EU’s ‘farm to fork’ demands could mean indigestion for US food exporters
As if the retaliatory tariffs American farmers are facing were not enough, now they may have to deal with Europe’s new “Farm-to-Fork” policy. It could be a hiccup in U.S. food exports to Europe, but could also spur U.S. reforms that were likely coming down the pipeline anyway.
European leadership wants more sustainable farming practices and healthy food. According to the European Commission, tracing the origin of the food, ingredients, and the chemicals and pesticides used to grow or process it will enable the EU to work toward a “healthier and more sustainable EU food system.” U.S. Secretary of Agriculture Sonny Perdue says this is veiled protectionism and has even hinted at a World Trade Organization (WTO) case.
But as long as the new measures treat domestic and foreign entities in the same way, and the EU can show it is all being done in the least trade-restrictive manner, a WTO case could be hard to win.
The Farm to Fork initiative might be at least partially driven by protectionist sentiment, but citizens around the globe have a right – through their governments – to demand better labeling, access to healthy food and stronger environmental protection.
In the larger scheme, these are first-world problems. While about 9 percent of the global population is still struggling to get the daily calories they need to escape malnutrition, the EU and United States are fighting over what ingredients meet the definition of bread.
Countries make different choices about ingredients in their food. For instance, when Americans walk into the grocery store for bread, they find shelves of stark white, soft and fluffy loaves that can last for weeks at home. Europeans are more likely to buy fresh, locally baked loaves. In some larger food stores, shoppers can press a button and a machine will make your rolls while you shop.
One reason for this difference is that the EU does not allow some of the additives and chemicals in food that the United States allows. Take potassium bromate (added to flour to make dough rise higher and turn stark white) and azodicarbonamide (ADA, a whitening and conditioning agent for cereal flour and dough). Both the spongy feel Americans enjoy in their bread and that springy plastic feeling in yoga mats and flip flops come from ADA.
The case of Nutella may provide insight into how this can go. Palm nut oil, a longtime ingredient in the hazelnut cocoa spread, has been linked by some to health concerns and tropical deforestation. Amid warnings from an EU advisory panel, some grocery chains pulled Nutella off shelves, and competitors responded with palm oil-free chocolate hazelnut spread. Italian manufacturer Ferrero changed its recipe to use only palm oil certified as “responsibly sourced” in response to the environmental concerns.
Approaches to potentially hazardous ingredients differ across the Atlantic. The EU’s approach can be summed up as “better safe than sorry,” which is legally characterized as the precautionary principle. The U.S. approach is generally more open to tolerating low levels of uncertainty as the facts become clear. Researchers including Adam Thierer have made the case for “permissionless innovation” as the superior default regime, citing the indirect boost to, and long-term benefits of, technological innovation.
Economists tend to favor consumer choice as long as consumers can be well-informed. Policymakers get to decide how much information is enough. To the extent that a government acts on behalf of its citizens, then the level of risk aversion in regulatory agencies should mirror that of the people. When countries with different risk tolerances engage in trade, more information and better labeling is generally needed.
If the EU goes down this road in a WTO-consistent way, it will be up to America’s farmers and food processors to figure out how to meet European consumer demands within the guardrails of Farm to Fork. Our own country may already be heading there, too, as illustrated by changing consumer preferences and a new food-traceability rule proposed by the FDA.
But if Farm to Fork is truly veiled protectionism that hinders advances in agriculture biotechnology, it not only would be harmful to farmers and scientists in the United States and abroad but could also hamper efforts to feed the planet in a sustainable way.
Ideally, regulators across the Atlantic can cooperate on sustainability goals in ways that facilitate important scientific advances and allow sovereign nations to achieve their goals.
Christine McDaniel is a senior research fellow with the Mercatus Center at George Mason University.