By Sarah Gonzalez, Director of Communications and Digital Media
The U.S. Department of Agriculture is still working on crafting a labeling system mandated by the National Bioengineered Food Disclosure Law, which charges the agency’s Agricultural Marketing Service with developing a mandatory system for disclosing the presence of bioengineered material in food products.
During a panel discussion at USDA’s annual Agricultural Outlook Forum last week, MSMC Endowed Professor of Agribusiness Strategy at the University of Missouri, Nicholas Kalaitzandonakes, said there are many economic considerations for USDA as it builds the labeling regime. The department must identify factors that make a difference when attempting to maximize consumer welfare and market efficiency simultaneously.
He noted there are several issues of scope to consider in creating a labeling system, including defining terms for “may be bioengineered” and “conventional breeding,” as well as the amount of bioengineered substance that may be present to qualify as a bioengineered food.
“Anytime you have a segregated system, you have additional cost. One of barriers that really makes a difference is the level of tolerance [of genetically modified material]” present in a food, he said. “As you make tolerance level narrower, you add cost to the production system. You better think about how it plays out throughout the supply chain.”
He noted that when consumers are asked what percentage of the ingredients of a food product should be produced with non-genetically modified ingredients in order to be identified as “non GMO,” a majority of them say 100 percent. “If this sort of preference is applied to the market, that means that most of the GMO-free products today would probably not meet that sort of criteria,” he said.
Kalaitzandonakes added that balancing the needs of consumers, who have varying preferences, and producers, who have varying production methods, becomes exceedingly difficult for USDA as those differences become more pronounced.
Another panel member, Jeff George, vice president of Americas Research & Development at Campbell Soup Co., described the challenge in meeting consumers’ preferences, noting that in addition to good prices and good taste, they also want products to have a value-added aspect, like sustainable ingredients or a traceable supply chain. Campbell’s announced in 2016 that it would voluntarily label their products that contain GMO ingredients.
George said consumer prices will not increase as a result of that decision. “We frequently make label changes so we don’t expect costs related to labeling GMOs…meaningful enough to pass onto the consumer.”
He noted that consumers “are pleased with our decision” to label GMO-containing products. Campbell’s is working with the USDA and U.S. Food and Drug Administration on “consumer friendly” GMO labeling, he said, noting that “consumers like simple and familiar language” and they prefer labels indicating which ingredients in a product are bioengineered.
Meanwhile, the Forum panel recognized that new gene editing techniques, considered to be more targeted and more efficient that traditional genetic modification, are becoming popular in seed development. AMS Deputy Administrator Craig Morris said the agency would like the same labeling regime that is being developed now to remain as gene editing techniques become more prevalent in the food supply.
However, it remains to be seen when and how the Trump administration will move forward with implementation of the GMO labeling law. USDA has not released a planned advance notice of its proposed rulemaking with details about the regulations. Former Secretary of Agriculture Tom Vilsack released an exit memorandum stating that USDA “has established a working group and GMO Disclosure Team to manage implementation of the law.”
It is believed that a decision on how to proceed with the advance notice of proposed rulemaking will be one of the first decisions awaiting Secretary of Agriculture nominee Sonny Perdue once he is confirmed.