Transcript Food Supply Chain Mgt: US Perspective

Acceptance of Altered Foods:
A European Perspective
Eluned Jones, TAMU
Lynn Frewer, U. of Wageningen
Drivers of the EU perspective
1996 UK regulatory agencies
Nov/Dec 1989 Fall of Berlin Wall –
acknowledge link BSE/vCJD
Start of conversion of Eastern
Europe to market economies
1999 Dioxin contamination of
US Farm Bill
poultry feed in Belgium
market oriented
1985
Strategic decision making on
investment pipeline in
bio-engineering
1990
1995
2000
2005
Monsanto & DuPont invest
$20B in acquisitions
1996 – 1st commercial
biotech crops plants
Media reporting about BSE in 1996
Risk
Trust and blame
30
number
of
articles
20
Quality papers
Tabloids
10
0
date
Social amplification of risk - Trigger events (1) The Pusztai case
(August 1998)
Social amplification of risk - Trigger events (2) Greenpeace starts
picketing (1998)
Social amplification of risk - Trigger events (3) The Prince of Wales
joins in (1999)
Industry attempts issues management - Monsanto UK corporate
advertising campaign (1998)
Belgian dioxin crisis 1999
Domestic consumption: robust
Poultry
25
Per capita
consumption
(kg) of beef
and poultry
in Belgium
Beef and
Veal
20
15
Dioxin crisis
10
5
0
1996
1997
1998
1999
2000
2001
(Data source: Euromonitor)
Belgian dioxin crisis 1999
Exports: sensitive
Dioxin crisis
Poultry
180000
160000
Belgian beef 140000
and poultry 120000
exports
100000
(metric tons) 80000
60000
40000
20000
0
Beef and
Veal
1989
1991
1993
1995
1997
1999
(Data source: UN, COMTRADE database)
Top Global Supermarket Companies
Company
Countries of Operation
Wal-Mart
Stores (US)
Argentina, Brazil, Canada, China, Germany, Japan, Mexico, Singapore, S. Korea, UK,
US, Vietnam
Carrefour
(France)
Argentina, Belgium, Brazil, Chile, China, Colombia, Czech Rep., Dominican Rep.,
Egypt, France, Greece, Indonesia, Italy, Japan, Malaysia, Mexico, Oman, Poland,
Portugal, Qatar, Romania, Singapore, Slovakia, S. Korea, Spain, Switzerland,
Taiwan, Thailand, Tunisia, Turkey, US.
Ahold
(Netherlands)
Argentina, Brazil, Chile, Costa Rica, Czech Rep., Denmark, Ecuador, El Salvador,
Estonia, Guatemala, Honduras, Indonesia, Latvia, Lithuania, Malaysia,
Netherlands, Nicaragua, Norway, Paraguay, Peru, Poland, Portugal, Slovakia,
Spain, Sweden, Thailand, US
Kroger (US)
US
Metro
(Germany)
Austria, Belgium,Bulgaria, China, Croatia, Czech Rep., Denmark, France, Germany,
Greece, Hungary, India, Italy, Japan, Luxembourg, Morocco, Netherlands,
Poland, Portugal, Romania, Russia, Slovakia, Spain, Switzerland, Turkey, UK,
Ukraine, Vietnam
Tesco (UK)
Czech Rep., Hungary, Ireland, Malaysia, Poland, Slovakia, S. Korea, Taiwan,
Thailand, UK, US
Costco (US)
Canada, Japan, Mexico, S. Korea, Taiwan, UK, US
Albertsons (US)
US
Assessing perceptions of food risks
FAMILIAR
Salmonella
Saturated Fats
Botulinum
Sugar
NOT
DREADED
DREADED
Organic Produce
Colouring
BSE
Nitrates
Pesticide Residue
Hormone Residue
Genetically Altered Foods
UNFAMILIAR
Fife-Schaw and Rowe, 2000
Information source characteristics - 1999
Social Attenuation
Accountable to others
Likely to withhold information
Large commercial food manufacturer (1998)
Large UK supermarket (1998)
Dept of Health
MAFF
Large commercial food manufacturer
Health Education Authority
World Health Organization
Distrust
Distorted information
British Medical Association
Large UK supermarket
The Consumers Association
Biased information
Vested interest
Health Which?
Proven wrong in past
Protect self and interests
Greenpeace
Social Amplification
Provide sensationalised information
Trust
Expert in the area
Factual information
Good track record
Accurate information
Truthful information
In favour of using source
Concerned about public
welfare
Responsibility to provide
Freedom to provide
Knowledgeable
Trustworthy
Relative Trust in Agencies to Conduct
Credence Certifications (safety, animal,
social and environment)
US
UK
Least trusted
Special Interest
Groups
Gov’t
Most trusted
Gov’t
Retailer
Bailey et al, Utah State Univ. 2003
What is the long-term problem in Europe?
• misperceive the dynamic of public acceptance of
risk
• Public distrust in regulatory institutions continues
to increase
• All risk management practices are subsequently
judged to be flawed
Public perceptions and attitudes:
What are the key questions?
• What is driving consumer perceptions of risk and benefit?
• Who trusts whom to inform and regulate? How does this relate
to consumer confidence in the food chain and associated
science base?
• Are there cross-cultural and intra-individual differences in
perceptions and information needs?
• How might the wider public be involved in the debate about risk
management and technological development?
• How do related factors (ethics, wider value systems) relate to
perceptions of risk?
• How do the public react to information about risk uncertainty?
Consumers and experts
• decline in the public’s trust in science has passed a “threshold
point” where the legitimacy of scientific judgement is
questioned
• the rise of the “consumer citizen” and informed choice at the
level of consumer choice
• the diminished role of the “expert”
- wide availability of specialist information
- broad shifts in the national (and in some cases
international) political culture towards more transparent risk
management practices
Precautionary Principle vs Due Diligence
• Original intent: to sanction action where lack of full scientific
certainty exists – e.g. Exxon Valdese oil contamination
• In food/trade policy: to limit market activity where non-zero
risk is present, until scientific knowledge can clarify risk
exposure.
UK Legislation
• 1990 Food Safety Act 1994 General Product Safety
Regulations tightened interpretation of ‘due diligence’
• Requires demonstrated working system
• Assigns responsibility for ingredients ‘ownership’
Role in Market Oversight
Public vs. Private
• Industry governance
• Country
competitiveness
• Industry – economic
performance
• Product inspection
• Firm governance
• Strategic advantage
• Netchain
performance
• Process verification
Private sector motivation, e.g. 1990 UK Food Safety Act increased liability
for safety of food products downstream (retail). Retail could be held liable
for practices upstream. Alternative governance structures/organization
protocols adopted to reduce risk exposure – process vs. product added as a
coordinating mechanism.
EU Definition of Traceability
• “The ability to trace and follow a food,
feed, food-producing animal or substance
intended to be or expected to be
incorporated into a food or feed, through all
stages of production, processing and
distribution.” – European Union General
Food Law Reg. EC No. 178/2002
US Definition of Traceability
• US agribusiness firms and producers often feel uncomfortable with the
EU definition of traceability because they believe it is broader than
what is necessary to achieve specific food safety or quality assurance
goals
• Possible US definition – “The efficient and rapid
tracking of physical product and traits from and to
critical points of origin or destination in the food
chain necessary to achieve specific food safety
and/or quality assurance goals.”
Carrefour’s response:
The quality path 2001
Trace One
Carrefour Organic Lines
Internationalisation FQC
2000
Soya Line no GMO Brazil
1997
1995
Carrefour Bio PGC (organic)
FQC/ Fruit and Vegetables Line
1992
Start of FQC / 1st Bovine Line
1991
1985
Organic: ‘Boule Bio’
Carrefour brand
1975
2003 Club FQC
Free Products
Traceability within the Supply Chain
System
HACCP
Fully integrated safe,
quality, 3rd party audited
protocols, e.g. SQF 2000
(ISO + HACCP)
Sector
HACCP
Food
Safety
Codes
No specifications Sector Grades
& standard
Product Specifications
Non-audited | Audited
ASSURANCE
Engineered Protein Products
Crop
Protein Products
Company
Corn
Blood protein,
Vaccine monoclonal
antibodies for
delivering anti-cancer
drugs
Prodigene
Corn
Monoclonal antibodies
for anti-cancer toxins
Corn,
Soybeans
Tobacco
Phytase enzymes
Monsanto
Integrated Protein
Technologies
Novozymes Biotech
Therapeutic enzymes,
HIV vaccine
CropTech Corp.