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Alternative Animal Welfare Responses: Options and Implications for Producers and Industry at Large

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Alternative Animal Welfare Responses: Options and Implications for Producers and Industry at Large AlternativeAlternative AnimalAnimal WelfareWelfare Responses:Responses: OptionsOptions andand ImplicationsImplications forfor ProducersProducers andand IndustryIndustry atat LargeLarge Glynn Tonsor Dept. of Agricultural, Food, and Resource Economics Michigan State University State-Wide Pork Industry Information Meetings March 23-26, 2009 OverviewOverview QuickQuick overviewoverview ofof consumerconsumer researchresearch OutlineOutline ofof industryindustry && producerproducer optionsoptions Consumer Group Sourced Articles 800 ConsumerLexis Group Sourced Articles 700 600 -Nexis Media Indices: 500 Nexis Media Indices: 400 Pork Consumer Group - LN-Media Indices (2003- Poultry 300 Beef 200 Westland/Hallmark; Chino, CA Event: 100 0 2003 2003 2003 2008) 2003 2004 2004 2004 2004 2005 2005 2005 2005 2006 2006 2006 2006 2007 2007 2007 2007 2008 2008 2008 2008 LexisLexis--NexisNexis MediaMedia Indices:Indices: IndustryIndustry SourcedSourced ArticlesArticles Industry Source (2003-2008) 40 35 30 Pork Poultry Beef 25 20 15 10 5 0 2003 2003 2003 2003 2004 2004 2004 2004 2005 2005 2005 2005 2006 2006 2006 2006 2007 2007 2007 2007 2008 2008 2008 2008 PerceivedPerceived AnimalAnimal WelfareWelfare InformationInformation AccuracyAccuracy (1=Very(1=Very Inaccurate,Inaccurate, ……,, 7=Very7=Very Accurate)Accurate) The Humane Society of the U.S. (HSUS) 4.93 University Scientists/Researchers 4.47 People for the Ethical Treatment of Animals (PETA) 4.22 National Milk Producers Federation (NMPF) 4.20 U.S. Poultry & Egg Association 4.18 National Cattlemen's Beef Association (NCBA) 4.11 United Egg Producers (UEP) 4.10 National Pork Producers Council (NPPC) 4.07 State Governmental Agencies 4.00 Federal Governmental Agencies 4.00 PerceivedPerceived AbilityAbility toto InfluenceInfluence andand AssureAssure AnimalAnimal WelfareWelfare (1=Very(1=Very LowLow Ability,Ability, ……,, 7=Very7=Very HighHigh Ability)Ability) Farmer/Grower 5.33 Government Inspectors/Regulators 5.16 The Humane Society of the U.S. (HSUS) 5.00 Meat or Milk Processor 4.68 Animal Industry Representative Groups 4.58 People for the Ethical Treatment of Animals (PETA) 4.44 Consumer – Food Purchaser 4.38 Retail Grocer 3.71 Food Service Restaurant 3.59 CACA’’ss PropositionProposition 22 Question:Question: LawLaw wouldwould requirerequire farmersfarmers nationallynationally toto confineconfine calvescalves raisedraised forfor veal,veal, eggegg--layinglaying hens,hens, andand pregnantpregnant pigspigs onlyonly inin waysways thatthat allowallow thesethese animalsanimals toto lielie down,down, standstand up,up, fullyfully extendextend theirtheir limbs,limbs, andand turnturn aroundaround freely.freely. CACA actualactual vote:63%vote:63% FORFOR SurveySurvey nationalnational question:question: • National support: 70% FOR • CA residents: 70% FOR • MI residents: 69% FOR • IA residents: 57% FOR • Weakest support in SD: 33% FOR Source: Survey of 2,000 U.S. residents “…“… threethree statesstates havehave passedpassed eithereither ballotballot initiativesinitiatives (AZ(AZ andand FL)FL) oror statestate legislaturelegislature (OR)(OR) tthathat willwill banban thethe useuse ofof gestationgestation cratescrates byby swineswine operationsoperations inin theirtheir respectiverespective statesstates atat differentdifferent pointspoints inin thethe future.future. …… WouldWould youyou votevote FORFOR oror AGAINSTAGAINST thethe ban?ban?”” 69%69% nationallynationally (omitting(omitting FL,FL, AZ,AZ, OR,OR, CO)CO) wouldwould votevote FORFOR thethe banban •• FL:FL: 55%55% FORFOR toto 45%45% AGAINSTAGAINST (Nov.(Nov. 0202’’)) •• AZ:AZ: 62%62% FORFOR toto 38%38% AGAINSTAGAINST (Nov.(Nov. 0606’’)) Source: Survey of 1,001 U.S. residents Labeling Impacts on G.C. Ballot Support (69% FOR initially) 18%18% ofof banban supporterssupporters wouldwould changechange votevote if:if: • ‘all pork products in the US included more complete labeling information accurately depicting if gestation crates were used…’ Net count would be 56.5% FOR the ban Suggests additional transparency is desired 23%23% ofof banban supporterssupporters wouldwould changechange votevote if:if: • ‘all pork products raised using gestation crates were labeled as such and certified to have passed additional food safety inspections…’ Net count would be 53.6% FOR the ban Suggests gestation crates are associated with lower food safety Source: Survey of 1,001 U.S. residents DeterminantsDeterminants ofof votingvoting responseresponse inin cratecrate banban questions:questions: DeterminantsDeterminants ofof votingvoting response:response: • Observable demographics are NOT drivers • State of residence and pork industry prevalence are NOT drivers • Perceptions ARE highly influential Those associating g.c use with more food safety risk, lower pork quality, larger farm size, or corporate ownership are more likely to support the ban. Source: Survey of 1,001 U.S. residents BallotBallot VotingVoting ImplicationsImplications TargetingTargeting residentsresidents isis difficultdifficult (latent(latent perceptionsperceptions drivedrive voting)voting) ResidentsResidents werewere insensitiveinsensitive toto ## yearsyears forfor producersproducers toto complycomply (6(6--88 isis common).common). •• 11st oror mostmost heardheard voicevoice maymay setset adjustmentadjustment timetabletimetable •• SubstantialSubstantial costscosts ofof notnot beingbeing activeactive oror sendingsending mixedmixed signalssignals •• IndustryIndustry maymay havehave opportunityopportunity toto pursuepursue longerlonger implementationimplementation timetabletimetable PerceivedPerceived priceprice impactsimpacts ofof ban:ban: Entire Pop. Raw % "Know" %s Fall by 11% or more 4% 7% Fall by 6-10% 3% 5% Fall by 1-5% 2% 3% Change by less than 1% 5% 8% Increase by 1-5% 7% 12% Increase by 6-10% 12% 20% Increase by 11% or more 26% 44% Don't Know 42% FOR a G.C. Ban AGAINST a Ban Raw % "Know" %s Raw % "Know" %s Fall by 11% or more 3% 5% 5% 8% Fall by 6-10% 3% 5% 2% 3% Fall by 1-5% 3% 5% 0% 0% Change by less than 1% 6% 11% 2% 3% Increase by 1-5% 9% 16% 2% 3% Increase by 6-10% 14% 25% 7% 12% Increase by 11% or more 19% 33% 42% 70% Don't Know 44% 40% Source: Survey of 1,001 U.S. residents WouldWould youyou bebe inin favorfavor ofof mandatorymandatory labelinglabeling of:of: allall porkpork thatthat waswas producedproduced byby farmsfarms usingusing gestationgestation crates/stalls?crates/stalls? •• 62%62% YESYES CA: 66%; IA: 44%; MI:59% •• COMPARECOMPARE WITHWITH COOLCOOL DISCUSIONSDISCUSIONS •• LABELINGLABELING ISIS ALTERNATIVEALTERNATIVE TOTO PRODUCTIONPRODUCTION BANSBANS But it does have trade (NAFTA, WTO,…) implications (as does COOL) Source: Survey of 2,000 U.S. residents SummarySummary Points:Points: ConsumersConsumers Consumer/residentConsumer/resident desiresdesires regularlyregularly initiateinitiate changechange • Perception (i.e., farm size, food safety, quality) drives decisions • “Accurate knowledge” and familiarity is NOT necessary to be influential BallotBallot votingvoting behaviorbehavior && regulationregulation impactsimpacts allall residentsresidents && consumersconsumers • Pork product choice set for all is impacted LittleLittle isis knownknown aboutabout truetrue desiresdesires • Is group indoor housing sufficient or outdoor pasture necessary??? • Would ‘site unseen’ meat from other countries be accepted if U.S. production costs accelerate??? OtherOther CriticalCritical PointsPoints ““MyMy statestate passingpassing aa ballotballot initiativeinitiative”” isnisn’’tt likelylikely necessarynecessary toto causecause change:change: •• CostCost ofof segregationsegregation maymay causecause packerspackers toto switchswitch atat somesome criticalcritical volumevolume Example:Example: cashcash-- toto leanlean-- pricingpricing ofof marketmarket hogshogs •• WasnWasn’’tt mandated,mandated, butbut marketmarket increasinglyincreasingly encouragedencouraged transitiontransition Implication: “Fighting ballot initiatives at all costs” may not be optimal AlternativeAlternative IndustryIndustry PathsPaths ““DoDo Nothing:Nothing:”” •• Benefits:Benefits: Minimize current investment Wait for more information, hope to improve decision •• Cons:Cons: Limits nearly all ability to have influence • Ballot support insensitive to producer adoption time Fails to leverage perception that farmers/growers have most influinfluenceence • Public may perceive the industry as not caring AlternativeAlternative IndustryIndustry PathsPaths ““ProactiveProactive options:options:”” •• NegotiateNegotiate withwith concernedconcerned groupsgroups Colorado approach (currently ongoing in Ohio) Adjustment time and requirements may (or not) be improved •• SeekSeek additionaladditional MIMI legislationlegislation Agriculture may have more influence than reacting to ballot initiatives Note that “heading off ballot initiatives” doesn’t mean the market won’t drive change But be careful what you ask for … “there is no free lunch” AlternativeAlternative IndustryIndustry PathsPaths ““ProactiveProactive options:options:”” •• SupportSupport additionaladditional labelinglabeling ofof practicespractices ‘swing vote concept’ on ballot initiatives; critical to note difference from demand enhancing motives … Tonsor opinion: costs would likely be lower than COOL, but notable trade impacts (both) •• SupportSupport ‘‘phasephase--outout’’ asas oldold buildingsbuildings comecome outout ofof productionproduction May align with “facility age” timetables Reduce adjustment costs & improve exits AlternativeAlternative IndustryIndustry
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