US: Wal-Mart Charged with Selling Nonorganic Food as Organic

The Cornucopia Institute, the nation's most aggressive organic farming watchdog, has filed a formal legal complaint with the USDA asking them to investigate allegations of illegal "organic" food distribution by Wal-Mart Stores, Inc. Cornucopia has documented cases of nonorganic food products being sold as organic in Wal-Mart's grocery departments.

"We first noticed that Wal-Mart was using in-store signage to misidentify conventional, nonorganic food as organic in their upscale-market test store in Plano, Texas," said Mark Kastel of The Cornucopia Institute. Subsequently, Cornucopia staff visited a number of other Wal-Mart stores in the Midwest and documented similar improprieties in both produce and dairy sections.

Cornucopia notified Wal-Mart's CEO Lee Scott in a letter on September 13, 2006 alerting the company to the problem and asking that it address and correct the situation on an immediate basis. But the same product misrepresentations were again observed weeks later, throughout October, at separate Wal-Mart stores in multiple states.

"This is disturbing and a serious problem," Kastel said. "Organic farmers adopt and follow a rigorous range of management practices, with audit trails, to ensure that the food they sell to processors and retailers is organic and produced in accordance with federal organic regulations. Consumers, who are paying premium prices in the marketplace for organic food, deserve to get what they are paying for."

Earlier this year, Wal-Mart announced a sweeping organic foods initiative and declared that they would greatly increase the number of organic offerings for sale in their stores-at dramatically lower prices than the competition. The move by the giant retailer has been under close scrutiny from members of the organic community seeking to assess what impact Wal-Mart's decision will have on organic food and farming concerns.

A number of other organic food retailers throughout the country, including Whole Foods Markets and many of the nations member-owned grocery cooperatives, have gone to the effort to become certified organic in terms of the handling of their products and have invested heavily in staff training to help them understand organic food production and sale concerns.

"Our management and our employees know what organic means," said Lindy Bannister, General Manager at The Wedge Cooperative in Minneapolis, Minnesota. "If Wal-Mart intends to get into organics, they can't be allowed to misidentify 'natural' foods as organic to unsuspecting consumers." The Wedge, the largest single store member-owned food cooperative in the nation, was one of the first retailers to go through the USDA organic certification process.

"One can question whether Wal-Mart has the management and staff expertise necessary to fully understand organics and the marketing requirements essential to selling organic food," observed Kastel. "At this point, it seems they are attracted by the profits generated from the booming organic food sector but are not fully invested in organic integrity. Given their size, market power, and market clout, this is very troubling."

Cornucopia's complaint asks the USDA to fully investigate the allegations of organic food misrepresentation. The farm policy organization has indicated that they will share their evidence, including photographs and notes, with the agency's investigators. Fines of up to $10,000 per violation for proven incidents of organic food misrepresentation are provided for in federal organic regulations.

This past September, The Cornucopia Institute also accused Wal-Mart of cheapening the value of the organic label by sourcing products from industrial-scale factory-farms and Third World countries, such as China.

The Institute released a white paper, Wal-Mart Rolls Out Organic Products-Market Expansion or Market Delusion?, that made the argument that Wal-Mart is poised to drive down the price of organic food in the marketplace by inventing a "new" organic-food from corporate agribusiness, factory-farms, and cheap imports of questionable quality (available at www.cornucopia.org).

• 181 Food and Agriculture
• 208 Regulation