Potential economic losses to the US corn industry from aflatoxin contamination

Mycotoxins, toxins produced by fungi that colonise food crops, can pose a heavy economic burden to the US corn industry. In terms of economic burden, aflatoxins are the most problematic mycotoxins in US agriculture. Estimates of their market impacts are important in determining the benefits of implementing mitigation strategies within the US corn industry, and the value of strategies to mitigate mycotoxin problems. Additionally, climate change may cause increases in aflatoxin contamination in corn, greatly affecting the economy of the US Midwest and all sectors in the United States and worldwide that rely upon its corn production. We propose two separate models for estimating the potential market loss to the corn industry from aflatoxin contamination, in the case of potential near-future climate scenarios (based on aflatoxin levels in Midwest corn in warm summers in the last decade). One model uses the probability of acceptance based on operating characteristic (OC) curves for aflatoxin sampling and testing, while the other employs partial equilibrium economic analysis, assuming no Type 1 or Type 2 errors, to estimate losses due to proportions of lots above the US Food and Drug Administration (USFDA) aflatoxin action levels. We estimate that aflatoxin contamination could cause losses to the corn industry ranging from US$52.1 million to US$1.68 billion annually in the United States, if climate change causes more regular aflatoxin contamination in the Corn Belt as was experienced in years such as 2012. The wide range represents the natural variability in aflatoxin contamination from year to year in US corn, with higher losses representative of warmer years.