Food For Thought
Excerpt By Catherine Valenti, ABCNews.com

Would you pay more to know where your meat came from? Are you concerned about the conditions in which animals are kept while they're being raised for slaughter? Do you care if your meat has antibiotics in it or if your food contains genetically modified ingredients?

If so, you may be one of many consumers who are affecting the way food is manufactured and labeled.

At a time when a lot of attention is being paid to issues like food safety, mad cow disease and genetically modified foods, many companies and the government are responding to both consumers' and activists' concerns about the food supply.

"We'd always say give the consumer as much information as you can and he's free to ignore it and free to make whatever decision he's going to make," says Art Jaeger, associate director of the Consumer Federation of America, a Washington-based consumer advocacy group.

Changes in the Air

Recent moves include fast-food giant McDonald's calling on its meat suppliers to phase out the use of growth-promoting antibiotics in its meat, a decision that will likely change the use of antibiotics in animals since the chain is one of the world's largest purchasers of meat.

In response to growing concerns about the way animals are raised, KFC announced changes to its animal welfare policy at the end of May that included guidelines for more humane slaughter and handling of its suppliers' chickens.

And next year shoppers in supermarkets might even be able to choose which country their meat comes from. A new country-of-origin labeling regulation is expected to go into effect in September of 2004. It will require a label showing the country of origin on beef, lamb, pork, fish, produce and peanuts sold in the United States. The meatpacking and retailing industries are vigorously fighting the new regulations, which were part of the 2002 farm bill.

Experts say these moves appeal in part to consumers' desire for more information about where their food is coming from, but also to activists' efforts to change some of the ways food — and especially meat — is prepared.

"There's a growing trend that consumers in general are more concerned about what happens beyond the four walls of our restaurant," says Bob Langert, senior director of social responsibility for McDonald's in Oak Brook, Ill.

Concern About Consumables

Some recent polls highlight consumers' growing concerns.

One poll found that a third of Americans try to avoid buying foods that have been genetically modified or treated with antibiotics or hormones, and that resistance apparently would swell if such products were required to be labeled.

Other research shows consumers' concerns change as different issues come into the spotlight. Some 30 percent of shoppers surveyed by the Food Marketing Institute in 2003 said that food produced by biotechnology posed a "serious health risk," compared to just 15 percent in 1997. For the past two years, consumers' top health concern has been bacteria.

Another recent study, from the Pew Research Center, also found that 55 percent of Americans think genetically modified foods are a "bad thing."

Genetically modified foods, which are biologically altered to have characteristics such as faster growth or insect resistance, are widely used in the United States and Canada. But their use has been controversial in Europe, where consumers fear unknown health effects and commonly deride them as "Frankenfood." The European Union has banned the importing of any genetically modified foods from the United States.

Groups like the Consumer Federation of America support labeling genetically modified foods, which is currently not done in the United States.

"For a variety of reasons, consumers may want to avoid [genetically modified foods]," says the Consumer Federation's Jaeger. "Without labeling they can't make an informed decision."

Paying the Price

Whether all of this information about what is in food and where it comes from actually changes consumers' behavior is another matter. Marketing experts say the number of people who would actually change their shopping habits based on these factors is a small niche, especially since raising organic meat and produce is more expensive than other mass-produced foods.

"If you really want to change behavior you have to make the preferred product less expensive than the food that's less preferred," says Harry Balzer, vice president and food industry analyst at the NPD Group, a Port Washington, N.Y.-based market research firm.

The NPD Group recently found that despite the recent case of mad cow disease in Canada, 56 percent of consumers surveyed said they would eat the same amount of burgers as before.

But there is other evidence that consumers might pay more to know where their food comes from. A recent study of country-of-origin labeling out of Colorado State University, where a sample of 273 people bid for meat made in the United States or meat that was not labeled, showed that 73 percent of the bidders were willing to pay an 11 percent premium for steak made in the United States and a 24 percent premium for U.S.-produced hamburger.

"There are groups that have the income to pay for their concerns," says Wendy Umberger, assistant professor of agricultural and resource economics at Colorado State University, who led the study. "We have the luxury now about being pickier about our food."

Marketing Opportunity

Although it may be a relatively small portion of the population who is willing to pay more to know what's in their food, companies are still responding.

Tyson Foods, which supplies meat and poultry to both McDonald's and KFC, began phasing out the use of growth-promoting antibiotics in the early '90s and started a small, organic line of poultry three years ago.

"It's still what we would consider a niche market at this point," says Tyson spokesman Ed Nicholson. "Within certain markets it's sold well and in others it doesn't because it's premium-priced. Not every consumer is willing to pay that cost."

Whole Foods Markets, the country's largest retailer of natural and organic foods, has been at the forefront of providing organic food to the masses. The company has its own private label line, called 365 Everyday Organic Value, which strives to provide organic food at value prices. The stores also use country-of-origin labeling on their produce.

"Consumers are asking more questions now," says Marget Wittenberg, Whole Foods' vice president of governmental and public affairs. "They really want to get connected to their food and are looking for the answer."

Changes Bring Controversy

Of course, any shift that brings about potentially costly changes in the way manufacturers do business is not without controversy. The meat industry is opposed to country-of-origin labeling because it says it will be costly to the industry and to the government, with no real benefit to consumers. Industry publication Cattle Buyers Weekly estimates the country-of-origin labeling will cost the beef industry alone at least $1.4 billion to implement.

"We're afraid consumers are going to be upset that the same package of hamburger they bought yesterday is going to cost more because of the labeling," says Dan Murphy, vice president of public affairs for the Arlington, Va.-based American Meat Institute.

The Consumer Federation of America, which supports country-of-origin labeling, estimates that the change would cost a family an average of 30 cents to 40 cents more a week, a cost the group does not consider exorbitant.

Others say that activist groups, not consumers, have been more influential behind some of the changes in food production.

The use of growth-promoting antibiotics is one issue on which groups are divided. Agriculture and animal farming groups say the type of growth-promoting antibiotics that McDonald's has asked its suppliers to stop using are Food and Drug Administration-approved and safe. But other groups, such as the Union of Concerned Scientists, say the use of such hormones leads to increasing antibiotic resistance in humans, which makes diseases harder to treat.

And KFC's new poultry-treatment guidelines came under fire recently from People for the Ethical Treatment of Animals, which filed suit against the chain, saying that it was misleading the public about its treatment of animals. A PETA spokesman said the group had evidence KFC was not complying with the new guidelines, while KFC said PETA's suit was "one in a continuing series of publicity stunts designed to mislead the public."

Whether the recent changes reflect a public relations effort on the part of companies or simply the latest food fad remains to be seen. But some are confident that shifts in the food supply, however slow, will provide consumers with more choices in how they choose to eat.

"It's really overwhelming how much of a change there's been," says PETA campaign coordinator Dan Shannon. "Twenty-three years ago, the idea of free-range farming didn't exist. The idea of vegetarianism as a popular, accepted thing didn't exist. As far as the consumer side of things goes, it's an exploding market."

Reference Source 104

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