GMO Labeling Will Not Increase Food Prices
Tomorrow morning, the House Agriculture Committee will hold a hearing on the impact of GMO labeling on food prices.
Several witnesses will raise their hands and give sworn testimony that a simple disclosure on the back of a package that food made with genetically modified ingredients will raise food prices.
All of them will be wrong.
Here’s the truth: changing labels has no impact on the price of food. Food companies change their labels all the time to highlight innovations or make new claims. Remember when General Mills changed the Cheerios box to share the good news that its iconic cereal was GMO-free? Did the price change? No.
Here’s another dose of reality: Shoppers do not read everything on the box, can or bottle. As my colleague Mike Lavender recently noted, shoppers tend to look for certain attributes – like calories or the presence of fiber – and disregard the rest. So while some consumers will look for the GMO disclosure, many more will not.
Another fact: Even if consumers are aware of the presence of GMOs, relatively few will reject their GMO food in favor of organic or non-GMO options. Disclosure is not the same as disparagement. Consumers in Brazil have had GMO labels since 2001, but less than one percent of Brazilian food sales are organic.
Hard truth: Some witnesses are expected to testify that farmers and food processors will have to create an expensive new system to separate GMO and non-GMO crops. This is simply false -- the supply chain already separates GMO and non-GMO foods.
Final lesson: Retail food prices are driven by many factors, including shopper demographics. Wholesale food prices are driven by ingredients, labor and energy costs, not the cost of label changes.
Study after study shows what consumers know intuitively – requiring a modest GMO disclosure on the back of the food package will have no impact on the price of the food item.
Of course, that won’t change the testimony tomorrow.
Because what’s really at stake is whether food companies like Land O’ Lakes and PepsiCo will be required to tell consumers something they’ve spent more than $100 million to hide.