Economic aspects of co-existence and traceability

Co-existence, traceability, and freedom of choice make up the groundwork of Europe's approach to GMO policy. The desired outcome of Europe's approach is that when customers reach for food on a grocery store shelf, it's an act that actually has an influence on how farmers run their operations. A label stating the food contains GMOs, however, isn't the only important piece of information on a package. There is also a price tag. Co-Extra research on economic aspects of co-existence and traceability is looking to determine how new demands placed upon producers will reflect product prices, and how product prices will influence how consumers make their buying decisions.

Milk: Avoiding genetic engineering can unlock an added value market
Milk: Avoiding genetic engineering can unlock an added value market

Cost / benefit analysis

New requirements for documentation, traceability, and labelling place new demands on stakeholders in the food supply chain. Operators may consider changing suppliers to keep their products free of labelling requirements, spending extra time cleaning machines between GM and non-GM ingredients, or expanding storage to ensure that different products won’t mix. All of these activities translate to added costs. High demand for GMO-free food, however, can unlock a value added market. Therefore, stakeholders need to plan for the potential economic impact of labelling and traceability.

 

 

Flexing consumer muscle

How do GMO labels affect consumer decisions?
How do GMO labels affect consumer decisions?
Consumer choices will have a major influence on how co-existence and traceability economically affect stakeholders in the food supply chain. If consumers are willing to pay a premium for products without GMO labels, producers have the opportunity to capitalise on a new added-value market. If retailers decide to reject all foods with GMO labels to lure consumers who are sceptical of GMOs, producers may want to adjust their operations accordingly. This is why it’s important for Co-Extra researchers to find out how many Europeans are reluctant to buy products containing GMOs, and just how much extra they are willing to pay for products that are “GMO-free”.