The Business Ethics Blog

A few weeks back I blogged about Wal-Mart’s stated intention to become the world’s #1 purveyor of organic foods. (See: Wal-Mart Goes Organic!?)

Today’s New York Times has an update: Wal-Mart Eyes Organic Foods

Starting this summer, there will be a lot more organic food on supermarket shelves, and it should cost a lot less.

Most of the nation’s major food producers are hard at work developing organic versions of their best-selling products, like Kellogg’s Rice Krispies and Kraft’s macaroni and cheese.

Why the sudden activity? In large part because Wal-Mart wants to sell more organic food — and because of its size and power, Wal-Mart usually gets what it wants.

As the nation’s largest grocery retailer, Wal-Mart has decided that offering more organic food will help modernize its image and broaden its appeal to urban and other upscale consumers. It has asked its large suppliers to help.

Wal-Mart’s interest is expected to change organic food production in substantial ways.

Some organic food advocates applaud the development, saying Wal-Mart’s efforts will help expand the amount of land that is farmed organically and the quantities of organic food available to the public.

But others say the initiative will ultimately hurt organic farmers, will lower standards for the production of organic food and will undercut the environmental benefits of organic farming. And some nutritionists question the health benefits of the new organic products. “It’s better for the planet, but not from a nutritional standpoint,” said Marion Nestle, a professor of nutrition, food studies and public health at New York University. “It’s a ploy to be able to charge more for junk food.”

Just a couple of quick points:
1) This whole story flags a big “buyer beware.” The term “organic” is not synonymous with “healthy” (which is why, in many juristictions, producers and sellers of organic foods are forbidden from making claims that organic foods are any healthier than non-organic foods.) And, just to push the point, if you eat a diet consisting largely of foods high in sugar — even if it’s organic sugar — you’re going to suffer for it. (And apparently Wal-Mart is going to help illustrate this point, by offering at least some high-sugar, highly-processed foods that also happen to be “organic.”)
2) Note that one of the key objections (from advocates of organic foods) to Wal-Mart’s involvement is that it will “ultimately drive down prices and squeeze organic farmers.” Yes, that’s exactly what Wal-Mart does. But remember: there’s nothing sacred about current prices. In fact, by driving down prices, Wal-Mart may of course reduce the income of organic farmers, but at the same time they’ll make organic foods available at lower costs to consumers. And that’s good, right?