Food Safety Incidents in a Modern Agricultural Market: E. coli in the Romaine Lettuce Industry
AAEA members publish new research in AJAE
New research found that the November 2018 E. coli incident were felt throughout the eight-week period associated with the government advisory and during an aftermath period that extended up to 12 weeks after the official all-clear as issued. Total economic costs of the incident were in the range of $280 - $350 million dollars, with the bulk of that cost borne by processor-shippers and grocery retailers. Growers were mostly protected from loss by the nature of contracts in this industry.
In the new article “Economic impacts of food safety incidents in a modern supply chain: E. coli in the romaine lettuce industry" published in the American Journal of Agricultural Economics, Ashley Spalding (now with USDA ERS), Richard Sexton, Rachael Goodhue, and Kristin Kiesel from the University of California, Davis find the economic impacts of the November 2018 E. coli incident for romaine lettuce for participants in the leafy greens supply chain, including growers, processors and shippers, retailers, food service operators, and consumers.
Spalding says, “This incident was due to contamination on a single farm, yet it impacted the entire industry for up to 20 weeks. Romaine lettuce is a healthy, nutrition-dense product, but consumption of most salads containing romaine declined by around 25% during this 20-week period.” According to their research, “The incident imposed substantial economic losses to market participants who bore no responsibility for it. The findings emphasize the importance of the industry developing and enforcing mandatory food-safety standards and for the government (Centers for Disease Control and Prevention and Food and Drug Administration) to have improved traceability standards so that the source of outbreaks can be quickly identified to prevent widespread and long-lasting impacts.”
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ABOUT AAEA: Established in 1910, the Agricultural & Applied Economics Association (AAEA) is the leading professional association for agricultural and applied economists, with 2,500 members in more than 60 countries. Members of the AAEA work in academic or government institutions as well as in industry and not-for-profit organizations, and engage in a variety of research, teaching, and outreach activities in the areas of agriculture, the environment, food, health, and international development. The AAEA publishes three journals, the Journal of the Agricultural and Applied Economics Association (an open access journal), the American Journal of Agricultural Economics and Applied Economic Perspectives & Policy, as well as the online magazine Choices and the online open access publication series Applied Economics Teaching Resources. To learn more, visit www.aaea.org.
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