Mexico is a country battling rising rates of obesity and the country’s government has been busy trying to encourage its citizens to eat healthily. However, the food industry is under the microscope with consumer groups analysing the impact manufacturers have on the nation’s health. Ivan Castano reports on the criticism facing Grupo Bimbo, the nation’s largest baker, which stands accused of deceiving consumers with its bread labelling.
The rate of obesity in the US is well known but a less familiar fact is that the world’s second-most obese nation is south of the border in Mexico.
According to national statistics, two-thirds of Mexican men and some 71% of women are overweight. The Mexican government has launched healthy-eating campaigns in a bid to stem rising obesity rates but the concern remains that more of the population could succumb to obesity and related diseases.
Consumer groups have criticised Mexico’s food industry – and the multinational food makers that operate within it – for their alleged contribution towards the rising levels of obesity. In the firing line right now is one of Mexico’s largest, home-grown food manufacturers – bakery giant Grupo Bimbo.
The company, Mexico’s largest bread maker, has been forced to defend itself against claims that it is hindering the fight against obesity through the use of “deceitful” labels on selected lines.
The consumer watchdog in Mexico has mounted a campaign accusing Bimbo of using labels to promote its sliced wheat breads as being healthier than they actually are. The claims centre around one key premise: that Bimbo labels state the breads are “100% whole wheat” without specifying the amount of whole wheat grain or reconstituted flower they contain.
The watchdog, El Poder del Consumidor, has urged health authorities in Mexico to intervene but it claims that the agency has so far failed to respond. And, according to Alejandro Calvillo, spokesman for El Poder del Consumidor, Bimbo has also not responded to its demands to publicise how much wheat flour is in their breads.
Calvillo claims that any 100% whole-wheat bread should have at least 50% wheat flour that comes from whole-wheat grain or reconstituted whole-wheat flour. “Bimbo continues to flout our requests to tell us how much wheat flour their bread has,” says Calvillo says. “They say their bread is 100% whole-wheat but they won’t show us why.”
According to the consumer group, which has led campaigns including full-page ads in top Mexican newspaper La Reforma, Bimbo has been able to flout this requirement because of its heavy clout in Mexico’s economy and on its political landscape. Bimbo’s owner is Lorenzo Servitje, who is said to wield huge influence in Mexico where he is a renowned corporate philanthropist. “We are talking about a food monopoly with 90% of the Mexican bread market,” argues Calvillo. Bimbo, billed as the world’s third-largest bread maker, posted sales of US$7.5bn in 2008.
Nevertheless, despite the watchdog’s exasperation with Bimbo, Cavillo hopes the company will comply with the new law and state how much whole-wheat flour its products contain. Cavillo claims the firm changed its labelling to include whole-wheat flour as an ingredient a few months ago following the first public criticism from the watchdog but he says the labels still do not specify the amount of whole-wheat flour in percentage terms.
“This is a country with huge numbers of obese people,” he notes. “Doctors advise consumers to eat more whole foods including whole-wheat breads. The supermarket is dominated by Bimbo brands so if they see a Bimbo product that claims to be “100 whole-wheat”, you bet they will buy it. Bimbo tells us its breads use the ‘most excellent products’ but the truth is that many of its breads and pastries are full of sugars and fat and aren’t as healthy as they claim.”
Bimbo’s reputation is already suffering in Peru, Panama, Venezuela and Chile, where the company has faced similar consumer campaigns. The greatest blows have come in Peru and Panama where the group has been fined US$100,000 and US$10,000 respectively, ordered to recall products and modify its labels.
According to Calvillo, it will only be a matter of time before loyal Mexican consumers take note of Bimbo’s “false” practices. However, speaking to just-food, Bimbo mounts a vigorous defence against the claims from Cavillo and the watchdog. Corporate relations director Luis Rene Martinez says Bimbo has not specified the amount of whole-wheat flour in its whole-wheat breads because such a measure is not required by Mexican law.
“We don’t cheat or hide anything from consumers,” Martinez says. “In different countries we use different labels, depending on what authorities require, and we always follow the law.”
According to Martinez, Bimbo’s whole-wheat breads contain 50%-70% whole wheat flour depending on the brand and packaging. Bimbo says a shortage of whole-wheat flour in Mexico means its bread uses mostly reconstituted whole-wheat flour, although Martinez points out that the firm is working to increase the whole-wheat grain content of its breads.
“We have told consumer agencies that our breads are made of the highest quality ingredients and when we say that our bread is 100% whole-wheat it’s because it has those characteristics,” Martinez says. “It either comes from whole grain or reconstituted wheat flour which has the same nutritional [characteristics] as coming from wheat grain. We have laboratory data to prove this.”
Martinez claims that Bimbo has applauded Mexico’s new bread law that will require whole-wheat bread manufacturers to state the percentage of whole-wheat flour in their products. “We are going to adapt to this law and re-label all our products before it comes into effect next January,” Martinez says, adding that he doesn’t expect the process will be costly for Bimbo.
Analysts say the consumers’ claims, while valid, are unlikely to tarnish Bimbo’s image in Mexico or Latin America unless they reach greater proportions
“So far, these claims have had little effect with consumers in Mexico,” says an analyst with a major investment bank in Mexico City. “Bimbo is a market leader and that plays in its favour. However, they are going to have to re-label their wheat breads and they will need to do this as quickly and silently as possible.”
Calvillo, however, disagrees. He claims that Bimbo’s marketing practices have already brought damage to the company, pointing to Bimbo’s place in a list of the “world’s 200 most respected companies”. The company’s ranking, he says, slipped by eight places to 17 in the first quarter of this year, a period in which its Mexican sales grew 0.7%, a weaker rate of growth than was expected.
Nevertheless, Bimbo’s Martinez says labels stating the percentage of whole-wheat flour contained in the bread should not be used to define the product. “For us ‘100% whole-wheat’ is a branding message, not a definition of the product. Plus, the concept of what a wheat bread is hardly exists in Latin America.”
The Bimbo director says the company is appealing its US$100,000 fine in Peru as local law does not require a company to state the amount of whole wheat flour in its breads. Still, Bimbo recalled the bread for two or three weeks and re-introduced it with modified labels.
Bimbo is similarly challenging its US$10,000 fine in Panama, although Martinez admits that the company is working to reintroduce the bread with labels showing exact nutritional percentages.
Nevertheless, Bimbo will need to take care with its reputation in Mexico. The company may dominate the bread market but, with the country’s government stepping up its actions to tackle obesity, it would perhaps be in the group’s interest to be proactive rather than reactive on the issue.