What keeps your phone buzzing?
The answer can be your favourite person in the world.
What keeps the world buzzing?
The stunning media reports, perhaps.
Now, what does the media really buzz about?
The media watchdog has constantly been at the fore of everything in your vicinity, gauging the important trends to the utmost flaws in the government to as specific as your local municipality.
In this piece, we zoom into the controversies of food manufacturing firms that media has uncovered and caused a large scale impact on its brand value and logistics.
Food for thought from an MIT research team
Much of what we eat comes almost exclusively from other countries—like 80% of the honey you stir into your tea, and 90% of the shrimp in your cocktail. And more often than not, it’s coming from developing countries that lack the basic quality controls we have here at home. In 2015, the United States imported more than 40 million individual shipments of food. The Food and Drug Administration has the resources to check only a very small fraction of those shipments to ensure they do not have harmful bacteria, contaminants, or additives. “They have to rely on risk models to make decisions,” said Retsef Levi, a professor of operations management at MIT Sloan. “On the one hand, they can’t allow harmful stuff to penetrate our food supply. On the other hand, they can’t delay commercial activity. That’s a tension the FDA has to balance, and it’s a very demanding and challenging task.”
Three years ago, FDA officials engaged MIT in a contract to support and improve the risk management system of the FDA related to economically motivated food adulteration. A team led by Levi drew from MIT Sloan, the MIT Center for Biomedical Innovation, and across campus. With additional funding from MIT’s Abdul Latif Jameel World Water and Food Security Lab, the team has conducted a systematic study of how food is grown, processed, and shipped to the U.S.—and of the risks involved.
Now, even as the team makes its recommendations to the FDA, it’s delving deeper. In a new multiyear, multimillion dollar partnership with the Walmart Foundation, Levi and colleagues are launching a new study of supply chains in China, the world’s third largest food exporter. Recently, Levi explained the quest to protect our edible imports.
What’s risky about the way our global food supply chains work today?
There’s a continuum of risks. Food can become contaminated with bacteria, like listeria or salmonella. That’s typically the non-intentional scenario, and that happens when you don’t have good practices or are negligent. The other extreme is terror-motivated, when an organization or individual has malicious intent like putting anthrax into the food system. And in between, there’s the economically motivated scenario. That’s mostly about financial benefits of some sort rather than intentionally causing harm. The FDA—and governments around the globe—are worried about all of the above.
What did you discover?
Our research indicated that a key issue to understand is the risk related to the product category and its supply chain. We know that, for example, the melamine case was motivated by external pressure on the milk supply chain—regulatory pressure. In other cases, our research focused on poultry in China, and there, in response to outbreaks of avian flu, there was an increase in extensive use of antibiotics, antiviral, and herbal medicines to fight the outbreak. In the shrimp case, we’ve seen that a disease called early mortality syndrome killed shrimp in Asia. There was big outbreak in 2009, and in again 2013, that lead to increased use of antibiotics and other additives. All of these cases indicate that you might be able to assess whether risk is likely to increase if you understand what kind of socio-economic and environmental drivers could increase the level of risk. Our research gave rise to a much more comprehensive, holistic understanding of the risk factors of a product category.
In addition, you have to look within the product category. We were able to look at massive amounts of shipping data. We looked at bills of ladings—papers that shippers have to file with the weight of shipment, content—and used them to reconstruct the different layers of supply chains. That kind of info has pointed out companies that are more likely to be engaged in the adulteration of food. If you look at economically motivated adulteration, about intentionally doing something, people who are intentionally involved behave in similar patterns. We can pick up those patterns and signs.
What are some of the signs?
They might use a third-party country and cross in and out of borders. They tend to ship with a lower number of shipments, or maybe have many transient partners.
Even the very structure of a supply chain is predictive of risk. For example, in China you can have “dragon head” companies, which are large companies contracting with thousands of household farmers. Each farmer is going to bear a high level of risk. That’s a big issue in the sense that if they are under pressure, they are going to do whatever it takes, including engaging in bad practices, like giving chickens antibiotics or chemotherapy drugs. We have mapped in China well over 95 illegal drugs farmers are buying publicly and using. There are cases where one chicken had residuals of 19 types of antibiotics. We see similar phenomena in other farming supply chains and this is suggesting that the fundamental structure of the farming supply chain is a major risk factor.
Then there are the importers. In 2011, President Obama signed the FDA Food Safety Modernization Act. It aims to make the way food products are managed more similar to pharmaceuticals. In the past, importers dismissed responsibility; in the near future they will not able to get away with that. They will be held accountable to verify their supply chain. Our research indicates that that’s a key aspect of being able to manage risk.
How the factory churned out events?
In the recent timeline of events, issues in the food supply chain were spotted, followed by the banning of the product. But, the repercussion and settlement remained a blurred picture.
The spicy saga
In July last year, the Bhutan Agriculture and Food Regularity Authority had banned the import of chillies from India. The ban followed a laboratory test conducted by BAFRA, which found that all three varieties of chillies imported from India (hybrid, teransani and akashi) indicated the presence of chlorophenol – a pesticide classified as moderately toxic by the World Health Organisation. In addition to chillies, Bhutan’s Agriculture Minister Yeshey Dorji said that BAFRA banned the import of cauliflowers and beans from India for failing to meet food safety standards.
It didn’t take long for the price of chillies in Bhutan to shoot up. Local organic chillies, usually sold for up to Rs 900-Rs 1,500 per kilo, were being sold at Rs 2,900 a kilo. Imported chillies, which cost Rs 25 to 50 per kilo in the past, were now selling at Rs 500 per kilo.
With a population of over 700,000 people, Bhutan requires 1,527 metric tonnes of chillies during the winter months of December, January and February, as per the Agriculture Ministry’s official estimate. The total chillies consumed in a year is estimated at 2,291 metric tonnes.
While the farmers of Bhutan do produce chillies, this is not sufficient to feed the entire population. To produce the required quantity, the country will need to cultivate chillies on nearly 770 acres of land, which it cannot do at present. To manage the crisis, on December 4, the Ministry of Agriculture again began to import 20 metric tonnes of chillies from Kolkata.
The import from Kolkata, apparently met food safety standards, and was sold at the subsidized rate of Rs 50 per kilo. But even this was not enough – by now, the local demand for chillies had increased. People were hoarding chillies, local vegetable vendors had begun importing them secretly (but were caught by BAFRA officials). The media attention on the crisis of chillies grew, and soon, officials were photographed dumping large quantities of seized chillies.
Finally, during a monthly press meet in late December, Agriculture Minister Yeshey Dorji told journalists in Thimphu that the government would resume importing of chillies, at least until the country was able to produce enough to meet its own appetite.
“As a regularity authority, we are obligated by the Food Safety Act to ban food products with toxic levels of chemicals,” he said, when asked why the ban had been imposed in the first place. Tests on chillies from Falakata still showed toxic levels of chemical residue, agriculture officials said, but the demand was simply too high to ban them.
The local crop of chillies is expected to hit the markets only in early February 2017. Meanwhile, the government has launched a programme to boost vegetable production in the winter. At the press conference, Dorji assured people that by the next New Year, there will be no shortage of chillies in Bhutan. Most villagers like Zangmo are yet to be convinced.
An analysis of the dioxin food tainting scandal in Germany in late 2010 to early 2011, by researchers in Germany, Switzerland and Canada, combined reporting of the shopping habits and media consumption of more than 2,500 households from GfK Consumer Scan data with an extensive media survey from the period.
The dioxin scandal, where unsafe levels of the chemical were found in consumer chicken and pork products, after tainted animal feed entered the food chain in late 2010, was covered extensively by German media in 2011. The researchers analyzed this coverage to create a Food Scandal index for the period.
Irish Times in 2013
“When we began our authenticity survey of processed meat products in the Irish market last November no one could have foreseen that we would uncover an EU-wide food scandal.
The adulteration of products containing beef has resulted in numerous lines, including burgers, meat pies, pasta dishes, sauces and soup withdrawn from sale.
Our meat product survey was carried out against a background of increasing prices of raw materials used in food and feed manufacture, and the global sourcing of ingredients. This can lead to a temptation to cut corners. The longer the supply chain the higher the risk that something can go wrong, in this recent case it was the substitution of beef with horse meat.
As an enforcement authority we are familiar with calls from the food industry to reduce the regulatory burden and assertions that private sector standards are more rigorous than those of the public authorities.
Given that most of the food companies caught up in this scandal adhere to the private sector standards, this demonstrates that official regulations and standards need to continually evolve to be ahead of the curve to identify fraud in the food chain.
Many standards tend to focus on food safety and food hygiene, but clearly now they need to be strengthened to include food authenticity. For meat products this should include meat speciation and the use of DNA-based analytical techniques to test for animal species which may be present in raw ingredients.
Equally, claims that brands are a guarantee of quality and reliability have been deflated as a result of the horse meat scandal. Convoluted supply chains have done little to bolster confidence in traceability controls by manufacturers and suppliers. One of the positive outcomes of this issue will be routine DNA testing by the food sector and this will be beneficial to consumers.
The FSAI is now co-ordinating a monitoring programme to establish the prevalence of fraudulent practices in the marketing of processed meat products. We are also working closely with the Department of Agriculture in implementing a monitoring programme for the detection of phenylbutazone residues in horses in order to ensure that only appropriate products enter the food chain.
While the FSAI considers that there was not a serious food safety risk associated with our findings, it did show how effective our national food control system is in underpinning consumer confidence in the integrity of Irish food.
As people become further removed from the sources of their food supply, trust becomes the key ingredient for businesses. Hence, regaining it will require much change.”
How about the 2012 EFSA aim?
Rebuilding European consumers’s confidence in the supply chain is a key challenge facing the European Food Safety Authority (EFSA), according to its tenth anniversary report, which also sets out its achievements over the past decade.
In addition to “deepening public confidence in the food chain”, The European food safety watchdog faced three other challenges, being: strengthening the dialogue with risk managers, building the EU’s risk assessment community, and maintaining standards in times of economic austerity.
At Point Blank Range
Jayem Logistics determines a consequent loss of trucking capacity and revenue due to product elimination.
As the highly valued market products came under the scanner such as Coke, Pepsi, Nutella, Maggi, Cadbury, et al, another league competitor, Patanjali, strongly worded the authenticity of its ayurvedic products.
Now, a consumer will not purchase any chocolate spread brand due to the presence of carcinogenic palm oil, save butter; as the UK scientists call butter “fine”.
Well, India has seen Patanjali fighting for the rightful place of its herbal products, without palm oil. Baba Ramdev, a yoga teacher known for his work in Ayurveda, is running a campaign against excessive palm oil (around 30-40%) usage by MNCs. However, the U.S and U.K have banned palm oil.
Jayem agrees to a drop-in sales due to sudden ban over a product. Though, one product, which isn’t for mass consumption won’t have a great impact on the market supply-demand process.
In Nestle’s case, Maggi, one of their highest selling products was impacted, with a revenue loss running in crores. Its mammoth-sized supply capacity brought a dreadful loss in the logistics arena. Since some companies are majorly dependent on the high brand value product manufacturing firms, their core business has to bear the brunt of it.
After the NASA conspiracy (some or all elements of the Apollo program and the associated Moon landings were hoaxes staged by NASA with the aid of other organizations; the most notable claim being that the six manned landings (1969–72) were faked and that twelve Apollo astronauts did not actually walk on the Moon), it’s difficult to buy any first world manufacturing firm’s theory about their products and processes.
The problem doesn’t revolve only about the business, but has political inclinations too- for instance the former U.S president, Barack Obama firing higher management Russian authorities for hacking into the US government system for voting victory in Trump’s favour.
The U.S food and drug standard controlling associations function effectively, unlike India. Hence, we still have rampant circulation of Crocin and Disprin in India, whereas it’s banned in US.
Politicians simply fool people and extract benefits out of the business oriented firms. A high share of media reports and awareness play a role in influencing the government in taking an action regarding such issues, which has a relative impact on the sales-demand curve in logistics.
In PM Modi’s reign, Jayem expresses high hopes for flushing out all the signs of corruption and ultimately earn goodwill to the country and its citizens.
Orange juice disappearing from breakfast in America
In an article by The Independent, the orange juice was considered a breakfast staple for decades, and has long been featured prominently in nearly every cereal ad as part of a “complete breakfast.”
But Americans’ consumption of orange juice has been plunging in recent years, as awareness grows over the scant nutritional value of the drink.
A 12-ounce glass of orange juice contains 153 calories, 34 grams of carbohydrates, 27 grams of sugar, and 2.4 grams of protein. That’s the same amount of carbohydrates and almost as much sugar as a bag of M&M’s, as Brodwin points out.
That’s why nutrition experts and health bloggers have been railing against orange juice in recent years. When you Google “orange juice good for you,” the top results include posts titled “Why orange juice is slowly killing you,” and “The #1 reason to avoid orange juice.”
Perhaps that’s why sales of the juice are down 13% in the past four years, according to data from Nielsen.
Frozen orange juice has experienced the biggest drop in sales, falling 39% to $98 million since 2012, compared to a 10% drop to $3.1 billion for refrigerated orange juice in the same period.
Florida, which is the top producer of oranges used for juice in the US, is on track for the fifth straight season of declines in orange output — representing the worst decline in more than a century, according to Bloomberg.
On top of falling demand, orange producers have also been battling a bacterial disease that has been wiping out their groves.
As growers leave the business, orange-processing plants have also been shutting down.
Thanks to the rise of the juicing trend, however, a wide array of juices and smoothies are available as alternatives to orange juice.
Nutella maker fights back
In May, the European Food Standards Authority warned that the contaminants found in the oil’s edible form are carcinogenic. It warned that even moderate consumption of the substances represented a risk to children and said that, due to a lack of definitive data, no level could be considered safe.
Sales fell by three per cent in the year to August 2016 as consumers ditched the product for palm-oil free alternatives. Coop, the country’s biggest supermarket chain removed 200 products containing palm oil, though not Nutella, from its shelves in May as a precaution.
In response, Ferrero has launched an advertising campaign in an attempt to reassure customers that its products are totally safe.
Ferrero insists that the decision to keep palm oil in Nutella, despite safety fears, is about quality, not cost. The substance is used to give the spread its smooth texture which it says can’t be achieved by using other oils. “Making Nutella without palm oil would produce an inferior substitute for the real product, it would be a step backward,” Ferrero’s purchasing manager Vincenzo Tapella told Reuters.
Substitute oils, derived for example from sunflowers or rapeseed, could be used but would increase the cost of making the product by as much as $22m (£18m), a calculation by Reuters found. Ferrero has not confirmed the figures. The company was not immediately available for comment.
The cancer fears centre on a compounds known as glycidyl fatty acid esters (GE), which are produced in palm oil when it is heated above 200 degrees celsius, as it is in the processing of for many foods.
The World Health Organisation and UN Food and Agriculture Organisation have also expressed concerns about GE but have stopped short of issuing warnings about its consumption.
A spokesperson for Ferrero said: “The health and safety of consumers is an absolute and first priority for Ferrero.
“The presence of contaminants in food products, analyzed by the EFSA, depends on the oils and fats used as well as the processes they are subjected to.
“It is for this reason that for some time now Ferrero has been carefully selecting raw materials and industrial processes that limit their presence to minimum levels, fully in line with the parameters defined by the EFSA.”
It is not the first time that palm oil has caused controversy. In November Amnesty International raised concerns that global firms including Colgate-Palmolive, Kellogg’s, Nestlé, Procter & Gamble, Reckitt Benckiser and Unilever have been using palm oil produced by children as young as eight, working in hazardous conditions on Indonesian plantations.
2008: The California Warning
Heavy metal risk to the confectionery supply chain came under the spotlight in the US as health officials detected banned levels of lead in two different chocolate confectionery brands.
California’s department of public health warned consumers not to eat Huevines Confitados Sabor chocolate products, manufactured by a Mexican firm, after tests found that the product contained as much as 0.20 parts of million (ppm) of lead.
Oil Drive Towards Extinction?
A lot of these stories start with a bulldozer and a forest that is being transformed into a large-scale oil palm plantation. Through the supply chain and hidden in our products, it is then our consumption of palm oil that is pushing orangutans and other animals to the edge of extinction.
Palm oil is a type of edible vegetable oil that is derived from the palm fruit, which is grown on the African oil palm tree. It is the most widely used vegetable oil in the world, with roughly tens of millions of tons of palm oil produced annually. It accounts for more than 30% of the world’s vegetable oil production, 80% of which is used in the food industry. It is everywhere and found in approximately 50% of household products, including baked goods, confectionery, shampoo, cosmetics, cleaning agents, washing detergents and toothpaste.
If you go and look in your fridge, your pantry or your bathroom cupboard right now, chances are you will have products labelled ‘vegetable oil’. But the real question is, how many of these products are actually palm oil that you don’t know about it? What damage are the products you have in your house doing to the orangutans, the ecosystem and people? It is this uncertainty and the impending extinction of these orangutans that is driving the desire to re-label products that contain palm oil.