Food Consumption/Nutrition/Food Safety, International Relations/Trade,

Anonymous

Jensen, Helen H.

English

Research Papers in Economics

CHOICES
The magazine of food, farm, and resource issues
1st Quarter 2007 • 22(1) CHOICES 5
A publication of the
American Agricultural
Economics Association
1st Quarter 2007 • 22(1)
©1999–2007 CHOICES. All rights reserved. Articles may be reproduced or electronically distributed as long as attribution to Choices and the American
Agricultural Economics Association is maintained. Choices subscriptions are free and can be obtained through http://www.choicesmagazine.org.
Overview: Globalizing Food Chains: 
Producer, Company, and Policy Responses 
By Bruce A. Babcock and Helen H. Jensen, Guest Editors
The rapid emergence of global food chains has changed
how food companies and farmers think about strategic
investment, marketing, and production decisions as well as
food and agricultural policy. But trade negotiators for
developed countries continue to spend most of their time
protecting the interests of domestic commodity producers,
whereas the top priority of developing country negotiators
is to shield their agricultural sectors behind import tariffs
while fighting for lower tariffs in developed countries.
Even as these efforts continue to bog down any progress in
the Doha round of negotiations in the World Trade Orga-
nization, the realities of increased urbanization in develop-
ing countries, continued income growth in most coun-
tries, economies of scale, and comparative advantage are
working together to transform the food choices of con-
sumers in both developed and developing countries. The
case studies included in this issue of Choices highlight
some of the key issues facing companies, farmers, and gov-
ernments as supply chains globalize. 
Increased demand by rich-country consumers for a
wide variety of high-quality and unique food products has
opened up opportunities for food companies and produc-
ers around the world. The decreased cost of providing
consumers information about product attributes has
greatly increased the feasibility of meeting these demands
with specialized products. The article by Stricker, Mueller,
and Sumner illustrates how this decreased cost of informa-
tion transmission through an Internet presence can be
used by producers of boutique products to greatly expand
the geographic range of their customer base, thus allowing
them to achieve greater scale than they would be able to if
they were limited to local sales only.
The increased demand for quality by consumers is
often accompanied by demands for increased assurance
that the products meet strict sanitary and phytosanitary
(SPS) guidelines. Both developed and developing coun-
tries are finding that new investments in upgraded food
production and processing systems are needed to meet
these international guidelines. Pork production systems
provide a good example of the trends. Batres-Marquez,
Clemens, and Jensen show how these investments are
slowly transforming how pork is produced and processed
in Mexico, with perhaps unintended impacts on the types
of pork products that are being offered domestically. Lence
shows how these investments have transformed Spain’s
pork industry and speculates about whether Spain’s pro-
ducers will choose to make the next set of investments
needed to meet ever-stricter requirements. 
The technical upgrades and investments required to
meet rich-country SPS guidelines put developing coun-
tries at a distinct disadvantage internationally, according to
many observers. Dong and Jensen review the difficulties
that China is experiencing as it tries to upgrade its regula-
tory system in order to meet international standards. The
Articles in this Theme:
Overview: Globalizing Food Chains: Producer, Company, and 
Policy Responses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
Mexico’s Changing Pork Industry: The Forces of Domestic and 
International Market Demand . . . . . . . . . . . . . . . . . . . . . . . 7
Grass-Fed Certification: The Case of the Uruguayan Beef 
Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
Challenges for China’s Agricultural Exports: Compliance with 
Sanitary and Phytosanitary Measures . . . . . . . . . . . . . . . 19
The Transformation of Spain’s Pork Sector: Can it Continue? 25
Marketing Wine on the Web . . . . . . . . . . . . . . . . . . . . . . . . . . . 316 CHOICES 1st Quarter 2007 • 22(1)
authors argue that, ironically, perhaps
the biggest hurdle for China to over-
come is a lack of central control over
SPS systems being used to produce
food. The study by Boland, Perez,
and Fox shows that developing coun-
tries occasionally have an inherent
advantage over rich countries in
meeting new demands of interna-
tional consumers. In their study of
the Uruguayan beef industry, the
authors show how reliance on a tradi-
tional grass-fed production system
has given the country’s producers an
advantage at meeting the growing
demand for natural beef. After all, it
is easier to adopt a certification sys-
tem for natural beef when all cattle in
the country are grass fed. In this case,
country-of-origin labeling of U.S.
beef could work in favor of Uru-
guayan beef producers. The Uru-
guayans could then differentiate their
beef, raised in pastures, without the
use of antibiotics and growth-promo-
tants, from U.S. beef, finished with
50,000 other animals in large feed-
lots. This is yet another example of
the complexity of decisions and their
effects, both intended and unin-
tended, in global supply networks.
The guest editors would like to
acknowledge the suggestions of the
anonymous reviewers and the assis-
tance of Roxanne Clemens and San-
dra Clarke in preparing the articles
for this theme issue. 
Bruce A. Babcock (babcock
@iastate.edu) is Professor of Econom-
ics and Director of the Center for
Agricultural and Rural Development,
and Helen H. Jensen (hhjensen
@iastate.edu) is Professor of Econom-
ics and Head of the Food and Nutri-
tion Policy Division, Center for Agri-
cultural and Rural Development,
Iowa State University, Ames, IA.

Overview: Globalizing Food Chains: Producer, Company, and Policy Responses

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