Organic Industry Watchdog Wins Major Antitrust Victory


Published:

The French dairy giant, Groupe Danone (Dannon in the U.S.), has announced an agreement with the U.S. Department of Justice (DOJ) to liquidate its holdings in the largest manufacturer of organic yogurt, Stonyfield, so that its proposed acquisition of WhiteWave Foods can move forward. The original merger deal would have combined the world’s largest organic yogurt brand, Stonyfield, with Wallaby, a rapidly growing organic yogurt label, and the nation’s largest brand of organic milk, Horizon.

In August 2016 The Cornucopia Institute, an organic industry watchdog, formally challenged the acquisition based on forecasting the serious erosion of competition it would have created in the consumer marketplace and the negative economic impact it would have on U.S. organic dairy farmers.

“In our discussions with the DOJ, and dozens of reporters in the financial press who contacted us, the operative question had always been, short of regulators killing the deal, what moves could Danone take to placate our concerns?” said Mark A. Kastel, codirector at The Cornucopia Institute. “We openly questioned whether Danone was interested in WhiteWave because of its role in organic dairy, and the synergy of combining that with their existing holdings in Stonyfield, or if they were more interested in WhiteWave’s dominance in the growing, and more profitable, ‘plant-based’ beverage category. This move seems to have addressed that uncertainty.”

“As part of the agreement in principle with the DOJ, we made the strategic decision to divest Stonyfield as it allows us to take a major step towards completing the WhiteWave transition expeditiously,” said Emmanuel Faber, Danone’s CEO, in a company news release.

WhiteWave brands that Danone is acquiring are the top sellers in their categories. Horizon organic milk controls nearly 25% of the organic milk market, while their Silk brand is a leader in plant-based beverages.

Dairy has long been one of the most commercially successful product categories labeled as organic. In many households organic milk is among the first foods introduced to children. Following fruits and vegetables, organic dairy products are the second largest product segment in the industry. “As such a key part of the organic market, it is vital that competition remains open,” said Marie Burcham, the lead Cornucopia researcher on this project.

The Cornucopia Institute made this argument in letters, on August 10 of last year, calling on the Department of Justice and the Federal Trade Commission to treat the proposed merger as suspect. Cornucopia also launched a petition drive on their website and organized a letter campaign among U.S. organic dairy farmers, pushing for a full investigation of the proposed merger by federal regulators.

The market for organic dairy already has less competition than other agricultural sectors and is more susceptible to monopolization. “It was important that the authorities looked at the anti-competitive implications of the Danone-WhiteWave deal,” said Burcham. “We asked that they consider the organic dairy and organic yogurt markets in particular as different and already more concentrated markets in comparison to Danone’s other, non-organic market share.”

Burcham, who in addition to her expertise in livestock agriculture is trained as an attorney in environmental law, added, “These are important considerations for determining whether an acquisition violates the Sherman Act and the Clayton Act for anti-competitive and anti-trust reasons.”

Danone was already a majority shareholder of Stonyfield, the largest organic yogurt brand worldwide, and owns a 21% stake in the Lifeway organic kefir brand. Adding WhiteWave’s Wallaby and Horizon Organic brand yogurts to Danone’s existing market share would have allowed the dairy conglomerate to control a sizable slice of the U.S. organic market.

“This merger could have reduced options and raised prices for consumers without any positive impact on the quality of the products they are buying,” said Cornucopia’s Kastel. “With less competition, big companies commonly underpay independent farmers for their products, undermining the economic viability of small, family-scale farms. The organic community was wise to be very wary of this acquisition.”

Kastel went on to explain that the multibillion-dollar acquisition could have seriously eroded wholesale competition in other, less obvious, ways.

The number two brand of organic milk in the marketplace, Organic Valley, is produced by a member-owned farmer cooperative that has been the longtime raw milk supplier to the Stonyfield yogurt brand. If, after its acquisition, Danone had decided to dump Organic Valley, a Horizon competitor, as a supplier, it could have left only one major purchaser of farm milk in some regions of the U.S., like New England.

Ironically, Organic Valley just launched a 50/50 joint venture with Dean Foods, the largest milk bottler in the United States, to process and market organic milk. Dean is the former parent of WhiteWave and has been without an organic offering since the spin-off of their former branded products division.

Under both Democratic and Republican administrations, antitrust enforcement in the U.S. has been anemic, at best, over the past two decades. However, decisions by the DOJ late in the Obama administration to scrutinize the Staples/Office Depot merger, and major proposed consolidations in the beer and healthcare industries, left organic dairy farmers optimistic that closer scrutiny of the Danone/WhiteWave deal was possible.

“The future trajectory of regulation on antitrust matters during the Trump presidency will likely become clearer going forward as they review deals proposed during the Obama administration and subsequent to Mr. Trump taking office,” added Kastel.

The Cornucopia Institute, through research and investigations on agricultural and food issues, provides needed information to family farmers, consumers and other stakeholders in the good food movement and to the media.

See also:
In 2017, More Antibiotics Will Be Consumed By Farm Animals Than Humans
What Small Farms Need To Compete With Corporate Food

Edit Module
Edit ModuleShow Tags
Edit Module Edit ModuleShow Tags

Daily Astrology

July 21, 2018

Soothing trends make for sound sleep and good dreams. Night owls find themselves pleasantly wandering between worlds of dreamy idealism and creative inspiration. As the new day dawns the Scorpio Moon is harmonizing with Pluto in Capricorn. Chores are…
Edit ModuleShow Tags

Alternative Health Directory

Browse all listings »

Edit ModuleShow Tags
Edit ModuleShow Tags

Calendar

July 2018

Join us for a monthly gathering of like-hearted people to give and receive angelic energy healing. This session is a combination of group meditation and discussion, along with working in pairs...

Cost: Scale $5-$20 ($10 suggested)

Where:
Pathway Of Joy
884 Broadway, Suite 12
Upstairs in the Spiritual Renaissance Center building
South Portland, ME  04106
View map »


Sponsor: Pathway Of Joy
Telephone: 207-329-7192
Contact Name: Linda Huitt
Website »

More information

Show More...
Show Less...

This special 2-part evening offering. Earn your Integrated Energy Therapy® certification in two evenings, while leaving your summer days and weekends open to enjoy the season. Part 1 is...

Cost: $195

Where:
Pathway Of Joy
884 Broadway, Suite 12
South Portland, ME  04106
View map »


Sponsor: Pathway Of Joy
Telephone: 207-329-7192
Contact Name: Linda Huitt
Website »

More information

Show More...
Show Less...

What better way to end a busy day than with a little bliss. We'll support your body right where it is today and help you to open your spine to find more movement and flexibility. Begin and end...

Cost: $18

Where:
Body Love Wellness Center
484 Bedford St
East Bridgewater, MA  02333
View map »


Sponsor: Bliss Through Yoga
Telephone: 508-331-3564
Contact Name: Janice
Website »

More information

Show More...
Show Less...

Relax and restore this summer with free outdoor yoga classes on historic Rogers Field! We’re packing the lawn with yogis of all levels for yoga led by experienced practitioners from Dragonfly...

Cost: Free

Where:
Rogers Field
Devens, MA


Sponsor: Dragonfly Wellness Center
Telephone: 978-487-7181
Contact Name: Anne Ferguson
Website »

More information

If you are worried about getting Parkinson’s or have beginning symptoms, check out a free intro on how to rewire your brain from the inside. First and third Wednesdays of the month,...

Where:
, MA


Website »

More information

Show More...
Show Less...

Please note this event is held at an off-site location at the Double Tree Hilton in Danvers, MA There will be a book signing following the mediumship demonstration, and as part of your ticket...

Cost: $45

Where:
Double Tree Hotel
50 Ferncroft Road
Danvers, MA  01923
View map »


Sponsor: Circles of Wisdom
Telephone: 978-474-8010
Contact Name: Cathy Kneeland
Website »

More information

Show More...
Show Less...

July 20 - 22 The Chinese internal martial arts derive their extraordinary power from the conscious control of one’s subjective state-of-being and the use of jin (internal power)....

Cost: Please see our website

Where:
Eastover Estate & Retreat Center
430 East St.
Lenox, MA  01240
View map »


Telephone: 866-264-5139
Contact Name: Yingxing Wang
Website »

More information

Show More...
Show Less...

The mission of the 4th Annual Compassionfest is to unite like-minded people that believe in the values of being just, kindness, equality and compassion. We’ll gather for delicious vegan food...

Cost: Free

Where:
Whitneyville Cultural Commons
1253 Whitney Ave
Hamden, CT  06517
View map »


Sponsor: In Defense of Animals
Website »

More information

Saturday, July 21, 10:00am – 4:00pm & Sunday, July 22, 10am – 4:00pm With Patty Collinsworth Get the beginner certification before Linda Howe comes in person to teach a new...

Cost: $170

Where:
Circles of Wisdom
90 Main Street
Andover, MA  01810
View map »


Sponsor: Circles of Wisdom
Telephone: 978-474-8010
Contact Name: Cathy Kneeland
Website »

More information

Saturday, July 21, 10:00am – 5:30pm & Sunday, July 22, 10am – 3:30pm Instructor:  Peyton Pugmire What brings you joy and a sense of purpose?  These are your soul...

Cost: $160

Where:
Creative Spirit
80 Washington Street
Marblehead, MA  01945
View map »


Sponsor: Creative Spirit
Telephone: 617-817-4547
Website »

More information

July 21 - 22 NEMHoFest, is New England’s premiere metaphysical festival. This year’s line-up includes world renowned guest speakers and vendors from across the...

Where:
Augusta Civic Center
Augusta, ME


Website »

More information

The GFAF Expos are the greatest events on earth for those living a gluten-free or allergen-friendly lifestyle. Sample hundreds of products, meet with local and national brands, receive coupons and...

Where:
DCU Center
50 Foster Street
Worcester, MA
View map »


Website »

More information

Show More...
Show Less...
Edit ModuleShow Tags
Edit Module Edit ModuleShow Tags