Commentary

Tipping Point: Retailers Find Natural Has Gone Totally Mainstream

Kroger Co.'s announcement that it will ditch dairy products from cows treated with bovine growth hormone by next February is hardly news.

Other chains, including Publix in the South, Safeway in the West, and Stop & Shop in New England have actively promoted milk that is free of rBST, a hormone given to cows to crank up their milk production, and Kroger itself has been limiting its use of rBST products for a decade.

And many large dairies-including Dean Foods, Hood, and Oakhurst-have made rBST-free cows part of their marketing campaigns. Starbucks-perhaps the retailing bellwether of consumer conscientiousness-- made headlines this spring when it stopped using rBST dairy products in its stores.

Still, the Midwestern grocery giant's decision, observers say, may well represent a tipping point. Since Kroger serves big swaths of the agriculture South and Midwest, pollsters might ask: If rBST can't play in Peoria anymore, can it play anywhere?

"Our customers' increasing interest in their health and wellness is the basis for our decision," Kroger says in its announcement that within six months it will require that all suppliers certify that milk is from rBST-free cows.

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The retailer was careful to say its decision is based on consumer feedback, not safety concerns. Numerous studies and government agencies have found that there is no difference in milk from cows treated with rBST and those that aren't.

But consumers don't seem to care who says rBST is safe - they just don't like the idea. The Natural Marketing Institute reports that in its recent polling, 53% of primary grocery shoppers say it is important for their stores to sell dairy, meat and poultry products that are free of hormones. And of those who have who have purchased milk in the past three months, 7% purchased organic milk, 52% purchased natural milk and 43% purchased neither organic nor natural milk.

That kind of consumer preference is sparking big changes in the dairy business, an industry that earned about $24.2 billion last year, according to the U.S. Department of Agriculture. The National Dairy Council estimates 30% of U.S. dairy farmers - accounting for about 20 to 25% of cows - still use rBST, a Monsanto Co. product sold under the brand name Posilac.

For its part, Monsanto, which regards any marketing claim that milk produced without rBST is better as a deceptive slam against Posilac, has sued dairies in the past. And earlier this spring, it asked both the U.S. Food & Drug Administration and the Federal Trade Commission to stop "deceptive milk labeling and advertising," saying "that promotions that differentiate milk based on farmer use of Posilac are misleading to consumers."

Labeling issues are problematic. There is still a fair amount of consumer confusion about what makes milk "organic," "natural" or "regular," and price differences can be considerable.

But Monsanto's efforts to defend Posilac are looking increasingly quixotic: "This is a marketing decision, not a scientific one," says Mark A. Kastel, head of the Cornucopia Institute, a nonprofit organic watchdog group in Cornucopia, Wisc. "Consumers are saying they don't care if there is no evidence that added hormones are unhealthy. They know it sometimes takes many years or a generation to figure out something we have developed is unsafe," he says.

"And, since milk is purchased so often by mothers to give to their children, it's really clear - the idea of using genetically engineered hormones unsettles people," he adds. "They want to believe the milk they give their families is as unadulterated as possible."

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