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Elanco's Self-Serving White Paper

by: Jill Richardson

Mon Jan 25, 2010 at 12:00:50 PM PST

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What do consumers want? Cheap, tasty, convenient food. And they DON'T care how you produce it. That's what Elanco, subsidiary of Eli Lilly, maker of rbGH and other animal drugs says in a white paper available from their website. Details below.
Jill Richardson :: Elanco's Self-Serving White Paper
In the white paper, they say:

Food producers should avoid "differentiating on the negative."
Labeling food products with claims such as NO additives, NO this, NO that, etc., results in a costly contest among manufacturers to "out-NO" each other while only confusing consumers who neither understand, desire, nor prefer these types of foods. Further, this practice can create an unfounded fear among consumers that products without such labels are less safe when, in fact, they can be even safer to consume. In any case, it's the consumer who should make the final decision about which food products to purchase.

Translation? Don't all label your products "No rbGH" (or other Elanco product) so that other dairy farmers have to give up rbGH in order to compete with you.

In this paper, they cite many stats. Here's a little taste.

UPDATE: I initially quoted his numbers but came to a false conclusion about them. Here's the actual survey question and responses. It was an open-ended question in which respondents could write whatever they wanted (it wasn't multiple choice):

What, if anything, are you concerned about when it comes to food safety? [OPEN END]

Disease/Contamination 50%
Handling/Preparation 29%
Food source 13%
Health/Nutrition 8%
Agricultural production 7%
Preservatives/Chemicals 6%
Packaging/Labeling 3%
Biotech 1%
Processed foods 1%
Other 2%

Source: 2008 Food Biotechnology: A study of u.s. consumer Trends." August 2008. International Food Information council.

The white paper adds that:

U.S. and international consumer research, involving a total of 45 focus groups conducted in 2001, 2004, and 2008 - and including a quantitative survey of 741 Americans taken in 2008 - revealed that most consumers (nearly 70 percent in 2008) assume the meat and poultry they buy is safe. The research also showed that consumers care little about the origin of meat they purchase. And only 17 percent of the consumers surveyed in 2008 expressed a strong interest in knowing about modern food animal production, while nearly 60 percent had little or no interest, preferring instead ot trust the food supply chain to ensure the food they consume is safe.

Tucked into this paper is the statistic organic sales DOUBLED worldwide between 2000 and 2006. Yet Elanco thinks that only 3 percent of consumers can afford organics. That's not entirely accurate. In 2006, organics accounted for just under 3 percent of the market BUT that is not the same as saying that only 3 percent of consumers bought them. In fact, in 2008, 69 percent of consumers bought organics at least occasionally. And Elanco should pay attention because during the first half of 2006, 30 percent of consumers purchased organic milk or dairy products (up from 23 percent the year before).

Elanco says:

Organics foods are a fine option for people who can afford to pay a premium for them. According to USDA researchers, these premiums can average 100 percent or more for vegetables, 200 percent for chicken and nearly 300 percent for eggs.

That's probably true if you're buying your organics from the grocery store. From the farmers' market or CSA, my research has shown that it's a different story. (I checked prices of 40 different items at the farmers market and compared them with 5 different retailers in Madison, WI in September 2006. Wal-Mart and Sams were cheaper than the farmers' market but they did not carry most of the items on the list. The traditional grocery, Whole Foods, and a worker-owned co-op were all more expensive than the farmers' market.)

Interestingly enough, Elanco's paper continues, saying:

It bears noting that not all organic production methods are less efficient and provide foods that invariably cost more. According to a U.N. FAO report, in some countries, well-designed organic systems can provide better yields and profits than traditional systems...

Nevertheless, the report also recognizes the need for more research to solve technical problems faced by organic growers, and suggests that organic agriculture could become a realistic alternative to traditional agriculture over the next 30 years, but only on a local level.

WOW. How's that for a reality check? The U.N. says that organics and local food systems work. I would also add that if we had invested the same amount of research and into organics as we had conventional ag in the past half century, no doubt we would have far better results with organic than we do now.

But that's not Elanco's point. They call for two things: technology and choice. Translation: Legalize our products please. We have technology, and consumers should be able to choose whether or not they buy foods that were produced using our technology. But please don't actually inform the consumers about that or label your foods "No rbGH." Just feed it to them without a label and they won't know the difference.

They cite a number of technologies in this paper. Typically they do so rather generically, with footnotes. For example "Use of an FDA-approved feed additive for swing can reduce manure production in pigs by 8 percent." Really? Wow! What product could that be. A trip down to the footnotes shows that it's Ractopamine, also known as Paylean.  They refer to the same drug again saying "an FDA-approved swine feed additive could enable the U.S. to maintain pork production levels while raising 11 million fewer hogs. This would also reduce demand for cropland used to grow feed grains by more than 2 million acres." Paylean is allowed in the U.S. and a number of other countries but banned in others, notably China. China has in fact rejected shipments of U.S. pork for containing ractopamine residues. In other words, the pork Americans actually eat contains ractopamine residues. Yum.

And they refer to rbGH as "another widely used technology," citing a study by Judith Capper (and a Monsanto consultant!) on how technology helps reduce the environmental impact of dairy cattle. I've written before about that paper's flaws. They compare today's conventional dairy cattle with those of 1944 and then draw the conclusion that today's organic producers are similar to those of 1944 and therefore the study shows that conventional is better for the environment than organic. This totally ignores advances in breeding between 1944 and now, and it ignores the actual numbers. Today's organic cow produces more than double - nearly triple - the milk a cow of 1944 produced. A conventional cow of today STILL produces more than an organic cow of today but it is FAR less dramatic than the study makes it seem.

Then there's my favorite footnote of all - an article by Alex and Dennis Avery of the Hudson Institute's Center for Global Food Issues (a corporate astroturf organization responsible for the book Saving the Planet with Pesticides and Plastic). I'm sorry but you CANNOT cite the Hudson Institute for anything and still be considered a credible source of factual information. Period.

All in all, I AM interested in the specific "technologies" they advocate for and I do not appreciate having to go dig for them in the footnotes. Perhaps this strategy of burying such boring details where few people will see it is a way of avoiding discussing what it is these "technologies" actually do. I'm certainly not anti-technology on principle, I just think that we need to be judicious in choosing the right technologies. Should we use nuclear bombs to fight wars just because we know how to make them and they are an advanced technology, or should we find a more appropriate technology (or, hell, even diplomacy!) that would kill less innocent people? The same questions should be asked in agriculture. Which technologies can produce food in the healthiest way that best benefits farmers, the environment, consumers, and livestock? Technologies that don't result in antibiotic resistant bacteria, for example. My hunch is that Elanco won't like that answer because it would lose them business.

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price premiums (4.00 / 3)
I admire you for being able to summon the fortitude to read that report and then be able to write and post a diary about it. Your blood pressure must be off the chart.

premiums can average 100 percent or more for vegetables, 200 percent for chicken and nearly 300 percent for eggs.

Was that claim substantiated in a footnote?

That is false. That is not true. That is a lie.

Conventional supermarkets in my neighborhood (not Whole Foods) offer organics. In no case is any of those stratospheric multiples approached, except for that stupid pancake batter in an aerosol can. In all other cases I have ever seen, the premium is a fraction of 100%.

The organic price premium is partly the result of a supply-demand equation. People in my neighborhood aren't rich, and they aren't crazy.

depends on the store (4.00 / 2)
Whole Foods charges an arm and a leg.

"I can understand someone from Iowa promoting corn and soy, but we are not feeding the world, we are feeding animals and soft drink companies." - Jim Goodman

[ Parent ]
It depends on the store. (4.00 / 2)
In the conventional "mega-marts" in my 'hood (Smith's, owned by Kroger; Vons, owned by Safeway; Albertsons; etc.), they do charge an extra arm and a leg for anything they can slap an "Organic!" or even "All Natural!" label on. Ironically, that's another reason I prefer Sunflower (from the founders of Wild Oats) and Trader Joe's. They offer the same quality as the food I find at "Whole Paycheck" and the "mega-marts", but for a much better price.

I took AP Economics in high school (and passed the test!), so I know all about supply & demand. And in the case of organic foods, sometimes these companies just artificially jack up the prices to take us for a ride.

Act on Principles and make equality happen.

[ Parent ]
Traditional ag (4.00 / 2)
According to a U.N. FAO report, in some countries, well-designed organic systems can provide better yields and profits than traditional systems...

It is well established, and obvious to pretty much everybody, that well-designed organic systems can provide better yields and profits than subsistence agriculture, which is what traditional ag is in large parts of the world. The dominant American-Canadian model is not traditional ag in any sense of the term, and it certainly is not the only or the best way to increase production and profits.

only on a local level

I wish.

Averys (4.00 / 1)
"Information" from the Hudson Institute can be suspect in general, but the Averys in particular are just downright dishonest.

I know (4.00 / 1)
it's about as trustworthy as if somebody cited that Cap'n Crunch said that sugary cereal is good for your teeth.

"I can understand someone from Iowa promoting corn and soy, but we are not feeding the world, we are feeding animals and soft drink companies." - Jim Goodman

[ Parent ]
CGFI-Elanco (4.00 / 1)
Because of your diary, I listened again to the podcast in which Jon Steinman reals off the companies and organizations that fund CGFI - ADM, Cargill, Syngenta, etc. - and I heard a name I hadn't picked up the first time I listened: DowElanco.


The company split off its agricultural chemicals in 1989, forming DowElanco, a joint venture owned by Dow Chemical Company and Eli Lilly and Company. Elanco continued to concentrate on its core business of animal science. DowElanco was later purchased entirely by Dow and became Dow Agrosciences.

Elanco Today
Today, the company's agricultural division has been renamed Elanco to emphasize the focus of its business. Elanco's current product line concentrates on livestock for the food animal industry and companion animals. The products encompass four therapeutic classes: antibacterials, parasiticides, anticoccidials, and productivity enhancers.

DowElanco was not the same company as Elanco, but I wonder if Elanco is a CGFI funder. Any bets?

[ Parent ]
ha! (0.00 / 0)
good call.

"I can understand someone from Iowa promoting corn and soy, but we are not feeding the world, we are feeding animals and soft drink companies." - Jim Goodman

[ Parent ]
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