Food & Agriculture Outlook 2019 - IEG Policy - Informa

Page created by Gregory Le
Food & Agriculture Outlook 2019 - IEG Policy - Informa
IEG Policy

Food & Agriculture
Outlook 2019
Food & Agriculture Outlook 2019 - IEG Policy - Informa
Anticipate every shift.
agri-print-01.pdf   1   6/29/17   1:40 PM

       Seize every opportunity.
       Gain every edge.
       Anticipate every shift.
       Seize every opportunity.
       Gain every edge.
       Dedicated consulting for the agribusiness sector
       Informa Agribusiness Intelligence is the expert resource      •   Market research/intelligence
       for global agribusiness markets covering the full value       •   Strategic planning
       chain from inputs, producers, and food manufacturers, to
                                                                     •   Market outlook
       transportation, bio-energy and policy.
       Dedicated consulting for the agribusiness
                                       •                 sector
                                          Feasibility analysis

                                                                     •   Geospatial analysis
                              Years of
       Informa Agribusiness Intelligence
                              experienceis the expert resource       •   Market research/intelligence
                                                                     •   Economic impact
       for global agribusiness markets covering the full value       •   Strategic planning

                                                                     •   Business plans
       chain from inputs, producers, and food manufacturers, to
                                   Analysts and                      •   Market outlook
       transportation, bio-energy and policy.
                                   consultants                       •   Market & financial analysis
                                                                     •   Feasibility analysis
                                                                     •   M&A due diligence

                                                                     •   Geospatial analysis
                                            Years of     Projects    •   Risk management
                                            experience   completed   •   Economic impact
                                                                     •   Policy analysis

                                                                     •   Business plans
                                                Analysts and
                                                consultants          •   Market & financial analysis

                                                                     •   M&A due diligence

                        20,000                           Projects

                                                                         Risk management

                                                                         Policy analysis

      Get in touch to see how we can
      help you compete and grow.

      Get in touch to see how we can
      help you compete and grow.

  2    / Food & Agriculture Outlook 2019 | IEG Policy                                  
Food & Agriculture Outlook 2019 - IEG Policy - Informa
IEG Policy

                                                            5      Introduction

                                                             US FOOD POLICY ❱

                                                            7 Produce safety likely to be priority #1 for FSMA in 2019
                                                            11 US agencies strike deal on regulating cell-based meat,
                                                               but thorny issues remain for 2019
                                                            15 Regulatory Outlook: US ready to revamp GE crop and animal rules

                                                             EUROPEAN FOOD LAW ❱

                                                            19 An odyssey of food labels challenge EU single market
                                                            23 A taxing year for food and drink
                                                            27 Tide continues to turn against palm oil as Europe’s protest intensifies
                                                             EUROPEAN AGRICULTURE POLICY ❱

                                                            29     CAP reform plans stalled by 2019 political timetable
                                                            33     Drought, agriculture and climate change: an end-of-year review
                                                            37     Supply chain fairness: Europe edges closer to new rules
                                                            39     Agri-food sector to remain on a knife-edge as Brexit drama
                                                                   continues to unfold
                                                             US AGRICULTURE POLICY ❱

                                                            43 Battle over USMCA shifts to Congress in 2019, swift approval
                                                               not assured
                                                            47 Host of issues ahead for the US biofuel industry

                               Agribusiness Intelligence | Informa UK Ltd. | Christchurch Court | London EC1A 7AZ | UK
                               Telephone: +44 20 7017 7500

           Publishing Director IEG Vu & IEG Policy                             Analyst: US Agricultural Policy                                Consultant: European
           Adam Sharpe                                                         Richard Morrison                                               Agricultural Policy
           Tel: +44 20 7017 7587                                               Tel: +44 20 7017 4089                                          Chris Horseman (contributor)
           Email:                                      Email:

           Editor: US Food Policy                                              Editor: European Food Law
           Joan Murphy                                                         Peter Rixon
           Tel: +44 20 7017 7553                                               Tel: +44 20 7017 5174
           Email:                                      Email:

           Analyst: US Food Policy                                             Analyst: European Food Law                        Head of Advertising Sales Ben Watkins
           Margarita Raycheva                                                  Sara Lewis (contributor)                          Tel: +44 20 3377 3911
           Tel: +44 20 7551 9130                                                                                                 Email:
                                                                                                                                 Subscription & Marketing Enquiries
           Analyst: US Food Policy                                             Analyst: European Agricultural Policy
           JR Pegg                                                             Pieter Devuyst                                    Agribusiness Intelligence Client Services Team
           Tel: +44 20 7017 7539                                               Tel: +44 20 7017 4990                             EMEA: +44 20 7017 6242 (9am-5pm BST)
           Email:                                    Email:                 APAC: +61 287 056 966 (9am-5pm AEST)
                                                                                                                                 NORTH AMERICA and LATAM:
                                                                                                                                 +1 21 26 52 53 22 (9am-5pm EDT)
           Analyst: US Agricultural Policy                                     Analyst: European Agricultural Policy             Email:
           Roger Bernard                                                       Alessandro Mancosu
           Tel: +44 20 7017 7550                                               Tel: +44 20 3377 3704                   
           Email:                                    Email:
                                                                                                                                 © Informa UK Ltd 2019                                                                                                       IEG Policy | Food & Agriculture Outlook 2019 /           3
Food & Agriculture Outlook 2019 - IEG Policy - Informa
4   / Food & Agriculture Outlook 2019 | IEG Policy
Food & Agriculture Outlook 2019 - IEG Policy - Informa
2018 was an exceptional year for food and agriculture policy
and regulation globally, and 2019 promises more of the same.
In the US, a series of food safety scares, in     5% fall in the overall budget for the policy         Even the CAP reform
particular an outbreak of E. coli in romaine      to contend with as a direct result of losing
lettuce, put the Produce Safety rule under        the net contribution made by the British.
                                                                                                       proposals for 2021-27
the spotlight again and the focus is set to                                                            could not escape from
intensify in 2019 as regulators start             Some of the proposed changes to the farm             the looming prospect of
inspecting produce farms for the first time       policy have disappointed some and have
under the Food Safety Modernization Act.          been described as more ‘evolutionary’ than
                                                                                                       the UK’s departure from
                                                  ‘revolutionary’ – but given the headwinds            the bloc, with a 5% fall
It was also a benchmark year for lab-grown        that have buffeted the agriculture sector in         in the overall budget
meat with decisions being made in regard          recent years, and the lack of political will to
to the oversight of the sector, while there       change things too much, it was difficult to
                                                                                                       for the policy
were also regulatory changes for the              imagine another outcome.
biotech industry.
                                                  EU farmers suffered a difficult summer with
President Donald Trump was of course at the       drought impacting crops and livestock but
centre of things, kicking off a trade war with    in better news for them, things moved
China that saw the Asian country apply import     forward with legislation to tackle Unfair
tariffs on agricultural goods such as soybeans,   Trading Practises in the supply chain.
and a renegotiation of NAFTA that may
open up new opportunities for US farmers.         Finally, the EU Food Law agenda was as
                                                  busy as ever with developments in food
In Europe, Brexit was at the heart of things      labelling policy and actions to introduce
for the EU agriculture sector, with uncertainty   sugar taxes and restrict imports of palm oil.
over a future trading relationship and (at
the time of writing) left questions over the      The following pages take a look at the past
withdrawal agreement still hanging in the air.    year in review and cast an eye ahead at
                                                  what is to come in 2019.
Even the CAP reform proposals for 2021-27
could not escape from the looming prospect        Adam Sharpe, Publishing Director: IEG Vu
of the UK’s departure from the bloc, with a       & IEG Policy, Agribusiness Intelligence

                                                                                                    IEG Policy | Food & Agriculture Outlook 2019 /   5
Food & Agriculture Outlook 2019 - IEG Policy - Informa
6   / Food & Agriculture Outlook 2019 | IEG Policy
Food & Agriculture Outlook 2019 - IEG Policy - Informa

Produce safety likely to be
priority #1 for FSMA in 2019
Lettuce outbreaks in 2018 to shape FDA’s
enforcement of produce safety rule
by Joan Murphy

The spotlight on the Produce Safety rule is likely to intensify                                   For the third time in
in 2019 as regulators start inspecting produce farms for the                                      a little over a year, the
first time and FDA tries to navigate the difficult job of writing                                 leafy greens industry
workable water provisions under the Food Safety Modernization                                     battled intense public
Act (FSMA).                                                                                       scrutiny in the wake
A lot happened in produce safety in 2018.    farms in January 2018 to comply with                 of E. coli illnesses
With the produce industry under the gun to   FSMA, except for the agricultural water
comply with FSMA, 2018 became the year       provisions that were put on hold. In
of romaine lettuce outbreaks that not only   January 2019, farms that qualify as small
added urgency to FDA efforts to rewrite      businesses will be next in line.
water standards but also revealed a gaping
need for better traceability.                For the third time in a little over a year, the
                                             leafy greens industry battled intense
The 2015 Produce Safety rule, one of seven   public scrutiny in the wake of E. coli
foundational rules established under the     illnesses. During the latest outbreak, FDA
2011 FSMA, sets science-based standards      informed US consumers not to eat any
for the safe growing, harvesting, packing    romaine lettuce, a devastating blow to
and holding of fruits and vegetables.        growers, then announced an industry-
                                             wide tagging scheme that would identify
Referred to by FDA as a “heavy lift” from    romaine lettuce by harvest date and
the start, FSMA required large produce       growing region as a way to return safe

                                                                                               IEG Policy | Food & Agriculture Outlook 2019 /   7
Food & Agriculture Outlook 2019 - IEG Policy - Informa
(FSVP) deadlines this year and there were
                                                                                                       concerns raised importers would not
                                                                                                       be prepared.

                                                                                                       Under FSMA, food importers need to verify
                                                                                                       they are significantly minimizing or
                                                                                                       preventing risks and producing food in a
                                                                                                       manner that provides the same level of
                                                                                                       public health protection as required for
                                                                                                       US producers.

                                                                                                       Breen said that so far, the most common
                                                                                                       finding during FSVP inspections is that
                                                                                                       importers do not have FSVP plans.

                                                                                                       “It has to be worrisome to FDA that all the
products to the market and calm                      industry as the agency considers next steps       efforts they have made still haven’t
consumer fears.                                      in drafting new water standards. FDA also is      succeeded in moving importers, albeit a
                                                     drafting a rule that will revise the definition   newly regulated population, into greater
Inspections have yet to start on big farms,          of “farm” and spell out when packing              compliance,” he said.
however. FDA Commissioner Scott Gottlieb             houses, terminal markets, and other
announced in 2017 that regulatory                    entities conducting farm-related activities       He also predicted the increase in the
inspections would be pushed back to                  are required to comply with the preventive        number of FSVP inspections may become a
spring 2019 to allow more education in the           controls or produce rules.                        higher priority in 2019, particularly as the
field and give FDA more time to set up                                                                 number of foreign plant inspections drops
technical assistance, train inspectors and           When FDA asked the romaine industry to            off – a likelihood when budgetary
write guidance documents.                            follow voluntary standards on labeling            constraints put a squeeze on foreign food
                                                     romaine lettuce to help consumers know            inspections in 2019.
This will give states, who will take the lead        which products are safe, it served as a
in FSMA produce inspections, and growers             reminder FDA did not move ahead with              VQIP launches
more time to conduct voluntary On-Farm               another FSMA requirement – traceability.          2019 will be the first full year for the
Readiness Reviews to bone up on the                  FSMA directed FDA to recommend a                  Voluntary Qualified Import Program (VQIP),
requirements before regulatory inspections           product tracking system.                          the fast lane FSMA created for top-notch
begin, Gottlieb said.                                                                                  importers to be rewarded with speedier
                                                     “If you look back a lot of what FSMA itself       port clearances.
Consumer groups, however, have complained            had given FDA authority to do … still,
about the delay in inspections during the            maybe it isn’t quite implemented yet,”            FDA originally expected to have the VQIP
latest bout of leafy greens outbreaks.               said Benjamin Miller, senior director of          portal in place earlier, but the launch was
                                                     food safety for The Acheson Group (TAG).          delayed when it took extra time to accredit
So, 2019 will be the year for the first              “I think we’re seeing some of the                 certification bodies. In October, FDA
regulatory inspections on the farm that will         consequences of that.”                            opened the VQIP application portal to allow
be almost exclusively conducted by state                                                               extra time for importers who want to take
officials, with FDA providing training, advice       But that may be changing. At least one            advantage of the program next year.
and scientific support, said Charles Breen, a        retailer, Walmart, decided to take the issue
former FDA official who advises on FSMA for          of traceability into its own hands by             Food companies fiercely advocated for the
EAS Consulting.                                      requiring, as of Sept. 30, 2019, all leafy        fee-based program under FSMA to help
                                                     greens suppliers to use blockchain to trace       qualified exporters move their food
The lettuce outbreak put added pressure on           products in seconds, not days. And                products into the United States with
FDA to set sound agricultural water                  Walmart’s blockchain architect, Frank             greater speed and predictability, and
standards after the first attempt was                Yiannas, has just taken the job as chief          without fear of unexpected delays at the
soundly rejected as too complicated and              regulator at FDA, another key development         point of entry.
too difficult to implement, sending FDA              in 2018 that may raise the profile of food
back to the drawing board. The water                 traceability at the agency and prod the           But the question remains: Will importers
standards are a key lever in preventing              industry as it becomes more digital to            find VQIP worth the steep fees?
contaminated produce, which is why FDA               embrace blockchain.
set microbial quality standards for                                                                    “I don’t think FDA knows,” Breen said.
agricultural water, including irrigation water       FSVP inspections
that comes in contact with produce.                  Produce safety is not the only game in            Another problem is the program relies on
                                                     town for food companies. Importers                user fees instead of congressional
A final rule due out soon will officially            were required to meet the first round of          appropriations. “If too few importers sign
extend the compliance deadline for                   Foreign Supplier Verification Program             up, there won’t be the money to provide

8   / Food & Agriculture Outlook 2019 | IEG Policy                                                                    
Food & Agriculture Outlook 2019 - IEG Policy - Informa
enough support to make VQIP attractive to       For the animal feed industry, inspections,
enough other importers to sustain it.”          originally slated to begin in January, were
                                                pushed back to this fall for large businesses
New inspection model                            subject to regulatory inspections for the
to be piloted                                   Current Good Manufacturing Practices
In 2019, FDA plans to tinker with its           (CGMPs) and PCs – and for importers whose
preventive control inspections for food         foreign suppliers are large facilities.
plants. The agency will be experimenting
with a new two-tiered inspection system         The Animal Feed Industry Association
that would allow investigators to check         (AFIA) said it was pleased some of the
written supply chain programs and recall        deadlines were pushed back, but it had also
plans at a firm’s corporate location before     asked for a delay in enforcing the supply
heading to individual plants.                   chain requirements.

The agency asked in September for at            Intentional adulteration rule
least five companies to test the new            raises questions
approach, which was pitched by food             The 800-pound gorilla may be FDA’s
companies early in the FSMA rule-writing        enforcement of the FSMA International
process. FDA also sees the potential payoff     Adulteration (IA) rule. FDA is required to
for reducing inspection times in facilities,    begin enforcing the rule after July 26, 2019,
improving public health and increasing          and it’s got the industry on edge.
outreach time between industry and
FDA staff.                                      Concerned about food tampering,
                                                Congress included steps to mitigate wide-
Under the Tier 1 component of the pilot,        scale harm from IA in the 2011 law. Since
FDA plans to conduct an announced               then, the food industry has raised
Preventive Controls for Human Food              concerns about the potential price tag of
inspection at a central location where          complying with the IA rule. Congress
investigators will assess a firm’s written      included language in the latest FY 2019
supply-chain programs (subpart G of part        appropriations bill that reminds FDA to
117) and recall plans (21 CFR 117.139).         take into account food defense practices
                                                already in place when helping them to
With that information in hand, FDA              comply with the new program.
investigators would move to the
unannounced, Tier 2 inspections at the          Earlier this year, Stephen Ostroff, FDA’s
firm’s plants where they will check for         then-deputy commissioner for foods and
compliance, with supply chain and recall        veterinary medicine, acknowledged FDA
plans reviewed at the offsite location during   has had “an ongoing dialogue with
the Tier 1 inspection. This move is designed    industry regarding the requirements and
to save time during the facility inspections.   the associated costs.”

Preventive controls                             FDA released the first draft guide in June to
enforcement continues                           ready the largest facilities that must meet
FDA is likely to undertake a modest             FSMA requirements in the summer of 2019.
increase in enforcement of both human           Another installment is due out in early
and animal food Preventive Control (PC)         2019. Small facilities follow in July 2020,
regulations in 2019, Breen predicted.           while very small facilities (less than $10
Whatever enforcement does happen,               million in sales over a three-year period)
warning letters or stronger measures are        will only need to prove by 2021 they meet
likely to be a result in the event of an        the exemption of the IA rule.
immediate health hazard, he said.
                                                Even with the rolling deadlines coming into
David Acheson, the founder of TAG, said he      force for FSMA in 2019, FDA will need to do
also expects more enforcement of PC rules       more with less, Breen predicted.
as FDA moves from education to regulation.
                                                The agency will need to conduct FSMA
FDA officials reported in June that             education, guidance, technical assistance
preventive control inspections were taking      and training while cutting back in other
roughly twice as long as traditional ones as    lower risk areas. Guidance documents and
investigators conduct environmental             training will continue to have priority over
sampling and check food safety plans.           the coming year, he said.                                                                              9
Food & Agriculture Outlook 2019 - IEG Policy - Informa
10 / Food & Agriculture Outlook 2019 | IEG Policy

US agencies strike deal
on regulating cell-based
meat, but thorny issues
remain for 2019
by Margarita Raycheva

While plenty of questions remain on how cell-based meat will                                “2018 was the year
be regulated in the United States, 2018 shaped up to be a                                   when USDA and FDA
“momentous” year for the emerging cultured meat industry.                                   decided they are going
                                                                                            to work together to
Following months of debate and pressure      to predict before 2018, because very few
from both conventional and cell-based        people were thinking about how cell-           ensure that clean meat
meat producers, FDA and USDA have            based meat and poultry should be               comes to market safely
solved what grew to become the most          regulated or labeled, Almy noted.              and efficiently”
significant regulatory challenge involving
the new cell-based meat industry – who       “Outside companies that are producing          Jessica Almy, policy director,
should regulate it.                          it or organizations like GFI, I don’t          Good Food Institute
                                             know that those issues were really a
“2018 was the year when USDA and FDA         part of the public discourse,” Almy
decided they are going to work together      explained. “So, I think that 2018 has
to ensure that clean meat comes to           been really momentous. I’ve heard of it
market safely and efficiently,” Jessica      being referred to as sort of the birth of
Almy, policy director at the Good Food       cell-based meat because there has
Institute (GFI) told IEG Policy Dec. 4.      been so much progress on how cell-
                                             based meat will be regulated in the
Such an outcome would have been hard         United States.”

                                                                                         IEG Policy | Food & Agriculture Outlook 2019 / 11
USDA, FDA strike joint                           “There are no technical barriers in this field
                                                    regulatory agreement                             anymore,” suggested Eric Schulze, Memphis
                                                    Watched by hundreds, the meeting                 Meats’ vice president of product and
                                                    marked a turning point in the debate, as         regulation, in November. “The regulatory
                                                    FDA and USDA leaders alluded to working          system is what needs to gel and clarify so
                                                    on a joint regulatory framework. And in          that we can produce safe products, that
                                                    November, the two agencies developed a           once they are brought to market
                                                    broad framework to jointly regulate the          consumers will really know what they are
                                                    emerging field.                                  getting. We [Memphis Meats] are ready to
                                                                                                     go when the regulatory system is.”
                                                    Under the agreement, FDA, which already
                                                    has experience with cell-culture technology      Memphis Meats’ poultry and beef products
                                                    and living biosystems, would oversee cell-       are expected to reach the market by
                                                    based meat products until they reach the         2021, while the Netherlands-based Mosa
                                                    cell harvest stage, including cell collection,   Meat says it plans to start selling cell-
                                                    cell banks, and cell growth and                  based hamburgers within the next one or
                                                    differentiation. USDA would take over once       two years.
                                                    the product is developed into tissue and
                                                    apply its expertise in overseeing production     Cell-based meat industry
                                                    and labeling.                                    hopes for guidelines in 2019
Regulatory questions open                                                                            Though a regulatory framework is now in
rift between agencies                               While still very preliminary, the framework      place, much remains to be done before
Still, establishing a regulatory framework,         has been hailed by cell-based meat               regulators decide exactly how to oversee
was a painful process that over the past            producers for outlining a clear regulatory       the novel food sector.
year often pitted the two major US food             path for companies, Almy said.
regulators against one another.                                                                      According to Almy, the biggest step
                                                    “The joint statement made it pretty clear        forward will come when FDA and USDA
Tension between the agencies started                that FDA is going to be the point of entry       develop specific guidelines for industry.
mounting in June, when FDA attempted                into the regulatory framework, so                Secretary of Agriculture Sonny Perdue
to take the lead on cultured meat                   companies should be consulting with FDA          indicated in October that his goal would
regulation and scheduled a meeting for              about safety issues before coming to             be to release the guidelines in 2019,
stakeholders without including or                   market,” she said.                               even though that may be a rather
consulting with USDA. While most cell-                                                               ambitious deadline.
cultured companies embraced the idea,               This model will apply to cell-based meats
the move worried consumer advocates                 and poultry, while fish, which traditionally     “My expectation … is that the two agencies
and angered many in the conventional                falls under FDA jurisdiction, will likely        are expecting to come out with guidelines
meat industry, leading some meat groups             remain under that agency, Almy noted.            for the industry in 2019. So that’s what I
to ask President Trump to put USDA in                                                                will be looking forward to next year – to see
charge of the novel food sector.                    While that issue, as well as many other          what those guidelines look like and how
                                                    technical questions, have yet to be ironed       the two agencies want to interact with
Concerned that potential FDA oversight of           out, the joint plan has also appeased the        these two companies,” Almy said.
cell-based meats could place conventional           traditional meat industry. The National
meat producers at a disadvantage, the               Cattlemen’s Beef Association (NCBA) called       Work on the guidelines has started, as the
meat industry lobby even pushed                     the plan a “step in the right direction,” as     two agencies have already encouraged
lawmakers to include language in the                it places labeling and inspection of cell-       stakeholders to comment on priority issues
US House version of the FY 2019 Agriculture         based meat production under USDA, and            that will likely be addressed in the
Appropriations Bill that would give USDA            not FDA jurisdiction.                            guidelines, Almy noted.
the sole authority to oversee
the emerging sector.                                But there is still work to do, the group         Those include potential hazards and
                                                    suggested, particularly in ensuring “that        sources of hazards, types and frequency of
As the debate raged and even states                 real beef producers and consumers are            inspections, and effective pre-market
picked a side, the North American Meat              protected and treated fairly.”                   programs that could ensure the safety of
Institute (NAMI) and Memphis Meats                                                                   products developed through cell culture.
teamed up in pitching a solution to allow           Memphis Meats and JUST have also hailed
the agencies to split oversight.                    the broad idea of joint regulation.              Regulators are also trying to determine
                                                                                                     what factors to consider for labeling and
The tension did not ease until September            The lack of a regulatory framework has           whether to establish standards of identity
when the two agencies announced                     been problematic for the cell-based meat         to ensure that product names are
a joint meeting to discuss oversight,               sector, because it impedes investment and        “truthful, not misleading, and sufficiently
as well as hazards and labeling of cell-            holds back companies from scaling up for         differentiate cell cultured products from
based products.                                     mass production.                                 traditional products.”

12 / Food & Agriculture Outlook 2019 | IEG Policy                                                                    
Hoping that stakeholder input will help         matter, even within the cell-cultured and
them make final decisions, the agencies         traditional meat industries.
have extended the comment deadline until
Dec. 26.                                        The United States Cattlemen’s Association
                                                (USCA), for instance, does not want cell-
The task ahead                                  based meat products to be called “meat”
Answering those questions, however, is          or “beef,” so in February it petitioned USDA
not going to be simple, suggested Brian         to prohibit the use of those terms on cell-
Ronholm, a former USDA deputy                   based product labels. While the agency has
undersecretary for food safety, who is now      yet to respond, both NAMI and NCBA, the
senior director for regulatory policy at        largest and oldest national trade
Arent Fox.                                      association for American cattle producers,
                                                oppose the idea, so they’ve joined
There is still much about the cell-based        thousands of other stakeholders in asking
meat process that is unknown, so before         USDA to reject the petition.
identifying any specific safety risks, USDA
would first have to invest time for studying    A similar battle is raging in Missouri, which
cell-based production, Ronholm noted.           in August adopted the nation’s first law
                                                restricting the term “meat” only to
And there is also the issue of how solving      products that come from slaughtered
questions about cell-cultured meat              animals. Backed by Missouri cattle
products would fit into the agencies’           producers, the law has been challenged
larger framework of competing priorities,       by a coalition of plant-based food
he noted.                                       advocates who argue that the statute
                                                represents an unconstitutional attempt to
The agencies, therefore, would have to          censor their labels.
determine how close these cell-based meat
products are to mass production.                The cell-cultured industry itself has yet to
                                                agree on what its products should be
“After that, then the agency can decide         called, Almy noted. While industry
the level of agency resources they want to      unanimously opposes terms such as
devote to it,” Ronholm said. “If mass           “synthetic meat,” “lab-grown meat” or
production is several years away, if it         “fake meat,” the idea of using “clean meat”
happens at all, it might make more              is not universally accepted and at least one
sense for USDA to allocate resources to         producer, Memphis Meats, is pushing for
more immediate needs, such as                   the more neutral “cell-based meat.”
combatting Salmonella.”
                                                According to Ronholm, that means
Reaching agreed-upon                            labeling decisions could stretch further
terminology a sticking point                    into the future.
The labeling of cell-cultured meats and
poultry is also likely to cause headaches for   “This might not be one of the first issues
regulators in the coming months.                that gets addressed, but it has the
                                                potential of being the most onerous,”
As indicated by questions they posed to         Ronholm said. “First, is the decision on
stakeholders, the agencies have already         what to label it – cell-cultured meat, lab-
highlighted where they want to start            grown meat, etc. This is expected to be a
and are considering issues, such as             source of contention, and it likely will be
whether labels for cell-cultured meats and      difficult to reach a consensus.”
poultry should specify methods of
production or the source of the animal          And, if disagreement lingers, that will raise
cells. There are also questions about how       even more questions, which could even
to handle health and safety claims for          impact the product’s ability to enter the
such products and how to label products         market, he noted.
that contain both cell-cultured and
traditional meat.                               “That notwithstanding, this easily could
                                                become a product that consumers develop
Answering these questions is likely going to    their own identity standard, without any
be an uphill battle because an agreed upon      official agency designation,” Ronholm said.
name for cell-cultured meats has already        “If so, how will that impact the industry,
been a highly controversial and divisive        and how do the agencies manage that?”                                                                              13
14 / Food & Agriculture Outlook 2019 | IEG Policy

Regulatory Outlook:
US ready to revamp GE
crop and animal rules
by J.R. Pegg

2019 is poised to be a critical year for agricultural biotechnology                                “The fundamental
as the Trump administration appears ready to fundamentally                                         basis of those regulations
re-shape the US regulatory regimes for genetically engineered                                      has not changed in 31
crops and animals.                                                                                 years... It’s long overdue”
Revising the federal rules for genetically       “The fundamental basis of those                   Mike Firko, APHIS Deputy Administrator
                                                                                                   for Biotechnology Regulatory Services
engineered crops – known as Part 340 –           regulations has not changed in 31 years,”
will be a major focus for USDA in 2019           he said. “It’s long overdue.”
and a proposal from the Animal and Plant
Health Inspection Service (APHIS) should         APHIS officially launched a new
be ready early in the year, according to a       rulemaking to update the GE crop rules
top agency official.                             in June, asking for stakeholder input
                                                 on how the regulatory regime should
“This is our number one strategic initiative,”   be revamped.
according to APHIS Deputy Administrator
for Biotechnology Regulatory Services (BRS)      Under the existing regulations, APHIS
Mike Firko.                                      considers all new GE plants as “regulated”
                                                 until it assesses if the product falls under
APHIS intends to publish a proposal in the       their authority and determines if it poses a
first quarter of 2019 to make much-              plant pest risk. The agency explains its
needed changes to the Part 340 rule, Firko       current approach as “regulate first and
told attendees at a BRS stakeholder              analyze later” – one that is focused on the
meeting in November.                             process of modification, rather than the

                                                                                                IEG Policy | Food & Agriculture Outlook 2019 / 15
product. Critics say the process is expensive,      we’ve done quite a bit of outreach on that     year and several other companies are
restrictive and misguided.                          since then.”                                   aggressively moving forward with gene
                                                                                                   edited crops. Calxyt, the US plant science
But APHIS got only 35 comments on its               Although it has been “very difficult to do     subsidiary of French genomics company
June notice, Firko said, a figure that could        anything with biotech regulations,” Firko      Cellectis, is already growing its high-oleic
be a sign of stakeholder fatigue with trying        said he is “very confident” that this latest   soybeans in the US and its first harvests are
to change the Part 340 rules. APHIS has             effort will succeed.                           expected in 2019.
been calling for reform since 2004 and
issued a formal proposal in 2008 that               The new plan will ensure APHIS is clearly      Perdue’s interest stretches beyond the
would have expanded the scope of GMOs               focused on its limited authority over GE       domestic regulation of GE crops and has
under its regulatory regime and revamped            crops, Firko explained.                        directed the agency to lobby other
the permitting system. But that effort                                                             countries to follow the US lead and to
stalled and was abandoned in March 2014.            “We don’t have any legislation about           contest the current European approach to
                                                    biotech in particular – our legislation is     regulation of new gene editing tools.
The agency subsequently held a series of            about plant pests and weeds,” he said. “So
stakeholder meetings and issued a new               that’s what our decisions are about.”          US ag officials were critical in drafting an
proposal in January 2017 during the final                                                          international statement of support for
weeks of the Obama Administration.                  Gene editing                                   genome editing in agriculture presented to
                                                    The new GE crop rules will likely be           the World Trade Organization (WTO). So far
The plan called for major changes to the            industry-friendly and will no doubt reflect    a dozen countries – including Argentina,
rules, notably a new trigger for regulation         the Trump administration’s enthusiasm for      Brazil, Canada and Australia – have signed
and revisions to enable the APHIS to                ag biotech and the USDA’s desire to take a     on to the pro-biotech statement. The move
regulate a broader array of GE crops,               hands-off approach to regulation of gene       is a clear response to the July 2018 ruling
including those made with new gene-                 edited plants.                                 by the European Court of Justice (ECJ) that
editing technologies.                                                                              declared gene-edited plants should be
                                                    Agriculture Secretary Sonny Perdue has said    treated as GMOs and subject to regulations
But the plan was not well received by farm          on several occasions that USDA has little      by EU member states.
and agriculture groups and was                      interest in regulating crops that have been
abandoned by the Trump administration in            developed with gene editing tools like         Perdue said the EU policy puts at risk
late 2017. Critics said it would undermine          CRISPR-Cas9 and TALENs – a view the            the “great promise” gene editing holds for
the agency’s bid to modernize its                   department shared under the prior              agriculture and could hamper
regulatory process and do little to make it         administration. In 2016 USDA declined to       international trade.
easier for new biotechnology products to            regulate a non-browning mushroom
come to market.                                     engineered using CRISPR and US ag              USDA will be reaching out to other countries
                                                    interests are bullish on the prospects of      in 2019 to caution them about the impact of
“Withdrawing that proposed rule set the             gene editing to improve crops.                 the EU approach and to rally additional
stage for a new level of engagement which                                                          support for the WTO statement, according
we could not do as long as we were in               Corteva Agriscience is set to introduce its    to Paul Spencer, director of new technologies
open rulemaking,” Firko explained. “And             strain of CRISPR-edited waxy maize next        at USDA’s Foreign Agricultural Service.

16 / Food & Agriculture Outlook 2019 | IEG Policy                                                                  
“We’re primarily concerned with the trade       The issue of FDA’s oversight of animal
elements of this,” Spencer said at the BRS      biotechnology animals has also caused
meeting in November. “The implication … is      friction with Agriculture Secretary Perdue,
that the European Union’s global policy         who has echoed stakeholder concern about
influence could pose a threat to US             the FDA’s plan.
agriculture’s ability to adopt and benefit
from these genome editing tools.”               Perdue has previously suggested USDA
                                                should take the lead on oversight of GE
The ECJ decision “emboldens the anti-           animals and several Republican members
technology groups,” Spencer said. “And          of Congress have indicated they might
that’s already prevalent in EU member           seek a legislative fix to shift authority
states such as France.”                         away from FDA.

The administration is committed to              In December FDA postponed a live webinar
contesting the idea that new genome             that was intended to detail its approach to
editing techniques are akin to GMOs and         regulating GE animals – the event has yet
should be regulated as such, Spencer added.     to be re-scheduled. The webinar was
                                                announced as part of FDA’s latest action
FAS will be spending considerable effort to     plan for regulating biotech – the agency
try and “limit the policy influence that the    says it is excited by the potential benefits
ECJ judgment,” he said.                         from both plant and is keen to promote
                                                development with a “science- and risk-
GE animal guidance                              based approach” to regulation.
While USDA is keen to aggressively promote
gene editing for crops – and to promote its     FDA’s revised animal guidance is expected
hands-off approach to trading partners –        to be finalized in 2019, but FDA has
FDA is sending different signals about how      not announced a timetable or indicated
it will regulate GE animals. But that doesn’t   how concerns raised about the draft might
mean the agency isn’t preparing to act in       be addressed.
the coming year.
                                                Promoting Biotech
Draft guidance, released in January 2017        FDA and USDA are working together
by the Obama administration and still           on an initiative to educate the public
under review at FDA, calls for the agency to    about the benefits of agricultural
continue regulating biotech animals as new      biotechnology, a move welcomed by the
animal drugs and to expand its oversight.       food and agriculture industries. The two
Currently FDA considers the presence of an      agencies have been given some $3 million
rDNA construct from another species as its      by Congress for the effort, which directs
trigger for regulation.                         FDA and USDA to collaborate on
                                                “consumer outreach and education
But the draft guidance moves far beyond         regarding agricultural biotechnology” to
that in a bid to bring in CRISPR, TALENs and    inform the public of the “environmental,
other gene editing tools by including any       nutritional, food safety, economic, and
animal with intentionally altered genomes       humanitarian impacts” of GMOs.
to FDA’s new animal drug review and
regulations. The plan has drawn sweeping        FDA’s Agricultural Biotechnology
criticism from ag and biotech interests –       Education and Outreach Initiative has
critics worry the proposed revisions will       strong support from biotech advocates –
needlessly expand the agency’s authority        a coalition of more than 60 food and
and undermine efforts to develop and            agriculture groups urged lawmakers to
commercialize biotech innovations that          authorize the effort because of their
could help producers control diseases,          concerns that consumers are being fed
improve food safety, enhance animal             misinformation about the safety and
welfare and decrease the environmental          benefits of GMOs.
impacts of animal agriculture.
                                                An FDA spokesperson told IEG Policy that
Only one GE food animal – AquaBounty’s          the agency plans to launch the initiative in
GE salmon – has been approved by                2019, adding that it is currently
FDA and commercialization of that               “conducting formative research that will
product has become ensnared in a dispute        help inform the development of our
over labeling.                                  educational materials for the public.”                                                                             17
18 / Food & Agriculture Outlook 2019 | IEG Policy

An odyssey of food
labels challenge
EU single market
Different origin labels, colour coded
nutrition panels, vegan and vegetarian
logos springing up in EU
by Sara Lewis

The food and drink industry’s ability to trade freely across the                                 On 28 May the European
EU single market is being increasingly challenged by numerous                                    Commission adopted a
different national and industry labelling schemes, despite                                       regulation laying down
the 2011 food information to consumers regulation                                                new rules for mandatory
(FIC – 1169/2011) laying down harmonised rules on nutrition,                                     origin labelling of primary
ingredients and allergen labelling.
                                                                                                 ingredients in foods
Origin Labelling                                 the same place as labelled on the final         bearing ‘made in...’
One of the areas where labelling has been        product. The regulation will apply from         labels when they are
hitting the headlines in 2018 and is almost      April 1, 2020 to give food business
certain to do so in 2019, is origin labelling.   operators time to adapt product labelling
                                                                                                 not from the same
                                                 to the new requirements.                        place as labelled on
On 28 May the European Commission                                                                the final product
adopted a regulation laying down new             The FIC regulation already requires that
rules for mandatory origin labelling of          where the origin of a food is given and is
primary ingredients in foods bearing             different from the one of its primary
‘made in...’ labels when they are not from       ingredient, the origin of the primary

                                                                                              IEG Policy | Food & Agriculture Outlook 2019 / 19
on potatoes that member states discussed
                                                                                                      with the Commission at a December 7
                                                                                                      meeting of the Standing Committee on
                                                                                                      Plants, Animals, Food and Feed (PAFF)
                                                                                                      general food law section.

                                                                                                      In September Spain adopted a dairy origin
                                                                                                      labelling law that requires labels to
                                                                                                      distinguish between products made in the
                                                                                                      country from Spanish milk, or those using
                                                                                                      imported milk, even from other member
                                                                                                      states. Dairy products also have to give the
                                                                                                      origin of the finished food, stating whether
                                                                                                      it is Spanish or not.

                                                                                                      France kicked off the spate of national
                                                                                                      origin labelling laws in 2016, with its pilot
                                                                                                      programme that is supposed to run until
                                                                                                      December 31 this year. However, France is
                                                                                                      now seeking the Commission’s permission
                                                                                                      to extend the pilot project until March 31,
                                                                                                      2020, a matter that has split member
                                                                                                      states down the middle, between those
                                                                                                      that have their own origin laws and others
ingredient shall be given or at least               consumers’ understanding of the                   that see them as a trade barrier and threat
indicated as being different to the origin of       information related to the origin of foods,”      to the EU single market.
the food for example, Italian tomato sauce          the spokesperson continued.
with tomatoes from China. The May 28                                                                  Moreover, the European Parliament sees
implementing regulation clarifies how the           However, in 2019 the Commission is                origin labelling as a way to improve
information on the origin of the primary            planning to look into how the origin of the       compliance of imports with European
ingredient should be displayed on labels. It        primary ingredient should be indicated for        animal welfare requirements. On October
lists geographical areas that can be used to        protected product designations and                25 it adopted a resolution on broiler
indicate the origin of the primary                  trademarks. The implementing act does             chicken welfare that included a call for
ingredient. It also harmonises the                  not apply to geographical statements              mandatory origin labelling on chicken meat
presentation of origin information on the           protected under EU legislation or to              in the retail, catering and food services.
primary ingredient to ensure that it is easily      trademarks that equal an indication
visible and clearly legible. “Some flexibility      of origin.                                        Nutrition labelling
is foreseen for food business operators in                                                            While the FIC requires foods to carry
order to take into account the various              There have been concerns about national           nutrition information on the back of pack,
circumstances of food processing, such as           origin labelling legislation, notably Italian     it leaves front-of-pack labelling (FOP)
multiple or variable supply sources,” a             laws covering rice and the durum wheat for        largely up to manufacturers, provided it
Commission spokesperson told IEG Policy.            pasta, and more recently dairy products,          complies with certain rules. As a result,
                                                    but the spokesperson told us that “the            national or cross-industry schemes have
Nevertheless, despite calls from consumer           legal acts adopted by the Italian authorities     sprung up such as the colour-coded UK
groups and many MEPs to have mandatory              in the area of origin indications for food link   Traffic Light scheme and the Italian
origin labelling for all primary ingredients in     the application of their provisions to the        batteries label.
the EU, the Commission remains staunchly            Commission’s implementing act.”
opposed to any more regulation in this area                                                           Meanwhile, the food industry has rolled out
so a move in that direction is not on the           The Commission sees the implementing act          single colour reference intakes, although
cards for 2019. “Voluntary origin labelling         as a way to end concerns about national           many firms voluntarily use traffic lights. For
combined with the mandatory origin                  origin laws, with the spokesperson arguing        instance in November both Kellogg’s and
labelling regimes already in place for              that “it can be expected that the                 PepsiCo announced they were going to use
specific foods or categories of foods is the        implementing act will provide for                 the traffic light scheme on products sold in
most suitable way forward at the EU level,”         harmonised rules applicable also in Italy         the UK and Ireland.
the spokesperson told us.                           and other countries. This should reduce the
                                                    need for further resort to national               PepsiCo had been one of five companies
“The aim is to ensure that the information          provisions regulating origin indication.”         that had started trials of a portion-based
on the origin of a food is given in a manner                                                          colour coded Evolved Nutrition Label (ENL)
which does not deceive the consumer and             However, the implementing act has not             in May, which they then suspended on
on the basis of clear criteria that ensure a        stemmed the tide of national origin               November 20 blaming a lack of standard
level playing field for industry and improve        labelling laws, with the latest a Polish bill     EU portion sizes.

20 / Food & Agriculture Outlook 2019 | IEG Policy                                                                     
In August Belgium adopted the colour-           Andriukaitis was not happy with the                   (ECI) calling for vegan, vegetarian and
coded Nutri-score scheme that                   proposal and since then the Commission                non-vegetarian labels on all foods.
neighbouring France had introduced in           has been negotiating with the spirits and
2017. Both countries officially endorse the     wine sectors to find a solution. German               The ECI ‘Mandatory food labelling Non-
scheme, but its use is voluntary.               centre right MEP Renate Sommer, who was               Vegetarian / Vegetarian / Vegan’ has a
                                                the lead MEP on the FIC up to its adoption            year from the registration date to gather a
The World Health Organisation (WHO)             in 2011, has been highly critical of                  minimum one million signatures from at
Europe region is also recommending              the Commission over its decision to let               least seven EU member states. If the ECI
government-endorsed policies on                 the drinks industry handle the end                    achieves that then the Commission will
interpretative FOP labelling after its Health   of the waiver.                                        have three months to respond, explaining
Evidence Network (HEN) report published in                                                            formally what it will or will not do on the
October found nutrition labels a key tool in    The Commission will go into 2019 still                issue and why.
promoting healthy diets. The report found       working on this issue under increasing
government-endorsed labels were more            pressure from MEPs, and member states for             Even without the ECI, the outgoing
effective than commercial ones.                 EU action in this area. Sommer is not alone           Commission had planned to work on the
                                                in criticising the Commission over its                issue in 2019. The ECI will keep up the
The Commission intends to publish a report      handling of the issue and demanding an                pressure on the Commission to act.
analysing all the different voluntary           end to the labelling waiver for alcoholic
schemes in place across the EU in early         drinks, Croatian Socialist Biljana Borzan also        Moreover, this is another area of labelling
2019 (or possibly at the very end of 2018).     launched a stinging attack on the                     law, where member states are starting to
The report on ‘additional forms of              Commission in November and six member                 adopt national laws in the absence of EU
expression/presentation’ is required under      states were highly critical in a Standing             regulations. In April France adopted a new
the FIC’s Article 35(5) and needs to look at    Committee meeting last April.                         law banning producers from labelling
their effect on the internal market.                                                                  plant-based products with meat- and
Crucially, the report should conclude on the    As with origin labelling, member states               dairy-related names.
advisability of further harmonisation.          impatient with the lack of EU action, are
                                                starting to take matters into their own hands,        The French law is based in part on the June
Alcohol labelling                               with national alcohol laws. On October 17, Irish      2017 TofuTown ruling in the European
The FIC waived drinks containing over           President Michael D. Higgins signed into law a        Court of Justice, which concluded that
1.2% alcohol by volume (ABV) from               ground-breaking law on alcohol that notably           vegan products cannot be labelled as ‘milk,’
ingredients and nutrition labelling             requires cancer and general health warning            ‘cheese’ or ‘cream’ even if the products
requirements but gave the Commission a          labels on bottles. In the run up to the Irish         clearly state that they do not contain
December 13, 2014 deadline for a report         bill’s adoption drinks producers from other           animal products.
on whether the exemption was still              countries, notably over the border in Northern
justified. The report, when it appeared         Ireland, expressed concern about the effect           The European Parliament elections and the
more than two years overdue on March            the labelling rules would have on trade.              approval process for the new college of the
13, 2017, concluded that alcoholic drinks                                                             Commission that will take office in the
should be subject to both nutrition and         Vegan and                                             autumn, is likely to spur the EU executive to
ingredients labelling requirements. Rather      vegetarian labelling                                  at least promise action on key labelling
than proposing an amendment to the FIC,         While the FIC tasked the Commission with              issues where MEPs have seen the outgoing
ending the waiver, EU Health and Food           producing an implementing act laying                  college as dragging its feet. A series of
Safety Commissioner Vytenis Andriukaitis        down EU rules for voluntary vegan and                 hearings where MEPs subject Commissioner
gave industry a year to develop a self-         vegetarian labelling, it does not set a               nominees to tough questioning, followed
regulatory proposal containing a common         deadline for doing so, resulting in the issue         by votes, with Parliament able to reject
scheme covering beer, cider, spirits            being sidelined.                                      nominees, is likely to focus the minds of
and wine.                                                                                             the incoming college.
                                                However, others are pushing for progress
When the scheme was unveiled on March           at EU level, both from the animal welfare             Brexit is certain to dominate the
12, it contained four separate annexes          side, with people wanting vegan and                   headlines in 2019 and in case the UK
outlining how each sector was going to          vegetarian foods easy to recognise, and               crashes out of the EU without an
offer consumers nutrition and ingredients       from the meat and dairy side, fighting                agreement – a so-called ‘hard Brexit’ –
information. While the beer and cider           against use of terms such as ‘vegan turkey            the British Department of Environment,
annexes more or less applied the FIC, the       slices’ or ‘soya milk’.                               Food and Rural Affairs (Defra) in
spirits and wine annexes both proposed                                                                September published a guidance
to offer consumers the information not          This is an issue that will continue to make           document “Producing and labelling food
on a bottle label but online through apps       headlines in 2019, especially with                    if there’s no Brexit deal.” The guidance
and websites. Moreover, both favoured           European elections focusing politicians’              sets out how labelling of food will be
offering that information per glass rather      minds on issues that the public cares                 affected in case of a hard Brexit on March
than per 100 millilitres as the beer and        about. Moreover, on November 12 the                   29. Significantly, current EU rules would
cider sectors had proposed and as is            Commission registered an EU-wide mega-                be rolled over into UK law under the
required under the FIC.                         petition, a European Citizens’ Initiative             Withdrawal Act.                                                                                 IEG Policy | Food & Agriculture Outlook 2019 / 21
22 / Food & Agriculture Outlook 2019 | IEG Policy

A taxing year for
food and drink
by Peter Rixon

Several European countries saw the introduction of, or an                                  Drinks companies are
increase in, sugary drink taxes this year. Peter Rixon looks into                          reducing the sugar
these fiscal developments of the past 12 months and how                                    content of their drinks, as
taxation could further develop in 2019.                                                    the Government wants
The UK soft drinks tax came into force       – to the consumer. That industry acted
                                                                                           them to, to avoid passing
in April this year and is arguably proving   on reformulation was probably necessary       on costs – and too much
a success.                                   as a study by Nielson pointed out that        sugar – to the consumer
                                             shopping habits were not affected by the
Between April 2018 and the end of October    UK sugar tax.
2018, the tax raised £154 million (€173m)
and is on target to raise the expected       In France, a similar effect has been
£240m annual revenue.                        observed this year. The French tax was
                                             actually introduced in 2013 but was then
Admittedly, this is a revised target. The    increased in 2017, coming into effective
government had expected to raise £520m       on July 1st 2018, as part of the
in the first year, but this was downgraded   government’s 2018 Social Security Bill.
to £240m when companies started
reformulating their products.                Olivier Veran, the French MP who
                                             spearheaded the tax increase, said
This, however, has proven that the tax       companies were already reformulating
has been to some degree effective. Drinks    drinks by the middle of the year, with
companies are reducing the sugar             Seven Up and Fanta cutting 30% of its
content of their drinks, as the              sugar content and some Schweppes and
Government wants them to, to avoid           Lipton Ice Tea drinks reducing sugar
passing on costs – and too much sugar        content by 40%.

                                                                                        IEG Policy | Food & Agriculture Outlook 2019 / 23
Tax in Norway leads to                              the example of the UK, France, Norway and        towards taxation. A study published in the
growth in border sales                              Ireland in implementing fiscal measures to       medical journal, The Lancet, claimed that
Things panned out differently for Norway            reduce sugar consumption.                        taxes on sugar, as well as tobacco and
this year, with its sugar tax system causing                                                         alcohol, would help poor households the
considerable upset. As of January 1st,              Eastern neighbour, Lithuania, took a             most as the resulting price increases would
2018, the Norwegian sugar tax was                   different approach, however, announcing in       lead them to make healthier choices. This
increased by 83%, whilst a fee on soft              in February this year that it had opted          flew against the industry argument that
drinks and non-alcoholic beverages                  against bringing in a tax, deciding instead      such taxes would harm low-income
increased by 43.3%.                                 to seek cooperative partnerships with the        households the most.
                                                    food industry to reduce sugar, as well as
This led to heavy criticism from politicians        salt and fat in foods.                           What does 2019 hold?
and industry who realised that the tax was                                                           From the UK experience, it seems that the
leading to stronger growth in Swedish sales         Germany’s lack of a sugar tax came to the        sugar tax is here to stay and can be
as people crossed borders to shop for               forefront when it was revealed that the          expected to spread to more countries.
cheaper drinks.                                     Germans are Europe’s biggest consumers of
                                                    soft drinks. Germany, however, has started       The measure offers governments a source of
By August, the Norwegian Brewery and                to focus more on measures to improve             revenue, is consistent with genuine efforts to
Beverage Association was calling for the            the nation’s diet so future proposal could       reduce non-communicable diseases among
sugar tax and the soft drinks tax increases         still be round the corner.                       populations, particularly among children, and
to be reversed. The Norwegian government                                                             industry has proven capable of not only
proposed that a differentiation of the levies       Mixed opinions on taxes                          incorporating the costs incurred by a new tax,
should be investigated instead.                     at global meetings                               but also has proven capable of responding
                                                    During the year, global political voices were    to the stated aim of the tax, namely by
“The tax increases were introduced in a             either firmly in favour of fiscal solutions to   reducing the amount of sugar in drinks.
hurry, without impact assessments, and it’s         health problems or strategically keeping
a serious situation when the government             quiet about them.                                Should reformulation continue and, as is
doesn’t do anything about this when we                                                               envisaged, reduce the corresponding
see an explosive increase in border trade,”         In May, the health ministers from the 53         yearly revenue from the tax, then each
Petter Haas Brubakk of the Confederation of         member states of the Commonwealth                country that imposes the tax could
Norwegian Industry’s (NHO) Food and                 endorsed a proposal for a 20% tax on             potentially expect to see a natural phase-
Beverage complained.                                sugar sweetened drinks.                          out at some point. However, this is only in
                                                                                                     cases where the stated aim is sugar
By September, Sweden was confirming                 The measure was one of a number of               reduction for health improvement.
the increase in sales, particularly alcohol,        proposals at the ministerial summit to tackle
due to the Norwegian sugar tax policy.              non-communicable diseases (NCDs), which          Also, existing taxes might not go away at
Alcohol sales were rising because people            affects about 400 million people across the      all but simply be increased, as in the case
were naturally buying beer and spirits at           member countries spread throughout Africa,       of France and Norway.
the same time as buying the cheaper                 America, Asia and Europe.
chocolate and sugary drinks during their                                                             France has had a sugar tax since 2013 and
cross-border shopping trips.                        However, an international global                 the MP who helped introduce it, and
                                                    declaration that went before a United            spearheaded an increase that came into
Although the UK shares a border with                Nations meeting in September to address          effect earlier this year, has also gone on
Ireland, there were no corresponding                the obesity crisis was criticised for not        record to talk about potentially increasing it
problems with cross-border shopping in the          mentioning sugary drink taxes. NGOs              still further.
way Norway experienced with Sweden. This            suspected that the desire for governments
was because Ireland introduced a                    to work in partnership with industry was         Like colour coded labelling on food
comparable sugary drinks tax, just a month          responsible for the omission.                    packaging, once other member states see a
after the UK.                                                                                        successful model being used in one or two
                                                    On the academic side, a number of studies        European countries, others are likely to
The Republic’s tax came into force on May           were published this year that added or           follow. And parts of the European
1st after the European Commission said the          detracted credence to the value of using a       Commission will only likely be encouraging
levy was not illegal state aid.                     sugar tax to improve health outcomes.            the use of such taxation, with Commissioner
                                                                                                     Andriukaitis already expressing his support
Romania pushes the tax                              One study at the beginning of the year           for taxes to curb junk food.
agenda, Lithuania eases off                         suggested that sugar taxes could drive up
To the east, Romania’s interest in taxing           alcohol consumption whilst another, from the     In addition to this, counterparts in the US
soft drinks picked up pace in May when              New Zealand Ministry of Health, concluded        have been battling over so-called “soda
draft legislation for a tax was debated by          that evidence showing the sugar taxes could      taxes” for some year and, as our Informa
the country’s parliament.                           improve people’s health was “weak”.              colleagues in Washington point out in this
                                                                                                     podcast, the sugar tax debate over there
The bill stated that Romania should follow          However, some studies were positive              will not be going away anytime soon either.

24 / Food & Agriculture Outlook 2019 | IEG Policy                                                                    
You can also read