Don’t underestimate power of consumer concern
Fiona Boal of the multinational banking group pointed out that French veal production decreased by 1.8% over the last nine years, and veal production has grown by 5.8% in Holland, which she linked to the two countries’ different reactions to new EU legislation, which followed a public outcry against using single pens for calves in the veal industry.
New laws, effective as of 1998, but to be implemented over nine years, required single pens to be phased out by 2007.
French farmers were slower than their neighbours to adopt these requirements and some chose to exit the industry, explained Boal.
“While animal welfare regulation can clearly distort trade flows, as it did in France, early adoption of regulation can also benefit countries”, she added.
Producers in the Netherlands took advantage of low stock numbers during the foot-and-mouth crisis to invest in new group housing structures, and demand for Dutch veal has increased.
Boal, Vice President of the bank’s Food and Agribusiness Research and Advisory (FAR) unit added, “Not only is animal welfare hard to define and regulate across borders and cultures, but it has the potential to disrupt trade flows and could be used as a pseudo trade barrier, which will affect the whole industry.
“As people earn more they move beyond the basic drive to eat, and start worrying about issues like food safety and animal welfare.
“The human relationship with animals comes into the equation, and what’s considered minimum animal welfare varies across cultural and religious borders,’’ Boal said.
“There’s also a real danger that countries may use animal welfare as a trade barrier, like they’ve tried to use food safety,” she said.
She said animal advocacy groups are very influential and play an important role in this debate. They are well organised, well financed and media savvy, generating a lot of media interest. This can influence consumer opinion, which affects retailer decisions, with cost and logistical ramifications further down the value chain and all the way back to the farmer.
