Experts debated issues of food safety and security along the supply chain, both in Asia and globally, at a dinner hosted by Alltech during VIV Asia. The discussion was opened by Dr Mark Lyons, VP of Alltech, with an overview of crisis management, noting the recent broiler issues which have arisen in China and in the actions of Yum! Brands and McDonald's.
By Fabian Brockötter
Chaired by Alltech vice president Aidan Connolly, more than 150 industry leaders discussed the impact of recent crises and food safety scares on consumer confidence. The panel represented the experience of suppliers to the feed industry, integrated meat companies and the experience of a nutritionist involved with auditing meat and feed companies. The panel opened on the question “Why does it seem that so many food crises have occurred in China?” Jon Ratcliff, Food and Agriculture Consultancy Services, answered, “It's not only China that has seen crises recently. In Europe we have had the horse meat scandal, mislabelled organic eggs and aflatoxin contamination in milk in the Netherlands due to contaminated Serbian and Romanian grains. China attracts attention due to its sheer size - one state is nearly the size of the European Union - thus it's task in controlling food safety is magnified. It is an enormous task for China to control food safety with 1.3 billion people spread over such a large geographical area.”
Lyons agreed, adding, “The pace and scale of China means that one incident in China can be blown up to being very significant, whereas the same incident in one European country would not reflect on the entire EU.” Lyons zoomed in on the recent food scare involving Yum brands Kentucky Fried Chicken stores. KFC’s parent, Yum Brands, was facing problems of food safety, or food safety perception, originating in the fourth quarter of 2012. Yum! reported a 6% drop in fourth-quarter sales in China because of adverse publicity on social media regarding antibiotics and toxic chemical residue found in its chicken supply. In January consumer trust took an even harder beating (-41% in revenue), when it became clear that there was more going on than just rumours.
Insufficient control on farm level
“What went wrong, was it criminal behaviour, politically motivated or China’s X-factor?”, Alltech’s vice president of China, Mark Lyons, asked at the discussion. Part of the problems in China could occur because of insufficient control from the farm level up, at some of the suppliers. In a reaction Yum! stopped doing business with a few suppliers, cutting 1,000 farms out of the supply chain. Alltech is eager to facilitate any discussion on food safety to bring the protein sector forward.
Vice president Aidan Connolly: “Production in China is pushed so fast due to an increase in consumption that organisation and knowledge fell behind. China really needs help and fundamental changes have to be made in education, management and mentality. Food security is one thing, food safety is at least as important.’’ Getting the right knowledge across to the Chinese farmers and introducing broad quality control scheme’s, topped off with possible sanctions when not complying, that is the challenge for the near future. Responsibilities are huge for everyone involved in the poultry sector. Food safety is a global concern.
The panel discussed what the food industry is doing to adapt to food safety and traceability requirements. Philip Wilkinson, director of the British Poultry Council and executive director of 2 Sisters Food Group, discussed the development of the Red Tractor scheme in the UK, “The Red Tractor logo is a guarantee of quality and origin. Every critical step of the food supply chain is independently inspected to ensure food is produced to quality standards by assured farmers, growers and producers in the UK, from farm to pack.” He stressed that this industry initiative has not been imposed on companies, but rather driven and embraced by the entire industry all along the supply chain. Ratcliff argued that while there is a place for approval schemes and auditing procedures, “They are NOT a guarantee against food scandals or crises.”
Food safety perception
The panellists discussed whether some countries were using food safety as a form of protectionism but all agreed that this was not the case. Ratcliff told the audience that we must differentiate between food safety issues (such as dioxins or PCB contamination) and issues which are simply consumer concerns (hormone use or genetically modified (GMO) products). If companies want to export, they must meet local regulatory requirements as well as retailer requirements, such as welfare or feed requirements. Ratcliff stressed that this is not a barrier, as the same rules are applied to producers inside the country as well. Wilkinson agreed. “This is not a barrier of entry - it is only fair that foreign suppliers meet equal requirements as local suppliers,” he added.
The chairman asked the panellists what suppliers can do to make crisis management a core competence. Lyons stressed that companies should have people in the organisation focused on food safety. “We pay for feed, raw materials, lights, etc - but we have to consider food safety a necessary part of our cost structure. The costs are too high - we must include this in our pricing.”
Wilkinson spoke of the importance of consumer confidence in food. “If you buy a beef burger, you expect to get beef. We must assure customers that we are delivering what we say we are going to.” Lyons agreed, touching on recent testing which found that a single hamburger may be made with meat deriving from as many as 300 different animals.
The audience was eager to ask questions. One attendee asked what companies like Alltech are doing to be sure they are not part of the problem. Lyons answered, “Our owner has made it clear to all employees that he does not want to risk his reputation or that of our company.” He shared that seven years ago, Alltech put together the Alltech Quality System or AQS. “The AQS is not just a risk management tool; it is designed to ensure that every product we ship is safe, effective and nutritious.”
“Who wins in a food crisis?” Wilkinson asked the audience. “Analytical companies do. They are becoming more and more important in the food industry as consumers demand testing for GMO or PCBs.” Ratcliff added, “The more sensitive techniques become, the more likely we are to pick up contamination”. Professor Trevor Smith from the University of Guelph in Ontario, Canada commented from the audience about his work with fusarium mycotoxins. He shared that while current testing methods are significantly underestimating fusarium contamination by possibly as much as 100%, even the simplest of testing procedures are very helpful for diagnosing mycotoxin contamination, yet they are still not commonly used. “The educational process is so important - we must continuously repeat ourselves,” he added.
In closing, the panellists made final comments regarding the topics covered throughout the Alltech dinner event. Ratcliff encouraged attendees to be proactive, “Analyse your business at all levels and look to where a problem MIGHT occur.” Wilkinson emphasised that the beef issue is only the tip of the iceberg. He showed the audience a full page newspaper advertisement from supermarket Tesco in the UK promoting that their policy from July will be to use only Irish or UK chicken, as is currently the case with beef. “Never lose the opportunity of a good crisis,” encouraged Lyons. “Looking at China, we need to learn from crises. We need to really create initiatives for those that do the right thing. We need to provide programs to help them produce more food at lower cost.”
Wilkinson stressed that, “It's not just doom and gloom.” He added, “The food industry has a lot to be proud of. The developed world is living longer and are healthier than ever before. We don't need to be defensive.” Wilkinson concluded, “We are always looking to be safer, but really, our industry is doing a great job.”