Somehow the picture fits: withered nature around Darmstadt and partly also on the Alnatura campus. The organic sector has also been suffering for months. The Superbiomarkt and the Bacher health food store filed for bankruptcy. Götz Rehn, 72, organic pioneer and founder of the organic supermarket chain Alnatura, warns of the decline, almost desperately advertises his own products and is combative.
SZ: Mr. Rehn, is inflation shattering all hopes in the organic sector of finally breaking out of the niche? Some organic retailers are threatened with bankruptcy.
Götz Rehn: It’s true, the organic market is experiencing its worst slump in 35 years. And unfortunately it’s not just inflation that worries us organic retailers, even if Alnatura is doing relatively well. People are generally unsettled and are looking for orientation. They want to save and go back to the discount store more often, which also sells industrially produced mass-produced goods. The electricity bill is also simply a disaster for all of us. In addition, up until a year ago we had an unbelievable organic boom. This has led some to tackle projects that are getting them into trouble today.
Isn’t the biggest problem that organic is just too expensive for most people?
The assumption is wrong. There are organic products that are cheaper at Alnatura than conventional products, for example at Rewe. (pulls out a piece of paper). As of today, the 500-gram pack of Alnatura spaghetti costs 1.19 euros, Barilla 1.99 and our oat flakes 1.19, those from Kölln 1.49. Our oat drink costs 1.25, Alpro’s 1.99. Unfortunately, most of our customers do not know that we are cheap. It’s a phenomenon, but that’s the way it is.
yourself to blame?
That has more to do with the former image of the health food stores and organic shops, rightly so, I have to say. They were very expensive 30 years ago. That continues to this day. And some people still mistakenly believe that organic products don’t taste that good.
Doesn’t the uncertainty also play a role as to whether the goods are really organic and who checks that?
You are right about the uncertainty among consumers. But in fact, organic is the best controlled food there is. The EU organic regulation ensures this. We are closely watched by checkpoints. And we have all our products checked regularly and rely on the seal of the organic farming associations. And we look at the prices, including those of the producers. We want them to have their fair income too. Because we are convinced that we can make the world a better place with organic. Organic has many advantages for biodiversity, water quality, health and climate protection. Therefore, as many people as possible should be able to buy organic. We’ve long since left the elitist corner.
But if organic has so many advantages, why is the proportion of organic food not even seven percent?
That’s an interesting question that I keep asking myself. Many people have a misconception about us. They are surprised when I tell them that the Alnatura store has one of the best white sausages. Or we have a very special ham, so you won’t find a better one in terms of taste. The first hurdle is that they believe it’s a sectarian assortment. But that’s not true, we have potatoes, salad, Black Forest ham. And the taste is right. We fight for every article that it is qualitatively the best of the best.
Isn’t it already a directional decision what to buy, organic or not?
Naturally. If you contrast organic food and agribusiness, they are two completely different worlds. One world is highly subsidized with around five billion euros every year in Germany alone. This means that a pot is financed via the tax, which means that the products are cheaper. Then there are the external costs, which amount to around 90 billion euros. Citizens pay for this indirectly through higher water prices and rising costs for environmental and climate protection, because in conventional farming, soil, water and biodiversity are heavily polluted or threatened by pesticides and excessive fertilization.
Are you claiming that prices at Aldi, Lidl, Edeka and Rewe are subsidized?
Yes. We don’t have any real prices, the prices lie. However, this is a socio-political problem. If in the market economy, and I am a friend of the market economy, the prices no longer tell the truth, then this leads to wrong developments. Then competition becomes distorted and companies are squeezed out, as we are currently seeing with insolvencies.
By definition, isn’t it always cheaper to produce mass-produced goods than individual items due to falling unit costs?
Not necessarily. Objectively, organic products have a lower price for the same quantity than conventionally produced goods if they included the true social costs of production. But nobody sees them when they go shopping in the supermarket. Therefore, customers do not know the true price.
Then why not advertise with real prices?
Advertising is expensive. We have such low prices precisely because we spend comparatively little on marketing and advertising. We count on being recommended. And then, in this fight for cheap prices, there is of course the question of how to make reasonable arguments if the basis is not comparable.
Are the organic prices at Aldi and Lidl lying?
A discounter Aldi calculates the prices very differently than an Edeka or us. He keeps a very limited range in gigantic quantities and is very tightly organised. Therefore, the Edeka and Rewe organic own brands are more expensive than those from Aldi. It has to do with the structure of the business. But that has nothing to do with lying.
Who is then the biggest blocker of an upswing in the organic market?
There are many examples showing that agribusiness has a good lobby. In addition, there are false EU agricultural policy subsidies. As long as the traditional agro-industrial model is being promoted from all sides, how is organic farming going to progress? It is remarkable that there are so many people who buy organic at all. You have to take your hat off to them because they make life really difficult for them.
Critics say organic farming is a global disaster because…
… then there would be great famines. These views are communicated with great skill. We don’t want 100 percent organic cultivation, I would be happy with 40 percent. The federal government wants to reach 30 percent in Germany by 2030.
Is this realistic?
As it is right now, it’s completely illusory. To do this, Germany would have to convert 450,000 hectares per year. But last year it was only 80,000. Even as a small company, we have contributed 2.6 million euros through our Alnatura organic farmers initiative so that an area of 17,000 hectares is now farmed organically. You have to imagine where we would be today if the four major food retailers in Germany invested in organic farming in a similar way.
Should politicians intervene more?
In 35 years, I have had the privilege of getting to know all the agriculture ministers personally. Apart from Renate Künast, hardly anyone has changed the previous course per agricultural industry in the past. It created the state organic seal and set the target of 20 percent organic cultivation area.
… which stagnates at ten percent …
And even at this low level, many organic farmers are under extreme pressure at the moment. Many still have the 2021 harvest in stock. They can’t get rid of their goods because demand has collapsed. The drama that is looming is gigantic.
In what way?
If the farmers do not sell the organic quantity, they could end up being forced to sell the goods at a loss below the purchase price. Many customers do not even realize that every act of purchase is an order to produce the same thing again. But if this act of purchase fails to materialize, the consequences will be enormous. This can lead to existentially threatening situations and to a social regression. Organic farmers could then switch back to conventional farming. We may be thrown back years. That would be fatal.
Do you see a solution?
The federal government would have it in their hands. It would have to reduce VAT on organic food, it could make a proportion of organic food compulsory in public institutions and encourage farmers who switch – and do so well beyond a legislative period.