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Political Game of Chicken

Whole Foods Pressuring Congress to Change Provision

Its customers are what some in the industry call “deliberate eaters,” but it’s still not every day that shoppers at Whole Foods Market get a legislative action card at the checkout asking them to contact their Member of Congress.

About 1 million such cards were distributed to customers recently, pronouncing that “Congress Weakens Organic Standards!” and telling consumers how to contact their lawmakers.

Twelve lines in the fiscal 2003 omnibus appropriations bill — inserted at the request of Rep. Nathan Deal (R-Ga.) to help chicken producers in his district — essentially undid efforts spanning 12 years to enact national organic standards. In what detractors called a “last-minute rider,” the measure undermined the organic label for meat, poultry and dairy by allowing products to be labeled “organic” even if the animals are not fed 100 percent organic grain.

And thus began a grassroots effort to repeal the provision, an effort that managed to capture the attention of lawmakers and their constituents even with a war in Iraq dominating the news.

A stand-alone bill to repeal the Deal language, sponsored by Sen. Patrick Leahy (D-Vt.), garnered 52 co-sponsors in just three days. Before it was adopted last week as an amendment to the Senate’s version of the war supplemental now in conference committee, it had 68 signed supporters.

“The swift and strong groundswell of opposition to that rider has been an eye-opener for many in Washington,” Leahy said.

Once considered just a bunch of Birkenstock-wearing hippies, organic consumers have driven the growth of the agriculture industry for the past several years and are quickly becoming a major player in agriculture politics.

Although only about 2 percent of the food supply in the United States is grown using organic methods, during the past decade sales of organic products have shown an annual increase of at least 20 percent, according to the Organic Farming Research Foundation, making it the industry’s largest growing sector. By 2005, the organic food business is expected to be an $18 billion-a-year industry.

“What’s been striking to me is that [when] this rider was kind of added I think there was this sense that this was a niche market, a sidelined group of crunchy granolas that didn’t have much political clout and if you wanted to go in and mess with the standard, who was going to stand in your way?” observed lobbyist Steve Etka.

Immediately following the omnibus becoming law, the National Organic Coalition hired Etka Consulting to lobby specifically for its repeal.

Interestingly, Deal himself is now supporting the abrogation of his own language.

“We asked the Georgia Senators to accept Senator Leahy’s language, and we’ve asked the Speaker to accept the language” in the conference report, Deal’s chief of staff, Chris Riley, said Tuesday.

It was with the help of Speaker Dennis Hastert (R-Ill.) that Riley got language in the omnibus. Hastert’s office has since publicly backed away from the provision and put the onus on Deal.

Explaining his boss’ tactical change, Riley said that Deal now has assurances from the Agriculture Department that a study will be completed soon investigating the availability and price of organic grain. (The omnibus language that allowed producers to use the organic label on meat and poultry fed with nonorganic feed was contingent upon a department study showing that organic feed costs twice as much as conventional feed.)

Deal also is now focused on “food safety” issues as it relates to the organics industry, according to Riley. He declined to elaborate, other than to say that Deal plans to pursue hearings in the Energy and Commerce Committee, on which he sits.

Riley also denies that the wording in the omnibus was “last minute,” as opponents have contended. “We asked the Appropriations subcommittee [on Agriculture] chairman back in May for the language to be included,” he said.

Regardless of the timing, longtime proponents of stringent national organic definitions felt the wording was the last in a series of unacceptable assaults.

“Getting the organic standards right was a long and difficult process,” Leahy said in a statement. The Vermont Senator introduced the national organics standards that became law as part of the 1990 farm bill, but the fight over the wording of the Department of Agriculture regulations ensued for 12 years. In October 2002 the final definitions for what constitutes an organic product were issued.

It was during that battle that the organic movement first made its heft known in Washington. In 1997, the Agriculture Department issued draft regulations for organic standards that included irradiated and genetically modified foods and products grown or harvested on farms that used sewage sludge as fertilizer. Some 300,000 individuals contacted the department to comment on the regulations — the biggest response to date on any federal regulation — the vast majority of which said that such methods should disqualify foods from being considered organic.

“I think the lesson is it’s a broad community working closely together and have a pretty strong bond because of what they’ve been through,” Etka said.

The fight for standards goes back almost two decades. Responding to many California farmers growing conventional products and marketing them as organic, Rep. Sam Farr (D-Calif.) authored standards when he was a state Assemblyman that later became the basis for Leahy’s legislation.

“When this rider was added in the appropriations bill it really tapped into all of that history and there was kind of a feeling that: Don’t you know how important it is to all of these people that these standards have some integrity?” Etka continued.

What opponents perceived as deceptive tactics by Deal and others in slipping the language into a 12,000-page bill served as a galvanizing point for trade and consumer groups.

“That’s not the way changes should be done,” Organic Trade Association spokeswoman Holly Givens said of a process that doesn’t allow for public comment, adding that the 1,200 members of OTA told their customers across the country to oppose the Deal provision.

Placing the emphasis on getting word out quickly, Whole Foods decided to distribute the business-type cards to customers.

“What people got caught up in was the trickery that went down. We were less interested in that, but it prompted us to take action,” said Sarah Kenney, mid-Atlantic director of marketing for Whole Foods.

“There’s a lot going on in the world right now,” so the company decided to direct its customers to the Web site and let their interest drive the effort, she added. “And the outpouring was tremendous.”

The standards have at times been a point of cohesion for an industry that is still defining its image and its market.

“One thing that does unify all parts of the industry are the standards,” Givens said. “Across the board it was important to everybody whether it was a small farm or a large company.”

With 143 stores and $2.7 billion in annual sales, Whole Foods is the largest retailer in the organic and natural foods market worldwide. But one of the interesting aspects of the efforts to repeal the omnibus language is the level of cooperation among trade and consumer groups, and even among retailers.

Wild Oats, which has about 75 stores nationwide, launched a similar grassroots campaign to Whole Foods — and even acknowledged its competitor’s role in the process.

“The industry swung in to action. Retailers like us and Whole Foods put letters in the stores for customers to sign,” said Mary Mulry, Wild Oats’ senior director of product development and standards.

Company executives called key Members and made them aware of the organic retailers and producers in their districts. Mulry used the example of Boulder, Colo., where Wild Oats is headquartered. The city is also home to Horizon Organic and White Wave, two of the most prominent producers in the industry.

“We can show pretty clearly with our Senators and Representatives that we are a fairly strong voice … to let them know that the industry is important to their constituents,” she added.

But in many ways it’s not just the size of the industry or its stratospheric growth that insiders say turn heads in Washington.

“We have activist customers,” Mulry observed, adding that Wild Oats had more clicks on the “call to action” in the community section of its home page recently than any promotional event or another informational campaign.

Even the mainstream food industry is rushing to hop aboard, perhaps the strongest evidence that organics are taking a significant hold on agriculture. Many “traditional” companies now have burgeoning organic lines, including Frito Lay, General Mills and Tysons Foods. And the latter two have come out publicly supporting strong organic standards.

Although Ed Nicholson, director of media and community relations for Tysons Foods, stipulated that the company’s organic line is a “very small portion of our business,” he said his company doesn’t believe the organic standards should be compromised.

“There are a lot of people who want the assurance that those organic products are certified. And for those people, the organics standards are important, and we are willing to go to bat for them,” he said.

And as producers such as Petaluma Poultry attest, the industry’s growth is just the beginning.

“There’s serious money to be made in this category,” said Randy Duranceau, director of marketing and sales.

And as for its grassroots support, Duranceau said organic consumers are by and large “passionate, well-educated and very well-informed about what is going on. I think it’s caught a lot of [people] off-guard.”

Many in the industry agree that this is probably the last time that will happen.

The industry is finding its “voice here in Washington,” said Michael Sligh, director of the Rule Advancement Foundation International USA, which works with issues that affect rural communities and seeks to improve agricultural sustainability. Sligh was also the first chairman of the National Organic Standards Board.

“There is a growing sense in the Senate and in the House of a need for informal working groups on organics — a positive sign that this is something that needs to be taken seriously,” he said.

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