US Dairy Industry Claims Cheese Sector Would Crumble Over EU Geographical Indications Policy

13 Oct 2016 --- The US dairy industry is challenging its European counterparts over the naming rights of certain cheese and the geographical indications policy surrounding common cheese names. The European farm policy agenda is focused on using geographical indications (GIs) to give European food producers a commercial advantage and would force farmers and food producers outside of Europe to rebrand familiar foods with unfamiliar names, according to the International Dairy Foods Association (IDFA). 

The naming of certain cheese has become a bone of contention in negotiations with the European Union on the Transatlantic Trade and Investment Partnership, as the European Commission argues for greater protection of certain foods. It wants more protection for producers of cheese such as Parmigiano Reggiano and Feta, claiming that foreign imitations should not be allowed to use generic names like “Parmesan” and should be distinguished by using a different name making it clear to the consumer exactly where they originate.

While the EU argues this is only fair for European producers and is advocating extending GI protections beyond a small number of speciality foods to cover many other food names, the US has different ideas. Three US dairy trade associations have released economic analysis to back up their argument that there will be dramatic negative effects on American dairy farmers and consumers if this goes ahead. 

The 60-page analysis was commissioned by the Consortium for Common Food Names (CCFN), an international alliance of companies and organizations dedicated to preserving the right to use common food terms. It was conducted by Informa Economics IEG and unveiled jointly by CCFN and the three major U.S. dairy trade associations: the National Milk Producers Federation, the US Dairy Export Council and the International Dairy Foods Association. 

Speaking to FoodIngredientsFirst, secretary general of the European Dairy Association, Alexander Anton, says the new US report is making assumptions. 

“Agriculture is more than an important business sector in Europe, it is part of our society. Food is more than nutrition in Europe, it’s about health, pleasure and culture. The quality policy of the European Union translates the culinary treasures of Europe and beyond and our cultural heritage in protected geographical indications. There are, by the way, quite some food specialities from other continents protected via our European quality scheme,” he says. 
 
“The US study seems to be based on the strange assumption that the US dairy industry would stop the production of hard cheese or brined cheese only because the geographical indications like Grana Padano or Feta are reserved for a quality product that stands for a unique cheese making tradition and a unique quality - both clearly linked to the origin of the cheese.”

“In the contrary, the EU production of (excellent) hard cheese has grown in Europe outside the restricted Grana Padano or Parmesan production area since the quality scheme has been introduced in the Union. And those hard cheeses do not need to take over a wrong identity to have success on the market.”

“We were happy to have US Secretary of State John Kerry ten days ago in Brussels, where he clearly pointed out that the US has ‘great respect for geographically identified goods like Champagne’. ‘Quality goods that are identified by their geographical location will remain quality goods that people will always want to seek for what they represent’, Secretary of State John Kerry stated,” adds Anton. 

The main claims of the new report include how at today’s prices, the decline in US cheese consumption due to the loss of common food names could amount to US$2 billion in lost sales over a three year period and up to US$5.2 in a decade. 

The analysis claims a change in naming policy could push dairy farm balance sheets “below the break-even point” and force many out of the sector completely. 

“Europe’s continued expansion of geographical indications in ways that protect terms long considered generic upends the entire concept of GIs,” said Tom Suber, president of USDEC, which represents the interests of dairy producers and processors in global trade. “Instead of protecting the names of a few specialty foods linked to specific areas, the EU uses GIs to eliminate competition for its producers.”

“The damage Europe’s GI agenda could do to the US dairy industry is severe,” added Jim Mulhern, president and CEO of NMPF, which represents dairy producers and cooperatives. “By 2025, our dairy farmers would lose up to 15 percent of their income and the US dairy herd would shrink by up to 9 percent, or 850,000 cows. Thousands of dairy farmers would be forced out of business.”

However, the European side has different ideas and is looking at the cheese naming policy in terms of offering greater benefits for producers, particularly in Italy, France and Greece, as geographical indications can help create a selling point for specialty food products. The US, on the other hand, claims names like Parmesan and feta are generic and forcing American producers to change would unbalance the market, create an advantage and confuse consumers. 

“Under Europe’s GI policies, US manufacturers would face a choice of abandoning markets for cheeses like feta and parmesan or selling them under names like ‘crumbly white cheese’ or ‘hard grated cheese,’” said Connie Tipton, president and CEO of IDFA, which represents dairy processors domestically and internationally. “It’s not hard to imagine the problems those name changes would create and this report finally quantifies those impacts.”

by Gaynor Selby