Whole Foods Will Stop Selling Chobani in Early 2014

Dec. 18, 2013 — -- Whole Foods Market Inc. said today it will stop selling Chobani yogurt by early 2014 to make way for more organic options and brands free of genetically modified organisms, or GMOs.

Some consumers have complained that Chobani, headquartered in Norwich, N.Y., produces Greek yogurt with milk from cows fed with GMO animal feed.

Whole Foods plans to sell more non-GMO, organic and niche yogurts, the company said, while it is committed to "offering shoppers the widest variety of high quality products possible, including new items shoppers simply can't find anywhere else."

"As the national demand for Greek yogurt has grown, the number of conventional Greek yogurt options has multiplied," the grocer said in its statement. "Whole Foods Market challenged its Greek yogurt suppliers to create unique options for shoppers to enjoy -- including exclusive flavors, non-GMO options and organic choices."

"At this time, Chobani has chosen a different business model, so Whole Foods Market will be phasing Chobani Greek Yogurt out of its stores in early 2014 to make room for product choices that aren't readily available on the market," Whole Foods said in a statement.

Whole Foods' move is a blow to Chobani, which quickly rose to prominence with its various Greek yogurt products, but was embattled in a publicity flub when it voluntarily recalled some of its yogurt due to mold.

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Kenneth Perkins, analyst with Morningstar, said merchandise decisions like that of Whole Foods can happen from time to time.

"As consumers spend more money with a handful of retailers, these retailers have more leverage to lean on suppliers for lower prices, different packaging, etc. This may be one such example," Perkins said.

Chobani also bid Whole Foods farewell.

"Though we have limited distribution within Whole Foods, they have been a wonderful and an important partner of ours over the years," Chobani said in a statement. "As the number one Greek yogurt brand in America using only natural ingredients, we share an affinity with Whole Foods and its shoppers. We know our fans love buying our products in their stores and we hope to continue our partnership moving forward."

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Perkins said Whole Foods has "done a great job" of generating success without relying heavily on national brands.

"To some extent, you could say it's the Whole Foods brand equity, rather than the brand of the product, that gives the stamp of approval on products in Whole Foods stores," Perkins said.

Over the summer, an activist group called GMO Inside asked Chobani to stop marketing its products as "natural" and "real" until it stopped using milk from cows fed with GMO animal feed.

Chobani responded in July with a blog post that said, "GMOs are found in key commodity crops grown in the United States, like corn and soy," and none of its non-dairy ingredients have been genetically modified.

"The challenge lies in the feed to the 78,000+ cows, across 875+ farms surrounding our plants," the company said in July.

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