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BW Businessworld

One Man’s Meat Is Another Man’s Poison

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Ever since Irish authorities discovered horse DNA in processed meat labelled as beef, a rush of reports about food adulteration has delivered a black eye to the global food business. As the reputations of food industry giants bite the dust, local food vendors in Europe are enjoying a boom, and environmental movements promoting local foods are signing up new supporters. Score 1 for environmentalists and zero for globalisation. But by putting the spotlight on the unedifying corner of global food business, the horse meat scandal may eventually help global food producers clean up their act and offer more honest fare to customers. 
 
The shock and dismay generated by cascading reports of adulterated food involving big brand names such as Findus, Nestle and Ikea have proved a bonanza for local butchers who use locally raised animals. But for the less affluent population, there is no substitute for packaged food on supermarket shelves. Nor is the scandal going to reverse the global supply chain that has evolved over the last decade, bringing in efficiency and expanded markets. 
 
Falling transportation costs and tariff barriers have allowed firms to source components worldwide and sell processed foods in global supermarkets. To make a few extra bucks (horse meat costs a third less than beef) some firms, at least their suppliers, engage in food adulteration and endanger consumer health. British health authorities have discovered that along with horse meat, a painkiller drug for horses has also entered the European food chain.
 
Food poisoning is, of course, common, but consumers are more distraught when the product is imported and the production process opaque. Five years ago, Japanese consumers suffered food poisoning after eating Chinese frozen ‘gyoza’ meat and vegetable dumplings that contained pesticide. It led to a ban on its import and a bitter dispute between the two countries. A chemical mimicking protein, melamine, was found in China-made milk and led to a recall of milk products from supermarkets abroad. This has resulted in foreign customers becoming wary of ingesting anything made in China. Even Chinese citizens regularly swoop into Hong Kong supermarkets and bring back cartons of milk for their children when travelling to Australia.
 
The horse meat scandal is more embarrassing than shocking as the culprits are all Europeans and not shady operators from a poor country. Greed knows no borders but, fortunately, Europe has the technology to detect malpractices and the legal system to bring them to justice (India’s Food and Drug Administration offers tips on how to detect foreign substances in food items, but punishing the adulterers is another story). Since the outbreak of the mad cow disease in the 1980s and the health scare from tainted meat, Europe has developed elaborate systems to trace the source of bovines and the labelling of their meat. It is so elaborate that one can almost read the biography of the animal one has on one’s plate. But the authorities have been lax in their control of horse meat and of processed food made with ingredients from a variety of places. The expanding scale of global outsourcing, and a farm lobby resisting hiked costs on regulatory controls, has resulted in loopholes and the latest scandal. 
 
But scandals often bring reform. A recent Consumer Intelligence of Britain opinion poll found that nearly one in four of the 2,200 respondents said they were consuming less meat; two-thirds said they now mistrust food labels. The falling sales in supermarkets and branded pre-cooked meals have now jolted both the governments, and industry. We can expect some corporate bosses going to jail for fraud, governments drafting new regulations, and supermarket chains pledging new vigilance to protect the consumers. But it won’t be too long before new scams emerge to defraud consumers. 
 
For governments monitoring global food trade, there is no substitute for the Russian proverb: Trust, but verify.

The author is director of publications at the Yale Center for the Study of Globalisation and editor of YaleGlobal Online

boundtogether(dot)bw(at)gmail(dot)com

(This story was published in Businessworld Issue Dated 08-04-2013)