The premium price for organic products induces a natural, logical response in growers to capture as much of it as they can. Some of them are good producers and managers and become big winners in this competition. Hence the stunning statistic that has been revealed as "Spinachgate" unfolds.
Earthbound sells more than 70 percent of the country's bagged organic salad and processes about 30 million salad servings each week, according to the company. Its produce can be found in nearly three-quarters of U.S. supermarkets and in all 50 states and Canada. [More]Various reports differ on the source of the contamination, with at least one suggesting it is in the irrigation water - which means you can't wash it off - the bacteria are in the spinach leaves. Worse yet for growers, the timing creates a "perfect spinach storm".
It may take some time to sort out the real origin, and then more to restart the supply chain. Coaxing consumers back could take considerably longer. Regardless, just when organic is seeing some market progress, revelations that organic doesn't necessarily mean small agrarian farms may erode their pricing power.
That's the trouble with selling an image - not a product.