Country of origin bill could affect family food budget

1 June 2017

The Consumers’ Right to Know (Country of Origin of Food) Bill proposes major problems for popular and basic parts of the family food budget, NZ Food and Grocery Council Chief Executive Katherine Rich told a parliamentary select committee hearing submissions on the bill.

“We absolutely support country of origin labelling on a voluntary basis and our members provide this information to consumers already.

“But expressing support for country of origin labelling and what is actually in this bill are two different things. We told the Select Committee today that had the bill stuck with fresh fruit and vegetables, it could have gained widespread industry support.

“But as drafted, it proposes problems for many basic staple foods, such as coffee (powdered and capsules), tea, sugar, flour, fish, meat, custard powder, pepper, cooking oils, oats, spices, baking soda, as well as some breakfast cereals.

“From time to time, many of these single-component products use ingredients from several sources, and keeping up with an ever-changing supply and labelling for every batch would be a huge, if not impossible, challenge for suppliers.

Consumer Right to Know (Country of Origin of Food) Bill

Opening Statement to Primary Production Select Committee, 1 June 2017, by Katherine Rich, Chief Executive, NZ Food and Grocery Council

Mr Chair,

You have our submission where we set out the key concerns we have with this bill.

Consumers want information about their food and we understand that. But expressing support for CoOL and what is actually in this bill are two different things. We believe that had the bill stuck with fresh fruit and vegetables, it could have gained widespread industry support. In fact, we have one member who supports mandatory country of origin applied to fresh fruit and vegetables.

Whether this committee recommends a major rewrite to achieve this is a matter for the committee, but in its current form, this bill should not become law. The way it’s drafted, it captures many processed foods which have never been a focus of a country of origin discussion and many multi-ingredient staple foods that New Zealand families rely on.

When CoOL reform was first mooted, its main aim was to provide information about where fresh fruit and vegetables came from. Fair enough. And this call was heard – it’s already happened – at least in supermarkets and a range of specialty suppliers. Countdown, New World, PAK’nSAVE and the likes of Moore Wilsons all voluntarily label fresh produce and have been doing so for many years – they even advertise this in their colour advertising which appears in newspapers regularly.

Our members have been 100 per cent behind voluntary labelling and they already do this for seafood, bacon and smallgoods, beverages, breads, tissue products, dairy - the whole range.

We do have some sympathy with Horticulture NZ’s concern about some other less professional sellers at farmers’ markets, small fruit shops, or road side stalls who might not be as transparent.

But it's not fresh fruit and vegetables that’s the problem – it’s the expanded bill. We believe the expansion and this world-first unique definition of ‘country of origin’ has made it either impossible or cost-prohibitive to implement in New Zealand.

Problems arise, not for fresh fruit and vegetables, but for other, everyday grocery categories which have never been poster-products for the debate.  

The bill proposes major problems for significant parts of the family food budget, such as coffee (instant, capsules), tea, sugar, flour, pepper, cooking oils, oats, spices and other popular staple foods. The way it’s drafted, it could catch many breakfast cereals, too – even porridge and Weet-Bix. When consumers were surveyed on CoOL, it’s doubtful these categories were top of mind.

Many of the products caught are ones New Zealand does not produce locally – and consumers generally know that - such as sugar.

Coffee is an important example because it’s a big part of our lives (along with tea). A packet of Nescafé Classic, Moccona or Gregg’s could contain beans from many countries blended to deliver the consistent taste consumers expect. Beans are traded globally and purchased depending on availability, seasonality and price. As I mentioned, the beans are blended, so in any given pack it might be a combination but its blended for the taste profile that consumers expect.

This bill assumes that all single-ingredient foods come from the same place. That’s not the case for many processed foods that are a mixture of sourced commodities that are globally traded.

Maintaining segregation on a massive scale or regularly re-labelling with the bill’s unique definition of country of origin for blends would be a task where the benefits would far outweigh the desires of consumers. For some products, such as crystalline sugar that comes from up to 10 different countries, it would be a nightmare for NZ Sugar, New Zealand’s only sugar refinery.

The bill’s definition of what is a single-ingredient food is clunky and ambiguous. The bill says some ingredients should be ignored when deciding something is a single ingredient or not. Without a rewrite its scope would exclude products and additives – like the potentially 80 preservatives and colours, 15 sweeteners, and 100s of substances used as flavours – this bill will continue to capture 1000s of multi-ingredient products, which i don't think was the original intention.

The bill has such a unique definition of ‘country of origin’ that even products from other countries which do have country of origin will not comply in New Zealand, so will have to be re-labelled. For example Canadian maple syrup, proudly labelled Canadian, that will not meet the current bill and will have to be re-labelled. So many other countries that do have schemes still won;t comply with tyhis relatively unique definitition that New Zealand is looking at in this bill.

Will these manufacturers re-label for a market of four million people? It's unlikely. Some products could disappear from the shelves and consumers will miss out in terms of choice.

One of the other things we are concerned about if this becomes law is that we’ll also see a drop-off in products that are currently, proudly, labelled “Made in New Zealand”. So some manufacturing will be lost as well.

I don't think the intention of the bill was to make staple foods more expensive for New Zealanders but that's what will happen with flour, sugar, peppe, cooking oils etc if there is constant re-labelling in order to comply.

This bill will legislate for more expensive cups of coffee – impacting on every home, work break or café – and this is just one category.

When people are putting that teaspoon of sugar on their porridge in the morning do they really want to know that it could come from Equador, Guatemala, Australia, Brazil, Argentina, Costa Rica, Philippines, Thailand, Mexico, China, Pakistan, Colombia?  

There's a certain amount of information that consumers want and I feel we're delivering that amongst our membership but certainly this bill brings up some complexities.

Mr Chair, this bill should not proceed in its current form. If it does proceed without amendment it will prove to be costly, damaging and, we believe, trade-restricting, ultimately costing the New Zealand consumer and the economy dearly for what started out as a discussion about clearly labelling fruit and vegetables.

FGC's written submission on the bill is in the Submissions section of this website.