The Biotech Market and the Consumer

1
The Biotech Market and the Consumer
Response of Public to Biotechnology Products
Biology 600 Biotechnology Principles and
Products Delivered Live and via
Videoconference June 1-2, 2005
Phil McClean Department of Plant Science North
Dakota State University
2
Precautionary Principle Why Europe Regulates
Biotech Products

• Precautionary Principle States
• Commercial activities can be restricted by
  governments
• IF a scientific or environment risk is perceived
  
• EVEN IF conclusive data is NOT YET available
• It is
• A key principle that underlies European Union
  approaches
• to regulating biotech products
• Incorporated into the Maastricht Treaty that
  lead to
• the formation of the EU

3
Precautionary Principle
Effects of Applying the Principle

• The principle makes it difficult to
• determine when risk avoidance should take
  precedence
• over the general welfare
• At its most basic, the principle
• Regulates mans excitement of the new and novel
• Can prevent the most unexpected damage from
  occurring
• As interpreted the principle requires that
• Biotech products should be regulated until
• compelling evidence proves they are safe

4
European Consumer Attitudes Toward Biotech Crops
Themes Observed in Recent Surveys

• Uncertainty about the issues (1994, 1997, 1998)
• Caution is necessary when dealing with complex,
• technical issues (1998)
• Labeling of foods is strongly desired (1994,
  1998)
• Biotech has less promise than other technologies
  (1997)
• Medical uses of biotechnology preferred over
  food uses (1994)

Surveys 1994 UK National Consensus
Conference 1997 Eurobarometer 1998 Iceland
Frozen Food Survey
5
Other European Concerns About Biotechnology

• Biotech crops will be introduced against the
  will of the public
• Precedence exists in Indonesia
• 1960s Government required that Green
  revolution
• cereals be grown
• It is feared the same will occur with biotech
  crops
• Vegetarians fear animal genes will be added to
  plant foods
• Producer, not consumer, innovations will be
  favored
• Producer savings will not be passed on to the
  public
• Foreign DNA will be absorbed by humans
• Unknown allergens will be introduced
• Long-term risk to human health not known

6
How UK Organizations Responded To Recent Public
Controversies
Irradiated Food

• An effective method of protecting against
• food-borne pathogens
• 1980s
• Idea proposed
• Factories built
• 1990s
• Public objected
• Process never implemented

7
How UK Organizations Responded To Public
Objections
Tomato Puree Example

• Zeneca released a GM tomato product
• Processed at lower temperature
• Less carmelization
• Fresher tasting
• Rated highly in blind taste tests
•  
• Own Brand puree sold with GM label
• Outsold non-GM 6040 in Safeway stores
• Sales 30 less in Sainsbury stores
• Sainsbury dropped the product because of
• consumer objections

8
Buying Power of Large Companies Controls
Biotechnology Acceptance
McDonalds Corporation

• Largest purchaser of potatoes in the world
• Originally purchased insect resistant GM
  potatoes
• Changed policy over potential consumer
  objections
• Monsanto discontinued production of insect
  resistant
• GM potatoes

9
Buying Power of Large Companies Controls
Biotechnology Acceptance
Heinz

• Large producer of canned beans
• Europe a major market for canned beans
• Heinz declared they would not buy GM beans (even
• though they were not available)
• Research to develop GM beans is essentially
  non-existent

10
Principles Objections to Biotech Crops
General Topics

• Unknown health risks
• Damage to the environment
• The science is unnatural
• Multinational corporations are controlling the
  technology
• Benefits are profit not health relate

11
Principles Objections to Biotech Crops
Perceived Health Risks

• Originated in Europe
• Related to the uncertainty over the Mad Cow
  disease crisis
• Public does not trust government statements
  regarding
• the safety of the technology
• Safety of biotech foods not demonstrated to
  their satisfaction
• Why risk your health when the benefits from the
  crop
• are not health related

12
Principles Objections to Biotech Crops
Environmental Risks

• Herbicide resistant crops encourage more
  chemical usage
• Resistance genes could migrate to related weeds
• Weed control would then not be possible
• Non-target species could be damaged
• Monarch butterfly controversy

13
Principles Objections to Biotech Crops
Multinational Corporations Control the Technology

• Only a few companies control the technology
• The corporations are forcing non-biotech crops
  to the market
• Leads to further industrialization of agriculture

14
Does Technical Knowledge Increase Acceptance Of
Biotechnology???
Sometimes yes, sometimes no
Yes 1997 Eurobarometer Survey No 1998 Iceland
Frozen Food Survey
15
Environmental Issues Related to Biotech Crops
Recent History

• The Environment Has Many Historical Advocates
• Rachel Carson Effects of DDT
• 1970s Earth Day Movement
• 1980s EPA director becomes a cabinet level
  position
• 1980s - 2000s The Green movement becomes
  worldwide
•  
• Environmental advocacy is a now a worldwide
  movement

16
Environmental Concerns About Biotech Crops

• Escape of Transgenes into Wild Species
• Only an issue with crops that have weeds they
  can cross with
• Wheat and Johnson Grass
•  
• Dependence on Chemical Usage
• Volunteer RR crops appear in following year
• Control of these will require more harmful
  chemicals
•  
• Insect Tolerant Crops
• Provide an effective tool for corn and cotton
• Target insects are clearly controlled
• Non-target insects may be affected

17
Environmental Benefits Of Biotech Crops

• Scare environmental resources saved
• Reduced herbicide and pesticide usage
• which means
• Reduced number of applications
• which means
• Reduced usage (and dependence) on oil
•  
• Farming systems better maintained
• Planting herbicide resistant crops in untilled
  fields
• Reduces moisture loss
• Untilled soil helps prevent erosion

18
What Would Lead to Acceptance of GMO Products?
Significantly Lower Prices

• Norway (2003 study)
• Consumers would buy the product over non-GMO
  bread
• If the cost of GMO bread 49.5 lower
• Japan (2004 study)
• Consumers would preferentially buy GMO-base
  product
• If the cost of GMO noodles was gt50 lower
• England (2001 study)
• Men would pay 26 extra to avoid GMO technology
• Woman would pay 49 extra to avoid GMO technology

Data quoted from AgBioForum (2004) 770-75
19
Other Attitudes Toward Biotechnology
Developing Countries

• China
• Will pay
• 16 premium for GM oil
• 38 premium for GMO rice
• 35 premium for processed GMO potato products
• Colombia
• 66 would try GMO products
• GMO products most favorable to those with
  limited
• access to high quality food

Data quoted from AgBioForum (2004) 770-75
20
Why Are Attitudes Different??

• In these countries,
• An urgent need for available, nutritious food of
• good quality exitsted
• Individuals trusted their government
• Science in general had a positive public opinion
• These attitudes are opposite of those expressed
  in
• European public opinion pools.

Data quoted from AgBioForum (2004) 770-75
21
Crop Biotechnology Has Supporters
Relevant Quotes
The agricultural scientists and farmers all over
the world who improve our crops are the true
heroes of our time.   We have not seen any
evidence of these scenarios (super weeds and
super bacteria) even though we have been testing
these GI crops for 20 years and they have been
eaten by millions of people on a daily basis
since 1996.   We believe that agriculture can
be less ecologically damaging and more
sustainable, and that GI crops can play a
positive role in this development.  
Martin Crispeels,
Director, San Diego Center for Molecular
Agriculture
22
Reasons to Adopt the Best Technologies for Crop
Improvement
Feeding People

• World population will double to 9 million by 2050
• Feeding everyone will be important
• Liberal societies, like the US, believe
• It is our moral obligation to alleviate hunger

23
Hunger A Major Health Issue
General Facts

• 25-30 Million Children Are Underfed
• Malnutrition is the cause of 54 of child
  mortality in
• developing African countries (WHO statistics)
• Other Effects of Malnutrition
• Stunted growth
• Reduced mental development
• Susceptibility to diseases
• Blindness

24
Hunger Is Also A Security Issue
Hungry people are angry Angry people seek change

• Recent Example
• Food was scare in early 1970s in the former
  Eastern Bloc
• countries
• Food strikes occurred in Poland in early 1970s
• Former Soviet Union forced to buy grain on the
  open market
• Purchases seen as a failure of their economic
  system
• These strikes created the first anti-Soviet
  dissident groups that
• lead to the fall of the Soviet Union in the
  late 1980s.

25
Organic Farming Is Not The Answer To World Hunger

• Organic Farming Rejects
• Pesticides
• Synthetic fertilizers
• Herbicides
•  
• And Accepts
• Biological control of insects
• Manure as a fertilizer
• Mechanical (with tractors) removal of weeds

Organic farming data from Foods from
Genetically Improved Crops in Africa"
26
How Much Can Organic Farming Produce?

• Organic Farming
• Can feed about 3 billion people
• But not the 10 billion projected for the future
•  
• Why?
• Biological control is not complete and yields
  reduced
• Land must be set aside for animal production to
  produce
• manure fertilizer
• Nutrients are extracted from the soil at a
  greater rate
• than they are returned
• Crop rotations do not completely replenish
  nutrients
• to the soil

27
Biotech Crops Producer vs. Consumer Products
Producer-Friendly Biotech Crops

• Harvested product is not altered
• Producers cost reduced
• Examples
• Herbicide resistance
• Insect resistance
• Virus resistance

28
Consumer Products On The Horizon
Consumer-Friendly Biotech Crops

• Harvested product has added value to the
  consumer
• Producer may receive a premium
• Examples
• Reduced food allergens
• Increased micronutrient content
• Increased N content of cereal crops
• Edible vaccines

29
Essential Principles Guiding Policy Evaluation
Principles Used for Public Decision Making
General Welfare Institutions (public and private)
work to protect citizen interests
Peoples Right The freedom to choose to use or
not use biotech products
Justice Burdens and benefits are shared by ALL
involved
Adopted from Genetically Modified Crops The
Ethical and Social Issues Nuffeld Council on
Bioethics
30
How These Guiding Principles Apply
to Biotechnology Products
General Welfare

• In a liberal society, our intuitions promote and
  protect
• the welfare of its citizens
• Tools of technology can promote and protect
  citizen welfare
• But what are the costs (social and economic)
  associated with
• the adoption of technology products
• What about biotechnology products?
• Are the products (reduced chemical usage,
  improved
• nutrition) safe or hazardous?

31
Society Tries to Balance Competing Concerns

• Healthy people are valued
• Abundant food supplies reduce hunger
• This promotes the general welfare of the society

• But a diverse environment is also valued
• Are the biotech products endangering the
  diversity?
• Should reducing hunger or maintaining diversity
  be
• valued more?

32
How These Guiding Principles Apply
to Biotechnology Products
Peoples Rights
Can the public choose NOT to come in contact with
the products? How does this conflict with
commercial concerns? What weight should each
carry?
33
Balancing Rights and Interests
The Balance Between European Citizens and
Commercial Interests

• Many European want to avoid biotech foods
• This is their personal right
• US producers and the government have resisted
  labeling
• It is viewed as a restraint to free trade
• BUT without labeling, it is difficult for
  Europeans
• exercise their right to avoid biotech foods

34
Exercising Personal Rights The Cost Issue
The Financial Cost of Choice

• Some choose to not eat biotech foods
• Labeling is necessary for those to exercise this
  choice
• Labeling adds a cost to the producer
• The cost is passed on to the consumer
• BUT consumers not concerned about biotech foods
  pay
• an additional cost
• Therefore the choice of one group is a burden
• on another group

35
Exercising Personal Rights Obligations
Choice and Obligation

• In a biotech world, some may choose not to eat
  biotech products
• What if there is not an alternative?
• Is it their right to be able have a non-biotech
  alternative?
• Should the producer community be obligated to
  produce
• a similar non-biotech product?
• If demand is great enough, that product will be
  produced.

36
How These Guiding Principles Apply
to Biotechnology Products
Justice

• Justice Issues
• Do those benefiting from the products have an
  obligation to those
• who object to the products?
• How can justice be achieved while balancing
  various interests?

37
Can Justice For All Competing Interests Be
Achieved?
Opponents and Proponents

• Justice For Biotech Opponents
• Should labeling be a requirement?
•  
• Justice For New Biotech Companies
• Is the market saturation of large biotech
  companies
• making it difficult for others to enter and
  succeed
• in the business?

38
Other Biotech Justice Concerns
Countries and Farmers

• Justice For Countries With Food Shortages
• Should biotech opponents have the ability to
  deny the
• opportunity of countries with severe food
  shortages
• to become self-sufficient or even exporters?
•  
• Justice For Subsistence Farmers
• How will subsistence farmers who cannot afford
  the new
• technology be compensated?