[permaculture] UP AGAINST THE WAL-MART

Keith Johnson keithdj at mindspring.com
Mon Aug 28 19:22:05 EDT 2006

By Tom Philpott
August 23, 2006

Original Link 

[Visit the URL above for links to references in the following article. --DS]

With Whole Foods continuing to dazzle Wall Street with its growth and 
Wal-Mart vowing to become the world's No. 1 organic grocer, now would 
seem to be a wonderful time to be an organic farmer -- particularly one 
with enough acreage to supply the corporate giants.

According to classical economics, when demand jumps, supply should 
follow, pulled up by the good's rising price. But a funny thing is 
happening in the certified-organic fields and orchards of California, 
home to about 40 percent of the nation's organic-vegetable acreage: 
produce is shriveling unpicked on the vine, choked by weeds and neglect.

A labor squeeze has gripped California's farm operators. Simply put, not 
enough undocumented Mexican workers are sneaking across an increasingly 
militarized border, and the ones who do tend to be drawn to higher-paid, 
less-demanding urban jobs. While the labor shortage affects all of the 
state's fruit and vegetable farms, organic ones bear the heaviest 
burden, according to a recent Associated Press report. That's because 
human hands, often wielding a hoe, must do work that's done on 
conventional farms by herbicides and other chemical inputs.

The AP article focuses on one prominent California organic farmer who 
"has been forced to tear out nearly 30 acres of vegetables, and has 
about 100 acres compromised by weeds." The farmer figures this season's 
dearth of workers has cost him $200,000 so far -- "worse than anything 
he's seen in his 31 years of farming," AP reports.

Under perfect free-market conditions, a simple mechanism would remedy 
the shortage. As farmers abandoned rotting vegetables to the weeds, 
supply would drop. Since demand is robust, the price of organic veggies 
would rise -- allowing farmers to raise wages without compromising 
profitability. Higher wages would then lure more Mexican workers to 
brave the U.S. marshals, minutemen, stiff "coyote" fees, and brutal 
desert conditions that characterize the border crossing. And then 
California's large-scale organic farms would hum again, ready to stock 
the shelves of Wal-Marts and Whole Foods the nation over.

Yet I doubt this scenario will play out. The organic produce market once 
relied on direct sales between small-scale farmers and consumers -- 
think farmers' markets and CSAs. That meant that buyers were a diverse 
and numerous bunch, giving farmers some power to set prices at a level 
that reflected labor and cost. At the farmers' market, I know that if 
one person gawks at my $3 per pound yellow heirloom tomatoes and walks 
away empty-handed and flummoxed, I can count on a food fanatic dropping 
by a minute or two later and snapping up a few pounds with a smile. We 
nurtured those tomatoes from seed, and staked, strung, and harvested 
them by hand; $3 per pound seems like a bargain to us.

Now, however, the produce market is increasingly the territory of a few 
big retailers. In short, a market once characterized by many buyers is 
transforming into one controlled by a few. And the power to name prices 
is being wrenched from the hands of farmers by the likes of Wal-Mart and 
Whole Foods. As those two titans battle it out for the title of the 
nation's top organic grocer -- a position Whole Foods currently owns by 
a wide margin -- expect them to compete over who can deliver the 
cheapest organic tomato. And that means large-scale organic farmers can 
expect to see a price squeeze even as they're struggling to find enough 
workers to pick their fruit.

Sound far-fetched? Consider that while organic vegetables typically 
fetch prices 20 to 30 percent higher than conventionally grown fare, 
Wal-Mart has already announced plans to squeeze that premium to 10 
percent. Most likely organic farmers, and not Wal-Mart's profit margins, 
will feel the pinch more painfully.

Wal-Mart can perform this feat simply by playing large-scale U.S. 
organic farmers against their counterparts in Mexico and even China -- a 
strategy that would not be completely at odds with the retail giant's 
historic business model. According to AP, "Some [California] growers are 
moving parts of their operations to Mexico." A few months back, 
BusinessWeek reported that Cascadian Farm, General Mills' "natural" 
subsidiary, "buys its organic fruits and vegetables from China and Mexico."

Some optimists see in these trends the "democratization" of organic 
food. As its retail price drops compared to conventional food, more 
people will buy it, benefiting public health and the environment alike. 
But I see the process of commodification at work. In commodity markets, 
distinctions fade. A given product's history disappears into history's 
dustbin. An organic tomato from Mexico equals an organic tomato from 
Chile equals one from the farmer down the road. The goal becomes not to 
maximize flavor or bolster local economies, but to minimize price.

Even small-scale, locally oriented farms like my own Maverick Farms have 
felt commodification's pressure. Just two weeks ago, the chef/owner of a 
nearby posh restaurant, one that had loyally bought produce from the 
family who started our farm 20 years ago, called to complain about our 
prices. It seems Albert's Organics was quoting him prices 20 or 30 
percent lower than ours. Albert's -- a subsidiary of United Natural 
Foods, the self-proclaimed "largest publicly traded wholesale 
distributor to the natural and organic foods industry" -- is evidently 
opening a distribution center nearby. That's bad news for Maverick and 
other local farms.

Starting in the 1930s, the U.S. food system succumbed to commodification 
at a blistering pace. The result has been, to paraphrase T.W. Adorno, 
"disaster triumphant" -- flavorless institutional food, declining public 
health, wrecked rural economies, and untold environmental wreckage. For 
the corporations that dominate the food industry, though, it's just been 
a triumph.

And now the organic movement, which emerged as a critique of the idea of 
food-as-commodity, is itself hurtling down the path of commodification. 
Some greens, embracing a binary worldview not unlike the one prevalent 
in the White House, insist that everyone declare it a "good thing" that 
corporations are embracing organic. I respond: let's not surrender our 
power to analyze just because some slick CEO talks a good game. Let 
Wal-Mart do what it wants. I'll remain part of the movement to rebuild 
locally owned food-production institutions that benefit farmers, 
consumers, and the environment alike.

Keith Johnson
Permaculture Activist Magazine
PO Box 5516
Bloomington, IN 47408
(812) 335-0383
also Patterns for Abundance Design & Consulting

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