence of GMOs in the food supply. Then, there are other consumers who are more knowledgeable and shop at health food type stores and websites to obtain locally sourced, GMO free products.

There are still others, and that will encompass a huge group of consumers, that know and understand the fact that GMO corn, sugar beet, and soybean are the most prevalent supply in American domestic food products. We do not have much choice because of the expense of buying alternative products that are GMO free to feed multiple people or a family. The cost factor associated with removing GMO containing products from our respective diets is not feasible when coupled with other rising standard of living costs.

It is my opinion, and I am in agreement with the analysts’ data from the financial valuation on Campbell Soup, that there will be some shoppers that will be so shocked by the GMO labeling that they will put the product back on the shelf and make another product choice. Then there are other consumers who will see the label and purchase the product anyway in a state of resignation to the fact that GMOs are part of our current food supply chain.

The fact remains that the seed used to grow the staple crops such as corn, wheat, soybean, and sugar beet are genetically engineered. There is not enough non-GMO seed to support more than a fraction of the amount of food needed in production for our population. This is the inherent problem with sourcing sustainable “clean” food products.

The debate over whether the food labeling should be done federally or on a state-by-state basis will only cease when the federal authorities make a final determination. In the event that labeling guidelines become mandated by law, then this shopper shock will only become more intense because it will effect such a large amount of products in our stores.
In my own perspective, I have had the most difficulty with reading it on boxes of breakfast cereal. I think it is the understanding that for several years I have been eating cold cereal for breakfast, and that basically all of them contain some sort of genetically engineered ingredient. There is something very stark about coming to that realization.

In the end analysis, as the labeling of the GMO or genetically engineered ingredients becomes more commonplace I am interested to see whether this “shopper shock” will wear off, similar to the initial “sticker shock” we might get on a price of a higher ticket item. In many cases, over time, we become desensitized to many external factors within our human condition. I am interested to see if this will be another example of that type of behavioral response.

In the interim, we as consumers will continue to get jolted whenever we pick up a can of soup or a bottle of juice and find that it contains genetically engineered ingredients. We, as consumers, will continue to try to drive the progress towards the “right to know if it is GMO”. We will continue to have conversations with people we may have only just met, in one of the last places to do so in an increasingly isolative and online shopping obsessed society: in the aisle of the local grocery store. In that case, if nothing else, at least we are talking about something.

Tainted: Academies of Science GMO Report

The report issued today from the Academies of Science which essentially stated that GMOs in our food supply are safe for humans to consume came under fire by several consumer advocacy groups. The media coverage of the report can easily be found, and in fact, USA Today did fair and balanced overviews of both sides of this argument.

The focus of this commentary on my own blog here is to not delve into the specifics of the report from this organization, but rather to focus on the facts and implications that still remain in the “great GMO debate” in America. Most of you know as readers of my prior work on the topic of GMOs that I am very strongly anti-GMO. That stance has been honed by researching tons of scientific studies and empirical data from trusted sources and reading accounts of the effects of herbicides such as Roundup and their impact on the soil and crops in our country over a period of roughly 20 years.

Despite what this report released today states, GMOs are not safe for humans to consume, products such as herbicides and pesticides have caused all sorts of illnesses in children and adults. The use of genetically engineered seeds and other products in our agricultural production processes has a direct correlation to increased incidences of gastrointestinal, autoimmune, cancers, and other diseases.

Several other consumer advocacy groups and others involved in the food industry agree with my view on this report and on this situation. The reason: the Academies of Science report is tainted, it is skewed because the scientists and other members of the organization are linked with the large biotech companies and the agricultural production giants such as Monsanto. This effectively caused one group, Food & Water Watch (which is a respected consumer advocacy group) to call the results “watered down”.

This is not the first time, nor will it be the last, that the biotech and big agricultural giants like Dow Chemical and Monsanto got involved to directly or indirectly influence a report or a legislative measure when it comes to GMOs. I have written numerous articles over the past few years on this same subject with political donations being linked to high powered politicians who then change the course of a particular bill so that it is favorable to the big business interests involved.

This should come as no surprise to anyone in the audience because the genetic engineering of food has always at the core been inherently about pure greed. The ability to grow more product or make the food last longer so that stores had less perishable or expired inventory has been the catalyst behind a “make it GMO or bust” mentality.

The evidence of that is clear in the U.S. according to reports published in USA Today, Yahoo! News, and other trusted sources the following numbers for 2015 are staggering with regard to the prevalent nature of genetically engineered produce in our food supply. I have listed below the percentage of each crop that is genetically engineered:
Sugar beets = 99%
Soybeans = 94%
Cotton = 94%
Feed corn = 92%

I have written previously about the pervasive and persistent nature of the GMO problem in the U.S. based on these numbers above. It has created conditions where now the staple products are genetically modified and the soil has been degraded to a point where it is not capable of growing non-GMO produce. The other issue which is just as troubling is that the seed used in so many crops are genetically modified and two main companies – Dow and Monsanto control a huge market share in the seed business for our food supply.

The amount of feed corn that is genetically modified is also a tremendous problem because it has a direct impact on so many areas of agriculture which impacts the food that is provided to many of our sources of animal protein. In turn that creates a scenario where it is very difficult to avoid GMO containing products in your given daily food intake.

In any case, despite your view on the situation, God created all that we have been given here on Earth, every living thing, the soil, the seeds, the water, and the Sun. Then mankind came along and decided that they knew better than God and they decided to alter what God created in the name of enhanced profit margins. There are many other people and groups out there that also agree with this component of my argument against GMOs.

The incidences of increased levels of autoimmune diseases such as celiac, Parkinson’s disease, dementia, certain types of cancers, and other gastrointestinal diseases all jumped up in the past 20 years since man decided that they would alter the crops and the seeds and the soil with chemical ingredients and herbicides.

I cannot emphasize enough that the ties to the Academies of Science and the biotech and agricultural products suppliers casts a huge cloud of suspicion over the validity of the report issued today. It certainly was a far cry from an independent analysis on this issue.

National Geographic put together a really informative and well done piece on the effect of Roundup brand herbicide on the crops and the soil in the American farming system. The results, and the amount that we do not know about such a widely used chemical are alarming.

The final subtopic I will touch on with regard to this issue is the labeling of GMO product which is a debate that I have covered vigorously over the past few years as well. The consumer groups today stated that the majority of Americans still believe strongly that they have the right to know if the food they are consuming is GMO containing. That fight over labeling standards and a national protocol for labeling food products is not going away with this announcement today.

The basic premise being that even if a group states that GMOs are safe, the majority of people, whether they believe those ingredients are bad or unhealthy or not, still maintain that they should know whether the product they are going to purchase contains genetically engineered components.

The fact that so many of the staple food crops that I referenced earlier in this piece are genetically engineered creates a potentially very negative situation for certain large food producing companies such as Nestle and ConAgra just to name two. The consumer will most definitely think twice about buying a can of soup with genetically modified soy in the ingredients.

The federal government has to get involved with a standard protocol because each individual state cannot have their own separate ways of declaring GMOs on labeling for grocery products, it will become a complete nightmare for interstate commerce.

In the end, the report today did nothing to quell the debate over GMOs in the food we eat, instead it stoked the fire. This debate will continue because there is a mountain of evidence to refute what this report claimed today. The trend toward healthy and fresh/ organic eating habits in the American consumer will not change because of this report today. The distrust of the government, the disdain for lobbyists, and the general skepticism towards large corporations will continue in America, and in fact was emboldened by this report today. I urge you to educate yourself on this topic because it can have a dramatic impact on your health and that of the rest of your family. This report cannot change that fact.