Washington Insider -- Wednesday
Oxfam: Food Aid Proposal Would Increase Program Costs
Here's a quick monitor of Washington farm and trade policy issues from DTN's well-placed observer.
Oxfam: Food Aid Proposal Would Increase Program CostsThe international development group Oxfam America says a bill currently under consideration by a Senate committee would require that a minimum of 75% of U.S. food aid be carried on U.S.-flagged vessels, up from the current 50%. Shipping anything on a U.S.-flagged vessel is one of the more expensive ways to move cargo.
The proposed change appears in H.R. 4005 (the Coast Guard and Maritime Transportation Act) that passed the House earlier this month. The bill has been referred to the Senate Commerce, Science and Transportation Committee.
The publication Agri-Pulse reports that the Obama administration has come out against the provision and in a letter to committee Chairman Jay Rockefeller, D-W.V., the Department of Homeland Security says the provision would have "grave effects on United States humanitarian assistance programs."
There for years has been a debate about whether U.S. food aid programs should provide the maximum assistance possible to hungry people overseas or to U.S. ship owners and merchant mariners. It is clear that adopting the proposed provision in H.R. 4005 would shift funding from food to ships. As a result, expect push back from Rockefeller's committee.
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NTSU Issues Warning About Safety of Older Models of Rail Tanker CarsWith more oil and ethanol being moved around the country by rail, the National Transportation Board is warning railroads against an older model of tanker car for those types of hazardous cargoes.
Speaking Monday at an event in Washington, outgoing NTSB Chairwoman Deborah Hersman said the older model DOT-111 specification tank cars, the most widely used in the North American fleet, were not built to handle such shipments. Asked if the volume of such tank cars still in the rail fleet should be parked as unsafe, Hersman said: "Carrying corn oil is fine. Carrying crude oil is not…. These DOT-111s were not designed to carry hazardous liquids."
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The United States is enjoying an oil production boom, but moving the increasing supply of petroleum to market is proving to be a major logistical problem. If older tanker cars are sidelined and new pipelines cannot be built in relatively short order, oil companies will turn increasingly to trucks to get their product to refineries. And since trucks are the most expensive way to move oil, higher prices almost certainly will be passed along to customers.
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Washington Insider: Why Organics?A new battle is brewing in the ongoing food wars, this time involving USDA's certification program that guards labels for organic products. Researchers are severely criticizing the industry's strategies and marketing practices.
A publication called the "Organic Marketing Report" by Academics Review has examined the history of the modern organic industry. The publication says it is an independent international organization, founded by professors from the University of Illinois and the University of Melbourne, and that it only accepts unrestricted monetary contributions.
Now, it is making waves as it targets USDA and its certification program for organics, and the organic food industry. The main charge is that USDA's organic seals are often found on products sold using false or misleading claims about health and safety benefits.
With sales of $35 billion in the United States and $63 billion worldwide, the organic marketing industry has become very sophisticated, the researchers say, and often work through advocacy groups who are encouraged to practice fear-mongering. This effort is subtle but powerful — and is driven by concerns that more consumers "may come to accept that cheaper, conventional products are safe."
Industry supporters reject the report's concerns. What the report refers to as "intentionally deceptive" marketing is simply organic companies disclosing truthful information about how their food is produced, responded Scott Faber, executive director of Only Organics.
"Under the USDA organic standards, organic food must be grown without persistent pesticides and the use of GMO seeds, and organic livestock must be raised without antibiotics and hormones. Organic companies have the right to disclose these practices just as orange juice companies have the right to print 'not from concentrate' on their packaging," Faber said.
However, the report calls for much greater transparency, suggesting that both government and the organic industry currently do not reveal that the USDA organic seal says nothing about food safety, although the industry has been able to convince many consumers that it does. USDA polls have found that 65% of consumers believe that food sold under a USDA organic seal is healthier, by 70% as safer, and by 46% as more nutritious.
These beliefs are held in spite of the fact that none of them are included anywhere in USDA organic standards, the report says.
By contrast, the study points to the effectiveness of the Organic Trade Association's marketing campaign, "Organic: It's Worth It," and criticizes this effort as attempting to justify the higher prices consumers are charged for its products. "I don't think you lead with fear about a brand in food, but you can, and perhaps should, lead with fear as an industry," said Darren Mahaffy, vice president for marketing at Nature's Path Foods.
"As illustrated in this report, organic companies market their products by promoting alleged health benefits connected to the absence GMOs, hormones, antibiotics and pesticides juxtaposed to health risks they associate with less expensive competing conventionally produced products, which may use their production tools," the report states.
"Our report finds consumers have spent hundreds of billions of dollars purchasing premium-priced organic food products based on false or misleading perceptions about comparative product food safety, nutrition and health attributes," it states. The report further charges the organic industry with "intentionally-deceptive marketing and paid advocacy" that is "enabled and conducted" by the U.S. government through the USDA organic program.
"It is our hope that responsible members of the organic food industry and government officials will use these findings to address consumer misperceptions about important issues of food safety and nutrition," says Professor Bruce Chassy, professor emeritus University of Illinois Department of Food Science & Human Nutrition. "Accurate food safety, nutrition, and health information combined with consumer pocketbook protections should be a threshold standard for any U.S. government program that cannot be co-opted by special interest marketing groups."
The report certainly is not good news for USDA, although it is fair to note that agency was pushed by Congress to establish and manage the organics program. The current charges about agency participation in deceptive marketing and fear mongering are serious and should be taken so by USDA. This is not to say that there should not be an organic certification program — but, it is fair to require the organics industry to observer the same "truth in advertising" rules it requires from others, Washington Insider believes.
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