Not Crying over Spilt Soymilk

It's not often that family-scale farmers can go toe-to-toe with a
$12 billion agribusiness and come out victors. But organic soybean
producers, and a modestly scaled but powerful ally, The Cornucopia Institute,
are claiming victory over Dean Foods in the organic marketplace.

[Full news release at https://www.cornucopia.org/2010/09/not-crying-over-spilt-soymilk/]

Dean Foods, the manufacturer of Silk, the top-selling soymilk drink,
was first "outed" in Cornucopia's May 2009 report, Behind the Bean: The Heroes and Charlatans of the
Natural and Organic Soy Foods Industry, for switching its soybean
sourcing from American farms to cheaper organic beans from China. Later in 2009,
Cornucopia revealed that Dean Foods had then largely abandoned organic soybeans
altogether, stealthily changing the soybeans in their core Silk product line
from organic to less expensive conventionally grown soybeans that the company
was calling "natural."

The shift away from organic outraged many loyal consumers and alienated
retailers across the country that were not informed of the change and continued
to inaccurately merchandise Silk products as "organic."

Now leading natural/organic foods retailer Whole Foods Market has
decided to shift its soymilk offerings back towards organic. Saying that
its relationship with Dean Foods had "chilled," Whole Foods
indicated it was bringing in a new branded organic soymilk partner, Earth
Balance. The national retailer also told the Denver Post, in an August 27 story, that it wanted Earth
Balance's soymilk products to contain only domestically grown soybeans
carrying the organic label.

"Dean Foods has been roundly criticized for taking the organic
out of Silk, and now the marketplace and consumers are passing their
judgment," said Mark Kastel, Cornucopia's senior farm policy
analyst. "They took what once was a pioneering 100% organic brand,
before they acquired the company in 2003, and cheapened the product at the
expense of American farmers and consumers. Now they are paying a price
for their naked profiteering," Kastel added.

Dean's purchase of Silk initially excited American farmers who
had been selling organic soybeans for use in Silk soymilk. Many thought
that Dean would use its marketing prowess to further grow the Silk brand and
expand demand for domestic organic soybeans. Instead, the company turned
the screws on its farmer-suppliers and demanded that they compete on pricing
with Chinese imports - something they were unable to do.

"White Wave (the operating division of Dean Foods that markets
Silk and Horizon organic milk) had the opportunity to push organic and
sustainable agriculture to incredible heights of production by working with
North American farmers and traders to get more land in organic production, but
what they did was pit cheap foreign soybeans against the U.S. organic farmer,
taking away any attraction for conventional farmers to make the move into
sustainable agriculture," said Merle Kramer, a marketer for the
Midwestern Organic Farmers Cooperative.

Dean spokesperson Molly Keveney told the Denver Post that staying with organic beans would have
resulted in price increases. This statement stands at odds with the
reality of falling farmgate prices for organic soybeans in recent years.

The shift away from organics by Dean in its Silk soymilk products also
produced additional embarrassment for and anger at the company when Cornucopia
discovered in 2009 that it had failed to change the soymilk product's
packaging to overtly reflect that it was being made with "natural"
soybeans. Cornucopia filed a formal complaint with the USDA's
National Organic Program over the matter. The company ultimately
corrected its misrepresentation.

"Consumers and retailers repeatedly
reported to us that they were deceived and ended up unknowingly buying Silk
products with conventional soybeans," said Kastel. "We know of
numerous retailers that ultimately pulled Silk products from their store
shelves over the gross misrepresentation of the soymilk product," Kastel
added.

Earth Balance is not the only company that
is seeking to capitalize on the consumer's hunger for authentic, organic
foods. A new "natural" entrant into the soymilk marketplace, 8^th
Continent, is taking direct aim at dissatisfaction with Dean's handling
of Silk. Other soymilk manufacturers such as Eden Foods and Organic Valley
are also hunting for sales to the growing legion of organic consumers.
Still, with Dean spending upwards of $29 million on major media advertising
(according to The New York Times),
it will continue to flex its muscles in the marketplace.

The Cornucopia Institute maintains a soy
foods scorecard on its website (www.cornucopia.org),
which provides information and ratings of soymilk and various soy foods and
rates them on the integrity of their production (including whether brands buy
from American family farmers or from China). The scorecard can be used by
consumers and wholesale buyers to make purchasing decisions that support their
values.