Anne Bridges Consulting, Melbourne, VIC, Australia (firstname.lastname@example.org).
Managing cereals in the food supply chain to protect integrity and provide quality product is challenging in the global marketplace. To be successful requires active participation by all stake-holders. This is of particular interest and concern in managing agricultural biotechnology traits or Genetically Modified Organisms (GMO’s) in products between markets with different regulatory and/or labelling regulations. Constant changes in global agriculture and potential changes to regulations in different areas of the world suggest it is timely to review the options.
Trends in the grain industry
In large part, commodity crop operations are managed with bulk handling systems. There are exceptions of course, such as popcorn or barley, where the grain is usually grown to contract and subsequently handled in segregated systems. A recent global trend has seen some changes in response to the food industry requirements for specific quality and grain function attributes and in some other instances, exclusion of particular grains. This could be summarised as a shift in desired attributes from input to output traits, and a corresponding shift from open to propriety ingredients. Not new to some, like the barley industry, but perhaps an opportunity for other grain industries to participate.
Consumer preference and civil society groups demanding choice, and in some cases making somewhat questionable claims, have drawn the attention to genetically modified (GM) crops. In Europe, and a number of other countries, regulations for GM labelling and traceability have been implemented. The introduction of genetically modified crops into the supply chain and the changing regulations have presented challenges to the distribution of food and feed grains.
The implications of all of these changes are that grain handlers, in order to take advantage of the market opportunities, have modified their systems to give more effective segregation capabilities and are using tighter supplier relationships. One should expect to be able to make the necessary connections from suppliers to the consumer and manufacturing productivity requirements.
Global planting of gm grains
Increasing acceptance and success using crops with GM traits is contributing to the increase in the number of hectares planted. The data provided by ISAAA described in Figure 1 reflects this continuing growth. This shows an increase in hectares of 20% over the previous year. The major crop growing countries include USA, Canada, Argentina, Brazil and China. The majority of these hectares are from Corn and Soy crops, with Cotton and Canola making up the balance.
Figure 1. Global status of biotech crops in 2004.
Traceability or identity preserved
There are a number of definitions for Traceability, all of them using similar language. The European Union recently agreed to this one, EU Definition 178/2002.
“Traceability/Product Trace - The ability to trace and follow a food, feed, food-producing animal of substance intended to be or expected to be incorporated into a food or feed, through all stages of production, processing and distribution”.
Identity Preserved (IP) on the other hand is a subset of traceability that also requires the grain or ingredient identity, function and its integrity is maintained through the supply chain. This would require a link from farmer to consumer, through all of the intermediate handlers.
The consumer has many options and is in the position to make the ultimate choice. It is this choice that drives the rest of the supply chain. Most are looking for quality and safety in the food and beverages they purchase and consume. In the case of GM crops and the ingredients made from then they may choose to purchase non GM and more than likely pay an associated premium. This might be similar to the premium we pay for organic foods in markets where they are available.
All foods have quality attributes that are important to their acceptance. In some instances the definition of quality attributes has extended beyond the commonly applied safety, flavour and texture. The consumer will usually make choices based on these, but this is not always the case. And even if it isn’t evident that the consumer is making an informed choice, it’s a choice that must be acknowledged.
One customer that we don’t often think of as such is the group of international competent authorities who also have many options available and can make choices. Regulatory agencies are responsible for seed, grains, the environment, international trade and food safety. They choose the type of information they need, the levels or tolerances of an analyte that are supported by scientific data, and the implementation of protocols. They may choose to be similar or different to the decisions and plans made in other areas of the world. Similarly at each stage in the food supply chain, options and choices are played out. It should come as no surprise that the more requirements (or specific choices made) that are placed on a product, the higher the potential cost of that product. One might also expect tighter supplier and buyer contracts.
Today’s GM crops are focused on input traits, while those that are coming through the development pipeline include many which will deliver functional attributes. These are expected to be selected for by the customer and require identity preserved systems to deliver. Each step the product moves through the supply chain adds value to the product. The first transport step adds cost and increased value. The product usually becomes more recognisable or identifiable as it moves closer to the ultimate customer. The risk of not delivering the requested product increases as more steps are added to the chain. If you are going to manage this chain it would be most cost effective and have lower risk if the management focus is near the beginning of the chain. Similarly if an attribute or analyte needs to be tested this would also be most effective on the raw ingredients. In the case of GM crops this would likely allow the use of protein testing, which can be much faster and cheaper than testing for modified DNA with the polymerase chain reaction methods.
Simple Case Situation
An example of a simple supply chain situation would be for example sweet corn where the crop is likely grown with well documented seed under contract conditions. The trucks and other grain handling systems are likely used for only this crop and the manufacturing systems are also single purpose. One might add consumer acceptance and significant product experience to this mix. The supply chain has many options and delivering an IP product is relatively simple.
Not So Simple Case Situation
Many food manufacturers have moved to global sourcing of ingredients and to global delivery to multiple markets. In the case of breakfast cereal or snack products different products can be manufactured on the same equipment and the plants will have a number of lines operating at any given time. They should expect a wider consumer base and perhaps not uniform consumer requirements. These are just some of the considerations that must be understood to manage the more complex supply chain.
A basic management plan might include determining the point in the supply chain to identify and control the product, determining the regulatory requirements, establishing a paper trail, testing as appropriate for the desired attribute using validated test methods and building in quality checks throughout the chain. The degree of risk and the manufacturer’s risk tolerance level will determine how frequent these checks need to be.
Challenges to global trade
A number of recent disruptions in grain trade have been focused on GM crops. These have been suggested to be a form of trade barrier. Real or perceived these “barriers” need to be managed in the most cost effective way. It is an increasing challenge to grain exporters and food manufacturers to manage the ingredients and understand and meet requirements of the different competent authorities. Each additional regulatory step implies an additional cost which will undoubtedly be passed onto the next customer in the chain. The situation continues to change and while it might be nice to wish for harmonisation, reality suggests this is far from the case and it is unlikely to change in the near future.
Many options to manage the food supply chain with respect to GM traits are available for the grain or food producer in Australia. These may be the same or different to food producers in other global regions. These options occur and decisions can be made at any level in the chain. They all need to be considered when delivering to the customer’s expectations.
- Kim Magin Sutter, Monsanto
- James W. Stave, Strategic Diagnostics Inc
- Randy Giroux, Cargill, Inc
- Carl Adams, Diversified Laboratory Testing
- Dave Grothaus, Pioneer Hi-Bred International, Inc
- AACC International
- ISAAA Briefs 32, 2004 for Figure 1