WASHINGTON, Aug. 10, 2016 -- The Cornucopia Institute, an organic industry watchdog group, has filed a complaint with U.S. federal regulators alleging that French dairy giant Danone’s proposed acquisition of White Wave Foods is anti-competitive and a threat to the American organic dairy market.
Cornucopia said it has also launched a petition drive calling for the Justice Department and the Federal Trade Commission to investigate the planned merger.
Danone (Dannon in the U.S.) owns Activa, Oikos, Dannon and the world’s largest organic yogurt brand, Stonyfield, Cornucopia pointed out. The proposed $10 billion purchase of WhiteWave would combine Stonyfield with Wallaby, a rapidly growing organic yogurt label, and with Horizon, the nation’s largest organic milk brand, giving Danone a larger share of the U.S. organic dairy market than a single company has ever controlled, the watchdog group said in a release.
A union of the two companies “will have a chilling impact on both competition in the consumer marketplace and the wholesale market for organic milk,” Cornucopia said in its complaint. “We have specific concerns that this acquisition would have a serious anti-competitive effect on the organic yogurt and organic fluid milk markets in the U.S.”
The merger could violate both the Sherman Act and the Clayton Act for anti-competitive and anti-trust reasons,” said Marie Burcham, a livestock policy analyst and attorney with The Cornucopia Institute, who signed the complaint letters. “With this acquisition we are concerned that Danone will easily be able to beat out any competition by lowering prices beyond what farmstead dairies, and more moderate size milk processors and marketers, can withstand,” Burcham said.
In its release, Cornucopia said the market for organic dairy already has less competition than other agricultural sectors and is more susceptible to monopolization.
“Mergers like this one could eventually reduce options and raise prices for consumers,” said Mark A. Kastel, Cornucopia’s co-director. “With less competition, big companies commonly underpay independent farmers for their products, undermining the economic viability of small, family-scale farms.”
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