Monday, May 20, 2024

We need Price Parity between Vegan and Non-Vegan Foods

On May 10 2022, the patrons of a Manhattan Starbucks were no doubt rather startled and bemused to have their coffee interrupted as Oscar nominated actor (and honorary PETA director) James Cromwell started a protest along with several other PETA members. While the baristas studiously attempted to ignore what was going on, Cromwell and another activist super-glued themselves to the counter and then Cromwell read out a statement condemning Starbucks’ policy of charging extra for non-dairy milks.

Wearing a “Free the Animals” T-shirt Cromwell and the other PETA activists then chanted “Save the Planet, Save the Cows, End the Vegan Up-Charge now” and soon afterwards the police arrived to close the store and presumably arrest everyone. However, after freeing themselves from the counter with a knife it seems that all involved agreed to leave peacefully and there were no arrests. Possibly Starbucks was glad not to have to prosecute the 82 year old actor and risk even more bad publicity.

The protest was live streamed by PETA and did generate a lot of publicity, but I think not really of the right kind. Much of the commentary focused on Cromwell himself and his history of activism stretching back to the Vietnam war. Some articles applauded him getting involved in protests at the age of 82. Some noted that there is a discrimination issue involved as many people of colour are lactose intolerant. Many articles treated the event as an amusing story but very few commentaries discussed the core issue. Why does Starbucks charge more for non-dairy milks? Why are processed vegan foods generally far more expensive than meat or dairy?

We see this same kind of price differential on many vegan food options. Maybe in a perfect world vegans would only eat beans and pulses and other whole foods, but sometimes you just want a pizza or a burger or mayonnaise or lasagne. We do have to make some allowance for the fact that many vegan foods are produced at a smaller scale by smaller companies and sometimes they require processing. Also, the massive government subsidies given to meat and dairy allow them to be sold at a lower cost (and yet farmers often struggle to even make a living). However, even taking that into account the price differential seems far too high, especially where the companies involved (like Starbucks) are large multinationals. While some vegans bemoan the trend of small vegan companies getting bought up by larger food conglomerates (like Danone’s purchase of Alpro), I believe this is a good thing. It indicates that those companies see the writing on the wall and are willing to invest and develop vegan brands. However, in some cases the premium they charge for vegan options goes far beyond what is justifiable, and is having the effect of constraining growth in those products. Research in 2021 for the UK showed that plant based products cost 2-3 times more than animal equivalents.

Reviewing my local supermarket, looking at for example soya-based meatballs from a large frozen food company, they are double the price (100% higher) compared to an equivalent meat product. Interestingly though, the soya meatballs are only 20% higher than a “reduced fat beef meatballs”.  There is an important parallel to be drawn here about profit margins and the public good. The difference between the regular and low-fat meatballs is that one is 88% beef and the other is 92% beef – yet the low-fat ones are priced 50% higher! Why? I’ll quote James Cromwell here: “Making conscientious people pay more is profitable.” That conscientiousness might be about animal welfare or climate change and the environment, or about their own health, but whatever the reason they are willing to pay more to do the right thing as they see it.

In each case the companies involved are calculating how much more they can charge where the people involved care about something. However some people, especially now, can’t afford to pay more for the better choice even if they wanted to. They will buy the cheapest product out of necessity, and the companies adding a premium for vegan options are taking that choice away from them. That might be ok where, for example, it’s a gourmet ketchup versus a generic one, but this is the future of the planet we are talking about here! All of these companies (as Starbucks does) proclaim that they are committed to reducing their environmental impact and related greenhouse gas emissions, and yet they are not acting in the global good by making it affordable for people to switch to lower impact food choices.

Eventually, vegan food products will become cheaper than meat and dairy and there are some indications that this may happen sooner than expected with a recent survey in the Netherlands showing that some plant-based meat options are now cheaper than their meat equivalents. However, it does seem that this is due more to the inflation issues of 2022 causing the meat products to become more expensive, rather than the vegan ones getting cheaper.  So if the corporate pattern repeats we would have to be concerned that companies may increase vegan prices too after pricing stabilises.

If we are serious about reducing the effects of climate change then we have to move away from meat and dairy. Governments can help with this by reducing subsidies for animal agriculture while increasing subsidies for vegan alternatives. Consumers need to keep applying pressure on companies and exposing their hypocrisy when they charge far more than is justified for vegan products while at the same time claiming that the environment is one of their priorities.

Starbucks did issue a response to the glue-in, where they noted that “the additional cost” for vegan dairy substitutes was “similar to other beverage customisations like an additional espresso shot or extra syrup”. This seems an odd position to take for a company that in 2020 committed to cutting it’s carbon, water and waste footprint by half and which itself acknowledges that dairy is the largest contributor to its carbon footprint. Is Starbucks really saying that the choice of a non-dairy milk is just another choice like caramel syrup? That it doesn’t matter one way or the other to their environmental impact which type of milk customers pick? That charging so much more for non-dairy has absolutely nothing to do with squeezing conscientious customers for extra profit? In fact, in 2020 at the launch of that goal as reported by the Seattle Times the then CEO of Starbucks noted that “he wanted to push consumers to choose milk made from almonds, coconuts, soy or oats, whose production is environmentally friendlier than dairy”.  And he said: “Alternative milks will be a big part of the solution…The consumer-demand curve is already shifting.” It’s now 2 years past that announcement and Starbucks is still charging 15% more for a non-dairy milk coffee in the US. Why? Because they can. Because they have calculated that they can make more profit that way and that profit overrides any longer term environmental impact goals. Make profit now and maybe get to the reduction in 2030. That may be too late to save the planet though, and we may have more things to worry about than adding syrup to coffee.

As a postscript I should note that in several countries outside the US, Starbucks has removed the surcharge for non-dairy milks. China and India may never have had it and the UK, Ireland and France dropped it in early 2022. So clearly it can be done, but it’s a sad indictment of corporate culture that a company like Starbucks in the US is dragging its heels and delaying doing the right thing.


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