Consumer preferences and concerns shape global food trade

Food Review, Sept-Dec, 2001 by Anita Regmi, Mark Gehlhar

Major food safety incidents in recent years have resulted in lasting changes in consumer perceptions and food purchasing patterns in certain developed countries. For example, the 1996 announcement in Great Britain of a possible link between bovine spongiform encephalopathy (BSE), or mad cow disease, in cattle and a new strain of CreutzfeldtJakob Disease in humans led to dramatic declines in beef consumption in Europe, particularly in the United Kingdom. This incident also resulted in import bans on British beef and products by trading partners, leading to significant economic losses for associated industries. In the first year of the crisis, the United Kingdom's total economic loss from BSE was estimated at $1.2-$1.6 billion.

The rise of organic foods are another example of heightened consumer interest in particular food attributes. Worldwide markets for organic foods are expanding, with annual growth rates of 15-30 percent in Europe, the United States, and Japan for more than 5 years. As many as 20-30 percent of consumers surveyed in Europe, North America, and Japan claim to purchase organic foods regularly. While there is interest in organic foods among higher income, better educated population segments in nearly every country, consumers in the United States, Europe, and Japan are driving the growing demand for these goods.

Consumer concerns regarding the environment and animal welfare have also led to changes in food production and marketing in some countries. Many developed countries have implemented new regulations, some of which, in response to animal welfare concerns, directly affect the raising of farm animals. These new regulations impose restrictions on the conditions under which livestock and dairy producers and processors may raise, feed, and slaughter animals.

Consumer demand for improved food quality has also led public and private sectors to develop and implement mandatory and voluntary quality control, management, and assurance schemes. These schemes are changing the way food products are produced, marketed, and traded in Europe, and, to some extent, the United States.

Quality assurance schemes develop standards for the production, processing, and transport of food and may include standards for environmental management practices. Western European countries employ certification systems that guarantee the traceability of fresh and processed meat back to the originating animal and farm, certification systems aimed at guaranteeing both product quality and environmental management of farms, and labeling and certification systems covering organic and natural production.

Unlike European programs, U.S. quality assurance programs tend to be limited in scope, focusing primarily on health standards and rarely considering animal welfare are and environmental issues. U.S. programs also tend to be limited to onfarm quality assurance, rather than entire supply chain quality assurance. For example, the National Cattlemen's Beef Association's Beef Quality Assurance was introduced in 1982 to address concerns of chemical residues in beef.