May 2014Newsletter

The Unstoppable Force Meets the Immovable Object: What will be the Outcome of the GMO-Labeling Controversy?

Agribusiness, Food and Beverage Newsletter

Earlier this month, Vermont Governor Peter Shumlin made his state the first state to legislatively require food makers to label products made with genetically modified organisms, or GMOs. According to the Center for Food Safety, there are currently 62 active GMO-labeling bills in legislation in 23 states. For those involved in the anti-GMO/pro-GMO-labeling movement, they believe the momentum is building for GMO-labeling bills to become an unstoppable force.


In contrast, on April 9, 2014, U.S. Representative Mike Pompeo (R-KS) introduced a potentially immovable object: the “Safe and Accurate Food Labeling Act.” This federal legislation would put an end to state measures like those in Vermont, Connecticut and Maine, to label GMOs in food. The bill prohibits any mandatory labeling of genetically engineered food and also prohibits voters from proposing initiatives for labeling genetically engineered food at the state level. These state-level initiatives, which have been the subject of a great deal of national press coverage, have universally been opposed by large food and agriculture companies and their trade associations. These critics of GMO-labeling legislation reportedly spent heavily to help defeat ballot measures requiring GMO labeling in California and Washington State.


So with these two powerful forces clashing over whether or not it is a good idea to require GMO-labeling of food products, what does the future hold? What will be the outcome of the GMO-labeling controversy?


What are GMOs?

In simplest terms, GMOs are crops whose genetic makeup has been altered through scientific engineering. The purpose of doing this is to make them more resistant to pests, better able to withstand drought, and to make the crops bigger and hardier. The vast majority of the corn and soybeans grown in the U.S. are GMOs, and it is estimated that as much as 80% of the packaged food products sold in the U.S. contain some form of GMO.


The Position of Those in Favor of GMO-Labeling Legislation

While there are many arguments offered in favor of requiring GMO-labeling on food products, those most often advanced are either premised upon health and safety, or the consumer’s right to know.


Those advocating for GMO-labeling suggest that genetically modified crops harm the environment by causing greater use of pesticides. They also contend that GMOs could be harmful to human health, and argue that the long-term health effects of regular exposure to the GMOs found in the food supply has not been adequately studied. Indeed, the European Union introduced labeling requirements and this led to the nearly complete elimination of GMOs in food. And China is reportedly taking a tougher stance on the importation of GMO-containing corps, rejecting shipments of U.S. corn that contained a genetic modification that Beijing had not approved.


The argument most often (and most effectively) advanced in support of GMO-labeling is that consumers have a fundamental right to know what they are putting in their bodies. The notion that GMO-labeling requirements put people in a position to make informed choices about what they are eating is an argument with terrific persuasive appeal. And anti-labeling advocates really do not have a good answer for it.


The Position of Those Opposed to GMO-Labeling Legislation


In comments made in support of his bill, Representative Pompeo reportedly told a group of agricultural journalists that his bill is intended to ensure that America can continue to produce an adequate amount of food to feed the world. Like other GMO advocates, Representative Pompeo has argued that the U.S. Food and Drug Administration has approved their use, and that there currently exists no reliable scientific evidence that genetically engineered foods pose a health or safety risk to humans. GMO labels, he and others contend, actually mislead consumers into thinking there may be a safety concern where none exists.


GMO technology has unquestionably increased crop yields, due to the fact that these hardier crops are better able to handle the problems caused by insects and the elements. GMO advocates also contend that they have lowered food prices, and assert that once the Vermont legislation goes into effect, it will be more expensive to buy the same product in Vermont, as compared to another part of the country.


Another argument sometimes advanced by those opposed to GMO-labeling legislation is that it is unworkable. This is due, at least in part, to the fact that GMOs have become so prevalent in certain food processes and agricultural systems, that it will be nearly impossible to accurately label most food products “GMO-free.” And the process of verifying the GMO-free status of certain products, coupled with the costs associated with revising food labels to identify the GMOs therein, will be prohibitive, especially for small businesses in the food industry.


What Does the Future Hold for GMO-Labeling Legislation?


The advocates on both sides of the GMO-labeling debate are passionate. Nothing suggests their conflict will be resolved any time soon. Indeed, the arguments being advanced in favor of their opposing positions seem to present the proverbial “unstoppable force meets immovable object” scenario.


To date, the FDA has been reluctant/unwilling to intervene in this fight. In 2013, three federal court judges (two in California, one in New Jersey) stayed or suspended consumer class actions over foods labeled “natural” that allegedly contained GMOs, in order to ask the FDA for input. On January 6, 2014, the FDA told the judges: “… we respectfully decline to make a determination at this time regarding whether and under what circumstances food products containing ingredients produced using genetically engineered ingredients may or may not be labeled ‘natural’.” Similarly, arguments can and have been made that the current state of the science regarding the safety of GMOs in food is underdeveloped. Last October, a group of 93 international scientists maintained that there is a lack of empirical evidence supporting the notion that there is a consensus on GMO safety. If either the FDA or the scientific community definitively weighs in, this could be a “game-changer” in the outcome of the GMO-labeling debate.


But short of that, it appears the combatants are in for a long battle. Of course, some food companies have already decided to go “GMO-free” (at least to some extent) in response to perceived consumer demand. General Mills has very publicly begun selling its Original Cheerios without GMOs. Smart Balance’s buttery spreads now bear a prominent “non-GMO” label and pledge, and the company is reportedly evaluating opportunities to convert other products to non-GMO including mayonnaise dressing, cooking spray and cooking oils. The two largest retail grocery companies in the U.S., Kroger and Safeway, have reportedly agreed not to sell genetically modified salmon.


At present, these companies appear to be justifying their decisions based upon notions of “transparency,” and they have committed to not increase their prices based upon the non-GMO status of their products. However, this will only become a long-term commitment if consumers actually buy more of these products based upon their GMO-free status. In the case of Cheerios, General Mills’ CEO reported in March that while the company had received supportive letters and online comments about GMO-free Original Cheerios, that has not translated into a lift in sales. Without increased sales to offset the additional costs associated with being GMO-free, the price point for these products will go up. According to research from The NPD Group in Chicago, most grocery shoppers (roughly two out of every three) will not want to pay higher prices for non-GMO versus GMO containing food.


So how long are these combatants destined to struggle with one another over the issue of GMO-labeling requirements? The answer is probably for a long time. And short of intervention by the FDA or scientific community, the outcome of their battle will likely be determined by good old-fashioned consumer demand.

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