Whole Foods Market Inc. and Wild Oats Markets Inc., the two largest U.S. chains of natural-food stores, plan to ban genetically modified ingredients from their hundreds of private-label products.
The grocers would be the largest U.S. food retailers to ban genetically modified ingredients. Austin-based Whole Foods operates 103 stores in 22 states and the District and has more than 600 products carrying its brand name. It operates stores as Fresh Fields, Bread & Circus, Nature's Heartland, Bread of Life, Merchant of Vino and Wellspring Grocery. Boulder, Colo.-based Wild Oats operates 110 stores in 22 states and British Columbia. It has about 700 products under its own brand.
The move follows similar bans by major European supermarket chains, reacting to consumer concerns over the foods' safety. Though the U.S. Food and Drug Administration has deemed genetically modified foods to be safe and essentially no different from conventionally grown foods, the grocers' decision could influence public opinion, an analyst said.
"You're seeing more and more examples of this," said Frank Mitsch, an analyst with Deutsche Banc Alex. Brown. "I would not be surprised to see labeling at some point."
Concerns about Monsanto Co.'s agriculture business have contributed to a 25 percent decline in the price of its shares this year. The St. Louis-based maker of drugs, farm chemicals and seeds is planning to merge with Pharmacia & Upjohn Inc. to strengthen its pharmaceutical business. It also plans to spin off 20 percent of the agricultural business after the merger.
Major supermarket chains show no signs they're considering any ban on gene-modified ingredients, said a spokesman for major food processors.
"We don't think it's something we have to worry about for the large retailers," said Gene Grabowski, a spokesman for Grocery Manufacturers of America, which represents large brand-name food companies.
An estimated 60 percent of U.S. grocery products contain ingredients derived from genetically modified crops such as corn and soybeans. These include products from such well-known companies as Kellogg Co., Nestle SA and PepsiCo Inc.
The natural-food grocers say they're acting on customer demand.
"It's really not my position to say genetically engineered is a good thing or a bad thing," said Jim Lee, president and chief operating officer of Wild Oats.
"It's a matter of having a shopping choice. A high percentage of our customers are opposed to anything artificially introduced into their food."
Lee said he hoped to begin changing the labels of Wild Oats products sometime next year to say the foods contained no genetically modified ingredients.
Whole Foods has arranged for lab testing of ingredients that might have been genetically modified, while Wild Oats said it would take the word of its suppliers. Genetically modified seeds were planted this year on more than half of the U.S. soybean acres and more than a third of U.S. corn acres.
Shares of Whole Foods fell 37 1/2 cents, to $45.62 1/2, in trading on the Nasdaq Stock Market, while Wild Oats fell 50 cents, to $22.50. Shares of DuPont fell 75 cents, to $65.12 1/2, and Monsanto fell 81 1/4 cents, to $35.68 3/4, on the New York Stock Exchange.
Margaret Wittenberg, vice president of governmental and public affairs for Whole Foods, said all but a handful of Whole Foods products are already free of genetically engineered ingredients. The grocer hasn't labeled the products but has distributed brochures in stores about the plan.
About 12 percent of Whole Foods' $1.6 billion in fiscal 1999 sales were from its private-label products. Wild Oats had sales of $478 million for the first nine months of 1999, and products with its own label account for about 7 percent of its total sales. It also operates stores under a variety of names.
CAPTION: Counterprotester Antwan Brown of the District talks to protester Elizabeth Darrow during a demonstration against genetically modified food last month in Washington. The issue has risen in profile here after an outcry in Europe.