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Organic industry crafts counterattack to threat from study

NBC's Diana Alvear reports on a new study from Stanford University that questions the health advantages of organic products over conventional food, showing that there were no specific foods or fruits that display significant differences.

Finally, we can compare apples to apples.

For the record, that’s $2.99 per pound vs. $2.49 per pound –- the price difference between organic apples and regular, store-brand apples (as marked this week at a Denver Whole Foods store).

Thanks to new research released this week by Stanford University, consumers now know that all of those sweet, red pieces of fruit – no matter how naturally or conventionally they were grown, and no matter how they are labeled – carry the exact same nutritional value.

Forget: "Paper or plastic?" The question now: Will this revelation take a bite out of the $31 billion organic food industry?

“We really don't know what that impact is going to look like," said Christine Bushway, chief executive officer of the Organic Trade Association, which represents more over 6,500 organic businesses across 49 states, from growers to importers to retailers. "What we do know about our dedicated organic consumer is, this will not likely be an ‘aha!’ moment for them.

“For the most part, they’re not buying organic because of some nutrient density claim. They’re buying organic for the things that they’re avoiding: pesticides, hormones and antibiotics,” Bushway said. “The whole idea of looking at organic from a nutritional advantageous position – that’s never been organic’s claim to fame, frankly.”

While perceived richer nourishment may not be the dominant driver of organic sales, it is ranked highly among shoppers’ reasons for paying extra for organic chow. According to a 2010 report by Nielsen, 51 percent of consumers said they choose organic products because “they are more nutritious.” Only two psychological factors scored higher: Organic fare is seen as "healthier,” (according to 76 percent of consumers), and organic cuisine allows people to “avoid pesticides,” (according to 53 percent of consumers).

Which brings up another slightly bitter pill for organic sellers and lovers: the Stanford researchers found that not all organic fruits, veggies and meats are entirely free of pesticides or antibiotic-resistant bacteria, although the levels of such chemicals are far lower and their presence is far more rare when compared to conventionally farmed produce, chicken and pork. (Federal rules prohibit organic farms from using synthetic pesticides, but experts explain that some bug-killing vapors are known to drift from non-organic farm fields onto organic plots). 

If the nutritional equality between so-called "clean" food and traditional grocery items wasn't headline news to some shoppers, how about the researchers' detection of pesticide residue in seven percent of the organic produce samples?

"You may have hit on something that needs some more clarification with the consumer," Bushway said. "That’s exactly what we’re talking about right now: How can we get more information out there to the consumer about organic? It’s a maturing industry. I think that it is recognizing in this really incredible growth it’s having, like all things, you don’t just put products into a marketplace and hope they sell themselves. The consumer wants product information.

"So I would say we have a further job to do in that area." 

The first salvo in that push back came Tuesday when the Organic Trade Association issued a news release reacting to the Stanford report, opening with how the California scientists "confirmed that consuming organic foods reduces consumers' exposure to pesticide residues and to bacteria-resistant antibiotics." Then the OTA squarely acknowledged that "published literature lacks broad evidence that organic foods are significantly more nutritious than conventional foods." But, they emphasized, organic foods do tend to be higher in levels of omega-3 fatty acids (good for the heart) and phenols (thought to prevent cancer). 

Still one other assertion should be examined, however: namely that organic food - which costs, on average, 15 to 20 percent more than conventional fare - is enjoying "really incredible growth," as Bushway maintains. 

Indeed, that sort of organic sales surge did occur during the past decade. But is that trendy corner of the grocery store still expanding at the same pace? According to the U.S. Department of Agriculture, the retail value of the organic industry sprouted by almost 9.5 percent in 2011, to $31.4 billion. In 2010, organics comprised 4.2 percent of all U.S. retail food sales, the federal agency also reported.  

The USDA, by the way, ensures that not just any jar of mushrooms can be slapped with an "organic" label, thus allowing some sort of artificial boom fueled by false advertising. For a food item to be stamped "organic," 95 percent of the product must be made with certified organic agricultural ingredients, says the USDA. Foods containing less than 70 percent organic ingredients are prohibited from using the word "organic" on labels.

Despite the USDA's report of a nearly 10 percent growth in the sector last year, one food industry analyst believes that number is something of an inflationary mirage and, further, that the organic market already has hit its chic peak. 

"I believe the market has grown because of pricing actions – because the price of organic food has gone up, because all food prices have gone up. But that’s different from eating (more), or from tonnage consumed," said Harry Balzer, chief industry analyst and vice president of the NPD Group. The firm, based in Port Washington, N.Y., provides consumer and retail information to industries working with manufacturers, retailers, and service companies. Balzer also authors an annual report called "Eating Patterns in America."

Since 1980, the NPD group has asked 5,000 consumers to keep weekly food and beverage diaries for everything they swallow during every two-week period. And by Balzer's assessment of those logs, the consumption of organic foods has "leveled," following an abrupt explosion between 2003 (when 12 percent of consumers ate an organic item at least once during a two-week span) to 2008 when that practice reached 26 percent of consumers. 

"And then it stopped, which coincided with the recession. We all said it probably has to do with economics - because of the cost (of organic foods)," Balzer said. "For the last four years, that number has not been moving. 

"The one thing you must know about our eating habits is we are always looking for new things, and we wear food like we wear clothes," he added. "Food makes a statement about who we are. Food is fashion."

While peering into the soul of American consumers, Balzer has learned, he said, that we have two long-term, core values when it comes to buying any grocery item: "One, does it make my life easier? And two, and does it make my food costs cheaper?

"So when I saw the issue (out of Stanford) on the organic thing, I had a little smile on my face because I’ve been watching this trend. For over 35 years, I’ve been watching how people eat. This is my life," Balzer said. "The organic market makes a statement about who you are, what you value. 

"But it doesn’t serve the two basic needs of making your life easier or making your food cheaper. So, it has a limited market."

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