Food Safety Policy and Impacts to Producers,
Consumers and International Trade
ORGANIZED SYMPOSIUM
Southern Agricultural Economics Association
43rd Annual Meetings Program
February 5-8, 2011
Corpus Christi, Texas
Presented by
Mechel Paggi
Director, Center for Agricultural Business
www.csufcab.com
Authors: Mechel Paggi & Fumiko Yamazaki, CSUF
Luis Ribera, Ronald D. Kuntson, Juan Anciso, & Marco Palma, TAMU
Jay Noel, California Polytechnic State University, San Luis Obispo
•Food Safety is an Important Goal
•Food Safety is a problem that can
occur at any point in the supply chain
•International efforts are necessary to insure
food safety in an increasingly global food supply Chain
Detection and control of foodborne illness
Is difficult, timely and damage has usually
Already been done, or at least some damage
By the time the source is identified correctly
The time from the beginning of the patient’s illness to the confirmation
that he or she was part of an outbreak is typically about 2-3 weeks. Case
counts in the midst of an outbreak investigation must be interpreted
within this context.
The Centers for Disease Control
Has Finally Updated the Estimate
Of People Suffering from Foodborne Illness
In the US
Illnesses
Hospitalizations
Deaths
1999
76 million
325,000
5,000
2010
47.8 million
127,839
3,037
Major Pathogens
9.4 million
55,961
1,351
Unspecified Agents
38.4 million
71,878
1,686
Major Pathogens 1. norovirus (formally Norwalk agent) likely responsible
For 90% of the outbreaks of gastroenteritis around the world. Fecally contaminated
Food or water. 2. salmonella 3. T. gondii (the cat bug)
Note to self: In a linear sense by 2030 the problem will be solved
Food Safety is A Complicated Goal
Food Safety Issues
Salmonella Saint Paul In Fresh Tomatoes
June 3, 2008
Ultimately Actual Cause Linked to:
From Mexico
Estimated Cost to U.S. Tomato Industry: $100 million
The Economic Health of the Industry
Roberta Cook, November 2007
New Ex-Post Assessments May Add Knowledge
To Aid in Prevention in the Future
• So Taking Measures to Minimize contamination is a
sensible approach
• Standards that are acceptable across governmental
boundaries is a good idea in a global environment
• But who sets those standards?
• Can one size fit all?
• Where are we?
• Where might we be going?
Who sets the standards
• International organizations (CODEX, OIE, IPPC,
WTO, ISO)
• National government organizations (Mexico, US,
EU)
• Private international organizations (GLOBALGAP)
• Private national organizations (FLSC)
• Private firms (WalMart, COSTCO)
• Producer organizations (LGMA)
• All influenced to some degree by advocacy groups
(PETA etc)
Standards Have Proliferated and
Compete
So A Move Toward Harmonization has Emerged
In the Private Sector
Industry seeks accord on single GAP audit standard
by Joan Murphy
10/15/2009
The produce industry has long complained about competing
Good Agricultural Practice audits,
and now a new working group will meet next month to start
hammering out a single standard for all third-party GAP
audits by October 2010.
"We've created a monster allowing different standards to
propagate," said David Gombas, project coordinator for the
GAP harmonization effort and senior vice president for food
safety and technology at the United Fresh Produce
Association.
As We Can See, this is a very complex issue
Many different areas to examine
Our study takes a look at one small, but we think
Important, piece of the puzzle.
What is the impact of this quest for improved food safety
On producers.
To Make it even more manageable we look at fresh
produce, and do not try to take on milk, meat, eggs and
more processed product categories.
The Multiple Standards Issue is not Unique to the US
Producer
Information Suggest There are Economies of Scale and that
Small Holders Face Disadvantages
IFPRI Discussion Paper 00737
December 2007
Small holder up to 2 acres; small holder groups 15 members;
The exact number of smallholders that have been marginalized by the IFSS is unknown, but in Kenya, evidence from a few
leading exporters suggests that more than half of the small growers were dropped immediately following imposition of IFSS.
Consequently, while over 60% of green beans were produced by smallholders in Kenya in 1980s, this share had dropped to about
30% by 2003 (Jaffee, 2004, Kimenye, 1993).
Information Suggest There are Economies of Scale and that
Small Holders Face Disadvantages
IFPRI Discussion Paper 00737
December 2007
Small holder up to 2 acres; small holder groups 15 members;
The exact number of smallholders that have been marginalized by the IFSS is unknown, but in Kenya, evidence from a few
leading exporters suggests that more than half of the small growers were dropped immediately following imposition of IFSS.
Consequently, while over 60% of green beans were produced by smallholders in Kenya in 1980s, this share had dropped to about
30% by 2003 (Jaffee, 2004, Kimenye, 1993).
Various Standards Facing US Fresh Produce Producers
Cost of Standards Compliance, Fresh Strawberry Production
Average Food Safety Related Costs Increases From LGMA Compliance
Regulatory Cost Compliance Across Interstate Boundaries
Food Safety & Others
Influence of Increased Costs on Profitability
Influence of Increased Costs on Profitability
Proposed Food Safety Administration : “One Program/One Strategy
Proliferation of Influences Particularly Evident in the West
A Formidable Task to Address the All
Major Challenge
Need for Convergence of Multiple Process Standards *
National
International
United States
Food and Drug Administration
GlobalGAP
X
Producer
Industry/Retail
California Leafy Green
Marketing Association
Safety
Leadership Council
Wal-Mart
Producer
Dilemma
* The International Federation for Produce Standards (IFPS)
Work is Continuing
• Lettuce: CA / ARZ
• Strawberry: CA /FLA/Mexico
• Fresh Tomatoes: CA/FLA/Mexico
• Additional Monitoring of the