10. FAO
looks to organics for food security
By staff reporter
NutraIngredients-USA.com 5/14/2007-
Leading proponents of the
benefits of organic agriculture put
their heads together last
week to discuss how organic methods could help
preserve food security
for the future.
The UN's Food and
Agricultural Organization held a conference in Rome
last week on Organic
Agriculture and Food Security, in partnership with the
International Federation
of Organic Agriculture Movements (IFOAM).
The aim was to shed light
on the contribution of organic agricultural
methods in preserving
food security, to identify their potential, and to
outline the conditions
needed for their success.
It is estimated that the
world's population will increase from six
billion to nine billion
by 2050, calling for a massive increase in food
production.
But Angela Caudle,
executive director of IFOAM, said prior to the
meeting that food
security is not just a matter of production figures. Issues
such as war, climate
change, disasters and inequality also have a large
bearing.
In a paper published in
advance of the conference, the FAO said, "the
strongest feature of
organic agriculture is its reliance on fossil-fuel
independent and
locally-available production assets; working with
natural processes
increases cost-effectiveness and resilience of agro-ecosystems
to climatic stress".
It also called on
governments to devote resources to organic
agriculture, and to
integrate it within national agricultural development and poverty
reduction strategies. It
called for particular attention on vulnerable
groups.
A spokesperson for the
FAO was unavailable to give details of the
meeting's outcome prior
to publication deadline, but it was expected that that it
would yield a
"thorough assessment of the state of knowledge on organic
agriculture and food
security, including recommendations on areas for
further research and
policy development."
The report from the
conference will be presented to the 33rd committee
on World Food Security.
IFOAM expects this will result in FAO policy
chances that favour
organic agriculture.
The issue of food
security has had food policy experts assessing other
models for the future of
food supply on a global basis.
For instance in his 2004
book Food Wars: the global battle for minds,
mouths and markets, Tim
Lang, professor of food policy at City University,
London, and colleague
Michael Heasman laid out the agenda of two alternatives to
the existing
productionist model - one based on life sciences an the other
on ecological
integration.
Previously the FAO has
devoted attention to key areas in the effort to
ensure future food
security.
For instance, another
report, prepared in advance of the FAO Committee
on Agriculture meeting in
April, said that a major shift in agricultural
methods and their
environmental impact is urgently required to protect
productivity and food
security.
Agricultural practices
are often responsible for environmental degradation, such as non-sustainable
food production, poor fuel use, natural resource
depletion and habitat
exploitation.
And at the opening of a
UN climate change conference in Nairobi in
November,
FAO Kenya representative
Castro Paulino Camarada said climate change
will directly affect
future food availability and make feeding the world's
rapidly growing
population extremely difficult, said the FAO.
Camarada stressed that
greater attention must be given to the impact of
climate change on
agriculture, forestry and fisheries, and on mitigation
and adaptation measures.
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11.
Bill Bobier and Lana Pollack: Small farmers deserve help
Published May 13, 2007 Michigan's family farmers and forest landowners produce
an extraordinary bounty of food and fiber, as well as clean air, clean water
and habitat for wildlife. However, renewal of federal farm and food policies
this summer could do much more to meet the needs of our farmers, forest
landowners, consumers and communities. The reasons for reform are well documented. Many consumers lack affordable and healthy food
choices, contributing to soaring health care costs. Despite record farm
sales, many of Michigan's family farmers and forest landowners are struggling
to stay profitable. Our farm policies violate international trade
agreements, inviting retaliatory tariffs on everything from fruit to
pharmaceuticals. Many of Michigan's most pressing environmental challenges
are left unmet because the U.S. Department of Agriculture's funding shortage
forces them to reject six out of 10 Michigan's family farmers and forest
landowners who offer to help. Renewal of federal farm and food programs creates a
rare opportunity to boost the profitability of many more family farmers,
forest landowners and communities, provide consumers with more food and
energy choices, and to reward family farmers and forest landowners when they
take steps to provide clean water, open spaces, or habitat for wildlife. Only one out of three Michigan farmers grow the
crops that are eligible for farm subsidies that account for the lion's share
of farm spending under the current farm bill. By rewarding - rather than
rejecting - family farmers and forest landowners when they offer to share the
cost of good conservation practices that provide clean air and water, farm
policies can help many more Michigan producers and do much more for the Great
Lakes and Michigan's other precious natural resources. The next farm bill should provide new resources to
boost renewable energy development on farms, and should focus those
investments on energy proposals that help meet our environmental challenges.
By expanding incentives good stewardship and clean renewable energy, the next
farm bill can help our farmers get ready to profit from a cap on carbon
emissions. The next farm bill should do much more to boost the
profitability of our farmers in ways that provide more healthy food choices
for out consumers. For example, it should provide new resources to help our
farmers make the transition to organic and could link more farmers with
consumers through farmers markets, farm-to-school programs, and other
initiatives that bring fresh, local fruits and vegetables to our school
children. Lawmakers should assist in the protection of at
least 10 million acres of America's farmland from development because 80
percent of America's fruits and vegetables are in the path of sprawl.
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12. The Economic Impact of
B.S.E. on the U.S. Beef Industry:
BY NOT TESTING TO FIND
Date: May 6, 2007 at 3:05
pm PST
The Economic Impact of
B.S.E. on the U.S. Beef Industry:
Product Value Losses,
Regulatory Costs, and Consumer Reactions
Background
For nearly 2 decades the
U.S. beef industry has been impacted by bovine spongiform encephalopathy (BSE).
Since the emergence of the disease in the United Kingdom and the subsequent
discovery of a possible link between BSE and fatal new variant Creutzfeld-Jacob
Disease (vCJD) in humans, various agencies of the United States government have
implemented measures to prevent BSE from entering the country, prevent its
spread if it were to be discovered here, and safeguard human health. These
measures included restrictions on imports of live animals, meat products and
feedstuffs, restrictions on feeding certain ruminant derived tissues back to
ruminant animals, a disease surveillance program, and restrictions on blood
donations from individuals who previously resided in BSE affected countries.
As the disease spread
outside Europe to
Japan and, in mid-2003,
to Canada, USDA enhanced its surveillance efforts and increased funding for BSE
related research. Regulatory efforts to counter the disease were further
strengthened when, on December 23, 2003, it was reported that a dairy cow in
Washington state had tested positive for BSE.
Regulatory
Response to the December 23 Case.
To enhance protection of
human health and reassure export markets about the safety of U.S. beef, the
Food Safety Inspection Service (FSIS) of USDA issued rules designating certain
tissues (e.g., small intestine and tonsils of all cattle; brains, eyes, spinal
cord of cattle over 30 months of age) as specified risk materials (SRM) not
allowed in human food. FSIS also banned entry of material from downer cattle
into the human food chain.
To further reduce the
risk of BSE spreading, the Food and Drug Administration (FDA) proposed
enhancing the existing ruminant feed ban by removing the exemption for blood
products and banning plate waste and poultry litter. The Animal and Plant
Health Inspection Service (APHIS) stepped up BSE surveillance efforts and announced
that they would conduct BSE tests on “as many cattle as possible”
from the population of high-risk cattle in a 12- to 18-month period beginning
in June 2004. This represented more than a tenfold increase in testing relative
to previous surveillance levels.
Costs
Associated with BSE Regulations
The regulations
introduced in 2004 led to changes in cattle procurement, employment, employee
training requirements, food safety plans, capital investments, and marketing
opportunities for the beef industry. To assess the impact on industry, we
interviewed seven firms to gather data on costs associated with the new
regulations. The seven firms represented more than 60 percent of 2003 beef
slaughter and were sufficiently diverse to represent a reasonable cross section
of the beef packing industry.
On average, firms
incurred additional labor costs of $0.45 per head of daily capacity.
These costs arose
primarily as a result of regulations requiring the creation of positions to age
animals using postmortem dentition, to deal with non-ambulatory animals, and to
segregate SRM material. One-time costs of training existing employees to comply
with new FSIS rules varied from $13,800 to $100,000 across firms. Altering
HACCP plans and record keeping procedures resulted in relatively small cost
increases - a combination of nominal initial investments plus ongoing labor
costs of approximately $0.01 per head. Changes in capital investments varied
across firms. Some were able to achieve compliance without any new investments,
whereas others invested up to $84,000 in long-term assets. All firms had
investments in certain assets that they now consider obsolete. On average, the
loss resulting from investments being made obsolete was more than $700,000 per
firm. The new regulations also resulted in revenue losses due to products being
banned from the food supply. In particular, the condemnation of small
intestines from all cattle has been a hotly debated topic. We estimate that, on
average, firms that previously sold small intestines are foregoing an average
of $3.68 per head in potential revenue. That loss however, is contingent on the
availability of export markets for the product. For non-fed Executive Summary 4
slaughter (animals over 30 months of age), condemnation of bone-in cuts containing
vertebral column and restrictions on the use of advanced meat recovery (AMR)
systems reduce per-head revenues by approximately $8.50 and $9.36,
respectively. These decreases only apply to firms engaged in these respective
activities. Also prohibited from the food supply are non-ambulatory cattle. In
2004, this regulation resulted in an estimated loss of $64.6 million to the
beef packing sector. Considering all these areas of change, and ignoring
one-time expenses, we estimate the net economic cost to the beef industry in
2004 from FSIS Interim Final Rules to be approximately $200 million.
We also considered the
potential impacts of additional BSE measures that have been proposed, but not
yet implemented. One such policy being considered is a ban on SRM in animal
feed. We estimate that if this proposal is implemented, the associated costs
would be $2.16 per head for fed slaughter and $6.77 per head for non-fed
slaughter. We estimate that a complete ban on feeding of ruminant derived
proteins would cost $14.01 per fed animal and $12.35 per non-fed, in addition
to adding $4.50 per head to feed costs for a fed animal.
Market Response to the
December 2003 Case Export Markets Within days of the Washington state BSE
announcement, 53 countries, including major markets such as Japan, Mexico,
South Korea and Canada, banned imports of U.S. cattle and beef products. In
2003, U.S. beef exports were valued at $3.95 billion and accounted for
9.6 percent of U.S.
commercial beef production. The import bans caused U.S. beef exports to
plummet, and although some important markets, including Mexico and Canada did
reopen during 2004, export quantities for the year declined 82 percent below
2003’s level. The loss of export markets increased the quantities
available on the domestic market thereby depressing domestic prices below
levels they would have attained if exports were possible. We developed a trade
model to estimate the impact of export losses on the beef industry. The model
incorporated assumptions about the elasticity of domestic demand for beef and
offal in order to estimate the price impact of additional supplies on the
domestic market. Because the resulting loss estimates depend on the elasticity
estimates, our report includes results of a sensitivity analysis to provide a
range of probable loss estimates. Results suggest that total U.S. beef
industry losses arising from the loss of beef and offal exports during 2004
ranged from $3.2 billion to $4.7 billion.
The United States has yet
to regain access to the Japanese and South Korean beef export markets, the
second and third largest markets for U.S. beef during 2003. If the United
States regained access to these two key markets, and exported the same
percentage of U.S. production to these two countries in 2004 as in 2003,
wholesale revenue per head would have increased between $45 and $66 per head
for every head slaughtered in the United States. If exports to Japan and South
Korea were only one-half the 2003 level, as a percentage of U.S. production,
wholesale revenue per head slaughtered would have increased $22 to $32. Domestic
Market In the week following the December 2003 announcement, cattle prices fell
by about
16 percent. Consumer
surveys at that time suggested that U.S. domestic beef demand could fall by as
much as 15 percent. However, prices recovered in early 2004 as it became clear
that U.S. consumer demand had been impacted only minimally, if at all. In fact,
market data on beef disappearance and retail prices suggest that consumer
demand for beef actually strengthened in the first half of 2004. However, given
that the animal infected with BSE in Washington state originated in Canada and
could plausibly be viewed as an isolated case, the possibility remains that an
additional BSE discovery in an indigenous animal could have a significant
negative impact on demand.
To investigate the
potential impact of
additional U.S. BSE
discoveries we used a regionally targeted consumer survey. The results suggest
that most consumers (77 percent) did not change consumption habits because of
the first U.S. BSE case, but that subsequent discoveries, particularly of
multiple cases, could have a significant impact on demand. However, we cannot
infer from our results that an additional isolated case of BSE
5
in the United States
would have a significant impact on domestic beef demand.
Testing Voluntary testing
for BSE has been proposed as a means of regaining access to lost export
markets, but USDA has turned down a request from a private firm to conduct such
testing. The beef industry is sharply divided on the issue. Proponents of
voluntary testing tend to view it in terms of a marketing decision with
expected benefits outweighing costs, at least in the short run. Opponents see
testing as unnecessary and costly, as setting a dangerous precedent in terms of
acquiescing to an unreasonable customer requirement, and as a procedure with no
scientific justification in terms of risk reduction to consumers. In our
analysis we estimate costs and
potential benefits for a
range of testing/ market-access scenarios. Voluntary testing by a single, small
firm would provide little or no benefit to producers because the increase in
the derived demand for cattle generated from such a small-scale increase in
exports would have an insignificant impact on domestic cattle prices. The
policy could, however, result in significant profits for a firm engaged in
testing, at least in the short run, if testing opened up additional markets for
a firm’s beef products. If additional market access is obtained through
BSE testing, more firms would be attracted to testing and domestic cattle
prices would increase. Our analysis suggests that if all slaughter animals are
tested, but there is no increase in access to either the Japanese or South
Korean markets, the result would be a net loss of $17.50 (the estimated cost of
testing) per head. Alternatively, if full access to the Japanese and South
Korean markets is regained without implementing a broad based BSE testing
program, the potential revenue gain ranges from about $45 to $66 per head.
http://www.oznet.ksu.edu/library/agec2/MF2678.pdf