Organic, Conventional or GMO

• July 27, 2015
• Paul Neiffer

The Federal Reserve of Kansas City just had their annual Ag Symposium about two weeks ago.  One of the presentations was by Jill McCluskey, a professor at Washington State University on the demographic trends and consumer preferences regarding food.  The highlights of her presentation were as follows:

• Processed and fast food is the old trend – Farmers’ markets and Whole Foods is the idealized preference for most consumers now.
• Increased influence of the “Food Elite” and consumer expectations.  Good Equals GM-Free, Cage Free, no added hormones, etc.  Sustainable, Organic, Natural ….
• Food consumption as part of your identity.  Can be aspirational or a sign of fashion.
• The Organic Revolution shows no signs of slowing down.  Organic is viewed as healthy, even if the food looks like an Oreo.
• Rejection of GM foods.  Consumer’s willingness to pay (WTP) creates large discounts for GMO food compared to organic (or in some cases natural).  This discount can exceed 60%.
• Decline of traditional fast food.  Changing consumer tastes; Increased competition.  PAST: Leaders in restaurant associations “healthy choices don’t sell.”  NOW: Restaurants with healthier choices are more popular (at least perceived healthier).
• Food Explorers: THEN: Brand Loyalty.  NOW: Novelty, style and quality is much more important that the brand (craft beers versus brand name beers, etc.).

To feed the world will continue to require technology (GM Foods, etc.).  The important part to realize is the consumer does not like this idea (even if science says it is not harmful).  American agriculture will continue to need to tell their story since the trend to “healthier” food is here to stay (at least for the near term).

I am showing a handy chart below that lets you know if your food is organic, conventional or GMO.

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