The French dairy giant, Groupe Danone (Dannon in the U.S.) has announced the proposed acquisition of WhiteWave Foods for approximately $10 billion. The deal would combine the world’s largest organic yogurt brand, Stonyfield, with Wallaby, a rapidly growing yogurt label, and the nation’s largest brand of organic milk, Horizon. The Cornucopia Institute, an organic industry watchdog, said they were formally challenging the acquisition based on the serious erosion of competition it would create in the consumer marketplace and the negative economic impact it would have on U.S. organic dairy farmers.

WhiteWave brands are the top sellers in their categories. Horizon organic milk controls nearly 25% of the organic milk market, while their Silk brand is a leader in plant-based beverages. Danone will be taking control of a bigger piece of the organic dairy market than has ever been controlled by a single company before.

“With this acquisition we are concerned that Danone will easily be able to beat out any competition by lowering prices beyond what farmstead dairies, and more moderately sized milk processors and marketers, can withstand,” said Marie Burcham, a livestock policy analyst with the Wisconsin-based Cornucopia Institute.

Dairy has long been the first food consumers’ associate with the organic label. In many households organic milk is among the first foods introduced to children. Following fruits and vegetables, organic dairy products are the second largest product segment in the organic industry. “As such a key part of the organic market, it is vital that competition remains open,” Burcham added.

The Cornucopia Institute makes this argument in letters calling on the Department of Justice and the Federal Trade Commission to treat this merger as suspect. They have also launched a petition drive on their website pushing for a full investigation of the proposed merger by federal regulators.

The market for organic dairy already has less competition than other agricultural sectors and is more susceptible to monopolization. “It is important that the authorities look at the anti-competitive implications of the Danone-WhiteWave deal,” continued Burcham, “We ask that they consider the organic dairy and organic yogurt markets in particular as different and already more concentrated markets in comparison to Danone’s other, non-organic market share.”

Burcham, who in addition to her expertise in livestock agriculture is trained as an attorney in environmental law, added, “These are important considerations for determining whether this acquisition violates the Sherman Act and the Clayton Act for anti-competitive and anti-trust reasons.”