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1
Introduction1
T
he U.S. food system provides many benefits, not the least of which
is a safe, nutritious, and consistent food supply. However, the same
system also creates significant environmental, public health, and
other costs that generally are not recognized and not accounted for in
the retail price of food. These include greenhouse gas (GHG) emissions
(Gonzalez et al., 2011); soil erosion, air pollution, and other environmental
consequences (Heller and Keoleian, 2003; Wolf et al., 2011); the transfer of
antibiotic resistance from food animals to humans (Hayes et al., 2011); and
other human health outcomes, including foodborne illnesses and chronic
disease (Heller and Keoleian, 2003). Some of these external costs (i.e.,
external to the food system), which are also known as externalities, are
accounted for (“internalized”) in ways that do not involve increasing the
price of food (see Box 1-1). But many are not. They are borne involuntarily
by society at large (Tegtmeier and Duffy, 2004). A better understanding
of external costs would help decision makers at all stages of the life cycle
to expand the benefits of the U.S. food system even further. The Institute
of Medicine (IOM) and National Research Council (NRC), with support
from the U.S. Centers for Disease Control and Prevention (CDC), convened
1 This workshop was organized by an independent planning committee whose role was
limited to designing the workshop program and identifying goals, topics, and speakers. This
workshop summary has been prepared by the rapporteurs as a factual summary of the presen-
tations and discussions that took place at the workshop. Statements, recommendations, and
opinions expressed are those of individual presenters and participants and are not necessarily
endorsed or verified by the Institute of Medicine or the National Academies; they should not
be construed as reflecting any group consensus.
1
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2 EXPLORING HEALTH AND ENVIRONMENTAL COSTS OF FOOD
BOX 1-1
Externality as Defined by Individual Speakers
Katherine Smith defined externality as
a cost or benefit not transmitted through prices that is incurred by a party
who did not agree to the action causing the cost or benefit.
James Hammitt referred to the definition of externality laid out in the National
Research Council (2010, p. 29) report The Hidden Costs of Energy: Unpriced
Consequences of Energy Production and Use:
An externality, which can be positive or negative, is an activity of one
agent (for example, an individual or an organization, such as a company)
that affects the well-being of another agent and occurs outside the market
mechanism.
a public workshop on April 23-24, 2012, to explore the external costs of
food, methodologies for quantifying those costs, and the limitations of the
methodologies.
The workshop was intended to be an information-gathering activity
only. Given the complexity of the issues and the broad areas of expertise
involved, workshop presentations and discussions represent only a small
portion of the current knowledge and are by no means comprehensive. The
focus was on the environmental and health impacts of food, using externali-
ties as a basis for discussion and animal products as a case study (i.e., spe-
cifically beef, poultry, pork, and dairy). The intention was not to quantify
costs or benefits, rather to lay the groundwork for doing so. A major goal
of the workshop was to identify information sources and methodologies
required to recognize and estimate the costs and benefits of environmental
and public health consequences associated with the U.S. food system (see
Box 1-2). It was anticipated that the workshop would provide the basis for
a follow-up consensus study of the subject and that a central task of the
consensus study will be to develop a framework for a full-scale accounting
of the environmental and public health effects for all food products of the
U.S. food system.
Nor was the intention to make any recommendations or suggest poli-
cies. Rather, again, it was to lay the groundwork for future efforts. Accord-
ing to Anne Haddix, senior policy advisor at CDC’s National Center for
Disease Prevention and Health Promotion, the hope is that a framework
can be built that will help to identify novel strategies for dealing with food
system-related public health problems, such as obesity, in ways that are not
only healthful, but also environmentally sound and economically produc-
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INTRODUCTION 3
BOX 1-2
Statement of Task
An ad hoc committee will organize a 1.5-day public information-gathering
workshop to examine the challenges inherent in estimating the costs of the U.S.
food system not reflected in retail prices and to consider the kind of research strat-
egy that would be needed to approach such a full-scale accounting. The workshop
will identify the types of information sources and methodologies required to rec-
ognize and estimate the costs and benefits of externalities and unintended public
health consequences associated with the U.S. food system.
While the central focus of the workshop will be to understand how to account
for externalities and unintended public health consequences of the U.S. food
system broadly, meat will be used as a case study with which to explore how to
approach the measurement of environmental and public health effects. The work-
shop planning committee will select the animal species (e.g., beef, pork, chicken,
or fish) and different production, marketing, distribution, and retail systems that
would provide the most appropriate points for analysis. It is anticipated that the
workshop will identify key categories of externalities and unintended public health
consequences associated with the production and consumption of meat, the
extent of information available on each of the categories, appropriate metrics for
quantification, limitations and knowledge gaps, as well as modeling and other
analytical approaches needed to establish the value of these costs and benefits.
The workshop would also provide the basis for a follow-on planning discus-
sion involving members of the IOM Food and Nutrition Board and NRC Board on
Agriculture and Natural Resources and others to develop the scope and areas
of expertise needed for a larger-scale, consensus study of the subject. Based on
the framing of the study by the planning discussion, it is envisioned that a central
task of the work of a subsequent consensus study committee will be to develop
a framework for true-cost accounting of the U.S. food system and to attempt to
draw supportable conclusions about the true costs of food.
tive. Currently, no framework is available for analyzing in a comprehensive
and systematic way how the food system impacts public health. Although
the CDC’s initial intention was to focus on public health, Haddix described
the food system as being so complex and interactive that it is impossible to
separate the health consequences of the food system from environmental,
economic, social justice, and other consequences. Thus, the workshop plan-
ning committee invited a diverse group of experts and stakeholders to par-
ticipate in the discussion, including economists, farmers, environmental and
agricultural scientists, and public health experts. Their expertise spanned
the entire course of the food life cycle.
Given the diversity of perspectives, numerous challenges and complexi-
ties regarding the types of information sources and methodologies available
to measure the health and environmental costs and benefits associated with
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4 EXPLORING HEALTH AND ENVIRONMENTAL COSTS OF FOOD
the U.S. food system were identified over the course of the workshop. Some
participants questioned the rationale for conducting a full-scale accounting
of the costs of food and whether another approach might be more feasible.
They also stressed that all costs are relative because all food and agricul-
tural systems are dependent on the natural environment; therefore, such an
exercise would need to undertake comparisons of alternative food system
activities or practices. The heterogeneity of landscapes and management
practices among sites only complicates this endeavor, as emphasized by
many workshop participants. Participants also expressed varying opinions
about the limitations of framing the analysis in terms of externalities. Sev-
eral other issues were noted, including the broad range of external costs
and benefits that were not included in the focus of the workshop; the lack
of sufficient data; the importance of considering all stages of the food life
cycle; the risks associated with simplifying assumptions about the effects;
the inability of models to capture the heterogeneity among food produc-
tion methods; the variability in the degree of certainty around the magni-
tude of some effects; and the numerous unanswered questions about the
methodologies discussed for quantifying health, environmental, and other
effects. Many of these overarching issues are discussed in greater detail in
Chapter 7.
By bringing together a wide range of experts, however, the workshop
was able to forge connections across subjects that typically are discussed as
though they are distinct from one another. The diversity of perspectives and
experiences represented among the participants allowed for this workshop
to become an important first step in illuminating the range of expertise,
methodologies, and information sources that would need to be included in
future explorations of the topic.
ORGANIZATION OF THIS REPORT
The organization of this report roughly parallels the organization of
the workshop itself (see the agenda in Appendix A). Chapter 2 addresses
the economics of food prices and considerations for valuing food. Chapter
3 summarizes the Session 1 presentations on measures and strategies for
estimating the external environmental and health impacts of food. Speak-
ers considered the opportunities and limitations of several methodologies:
life cycle analysis (LCA), health impact assessment, cost-benefit analysis,
multidimensional impact assessment and modeling, and risk assessment.
Although the focus of the workshop was on environmental and health
costs, a panel session on the social and ecological dimensions of the food
supply was held to explore some of the broader impacts. Speakers discussed
ecosystem services and disservices, health inequalities, accessibility to food,
and animal welfare. Chapter 4 summarizes that panel session. Chapter 5
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INTRODUCTION 5
summarizes the two presentations that focused on methodologies and limi-
tations of attaching monetary value to costs and benefits.
Chapters 6 and 7 summarize group discussion that occurred through-
out the course of the workshop, including discussion that occurred during
the small working group portion of the workshop. About one-third of the
workshop time was spent in small working groups. There were four work-
ing groups: energy usage and GHG emissions; soil, water, and other envi-
ronmental consequences; consequences of antimicrobial use in agriculture;
and other public health consequences. The groups were asked to identify
effects, methodologies for measuring those effects, and limitations of the
methodologies. Chapter 6 includes a summary of these working group dis-
cussions. Chapter 7 provides an overview of the major overarching themes
from all the open discussions that occurred throughout the workshop, in-
cluding participants’ reflections on key considerations for moving forward
with future work in this area.
This workshop summary was prepared by the rapporteurs as a factual
summary of the presentations and discussions that took place during the
BOX 1-3
Key Terms Used in This Report
End-of-life: In the context of LCA, end-of-life refers to the stage of the product
after preparation and consumption by the conumer. At this stage, the food product
is disposed of in some manner (e.g., recycled or placed in a landfill).
Health impact assessment (HIA): HIA is not a single method, but rather a sys-
tematic process that uses a wide array of data sources, analytical methods, and
stakeholder input to determine the potential effects of a proposed policy, plan,
program, or project on the health of a population and the distribution of those
effects within the population.
Life cycle assessment (LCA): In the context of the food system, LCA is a tool
for examining the environmental impact of a product that covers the impacts of
manufacturing, of the upstream production chain (e.g., material extraction, fuels,
transportation, etc.) and downstream disposal (e.g., recycling, landfilling, etc.).
According to Heller and Keoleian (2003), “a product life cycle approach provides
a useful framework for studying the links between societal needs, the natural
and economic processes involved in meeting these needs, and the associated
environmental consequences.”
Life cycle stages: For a food product, the following life cycle stages are consid-
ered in the context of economic, social, and environmental sustainability indica-
tors: the origin of the product; agricultural and production conditions; processing,
packaging, and distribution of the product; preparation and consumption by the
consumer; and the end-of-life of the product (Heller and Keoleian, 2003).
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6 EXPLORING HEALTH AND ENVIRONMENTAL COSTS OF FOOD
workshop. Neither the workshop nor this summary were intended to be ex-
haustive explorations of the subject. None of the material summarized here
should be construed as reflecting group consensus. For an explanation of
key terms used throughout this workshop summary, please refer to Box 1-3.
REFERENCES
Gonzalez, A. D., B. Frostell, and A. Carlosson-Kanyama. 2011. Protein efficiency per unit
energy and per unit greenhouse gas emissions: Potential contribution of diet choices to
climate change mitigation. Food Policy 36:562-570.
Hayes, D. J., H. H. Jensen, L. Backstrom, and J. Fabiosa. 2001. Economic impact of a ban
on the use of over the counter antibiotics in U.S. swine ratios. International Food and
Agribusiness Management Review 4:81-97.
Heller, M., and G. Keoleian. 2003. Assessing the sustainability of the U.S. food system: A life
cycle perspective. Agricultural Systems 76:1007-1041.
Tegtmeier, E. M., and M. D. Duffy. 2004. External costs of agricultural production in the
United States. International Journal of Agricultural Sustainability 2(1):1-20.
Wolf, O., I. Perez-Dominguez, J. M. Rueda-Cantuche, A. Tukker, R. Kleijn, et al. 2011. Do
healthy diets in Europe matter to the environment? A quantitative analysis. Journal of
Policy Making 33:8-28.