Would Banning the Use of Non-therapeutic Antibiotics in Beef Production

Under current food-animal production practices in the The states, antibiotics are used to care for specific health problems (therapeutic use) and to improve animate being performance (subtherapeutic use), as discussed in earlier chapters. Used subtherapeutically, antibiotics upshot in enhanced growth rates and improved feed efficiency, thereby contributing to lower costs of meat and eggs. However, this practice also is associated with the development of antibiotic-resistant strains of leaner that contribute to the presence of drug-resistant pathogens in humans, as discussed in Chapters iii and 6.

It is oftentimes suggested that, because of the resistance event, subtherapeutic use of antibiotics should be banned. The primary arguments against a ban are that information technology would crusade an economic hardship for livestock and poultry producers and enhance costs for consumers. In large part, subtherapeutic feeding of antibody drugs is a management tool to prevent infection and to facilitate the use of confinement housing. This practise allows larger numbers of animals to exist maintained in a healthy state and at a lower cost per unit to the farmer. If subtherapeutic apply of antibiotic agents were eliminated, these product advantages would exist reduced or lost and consumers would pay more.

To gauge the price to consumers of eliminating the subtherapeutic employ of antibiotics, the Committee on Drug Use in Food Animals conducted an economic analysis. Under current production practices in the United States, it is difficult to quantify either the probability that subtherapeutic drug use results in human health problems, or the economical value of the current and potential stock of antibiotics. The role of economical analysis is limited to measuring the benefits of subtherapeutic drug use to producers or, alternatively, to identifying the costs incurred if electric current use of subtherapeutic drugs were prohibited. Ideally, the costs associated with a ban should be compared with the benefits to consumers (valued as the benefits from reduced health problems). Because of the difficulty in measuring economic benefits, only the costs are addressed here. The estimated cost measures can be compared among themselves to elucidate the sensitivity of the results to various assumptions and to provide an understanding of the magnitude of the costs.

CONSIDERATIONS IN DETERMINING THE EFFECT OF A BAN

The all-time way to make up one's mind the economical benefits of subtherapeutic antibiotics is to examine what would occur if the U.S. Food and Drug Administration were to prohibit all forms of subtherapeutic drug use. To make this estimate, several areas must be considered.

Definition of Subtherapeutic Utilise

If regulators were to decide to limit subtherapeutic drug use, it would become essential to define the difference betwixt therapeutic and subtherapeutic uses more accurately. For a detailed word of the dissimilar uses, meet Affiliate 2 and Hays and Blackness (1989). The current practise of incorporating antibiotics in beef cattle diets in the feedlot is washed to foreclose liver abscesses and the diseases associated with the stress of moving and commingling animals. Under current regulations, there is little incentive to make up one's mind whether such feeding is therapeutic or subtherapeutic, and an argument can be made for either definition. Such feeding is therapeutic in that the incidence of liver abscesses and stress-related diseases would be higher if the drugs were withdrawn. If the symptoms appear afterward drug withdrawal, the drugs can be used therapeutically. However, a strict interpretation of therapeutic use is to treat a symptom, and if antibiotics are used to prevent a symptom, they are used prophylactically. The argument over definitions is more than one of semantics. The unabridged beefiness-feeding manufacture would be exempt from any ban if the commencement definition were practical. In the analysis, the strict definition is used, because many of the benefits of subtherapeutic employ in poultry and pork industries could also be described every bit treating symptoms before they develop (that is, earlier subclinical bug become clinical). This issue is important considering it implies that one time a subtherapeutic-use ban were in place, at that place would exist strong incentives to restrict therapeutic utilise.

Measurement Choice

The first effect of whatever ban on subtherapeutic employ of antibiotics would be felt in the animate being wellness manufacture. In 1995, this industry generated $three.three billion in sales. In the same year, the human health pharmaceutical industry produced approximately $63 billion in sales. Approximately 62 pct of all fauna wellness products marketed in the United states of america are used in nutrient-animal production; 38 percent of those products are classified as feed additives and include antibiotics; antibacterial drugs such as sulfonamides, nitrofurans, arsenical compounds, anthelmintics, and coccidiostats; and other pharmaceutical agents such every bit ionophores, melengesterol acetate, antioxidants, mold inhibitors, probiotics, and nonantibacterial growth promoters (Richard Carneval, AHI, personal communication 1996). The animal health industry, if asked, could not estimate the reduction in sales it would suffer nor estimate the changes in employment and profits that would occur.

An alternative economical measure would exist to enumerate the consequences for farm profits and farm costs. Approximately 100 percent of chickens and turkeys, ninety percent of swine and veal calves, and 60 per centum of beef cattle receive diets containing antibiotic drugs during some part of their lives (Manchanda 1994). Thus, it is obvious that most producers notice these products useful. I study estimated that subtherapeutic drugs saved the U.South. hog industry approximately $2 billion in annual production costs (Wade and Barkley 1992). Notwithstanding, changes in production costs would non necessarily translate directly into lower profits. Beginning, the price of the drugs themselves must be considered. For average producers, that amounts to about 3.75 per centum of full ration costs, or about 50 percent of the value of the compounds to fauna producers (Beran 1987). Second, not all producers rely on these compounds to the same extent. Subtherapeutic antibiotics are well-nigh effective in animals under the stress of inadequate nutrition and suboptimal sanitation (Braude et al. 1953). That means the incentive to use these compounds decreases every bit management practices amend. For example, pork producers who launder hoghouses every time a group of pigs is moved and who move piglets to off-site growing facilities can reduce their reliance on antibiotics (Punch et al. 1992).

Thus, producers who practice good management would not be as profoundly affected by a ban as producers who practice not. This raises the interesting possibility that a ban on subtherapeutic drug use would really upshot in an economic incentive to improve animal care and could result in a more than efficient industry in the long term. All the same, the procedure required to reach that signal would exist painful for those producers forced out of business.

Because some producers might really benefit from a ban on subtherapeutic drug use, the estimate of costs to a typical producer could exist misleading. Examples of this tin can be seen in the successes of specialty producers such every bit Colemon Natural Beefiness in Colorado (NRC 1989a). Colemon beef, raised without antibiotic treatments or exogenous growth promoters, costs approximately 25 percent more than conventional beef. Colemon beefiness is produced for a specific niche market, and farmers laissez passer on the increased production costs to the consumer.

A more than feasible alternative to toll estimating would be to measure costs to consumers in terms of the college prices they would pay for meats. This culling has the reward of existence reasonably representative across all consumer groups. The dollar value expressed on a per capita or per family basis is readily understandable: It is a number anyone tin can put into perspective. Using a consumer measure besides makes sense from an economic perspective, considering all changes in production costs must somewhen be passed on in output prices in a competitive industry. The effects of a ban on subtherapeutic drug utilise might demand to exist outset by technological improvements to obtain equal levels of product. Therefore, costs would increase and meat prices would be higher than they were before the ban.

Viable Antibiotic Substitutes

The studies referenced to a higher place presume a worst case, in which the effects of a ban on production are exactly equal to the known production benefits of subtherapeutic utilize. The rationale for this supposition was suggested in the CAST (1981) written report: "Probably most of the economists did not know all the administrative and technical alternatives but expected that the socially optimum restriction would be less than complete emptying. The analyses reviewed did not try to design a socially optimum partial brake." (P. 39)

A more than reasonable assumption would be that the responses of drug companies and the producers cannot be predicted just that some response will occur. As mentioned elsewhere in the Bandage study, the response could take the form of dissimilar management practices, new products, or even genetic pick. Thus, in a different scenario, just 50 pct of the estimated effect on product is incorporated. (The worst instance contains the entire production issue.)

The issue of substitutes for subtherapeutic drug utilise as well gives rise to the question of whether some producers would buy antibiotics legally merely add them illegally to the feed or water. If that occurs on a widespread basis, there would be little result on output or prices, because illegal utilize would substitute for legal use. Again, the extent of such activity cannot be predicted, but it should be noted that the incentive to violate the ban would exist enormous every bit long equally therapeutic antibiotics were sold without prescription. The issue could become critically important if widespread violations forced a ban on over-the-counter sales of antibiotics. Banning subtherapeutic utilise of antibiotics without regulating therapeutic utilise might be impossible. Any attempt to regulate therapeutic utilize would increase production costs for the U.S. beef and pork industries, because veterinary visits would be required for each diagnosis and prescription. The costs of a ban on over-the-counter sales of antibiotics would possibly be greater than would exist the costs of a ban on subtherapeutic drug use.

Total versus Partial Ban

As has become clear in the fence on fluoroquinolone use in animals, whatsoever new antibiotics approved for human use volition be too expensive for subtherapeutic use in animals. That is an elegant example of the market at work. New antibiotics are pharmacologically valuable because homo pathogens accept get resistant to the old ones, and by comparison new drugs are quite expensive to manufacture and purchase. The old antibiotics are inexpensive, in part, considering they are less useful to humans and also because the manufacturing chemistry is simpler. To some extent, market forces volition deter the use of antibiotics in brute feed if human pathogens take not nonetheless developed resistance to these particular drugs. If regulators take that scenario, so the group of antibiotics in current use volition not be banned, and newer, more expensive ones will. In that case, the consequences of any ban would be minimal because they would occur only as animals develop increased resistance to older antibiotics. The rate at which microorganisms in food-brute populations go resistant to antibiotics is irksome because of the short lifespans and loftier turnover of these brute populations (Walton 1986). The food-animal industry could as well be expected to take additional steps to avert multiple-drug resistance as long every bit the manufacture knew that replacements would be hard to obtain. This market-driven solution has much to recommend it. Even so, the numbers presented in the economic assay assume that all subtherapeutic use is banned.

Consumer Beliefs

It has been argued that the best manner to measure the consequences of a subtherapeutic-utilise ban is at the consumer level. Because information is available at the producer level, some assumptions must be fabricated about how the actress costs would be passed on to consumers. Assumptions too must be made on the responses of consumers to higher prices and to any improvement or reduction in the quality of the meat. Attempts have been made in previous economic analyses to permit consumers to reply to higher prices by reducing consumption and to provide potential responses from retailers and meat processors (Allen and Burbee 1972; Dworkin 1976; Mann and Paulsen 1976; CAST 1981; Wade and Barkley 1992; Gilliam et al. 1993; FSIS 1995a; Part of Engineering science Assessment, Washington, D.C., unpublished material). To derive the effects of these responses, estimates of consumer–need elasticity and producer–retail markups must be made. But such estimates are subjective and can vary widely amidst studies.

A more straightforward approach is to assume that all costs are passed on to consumers and so to mensurate how much consumers would need to spend to maintain consumption. This measure of consumer costs volition slightly overestimate the truthful price (past an amount that depends on how meat consumption is affected by prices), but it has the reward of non depending on elasticity estimates (see Layard and Walters, 1978, p. 147, Effigy five–9). If the effect of a ban were more severe, it might make more sense to build consumer response to higher prices and a production response to lower demand. This would require use of elasticity measures and would make the final results sensitive to these measures. There is no real consensus on the appropriate size of these elasticities, and, given the very small cost effect, the committee decided that the elasticity approach would raise more questions than information technology answered.

A 2nd consideration is whether consumers volition pay more than for meat that is produced without subtherapeutic antibiotics. In the two most recent studies on this topic (Wade and Barkley 1992; Manchanda 1994), information technology was assumed that consumption in the United states of america would increase by five percent in response to such a ban. This supposition seems hard to justify, considering no modify can exist expected in the concentrations of antibody residues. The incidence of drug residue violations cited earlier in this report is and then low that a ban on subtherapeutic drug use would exist unlikely to accept whatever detectable consequence (FSIS 1995a). Consequently, the committee concluded that the correct assumption would be that no modify in consumption (positive or negative) occurs. That supposition is equivalent to bold that the positive effect of improved meat quality exactly offsets the negative effect of higher meat prices.

A final function of this question is whether the marketing system itself would pass on the higher costs in terms of cost per pound or in terms of percentage toll change. The latter scenario is used in all the previous studies on this topic and implicitly assumes that meat processors and retailers increase their margins on a per-pound basis in response to increases in the prices they pay. This assumption is justified, in office, because the U.South. marketing system works on a per centum-markup ground. This convention is used in the results presented below.

RESULTS OF Economical Assay AND CONCLUSIONS

Based on the assumptions discussed above, the commission derived the estimated economical touch of a ban on subtherapeutic apply (Table vii–1). Per capita price is estimated as follows:

TABLE vii–one

Approximate Almanac Costs of a Ban on Subtherapeutic Antibiotic Use in Four Domestic Retail Markets.

Per capita Costs = %C × P × Q

Where %C is %increase in annual production cost, P is retail price, and Q is annual retail quantity sold per capita.

The commission'south decision is that the average annual per capita cost to consumers of a ban on subtherapeutic drug use is $4.84 to $ix.72. The effect of the ban is lowest for poultry prices and highest for beef. That cost seems small; however, assuming a U.S. population of 260 1000000, the total amounts to virtually $1.2 billion to $2.v billion per yr. Of course, the higher per capita cost ways depression-income consumers would spend an even larger proportion of their income on food than would high-income consumers. To decide whether the increment in cost is justified, the corporeality should be compared with estimated health benefits. Additional costs non included in Table seven–one are (1) a slight erosion in U.S. export competitiveness; (2) the personal and financial costs of producers forced out of business concern; (3) the lower profits and revenues of the companies that manufacture these compounds; and (4) the boosted costs that would occur in markets for eggs, dairy, and pet-food, which are non discussed here. The values in Tabular array 7–i too ignore the possibility that a subtherapeutic-utilise ban eventually would lead to restrictions on over-the-counter antibiotic sales.

In that location has not been whatsoever previous attempt in the literature to estimate the consequences of an economy-wide ban of subtherapeutic antibiotic use on consumers. Four studies have focused on the economic effects of a ban (Burpee et al. 1978; Wade and Barkley 1992; Gilliam et. al. 1993; Machanda 1994). Those studies present estimates of production cost increases of iv to 20 percentage. Only 2 of the studies (Wade and Barkley 1992; Machanda 1994) attempted to estimate the effect of such a ban on consumers. They were specific to the pork sector and both calculated retail price increases of $0.04 per pound, which is within the range of $0.03 to $0.06 shown in Table seven–ane.

A more hard task would exist to gauge the effect of such a ban on the development of new fauna drugs by the creature wellness industry. For instance, the creature wellness industry invested $381 million in research and development: $355 million was spent for internal research and $26 million was invested in external enquiry, primarily at universities. Seventeen percent of the total research and development investment was allocated to feed additives (Richard Carneval, AHI, 1996, personal communication). The reduction in profits and manufacture confidence that could occur later such a ban would crusade a reduction in research and society would lose the research benefits. Although that loss might well be one of the almost of import consequences of such a ban, it is incommunicable to put a budgetary value on future research, in function considering no one knows what drugs would be developed or approved. Considering a value cannot be placed on animal drug research, the associated costs are non discussed. That omission ways the numbers provided here underestimate the truthful costs of a ban.

APPENDIX

Technical Notes for Tabular array 7–one

Chicken Data

On the footing of personal communication with Jerry Sell (Iowa Country University, 1997), information technology was assumed that poultry feed conversion efficiency (FCE) changes from 1.85 tons of grain per ton of meat to ane.90 tons of grain per ton of meat, a 2.7 percent increase. This would represent a 1.76 percent increase in total product costs because feed represents 65 percent of producers' total costs. To calculate the expected result in the scenario without substitutes, this one.76 percent was multiplied past the 1997 retail price of chicken ( $one.46 per pound) to make it at price of 2.6 cents per pound. The scenario with substitutes is set equal to one-half of that value. The primal bespeak of this substitute scenario is that some exchange will inevitably occur and it will diminish the result of a ban. Because these substitutions will occur in the future, there is no authentic way to know what they or their likely magnitude will be. The committee used a value of half as a crude estimate of the likely effect of substitution.

Turkey Information

For turkeys FCE was assumed to change from 1.68 to 1.75 tons of feed per ton of meat, a four.2 percent increase. Feed was causeless to represent lxx percent of total product costs. The total toll increase was calculated at 2.94 pct. The 1997 turkey price of $1.05 per pound was so used to calculate a 3.1-cent-per-pound increase in the scenario without substitutes. The value with substitutes was arbitrarily causeless to exist half of that value.

Beef Data

Personal communications with Richard Cowman (nutrition expert at the National Cattlemen'southward Beef Clan, 1995) indicated that the consequence of a ban would exist an increase of $0.06 per pound in the price of beef. However, this expert did not consider that these particular uses stated were subtherapeutic, because the treatments were for preventing liver abscesses and stress-related diseases and, therefore, suggested a nada value. The retail price used was $2.fourscore per pound to derive a no-substitutes value of vi cents per pound. The scenario with substitutes was one-half of that value. The analysis assumes that simply 60 percentage of all beef animals are affected by such a ban.

Pork Data

The pork information are taken from the Pork Manufacture Handbook (1996). The data showed a change in FCE of half-dozen.5 per centum for the first 40 pounds of gain and a change of iii.18 percent for the remaining 145 pounds of proceeds.

The ration costs and FCE for young pigs were $150 per ton and 2.04, respectively. The values for fattening were $120 and 3.0, respectively. These four values were used to weigh the changes in feed conversions. The weights were calculated to be 4.3:i. Thus, the 6.v percent change in FCE in the starter ration came to approximately xix percent of total ration costs. The 3 percent modify was added to the remaining 81 pct. The total change in FCE was, therefore, calculated at 3.half-dozen percentage. Assuming that ration costs equal lxx percent of total production costs, the total change in retail prices represent a ii.five per centum increase. The retail price used for 1997 was $2.30 per pound to arrive at a 6-cent-per-pound increase in the scenario without substitutes.

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Source: https://www.ncbi.nlm.nih.gov/books/NBK232579/