Millions of Americans suffer from foodborne illness each year. Michael Batz, head of food safety programs at the University of Florida’s Emerging Pathogens Institute, calculates the cost of salmonella-contaminated eggs at $370 million a year. Salmonellosis is an infection that causes diarrhea, fever and stomach cramps. Batz factors in missed work, medical bills, victims’ assessments of how their illness harmed them (called “quality-adjusted life”) and premature deaths. The non-monetary loss is also substantial. An estimated 115,000 people suffer this type of food poisoning each year, resulting in 42 fatalities, according to his estimates.
Spending two-tenths of a penny per dozen eggs to protect consumers may not sound like much, but it adds up in an industry that produces 90 billion eggs each year. It’s an example of the costbenefit calculation companies make as they consider implementing new food safety measures.
Profits for egg farmers are small. And with lax regulations, some producers cut corners rather than invest in sanitation. Consumers, meanwhile, have little information about who supplies the eggs stacked in their grocery store coolers.
New federal rules, based on the Pennsylvania program, are the first safety measures required of egg producers. The rules, which went into effect in July 2010 for large producers (about 80 percent of the industry), followed a decades-long discussion that began after the Centers for Disease Control and Prevention first traced salmonella to eggs in 1986.
FDA funding in peril
The new federal rules initially specified that the Food and Drug Administration would inspect egg farms annually, but that was later reduced to once every three years. When inspections began in September 2010, the FDA announced it would visit 600 facilities by January 2012. Only 35 farms were reviewed in the first four months because, the FDA said, the agency initially targeted only the highest-risk farms with histories of violations, requiring intensive, time-consuming inspections. At that rate, initial inspections won’t conclude until the end of 2014, nearly three years behind schedule. The FDA declined to say how many inspections have been completed since the first four months, but an FDA spokeswoman said the program was on pace to meet the deadline.
Nor have reports been filed on all of the completed inspections. Twelve of 35 reports are unfinished because inspectors were called away to cover outbreaks associated with sprouts and cheese, according to the FDA’s Web site.
Now, some members of Congress want to cut the FDA’s funding.
“The major reason food is safe in America isn’t because of government. It’s because the private sector does a huge job of self-policing,” said Rep. Jack Kingston (R-Ga.), who leads the House Appropriations subcommittee that oversees funding for the FDA.
Sarah Klein, staff attorney for the consumer-oriented Center for Science in the Public Interest, disagrees. “Forty-eight million Americans get food poisoning every year,” she said. “It’s disingenuous to say . . . policies that allow industry to police itself without oversight from the government are effective.”
Expenses and profits
Thin profit margins make investing in safety difficult, farmers say. The higher safety rules mean even thinner profits.
“When I worked for an egg company, we had to take things out to the fourth decimal place to see if we were making a profit or loss,” said Paul Hostetter, who now works for the nonprofit PennAg Industries Association and helps Pennsylvania egg producers comply with sanitation guidelines.
Pennsylvania’s safety efforts began in the early 1990s, after eggs from that state were linked to widespread salmonella contamination in New York. Faced with the possibility of losing their largest market, Pennsylvania egg farmers began a quality assurance pilot program.
Iowa, the source of last year’s massive egg recall, is the largest egg-producing state, turning out 14 billion eggs annually. A quality assurance effort there had gone inactive in recent years.
The FDA estimates that the new federal rules, which are slightly more rigorous than the Pennsylvania standards, will cost large egg producers $100,000 each year. That means the 175 biggest companies, which constitute 95 percent of the industry, together will spend about $20 million annually to comply. That’s a fraction of the $370 million that Batz calculates as the annual cost of egg-related salmonellosis.
Even so, egg producers interested in keeping their costs down may not see the potential savings to consumers as an incentive to pay for better sanitation. At the grocery store, customers still won’t know whether the eggs they are buying come from sanitary farms.
Many “don’t want to unduly burden themselves with preventive measures that are costly,” Klein said. “Especially when they believe the chances of causing an outbreak — or having an outbreak traced to them — are small.”
High price for offenses
In the event that an illness is traced to its source, the offending farmer pays a considerable price. For example, Wright County Egg, the larger of the two major Iowa producers responsible for the 2010 recall, was shut down for four months last year. Both farms face numerous lawsuits over the contamination.
“There’s that risk assessment of the cost of complying versus the cost of getting caught,” said Daniel Otto, an economist at Iowa State University. “You have to have commensurate penalties and a high probability of detection and enforcement” for the new regulation to be effective.
Wright County Egg, one of several egg farms and related businesses owned and operated by Austin DeCoster and his family, produces about 1.4 billion eggs each year, or more than one of every 100 eggs in the country. In a 2003 article about his businesses, which have frequently been fined for health and safety violations, the Omaha World-Herald estimated his annual profit at $13.3 million.
When inspectors checked Wright County Egg’s barns after last year’s salmonella outbreak, they reported finding uncontained mountains of chicken manure; feces in the hens’ food supply; rodents; and maggots and flies “too numerous to count.”
In testimony before Congress in September 2010, his son Peter said the salmonella contamination had probably come from the feed used on his family’s farms, not the conditions of the farms. Peter DeCoster did not return several calls seeking comment for this article.
This article was produced as part of the Knight-Carnegie News21 program, a national university reporting project headquartered at the Walter Cronkite School of Journalism and Mass Communication at Arizona State University.