Thursday, March 18, 2010

What does banning trans fats mean for the agricultural industry?

You may have heard news recently about the harmfulness of consuming too much trans fat. To combat this, California has implemented a ban on trans fats in all foods. All oils, margarines, and shortenings used in cooking must contain less than 0.5% trans fat per serving. If a restaurant is caught using trans fats, they can face fines up to $1,000. This law took effect on January 1, 2010 and is similar to bans in parts of Maryland, New York City, and Philadelphia.

I will assume that most consumers would want harmful fats removed from their foods, but what affect does this ban have on the agricultural industry? The biggest concern is obviously cost. Trans fats are used in foods because they are cheap. By banning cheap raw goods, food producers will have to use more expensive oils and therefore pass the cost increases onto to the consumers. Since this ban only began 3 months ago, I haven’t been able to find any data from food producers on cost increases and therefore cannot provide statistical information in this post. I am more so trying to alert food producers of a possible ban in their city or state and I am also looking for feedback from agricultural entrepreneurs about how this ban has already or would in the future affect their business.

Questions for agricultural entrepreneurs
If this ban spreads to your city or state, how will this affect your costs/sales/profits? Would changing the type of oil you use alter the taste of your food product?

For consumers
If the ban reaches your city or state, are you concerned about paying more money for foods affected by the ban? Do you think that other consumers might get a false sense that foods labeled as “trans fat free” are healthy?

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