A large European food group with holdings in organic products must divest itself of a well-known brand of yogurt to purchase the company responsible for food-based dairy alternatives.
Groupe Danone, a French company known as Dannon in the U.S., had its pending purchase of WhiteWave Foods challenged by the industry watchdog group The Cornucopia Institute on antitrust matters.
WhiteWave is the owner of, among others, Horizon Organic milk and the non-dairy alternative Silk brand, which includes soy, almond and coconut dairy alternatives.
At the crux of the matter was Danone’s current ownership of Stonyfield, an organic yogurt manufacturer. The Cornucopia Institute successfully argued before the U.S. Department of Justice that by having the two, Danone would have an unfair advantage in the consumer marketplace and with U.S. organic farmers.
Stonyfield Organic is said to be the largest organic yogurt brand in the world.
In a statement from Mark Kastel, The Cornucopia Institute’s cofounder, the institute wanted to know Danone’s interest in the purchase. Was it simply interested in WhiteWave for its dominance in a growing and more profitable ‘plant-based’ beverage category, or was there more to it given the company’s current Stonyfield holdings?
The organic dairy sector already has less competition within it, when compared to other agricultural sectors, the institute says, and is therefore more susceptible to monopolization.
As one example of where this could have become sticky, Organic Valley, the No. 2 brand of organic milk in the marketplace, has been the longtime raw milk supplier to Stonyfield yogurt, according to the institute. If, after the merger was complete, Danone wanted to end its relationship with Organic Valley, a competitor to WhiteWave’s Horizon Organic, this could have left only one major purchaser of organic farm milk in parts of the United States, the institute says.
“This merger could have reduced options and raised prices for consumers without any positive impact on the quality of the products they’re buying,” Kastel said in a written statement.
In a statement, The Cornucopia Institute writes: “Ironically, Organic Valley just launched a 50/50 joint venture with Dean Foods, the largest milk bottler in the United States, to process and market organic milk. Dean is the former parent of WhiteWave and has been without an organic offering since the spin-off of their former branded products division.”
This may be of interest to some California almond farmers as the WhiteWave Silk brands are a direct competitor to Blue Diamond Almonds and its brand of Almond Breeze dairy alternative beverages.
The Cornucopia Institute bills itself on its website as “promoting economic justice for family scale farming.” Included on that site is a printable chart illustrating the corporate ownership of organic food processors.