Thursday, October 18, 2012

Fat Profits

At global level, the number of overweight people (around 1.5 billion, of whom 500 million are obese) is now greater than the number suffering from malnutrition.

Obesity is now so widespread that the problems it causes (depression, discrimination, health risks, loss of productivity) have become a concern to all of society. Obesity kills 200,000 people a year, which puts it behind tobacco (over 400,000 a year) but well ahead of alcohol and road accidents: it is now the second biggest cause of avoidable deaths in the US. Treating obesity-related illnesses (type 2 diabetes, cardio-vascular disease, high blood pressure, pulmonary embolisms, high cholesterol, cancer) costs 10% of all medical care spending in the US. Processed food has made Americans grow fatter over the past 40 years. US has five times more fast food outlets than supermarkets, this trend has contributed to obesity. In Mexico 30% of adults are obese, in South Africa 18.1% and in Brazil 13.9%. Even India and China are affected. In India, the average rate among adults is 15% — more women than men — with peaks of 30% and 40% in cities.  In China, 31% of adults are classed as overweight and 12% as obese. 6-10 million adult Chinese become obese each year. In the poorest countries, huge wealth gaps, and gaps between city- and country-dwellers, have led to a double nutritional problem: food is scarce and expensive in the countryside, and many smallholders are undernourished; in the cities, where there is an abundance of industrial food, the new "middle classes" are adopting a high-calorie diet. In Niger, 30% of people in cities are over the recommended weight, while 20% of those in the countryside suffer from malnutrition. In Namibia, the ratios are 40% and 18%. In Egypt, 12% of children are stunted but have obese mothers. Being fat is a sign of success and good health.

The American way of life, based on the cult of consumption, encourages physical inactivity, thanks to lifts, escalators, remote controls, automatic garden-watering systems, vacuum cleaners, washer-dryers and electric tin openers and carving knives.  American sub-urban life encourages ever-greater use of cars. Americans spend over 10 hours a week in their cars. Every hour of the day spent in a car increases the risk of obesity by 6%. Americans spend 40 hours a week in front of a screen (TV, computer or game).  Cars, televisions and washing machines are encouraging a sedentary lifestyle.

Between 1990 and 2010 more than 116,000 new products appeared on US supermarket shelves. The beverage aisle illustrates the inventiveness of this “product diversification” — energy drinks in bright colours, sold in packs of six sachets in a cool bag or in decorated cans; soft drinks in ever more flavours, including many varieties of Coca-Cola (sugar-free, caffeine-free, cherry, lemon, lime or vanilla); fruit juices, with or without bits, organic or with “fruit extracts”. It has been a highly effective strategy: every year, the average American consumes 178 litres of soft drinks, compared to 85 litres in 1970 and 135 litres in 1980.

Manufacturers have also targeted new customers. The poor, whose purchasing power rose with economic growth during the post-war decades, have become the ideal target. Fresh food used to be expensive in the US, and the working class had difficulty affording a proper diet. Then agricultural mechanisation and industrial production made food plentiful. Its relative price started to fall, but not at the same rate for all products.

The sophistication of packaging, storage and distribution techniques means that high-calorie processed foods now cost less than fresh foods rich in nutrients (minerals and vitamins): a dollar’s worth of potato crisps is more filling than a dollar’s worth of carrots. If Americans followed government dietary advice to eat more potassium, calcium and vitamin D, and less saturated fat and added sugar and salt (found mostly in processed foods), they would have to spend an extra $400 a year. The poor, being price-conscious, consume more foods that are ultra-high in calories and low in nutritional value, and are more likely to suffer from obesity. The highest ratios of overweight and obese people are found in poor states with large Hispanic and Afro-American minorities.

Actual food now accounts for such a small proportion of the price of a product as compared to packaging, marketing and design that it has become more profitable to sell larger portions. At Walmart, a 321g bag of chocolate-coated peanut and caramel candy bars costs $3.58, while a 1,100g bag costs $8.98, nearly four times as much product for less than three times the cost. Many customers will choose the larger pack. It’s cheaper to buy milk by the gallon, potato crisps in a family-size bag. This might seem a good thing — not only cheaper but kinder to the environment — but “there is something about our psychology that makes us eat more if it’s put in front of us,” says nutritionist Marion Nestle. Well aware of human psychology, the fast food chains have introduced “supersizing”. For a few dollars more (giving the impression of a bargain), customers can “supersize” their menu: a bigger drink, an extra burger in their bun or a double portion of fries. Forty years ago, the only size of drink at McDonald’s was 20cl; now the smallest cup holds 35cl and the largest nearly a litre.

Children are a prime target for advertisers and the average American child sees 25,000 TV adverts a year, more than 5,000 relating to food  Over the last few years, the federal government has introduced labels that show the nutritional content of food products, and banned soft drinks machines from schools. State and municipal governments, too, have been adopting stricter legislation. Following the example set by California, Maine and Oregon, New Jersey has, since 2010, required fast food retailers to show how many calories their products contain. In May 2012 the city of New York banned the sale of supersized soft drinks in restaurants, cinemas and sports stadiums. Coca-Cola cited the adoption of stricter legislation as one of the factors that could affect its future profits. Coca-Cola is worried that “obesity and other health concerns may reduce demand for some of our products.” To secure their future, the multinationals are turning to new markets, which are less regulated. The fast food chains are applying techniques learned in the US and Europe to the emerging markets. All they have to do is nod to local culture. In India, adverts feature Bollywood stars and cricketers instead of Hollywood stars and baseball players. At McDonald’s, the Big Mac, unsuitable because 80% of the population are Hindus and don’t eat beef, has been replaced by the Chicken Maharaja Mac. At Domino’s Pizza, pepperoni and ground beef has been replaced by paprika and goat’s meat. National restaurant chains (Moti Mahal, Nathu’s Sweets, Sagar Ratna) compete with US fast food giants for share of a market that is growing by 25-30% a year. In 2011 Yum! Brands — which owns KFC, Taco Bell and Pizza sHut — announced that it planned to open 1,000 new restaurants in India by 2015. In China, it hopes to open as many as 20,000 restaurants over the next few years.

Adapted from here

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