Non-G.M.O. agriculture
Companies investing in non-G.M.O. food and beverage product development generally move away from flexible and efficient commoditized agricultural supply chains to identity-preserved programs.

Choosing to go non-G.M.O.

There are several factors to consider before going non-G.M.O.

“Considerations include consistent supply availability, the price premium for the raw ingredients, particular brand positioning and whether the target consumers will be willing to pay a premium, in instances when the increased cost is passed on,” Ms. Chittkusol said.

Though sourcing organic is more challenging than non-G.M.O., it is still not easy. For example, about 92% of all corn planted in the United States in 2016 was genetically modified, according to the U.S.D.A. The figure was 73% in 2007 and a mere 25% in 2000.

“The combined effect of reduced supply of non-G.M.O. raw material and consumers’ heightened interest may continue to drive demand for non-G.M.O. ingredients in the industry,” Ms. Naeini said. “What is crucial to the success of non-G.M.O. procurement is supplier reliability. Robust traceability and identity-preservations systems are vital to reliable non-G.M.O. ingredient supply.”

Mr. Giroux said, “From a supply chain perspective, companies generally move away from highly flexible and efficient commoditized agricultural supply chains to an identity-preserved program. This increases the risk of potential volume or supply disruptions, can remove transparent price discovery opportunities and requires significant upfront forecasting and planning to meet supply needs.”

Food manufacturers must also recognize they may be required to trade sustainability goals to move to non-G.M.O. supply chains.

“From a sustainability perspective, non-G.M.O. agronomics have been shown to negatively impact several sustainability metrics, including greenhouse gas emissions, environmental impacts and soil biodiversity,” Mr. Giroux said. “The price for non-G.M.O. ingredients can also be significantly higher due to the costs to administer a specialty non-G.M.O. identity-preserved supply chain. If those costs cannot flow through to a consumer willing to pay more, these are likely added costs to food manufacturers.”

Lea Buerman, food safety, quality and regulatory manager at Cargill, said, “Across the industry, we see suppliers working to increase their non-G.M.O. ingredient offerings. At Cargill, we are fortunate to have long-standing relationships with many farmers, enabling us to produce ingredients that meet stringent non-G.M.O. standards.”

Many of Ingredion’s functional starches, flours and sweeteners are also now non-G.M.O., and the company’s portfolio continues to grow. The company’s Indianapolis facility has been dedicated to processing non-G.M.O. corn since 1997. And since 2004, Ingredion’s established identity preservation and traceability program has protected non-G.M.O. purity via global, third-party-audited best practices for segregation and documentation of non-G.M.O. corn.

“Procedures for growers — regarding seed, farm practices and production fields — are strictly enforced and audited according to established protocols,” Ms. Naeini said. “Using identifiers for each grower, we can trace any batch of starch back to the farmers who grew the corn, the fields on which the corn was grown and the seed varieties and lots used.”

Much like with organic ingredients, non-G.M.O. ingredient sourcing requires forecasting. This comes with risk for growers, suppliers and manufacturers. After all, crops are living systems that are at the mercy of the environment.

“Because of the extended supply chain, the commitment to the non-G.M.O. volume is done many months ahead of filling in customer orders, which creates business risks,” Mr. Azmy said. “If the non-G.M.O. demand is overestimated, then there will be financial loss of premiums.”

DuPont has committed resources focusing on the supply chain to make sure it gets as close as possible to its target non-G.M.O. ingredient volume. This is the result of operating a global non-G.M.O. program for 20 years.

“It allowed us to fine-tune the program to not only meet customers’ demands, but to also educate and support our customers in building their non-G.M.O. process and responding to information by their customers or regulators,” Mr. Azmy said. “Almost anything can be available as non-G.M.O. if you pay enough premium for it. The question a manufacturer must ask is if this is a sustainable business model, especially with the more challenging ingredients where not only cost is a factor but also adequate volumes to meet business plans.”

Manufacturers who are on the fence about going non-G.M.O. need to focus on their brand and their customers.

“If the consumer need is there, then absolutely you can afford to make the switch,” Ms. Doran said. “Stay true to your brand and your core consumers.”