Is It Time for Starbucks to Stop Milking GMOs?

An anti-GMO organization targets the coffee giant to have it source its milk from GMO-free dairy farmers.

Mar 5, 2014 at 9:04PM

Although the dairy cows we currently get our milk from aren't themselves genetically modified (yet), they're fed lab-altered grain and feed, primarily from corn and soy, but also alfalfa, cotton seed, and sugar beets, which are among the most genetically modified crops around.

But there are alternatives, and GMO Inside, an organization trying to eliminate genetically modified organisms from the food chain, is targeting java slinger Starbucks (NASDAQ:SBUX) in a bid to pressure it to source its milk from organic farmers whose cows are fed only non-GMO feed. 


Source: GMO Inside.

The organization notes that Starbucks is already an industry leader when it comes to sourcing its dairy from farmers who avoid use of bovine growth hormone, as well as using only USDA-certified organic soy milk, which is already GMO-free, and now it wants the company to take the next step and go all the way with the rest of its milk.

GMO Inside has targeted a number of dairy-product companies, including dairy giant Dean Foods and Greek yogurt maker Chobani, which Whole Foods Market (NASDAQ:WFM) purportedly dumped last year because it wouldn't source its dairy from GMO-free farmers (of course, the fact that Whole Foods sells GM products from other companies and was planning on introducing its own house brand of Greek yogurt didn't hurt, either).

There's a growing roster of companies that are abandoning genetically modified ingredients, from cereal makers such as KelloggGeneral Mills, and Post Holdings, to ice cream shop Ben & Jerry's and, most recently, buttery spread maker Smart Balance.

Yet as Ben & Jerry's has found out, it's not so simple to source GMO-free dairy products because of the pervasiveness of GM-tainted feed. Because it's also committed to sourcing its dairy locally, as it has for the past 30 years, the 460 family farmers that comprise the St. Albans dairy cooperative have found it difficult to get GMO-free feed. More than 85% of all corn grown in the U.S. and 94% of all soy is genetically modified. Monsanto (NYSE:MON)Dow Chemical (NYSE:DOW), and DuPont (NYSE:DD) control 80% of the corn seed and some 70% of the soy. In fact, 98% of GM soy and 49% of GM corn is used to feed livestock and poultry.

Of course, once a company begins the process of alternative sourcing, it can't expect that that will fully satisfy those looking for complete elimination. When General Mills announced that its original Cheerios cereal would go GMO-free, GMO Inside immediately launched a new effort to have Honey Nut Cheerios begin using non-GM ingredients, too. Yet the pressure also prevents companies from engaging in a form of greenwashing, doing just enough to silence critics but no more.

Starbucks CEO Howard Schultz has been a leading figure in an enhanced form of business ethics, perhaps not as pious as the conscious capitalism as espoused by Whole Foods co-CEO John Mackey but certainly respectable nonetheless and likely willing to adopt such goals as eliminating GM dairy for its supply chain if enough customers joined in.

The rate of growth in the number of GM crops planted in developed countries seems to be slowing. It was up less than 1% in the U.S., and actually decreased in Canada and South Africa (Asia, however, seems to be on the rise). As more companies drop these ingredients from their products, more farmers will turn away from growing them, and the leveling out will turn into a decline, something GMO-free proponents hope can be achieved one cup of coffee at a time.

No crying over spilled milk
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John Mackey, co-CEO of Whole Foods Market, is a member of The Motley Fool's board of directors.

Rich Duprey owns shares of Dean Foods. The Motley Fool recommends and owns shares of Starbucks and Whole Foods Market. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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