General Mills Gives a Hearty "Cheerio!" to GMOs

Although the cereal maker went GMO-free with its original brand, it's apparently now doubling down on their inclusion

Jun 5, 2014 at 10:29AM

Cheerios Protein Oats

Source: General Mills

You just knew General Mills(NYSE:GIS) support for GMO-free cereals was simply a thin veneer, a sop to activists agitating for removing genetically modified ingredients instead of a deep-rooted conviction its cereals would actually be better. It became particularly clear after its CEO said its GMO-free original Cheerios failed to move the needle, which was just what he expected, and he had no intention of removing them from any other cereal.

But the introduction of a new Cheerios Protein line underscores where his loyalties really lie, and it's not with the clean-foods crowd.

While it's understandable why the cereal maker would contribute millions of dollars to defeat state GMO labeling laws, since dealing with a patchwork quilt of competing standards makes operating a company with a national footprint challenging to say the least -- although simply removing GMOs from cereals wherever they're sold would largely solve that problem -- it's not so intuitive why it would wholly endorse making its best-selling brand even more GM dependent.

Cheerios Protein comes with 11 grams of protein, four more than the original, and with protein among the biggest, fastest growing trends among consumers, General Mills is hoping that by packing more protein into its cereal will help offset the general decline cereal makers have experienced.

Screen Shot

Source: Janney Capital Markets, "Closing in on the Cereal-Killer," Oct. 18, 2013 

To infuse the new cereal with more protein, General Mills is making them with soy, which it says gives it the benefit of being compatible with vegetarian diets, but also has a better taste profile.

The problem is, virtually all soy grown in the U.S. today is genetically modified. According to the U.S. Department of Agriculture, some 93% of the soybeans grown on U.S. farms are herbicide tolerant, meaning they've been genetically engineered to withstand herbicides, mostly Monsanto's (NYSE:MON) Roundup brand. That percentage is up from 68% in 2001 and from just 17% in 1997, making it the second largest GM crop in the country behind corn, but also the most widely planted GMO crop ("only" 85% of U.S. corn is genetically modified). 

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Source: U.S. Dept. of Agriculture

It's also Monsanto's second biggest profit center behind corn, generating over 15% of the company's sales and gross profits in 2013.

That means Cheerios Protein is likely made with GMOs. Of course, sourcing organically grown soy might be problematic as less than 1% is grown that way (0.2%, actually), and the remaining 7% or so is grown traditionally, without being genetically modified.

One of the problems with GM soy is that residue from glyphosate, which is the active ingredient in Monsanto's herbicide, remains with the plant more so than it does in other crops grown with the trait. According to a study published in this month's issue of Food Chemistry, on average GM soy had total residue equaling 11.9 parts per million. Although that's below the 20 ppm threshold set by both the U.S. and the EU, the study goes on to note the threshold was raised from 10 ppm not because of greater safety or efficacy, but merely because the glyphosate was so prevalent in our foods.

It may be true that sourcing GM soy is easier than organic or even traditionally grown soy, but if delivering protein is General Mill's true goal then it might want to take the pains to do so as the study also found the organic soy (and to a slightly lesser extent, conventional soy) packed more protein than did its genetically modified counterpart. Yet because soy also contains both linoleic acid and palmitic acid, a saturated fatty acid, if they're not consumed in balance it becomes a bigger risk factor for developing obesity. Organic soy had substantially lower levels of both kinds of acid while and GM soy contains palmitic acid levels that are significantly out of whack with the linoleic acid counterparts.

The $9 billion ready-to-eat breakfast cereal business is coming under pressure from the changing tastes of consumers who are looking at both convenience and foods they can eat on the go. Yogurt has specifically grown in popularity, as have breakfast bars, with Kellogg (NYSE:K) saying it's necessary to look "beyond the bowl" for new growth opportunities.

General Mills attempt to meld this interest in protein to its leading cereal brand may be a worthy effort, but seemingly doing so by pursuing the GMO route suggests its previous efforts at going GMO-free were merely paying lip service without having commitment. 

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