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Consumer Expectation: Traceability

Center for Science in the Public Interest. Bi-national consumer advocacy organization founded in 1971 by Michael JacobsonFocuses on nutrition and health, food safety, alcohol policy, and eating greenPublishes award-winning Nutrition Action HealthletterRepresents 950,000 subscriber/members in the United States and Canada.

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Consumer Expectation: Traceability

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    1. David W. Plunkett, JD, JM Center for Science in the Public Interest Consumer Expectation: Traceability

    2. Center for Science in the Public Interest Bi-national consumer advocacy organization founded in 1971 by Michael Jacobson Focuses on nutrition and health, food safety, alcohol policy, and eating green Publishes award-winning Nutrition Action Healthletter Represents 950,000 subscriber/members in the United States and Canada

    3. Consumer Expectations: Traceability Support for Traceability Polling on Trace Polling on Costs Random Assignment Costs Feasibility Factors in Trace System Effectiveness Consumer Awareness and Biases Meeting Consumer Expectations

    4. Consumers Value Traceability Polling Support for trace system that enables FDA to trace food back to its source – 94% Hart Research/Public Opinion Strategies, June-July 2009 Support for government being able to trace food from production to sale if problems arise – 97% National Research Center, Consumers Union, Nov. 2008 Support for labels disclosing region, state, or farm of origin to ID source of contaminated food – 79% CSPI members’ poll 2008

    5. Source Information is Important Country of Origin Labeling Support for COOL – 93% CSPI Members’ Poll 2008 Support for more information on source – 76% “[T]here’s still a significant gap between consumer expectations and what retailers/ manufacturers are providing.” IBM Survey, June 24, 2009 Read COOL info often or sometimes – 52% Harvard Food Safety Survey, May 12-June 1, 2008

    6. Willingness to Bear Costs Polling Would pay 3% to 5% more for additional safety – 72% Hart Research/Public Opinion Strategies, June-July 2009 Studies Experimental auction lends support to poll results “The empirical analysis shows that consumers were willing to pay non-trivial amounts for a traceability assurance… For consumers, traceability has the most value when bundled with additional quality assurances.” J.E. Hobbs, Liability and Traceability in Agri-food Supply Chains

    7. Random Assignment of Costs Decline of Food $ as % of family budget 1958: Food purchases represent18.4% of disposable income 2008: Food purchases represent 9.2% of disposable income Annual spending on food = $1,165 B Economic Research Service Estimates of the annual cost of food-borne illness range from $6.9 B to $357 B Crutchfield & Roberts, ERS, 2000 (5 pathogens only); Roberts, 2007 (WTP)

    8. Random Assignment of Costs Per capita expenditures/costs Food: $3,832 Food-borne illness: $1,174 Random assignment of illness costs $26 (no doctor visit) to $30,998 (hospitalized HUS) per case $1.8 million (age = 85) to $9.3 million (infant) per life Frenzen, ERS Cost Calculator, 2007 (STEC 0157 only and 2003 $) Random assignment of industry losses Spinach: Loss of $350 million Tomatoes: Loss of $425 million ($300 M CA; $25 M GA) Press Reports, UGA

    9. Cost of Implementing Traceability Traceability in H.R. 2749 CBO stated cost depends on future regulatory decisions and so could not be estimated Factors Costs: Infrastructure, standardization, replacement of legacy systems, labor, records Benefits: Lower recall costs, improve consumer confidence and supply chain management Institute of Food Technologists

    10. Feasibility of Tracing – Produce Lessons – Salmonella saintpaul 2008

    11. Traceability for Marketing Perishable Agricultural Commodities Act Trace to ensure fair dealing and resolve disputes Price Look-up Codes Trace-like system for inventory control; pricing Labels adapted for COOL information Customer loyalty programs Tracing customer preferences (who buys what) Consumer question Economic traceability is common; why can’t we have better safety traceability?

    12. Attitudes Toward Notices Inattention to notices Of those with internet access – Ones who ever visit government website for recall information – 20% Ones who read little or nothing about recalls – 25% Optimistic Bias “Recalls are relevant to others, not me.” Own food purchases are unlikely to be recalled – 38% Of persons suffering illnesses 5% said source was recalled food, but 11% said knew others made sick by recalled food Food Policy Institute, April 14, 2009

    13. Consumer Expectations Traits of an effective trace system Provides easily understood information about food’s source (not just codes or electronic tags) Uses standardized product identifiers so that recall information is easy to communicate Relies on pro-active communication (such as customer loyalty systems to alert consumers) Supported by relevance information (retail consignee; posting alerts in store)

    14. Contact Information David W. Plunkett, JD, JM Senior Staff Attorney Center for Science in the Public Interest 1875 Connecticut Ave, NW Suite 300 Washington, DC 20009 phone (202) 777-8319 fax (202) 265-4954 e-mail dplunkett@cspinet.org On the internet: www.cspinet.org

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