Moscow to Mark GM-Free Foods (25/6/2007)

Moscow to Mark GM-Free Foods
By James Kilner
Reuters, June 25 2007

Moscow will introduce a citywide label to identify GM-free foods next week, a move environmentalists hail as ground-breaking but that foreign producers say is complex and costly.

A handful of individual food producers around the world already use labels certifying their food is free of genetically modified elements -- but this is the first large-scale political effort to introduce such a system, Greenpeace said, expecting it to be watched by others as a test-case.

"These labels are important for consumers so they know which companies keep a tight control on ingredients in their products," said Greenpeace's GM researcher in Russia, Natalya Olefirenko.

After an official -- voluntary -- inspection, producers will have the right to carry Moscow's GM-free label for a year.

The European Union already insists products that contain more than 0.9 percent of GM-enhanced ingredients must say so on the packaging, but environmentalists argue that does not go far enough.

"It's very important for the rest of the world to watch Moscow," Olefirenko said.

Greenpeace estimates around 80 percent of Russian produce contains no genetically enhanced [!] ingredients, in line with other developing countries, compared to only about 20 percent in the EU and richer countries.

But Greenpeace said parts of the EU could follow Moscow's lead if it is a success, although the label should remain voluntary.

Foreign food producers say that is just one of the problems the label brings.

Supermarkets eager to curry favor with the Moscow city government have hinted they will only stock products carrying the GM-free label -- and signals from the authorities suggest the label will effectively be obligatory, producer lobby groups said.

"And it's all extra costs," said Alexei Popovichev, head of Rusbrand, which represents big Western producers such as Nestle and Kraft. "It involves special testing, special packaging, and the costs will be passed on to the consumer."

Small domestic producers will probably feel the burden of the extra costs hardest as they will not be able to spread them through economies of scale, he said.

Western businesses also argue the GM-free label could mislead customers into buying poorer products because the assertion that foods contain no GM-ingredients could be misread as a signal that all the ingredients are of high-quality.

Greenpeace does warn there is a potential flaw in the Moscow GM label, saying the testing system chosen by Moscow is untried even though it says more than $2 million has already been spent buying equipment for laboratories owned by a Moscow businessman.

The project, an initiative of Mayor Yury Luzhkov, comes to a city where environmental concerns are not typically high: traffic chokes Moscow's roads, residents throw out garbage with scant regard for recycling, and the centrally controlled heating grinds out warmth during even the mildest winter.

Russia lags behind in the growing multimillion-dollar organic food industry -- Moscow has just one self-styled organic supermarket, Grunwald, tucked away under an 18-story concrete apartment block on 30/1 Rublyovskoye Shosse, near the Molodezhanaya metro station. The store was founded by Nikolai Tsvetkov, president of UralSib Financial Corp.

Foreigners and wealthy Russians who live in nearby gated communities and dachas form the bulk of the customers, said Marina Goldinberg, the supermarket's marketing manager.

All the products in the store -- and everything is foreign -- have been certified to be GM-free.

On a weekday mid-afternoon visit the handful of middle-aged women browsing the displays wore designer sunglasses on their heads and the latest fashion from London and Paris.

They inspected GM-free apples from Argentina, which cost around 325 rubles ($12.50) per kilogram, and wild salmon from Sweden at 2,080 rubles ($80) per kilogram.

"When this new law comes in we will stock locally grown and produced food, prices will drop, and more and more people will shop here," Goldinberg said.

Dmitry Yanin, head of consumer group KonFOP, said research appears to suggest GM-free produce is not a priority for most Russians.

He said research last year showed 60 percent of food buyers said price was the most important factor in choosing what to buy.

Just over 5 percent picked ingredients.

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