You Won't Believe What Anti-GMO Activists Are Forcing on Starbucks

Starbucks may have taken growth hormone-fed cows out of its supply chain years ago, but it refuses to budge to the initial demands of GMO Inside to switch to organic dairy milk. Why?

Mar 10, 2014 at 1:35PM

Looking to avoid food products created from genetically modified organisms with your morning caffeine injection? Well, you'll have to avoid all 20,000-plus stores of Starbucks (NASDAQ:SBUX). Good luck.

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GMO Inside, an organization with a long history of pressuring large companies to jump ship from GMOs, called on Starbucks "to stop sourcing milk from cows fed genetically modified organisms in feed" and backed up its demands by reminding consumers "Starbucks already serves soy milk that is organic and non-GMO. Consumers also deserve dairy milk held to the same standard and level of quality." While the coffee chain may already serve GMO-free soy milk, it is much easier to source and verify than dairy milk, which faces nearly insurmountable hurdles for a supply chain stretching across 62 countries. Despite that fact, some consumers won't back down from their demands. Will Starbucks ever offer only organic dairy milk?

A Grande mistake?
The movement to persuade Starbucks to use more "consumer-friendly" products is less than one week old, so I would expect the pressure to only intensify over the coming weeks and months. After all, GMO Inside launched a "No GMOs, Cheerios" campaign on social media in 2013. General Mills (NYSE:GIS) responded by ensuring its supply chain for Original Cheerios was GMO-free. However, considering that no other General Mills cereal brands would make similar changes -- not even the other 11 offerings of Cheerios -- it appeared more symbolic than the beginning of a breakfast revolution.

Despite the success with General Mills and the fact that the Starbucks campaign is still in its infancy, you shouldn't expect the ingredients for your morning latte to change anytime soon, if ever. Simon Redfern, director of corporate affairs for Starbucks U.K., responded to GMO Inside's campaign by simply saying, "We keep all aspects of our business under regular review and our milk supply is no different. At this current time we have no plans to change our milk."

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That doesn't exactly scream defiance, but Redfern's words aren't the only thing making GMO-free organic dairy milk at Starbucks an unlikely possibility. As I explained last year before and after Whole Foods Market (NASDAQ:WFM) booted all-natural Chobani Greek yogurt from its shelves, the tiny organic feed market simply cannot support large numbers of organic meat or dairy (organic meat and dairy milk must be produced from cows fed organic feed). In 2011, organic pastureland in the United States totaled 3.5 million acres, which represented 350% growth from 1997 levels. While impressive, it's important to put the figure in perspective. So, simply consider that Nebraska alone contains more than 24 million acres of total pastureland.

If that alone wasn't enough, consumers should consider that claims made by GMO Inside implying organic dairy milk is higher quality or healthier than conventional milk are irresponsible and wrong. Numerous studies have demonstrated that there is no nutritional difference between the two. In fact, studies have shown that the levels of growth factors in conventional milk is not significantly different from levels found in organic milk, nor would any increase impact human health, since bovine growth factors are not biologically active in humans. Luckily for worried consumers, Starbucks already removed growth factors from its dairy milk supply chain. Just don't expect organic dairy milk to follow.

Foolish bottom line
Every consumer can make the choice to purchase exclusively organic foods, but you have to realize that the organic feed market simply cannot support the international, let alone domestic, operations of a global chain such as Starbucks. If more organic pastureland were available, it might be a different story -- and an easier decision to make. It just isn't possible given the logistics at this time. Before you sign GMO Inside's petition, ask yourself if you're really demanding the impossible.

What would Buffett think of Starbucks?
With or without organic milk, Starbucks presents a tremendous opportunity for investors. And as every savvy investor knows, Warren Buffett didn't make billions by betting on half-baked stocks. He isolated his best few ideas, bet big, and rode them to riches, hardly ever selling. You deserve the same. That's why our CEO, legendary investor Tom Gardner, has permitted us to reveal "The Motley Fool's 3 Stocks to Own Forever." These picks are free today! Just click here nowto uncover the three companies we love. 

John Mackey, co-CEO of Whole Foods Market, is a member of The Motley Fool's board of directors. Maxx Chatsko has no position in any stocks mentioned. Check out his personal portfolioCAPS pageprevious writing for The Motley Fool, or his work for the SynBioBeta to keep up with developments in the synthetic biology industry.

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 may not 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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