Demand Outstrips Supply
Growth in the U.S. organic market is being stunted by undersupply, resulting in
shelves remaining empty, companies withdrawing from the market, and others look-
ing internationally to supplement supply needs. The sectors hardest hit by supply
shortages are the organic orange juice, meat, and dairy sectors. The low number of
organic livestock producers in the United States has also resulted in the organic meat
industry experiencing undersupply for a number of years, with American producers
resorting to imported organic beef from Australia and Latin American countries.
Increasing quantities of organic fruits, vegetables, grains, seeds, beans, and herbs
are being imported into the United States. Finished products are also being imported
to meet consumer demand for all things organic. As consumers increasingly opt for
healthier products, the organic industry is set to enjoy solid growth. According to a
recent study, by 2025 organic products will be considered commonplace. Yet, a short-
age of supply is stifling sales. Nearly all market sectors would grow at much higher
rates if sufficient supplies were available.
Once a net exporter of organic products, the United States now spends more than
$1 billion a year to import organic foods, according to the USDA; the ratio of
imported to exported products is now about eight to one. This situation is occurring
despite the fact that about 10,000 American farmers have made the transition to or-
ganic food production on about 2.3 million acres of land. Hopefully, the number of
farmers converting from conventional to organic farming will grow more rapidly,
thereby easing the supply shortages.^67
Corporate Inroads
Today a significant, and growing, percentage of organic foods are produced by
large corporations more often associated with the predations of agribusiness than with
the ideals of sustainable farming. The increasing presence of conventional food pro-
cessors in the organic industry is raising debate among farmers, shoppers, and con-
sumer advocates about whether the values of organic agriculture and the motives of
big business can coexist.
Figures supplied by the Organic Consumers Association reveal the degree to which
conventional food processors have penetrated the organic market. General Mills owns
the organic brands Cascadian Farms and Muir Glenn. Heinz holds a 20 percent eq-
uity share in food distributor Hain, which owns Rice Dream soy milk, Garden of
Eatin’, Earth’s Best, and Health Valley, along with fifteen other organic brands. Kel-
logg owns Sunrise Organic, while Kraft owns Boca Foods, maker of the popular vege-
tarian Boca burgers. The largest organic seed company, Seeds of Change, is
controlled by M&M/Mars. Small, local organic operations simply do not have the
reach to coordinate nationwide distribution. Bigger companies do have the expertise
in getting products to shelves across the country. As the market for organics has
grown, they have stepped in to fill that role.
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