Now that the FDA has declared meat and milk from cloned livestock safe to eat, processors have a lot to consider when it comes to the adoption and growth of cloned animal products.
In December 2007, after five years of study, the Food and Drug Administration (FDA) declared that meat and milk products from cloned livestock are safe to eat. The decision has sparked fierce ethical and scientific debates. While these debates rage on, the question for the food industry is - where do we go from here? In the midst of much uncertainty, it is clear that several considerations need to be taken into account when trying to determine the adoption and growth of cloned animal products.
Consumers want to know
Today's consumers, now more than ever before, want to know exactly what they are eating. Shoppers stroll up and down grocery store aisles scanning nutrition labels and making purchase decisions based on the amount of fat, calories, sodium, artificial flavorings, carbohydrates, antioxidants etc., contained in products. Since the FDA has found no significant differences between products from cloned animals and products from traditionally-raised animals, it is uncertain whether the FDA will require special labeling on these products. This is not likely to sit well with today's ingredient-conscious consumers.
Consumers also want to know where the products they are consuming come from. Although animal science is present in nearly every category of the food sector, the linkages between science labs and the foods we eat have been relatively invisible to the consuming public for many years. In many instances, the science applied in the food industry has been in response to changing consumer demands and the desire of the industry to meet those demands. However, until recently, the consuming public was less interested in how quality products arrived on the shelves as long as the safety of those products was ensured. Times are changing. Transparency, along with safety, is now of growing importance.
Organic vs. perfect
Consumers today are increasingly purchasing locally grown and naturally raised products produced without growth hormones or chemical additives. Natural and organic products are one of the fastest-growing segments in the food industry. The most recent figures from the Organic Trade Association report that U.S. organic food sales reached $16.9 billion in 2006, representing a robust 22 percent year-over-year growth. While organic food sales still represent just three percent of retail food and beverage sales, growth rates for the category are four to five times greater than that of the overall food industry.
Illustrative of this trend are the growing number of food manufacturers and retailers catering to consumer demand for natural foods. Ben & Jerry's now places a label on its products stating that the family farmers who supply the milk and cream for their ice cream have pledged not to treat their cows with recombinant bovine growth hormone (rBGH), a genetically engineered hormone given to dairy cows to increase milk production. In 2007, Tyson Foods announced it is now producing all of its Tyson-brand fresh chickens from birds raised without antibiotics, making it the first major poultry company to do so on a large-scale basis. Whole Foods, a natural and organic foods retailer, has also thrived on consumer demand by opening a record 21 stores in 2007 and is expecting continued growth in 2008.
Animal science has also done its part to meet consumer demand by creating the "perfect" animal. Today's consumers desire lean protein as a part of a healthier diet. In response to this, the food industry has been using sophisticated genetic mapping and breeding techniques for years to produce the same types of protein, but without much of the undesired fat. By finding the right genetic characteristics that promote lean weight gain and then breeding those genes over time, the "perfect" animal has been created. As a result, a cross-section of a side of beef today looks dramatically different, and is significantly healthier to eat, than one processed in the 1970s. Chickens have also been bred over the years to produce more breast meat - a direct response to the popularity of white meat over dark.
Both organic and genetically perfected livestock have met consumer demand and will continue to do so amongst different segments. The question is whether cloned animal products also have a welcome place on the shelf.
Comfort with cloning
The general public's reaction to the "ethical" issues raised by the FDA's decision is yet to be determined. However, consumers will likely be vocal when these products are introduced into their grocery store aisles. Until this growing breed of informed and health-conscious consumers feels comfortable with cloned animal products, they will likely look to trusted food brands to proactively provide assurance that the lamb chops in the supermarket case came from a farm and not from a laboratory.
In every industry, demand for innovation drives improvements and growth. In the food industry, the production of food from animals has been accelerated by the application of animal science. It has played a key role in improving the process and shortening the time involved from "feed to meat" - the time it takes from the birth of an animal until it is processed for consumption. In today's environment, the faster an animal reaches market weight, the more profit a food processor can make. Therefore, by genetically modifying the feed, animals grow to their desired weight much more quickly. Also, as a result of genetic modifications, animals are more uniform and simpler to process, thereby reducing the time and cost involved. Ultimately, the money saved and profit made is passed along to the consuming public in the form of lower costs and a better product.
Whether or not consumers approve of the science is up for debate, but the fact remains it has been a part of the food industry for years. Both consumers and the industry have profited from the advancements in animal science. However, the topic of cloning brought about by the FDA's ruling elicits a moral and emotional response. It may help to meet increased demand, but it takes animal science to a new - and potentially uncomfortable - level in the minds of some. Before the industry can widely adopt such advancements, the question yet to be answered by the court of public opinion is whether or not science has gone too far.
Although the FDA has ruled upon the science and safety of cloning animals for use in food production, the availability of financing for these applications will be largely determined by how the consuming public weighs in.
If consumer reaction is negative, the need for loans to support the expensive endeavor of cloning will likely be minimal, and willing lenders few. However, consumer demand and general opinions of new technologies change over time. If that occurs and the potential for profitability through cloning becomes a reality, then the need for financing will increase significantly. Both borrowers and lenders will be challenged with understanding and making themselves comfortable with the myriad of risks involved to fuel innovation.
Where do we go from here?
Recent industry reporting states that in 1961, the world's total meat supply was 71 million tons. In 2007, it was estimated to be 284 million tons, and meat consumption is expected to double again by 2050. Cloning could be the solution to the burgeoning demand. However, consumers must decide if they are ready to ingest products from cloned genetically perfected livestock.
Over the years, science has played a significant role in producing food products that are mutually beneficial to both food companies as well as consumers. However, given strong industry trends towards health and wellness, and growing demands to understand exactly what is in food, it is likely consumers will remain wary for some time to come.
Until the consuming public feels a cloned cow has a place in local supermarkets, most food companies will be slow to adopt cloning technology. However, if consumer sentiment changes, food companies eager to optimize the latest advancements in animal science should be ready. Early adopters will seek partners who understand the complexities and resources necessary to capitalize on a potentially significant growth opportunity.