A Certificate is Not Enough
By Mary Smith
Whenever there is a consumer safety incident, the first impulse is to require a "Certificate" from the producer or manufacturer. During the uproar over Chinese goods, sparked by tainted toothpaste, adulterated dog food, leaded toys, etc., customers began demanding "No Chinese Origin" certificates. Now we are hearing of requirements for "Salmonella Free Certificates".
A Simplistic Approach to a Complicated Problem
The problem with this approach is threefold. First, a certificate, especially if it is not issued by an impartial third party, cannot always be taken at face value. Often the certificates are faxed or scanned, making alteration easy to do and difficult to detect. Secondly, what is there to guarantee that the certificate in question actually applies to the merchandise it is supposed to certify, if there is no tracking system? The third problem with solving safety issues through certificates is that it is a simplistic approach to a much more complicated question. In the case of the "No Chinese Origin" certificate, can we then assume that there are no problems in facilities in the rest of the world? For that matter, aren't there reputable facilities in China that have nothing in common with the substandard operations that cause the problems?
It was revealed that Peanut Corporation of America had actually issued a certificate stating that the peanuts that caused an enormous and costly recall, not to mention seven deaths, were free from salmonella. In reality, the batch of nuts had received a postitive salmonella reading from one laboratory, and a negative test from another. PCA's customers, who had relied on the certificate, nevertheless became embroiled in a difficult and cumbersome recall that strained resources and weakened consumers confidence.
The scenario was different for Nestle, who actually did inspect the plant. Nestle sent auditors to PCA plants in Georgia and Texas, and found "grossly unsanitary conditions" in both. The company did not do business with PCA, and consequently suffered no harm when the recall took place. Proper due diligence is the wisest course.
According to international food safety expert David Troster*, "Certificates are always open to question, scanners and copiers and unscrupulous people always ready to falsify things. The solution to this problem is to demand that all certificates be obtained from laboratories that have ISO 17025 certification, with a scope that covers the analysis. You need to extend this by including from time to time an audit of the laboratory and its certification. You must also audit your suppliers to see if they provide liquid bactericidal soap, non-perfumed, hot water and disposable towels to dry hands. Watch to see if people do clean their hands. Audit their cleaning methods. There are many factories that only clean when a vistor is coming. These are easily found and should be avoided."
The Need For Industry Standards
By David Rosenthal
At last year's Association of Food Industry Convention, I proposed as a topic for discussion at the Nut and Agricultural section meeting the need to establish protocol to address the increase in rejections due to microbial contaminants in nut products. I also stated that it was necessary to establish documented, industry wide accepted tolerance levels for microbial contaminants in raw nut commodities, and approved methods to reduce pathogens if they are above acceptable levels. At present, there are no established acceptable levels, and no industry wide standards addressing these issues. At that time the prevailing feeling at the AFI was that these were not priority issues, but recent events in the nut industry have made it urgent that ithey be addressed.
New Questions Are Surfacing
Last year at this time no one could have imagined that 700 people would have been sickened and 7 dead as the result of microbial contamination in a nut product. Nor would anyone have thought that just three months later another contaminated nut would be the cause of a massive recall involving products as diverse as energy bars and ice cream. Now questions are surfacing:
"What industry wide standards have been established for accepted microbial tolerance levels for raw imported nut products?"
"What are the accepted and effective kill steps for nuts in order to eliminate dangerous contaminants such as salmonella and e.coli?
Industry standards related to nut products have not historically addressed microbial tolerance levels as it has been widely assumed that the raw nut products would go through additional processing, such as roasting, that would involve a kill step. In recent years many of the nut categories that were traditionally consumed roasted are finding their way into consumer products in their raw form. This being the case, questions arise as to what steps have been taken to ensure that the raw material is within accepted microbial tolerance levels.
Is Testing Enough?
Does testing give us the assurance we need to omit a kill step? And here is the million dollar question "Who is responsible for the kill step when the raw product is distributed directly to consumers???" Many manufacturers have purchased raw imported nut products with the assumption that they were consumer ready from a microbial standpoint. This mindset started to change when some companies started to conduct their own testing, and now, in light of recent incidents, it has become a dangerous assumption.
There is no industry protocol to address what should be done in the event of a confirmed positive for salmonella, but the fact is that an adulterated product cannot be distributed in the USA. The following links provide some guidance:
http://rs6.net/tn.jsp?t=dyvb79cab.0.0.987yumcab.0&p=http%3A%2F%2Fwww.fda.gov%2Fopacom%2Flaws%2Ffdcact%2Ffdcact4.htm%23sec402&id=preview
www.co.sauk.wi.us/data/news/flood/ph_flood_info/Policy-10.12.pdf
Testing upon arrival is only one component of a food safety system, but it is not a substitute for the due diligence needed to ensure that the facilities at origin maintain good manufacturing practices. The testing is simply a final verification of the integrity of the process by which the product was manufactured. Therefore proactive measures to ensure responsible sourcing from good facilities overseas is the first step to ensure consistent product quality.
CCC Moves to New Offices
The CCC has moved to new offices. We are now located at 9509 Hull Street Road, Suite D1, Richmond, Virginia. 23236. Our phone and fax numbers remain the same.
-------------------------------------------------------------------------------
*David Troster is a Food Safety Consultant with thirty years experience in many areas of the food and hospitality industries. David's areas of work include:
A practical approach to developing working HACCP systems integrated into your operating system.
Training Directors and Managers in Food Safety.
Supply chain auditing, identifying the hazards and helping you eliminate them.
Factory design.
Advice on European legal requirements.
If you need more details or have a specific question then please e-mail David at troster@netone.com.tr
Tuesday, April 28, 2009
Wednesday, April 8, 2009
Prison Labor - A Major Threat to the Nut Industry
Forced Labor is not Acceptable
Last year we spoke with a prominent representative of the Vietnamese cashew industry who asked us if it would be a problem if prison labor was utilized in cashew processing. Our opinion is that under no circumstances must we, as an industry, tolerate the use of forced or prison labor in the processing of any product, most especially not in products that are to be consumed as food items.
The reasons for this are twofold. Firstly, few would condone inhumane working conditions - and in the case of prison labor there is a strong possibility that working conditions would be at the extreme limits of marginality. Indeed, many of these people may not be 'criminals' in the sense that we would understand the term - some are imprisoned for their political or religious beliefs, and have committed no crime.
Secondly, anyone laboring under such extreme conditions could hardly be expected to have concern for the integrity of the products they are processing. In fact, the risk of purposeful contamination or sabotage is significant.
"Soft Terrorism"
The FDA has recognized the possibility of 'soft' bioterrorism, where food products could be discreetly contaminated with microbes that are not particularly life threatening, but their detection could have devastating industry effects. This section of http://rs6.net/tn.jsp?et=1102544653790&s=210&e=001Psdol88E63Qm85GjrPWA00zpUogLFwfZ1eYIf218mbBPca1MhdQ608OYzdyc1smdMnFkwHXejRRQ1O9hOSnMKleEZxS217MFJrnJxIoekC20PfcjFJfg7g== ) explains the possible implications of this form of bioterrorism. But terrorists are not our only threat in the potential contamination of nut products.
One Prisoner's Story - Artificially Opened Pistachios in China
This article decribes the experiences of William Huang, a Chinese man who was arrested and imprisoned for practicing Falung Gong. He was placed in a facility where pistachios were artificially reopened by prisoners. (This is not meant to imply that such a situation was behind the recent pistachio recall - there has been no indication that the pistachios in question had been sent abroad for opening).
Here are some excerpts from his story:
" We had to put the pistachio nuts in water first so the shell became softer-some prisoners used urine for this step," he said. "Our cell was 10 meters squared for 20 prisoners and it doubled as our workshop." The bench they worked on became their bed at night. Huang said he and his cellmates had to pry the shells open for three months between March and June 2001. "We used very big iron pliers to open them ... My hands got blisters, bloody blisters, they were very painful," he said. But he could not stop working or heal his hands.The guards at the 2nd detention center in Zhuhai, China, told them that the pistachio nuts had come from the U.S. They got shipped back to the USA once opened. "We were warned not to use pork oil to help open the nuts because it would absorb bugs and become a problem to export back to the U.S.A,"
A related article proviides further information. Here are some excerpts from the second article:
"William (Kui) Huang is one of the people who spent their youth cutting open the nut shells with pliers. During an interview he told me that he had to work at least sixteen hours a day. The work was done in Cell No. 27 of Zhuhai 2nd Detention Center, which according to Huang was less than twenty square meters in size and was home to over twenty people. The room was full of products and the raw materials that they are made out of. To attend to natural calls one had to climb through these materials to reach the latrine pit in a corner which was not separated from the rest of the room. The room was never cleaned and the air was turbid. Huang witnessed a prisoner dying, not because he was beaten, but because he couldn't stand the environment."
An interview with William Huang can be found on this You Tube
Last year we spoke with a prominent representative of the Vietnamese cashew industry who asked us if it would be a problem if prison labor was utilized in cashew processing. Our opinion is that under no circumstances must we, as an industry, tolerate the use of forced or prison labor in the processing of any product, most especially not in products that are to be consumed as food items.
The reasons for this are twofold. Firstly, few would condone inhumane working conditions - and in the case of prison labor there is a strong possibility that working conditions would be at the extreme limits of marginality. Indeed, many of these people may not be 'criminals' in the sense that we would understand the term - some are imprisoned for their political or religious beliefs, and have committed no crime.
Secondly, anyone laboring under such extreme conditions could hardly be expected to have concern for the integrity of the products they are processing. In fact, the risk of purposeful contamination or sabotage is significant.
"Soft Terrorism"
The FDA has recognized the possibility of 'soft' bioterrorism, where food products could be discreetly contaminated with microbes that are not particularly life threatening, but their detection could have devastating industry effects. This section of http://rs6.net/tn.jsp?et=1102544653790&s=210&e=001Psdol88E63Qm85GjrPWA00zpUogLFwfZ1eYIf218mbBPca1MhdQ608OYzdyc1smdMnFkwHXejRRQ1O9hOSnMKleEZxS217MFJrnJxIoekC20PfcjFJfg7g== ) explains the possible implications of this form of bioterrorism. But terrorists are not our only threat in the potential contamination of nut products.
One Prisoner's Story - Artificially Opened Pistachios in China
This article decribes the experiences of William Huang, a Chinese man who was arrested and imprisoned for practicing Falung Gong. He was placed in a facility where pistachios were artificially reopened by prisoners. (This is not meant to imply that such a situation was behind the recent pistachio recall - there has been no indication that the pistachios in question had been sent abroad for opening).
Here are some excerpts from his story:
" We had to put the pistachio nuts in water first so the shell became softer-some prisoners used urine for this step," he said. "Our cell was 10 meters squared for 20 prisoners and it doubled as our workshop." The bench they worked on became their bed at night. Huang said he and his cellmates had to pry the shells open for three months between March and June 2001. "We used very big iron pliers to open them ... My hands got blisters, bloody blisters, they were very painful," he said. But he could not stop working or heal his hands.The guards at the 2nd detention center in Zhuhai, China, told them that the pistachio nuts had come from the U.S. They got shipped back to the USA once opened. "We were warned not to use pork oil to help open the nuts because it would absorb bugs and become a problem to export back to the U.S.A,"
A related article proviides further information. Here are some excerpts from the second article:
"William (Kui) Huang is one of the people who spent their youth cutting open the nut shells with pliers. During an interview he told me that he had to work at least sixteen hours a day. The work was done in Cell No. 27 of Zhuhai 2nd Detention Center, which according to Huang was less than twenty square meters in size and was home to over twenty people. The room was full of products and the raw materials that they are made out of. To attend to natural calls one had to climb through these materials to reach the latrine pit in a corner which was not separated from the rest of the room. The room was never cleaned and the air was turbid. Huang witnessed a prisoner dying, not because he was beaten, but because he couldn't stand the environment."
An interview with William Huang can be found on this You Tube
Human Rights Watch - Forced Labor in the Vietnamese Cashew Industry
Unfortunately, there is evidence that in some cases forced labor is being used in cashew processing as well. Here is an excerpt from Human Rights Watch on the use of forced labor in Vietnam:
"More than 400 political and religious prisoners remain behind bars in harsh prison conditions. Prisoners are placed in solitary confinement in dark, unsanitary cells, and there is compelling evidence of torture and ill-treatment of political prisoners, including beatings and electric shock. Credible sources report the use of forced prison labor in a cashew processing facility at Xuan Loc prison, where many political prisoners are imprisoned." (Note that, according to this statement, the cashew processing facility is actually part of the infamous Xuan Loc prison)
We Must Source Responsibly
As the food chain becomes ever more global, it becomes more difficult to know our suppliers, and to monitor the conditions under which our food is produced.
The CCC can help. Please contact David Rosenthal or Mary Smith at 804-745-2848 for further information.
Wednesday, April 1, 2009
Peanuts, Pistachios...The Roulette Wheel is Spinning
Peanuts, Pistachios....The Roulette Wheel is Spinning
Once again our industry is in the throes of a massive, damaging recall. Details continue to emerge, but the source of the salmonella that contaminated pistachios has not been determined, nor has the full scale of the impact been gauged. Already, consumers are voicing reservations about eating nuts. They are alarmed and in need of reassurance that nuts are a safe food source.
Legislators and the Public are on Alert
This latest incident increases the concerns of legislators such as Rosa De Lauro, Bart Stupak, and John Dingell, who have been on the forefront of the movement for stricter food inspection and tracking requirements. Now that nut products are definitely on these legislators' radar, we MUST address the conditions under which imported nuts, seeds and dehydrated fruits are processed. We have stated that contaminants have been found on pine nuts, pepitas, and brazil nuts. What might be present in some of the nut products that are not routinely tested?
If we continue to ignore these warnings the collective wrath of consumers, retailers, and legislators will be astronomical, and justified. We need to address questions such as whether or not any imported raw nuts should be distributed to consumers without a kill step. Although imported nuts have not yet come up on the hit list we should not use that as a reason to ignore the need for taking proactive measures for responsible sourcing and initiating protocol to address possible microbial contaminants.
Can Imported Nut Facilities Withstand Tough Scrutiny?
I have been criticized by some for speaking out too forcefully in favor of proactive responsible sourcing, but for 12 years, since I visited overseas processors, I feared the day that issues would arise that would shed light on the blatant disregard for food safety practices in many of the overseas processing facilities. The globalization of today's society has made information instantaneously available to everyone. If a consumer safety incident were to arise involving one of our vulnerable commodities, an overseas facility would be investigated with the same zeal as a domestic processing plant.
Although the peanut recall, followed by the pistachio recall, have directed the focus to these specific commodities, we cannot afford to ignore the fact that the problems that caused the contamination occur throughout the nut industry and are even more severe in the case of many imported nuts and seeds where there is a lack of control. How would the scenario unfold if overseas nut processing facilities were subjected to the same scrutiny, vigilance and thoroughness as the domestic processors? Many questions would have to be answered. Keep in mind that although individual companies may carry out their due diligence, the industry will be judged based on the lowest common denominator.
The True Costs of a Recall are Staggering
Although our main concern in today's difficult economy may be our day to day existence, we cannot ignore the big picture. Recently, businesses that were economically healthy and viable have come to an end almost overnight as a result of the overwhelming costs involved in a recall. Keep in mind that it is not just the nut ingredient that needs to be recalled. It is every product that the ingredient is found in, and in many cases the full retail price plus fines will be levied. The amount of recall insurance that would be necessary in order to cover these costs would be staggering. And if, as in the case of the contaminated peanuts, lives are lost, the devastation cannot even be measured in financial terms.
The Challenge for Our Industry Leaders
Years ago, industry leaders paved the way to the future. As recently as a few decades ago, that road was not strewn with the roadblocks and concerns that must be dealt with today. This creates a whole new challenge for those who are trying to navigate through uncharted waters. On a daily basis we receive e-mails, news reports, editorials and articles calling for more regulation of the food importing process, yet the reaction to this has not been proactive. Has this been talked about so much that we've become desensitized ? This is dangerous, because the day that it really happens, when legislation is put in place and the industry is forced to comply, many will be ill prepared. Recent events in the nut industry make this all the more likely to happen, as nuts have certainly moved up on the list of suspect food products.
Responsible Sourcing - The Right Path to Take
We should all be sourcing responsibly because it is the right and moral thing to do. Let's not forget that lives were lost because of the salmonella contamination found in peanut butter. Those who believe that as an industry we can keep our dirty laundry in the closet are mistaken. Until we address these issues by developing and implementing a solution we will continue to be in a very, very vulnerable position. Most of the food legislation that has been proposed to congress tells us what we need to do, but in no way provides us with the means and the "how" to do it. We as an industry must find an acceptable solution that is effective and practical.
How Do We Enforce Responsible Sourcing?
A major industry buyer recently asked "How do we enforce responsible sourcing initiatives like the CCC?" My answer was : "Just insist upon it." The only way that we will be able to develop systems of responsible sourcing is if industry buyers demand it. Consumers need to know that their food products have been sourced responsibly. If buyers ask for responsible sourcing initiatives to be put into action, they will be. If importers demand certification from the overseas facilities they source from, they will get it. When it comes right down to it, if revenue hinges on taking responsibility for what they produce, they will do what they need to in order to make the sale. A monitoring agency with staff that understands the industry needs to be an integral part of this procedure.
The CCC Can Help
The CCC offers a system that addresses exactly what is soon to be be required of our industry. We are not saying that it is the only way to go, but it is a comprehensive, turnkey system which ensures traceability and responsible sourcing. We would be happy to discuss our certification/tracking program, and to provide a demonstration.
Please do not hesitate to contact David Rosenthal or Mary Smith at 804-745-2848.
Once again our industry is in the throes of a massive, damaging recall. Details continue to emerge, but the source of the salmonella that contaminated pistachios has not been determined, nor has the full scale of the impact been gauged. Already, consumers are voicing reservations about eating nuts. They are alarmed and in need of reassurance that nuts are a safe food source.
Legislators and the Public are on Alert
This latest incident increases the concerns of legislators such as Rosa De Lauro, Bart Stupak, and John Dingell, who have been on the forefront of the movement for stricter food inspection and tracking requirements. Now that nut products are definitely on these legislators' radar, we MUST address the conditions under which imported nuts, seeds and dehydrated fruits are processed. We have stated that contaminants have been found on pine nuts, pepitas, and brazil nuts. What might be present in some of the nut products that are not routinely tested?
If we continue to ignore these warnings the collective wrath of consumers, retailers, and legislators will be astronomical, and justified. We need to address questions such as whether or not any imported raw nuts should be distributed to consumers without a kill step. Although imported nuts have not yet come up on the hit list we should not use that as a reason to ignore the need for taking proactive measures for responsible sourcing and initiating protocol to address possible microbial contaminants.
Can Imported Nut Facilities Withstand Tough Scrutiny?
I have been criticized by some for speaking out too forcefully in favor of proactive responsible sourcing, but for 12 years, since I visited overseas processors, I feared the day that issues would arise that would shed light on the blatant disregard for food safety practices in many of the overseas processing facilities. The globalization of today's society has made information instantaneously available to everyone. If a consumer safety incident were to arise involving one of our vulnerable commodities, an overseas facility would be investigated with the same zeal as a domestic processing plant.
Although the peanut recall, followed by the pistachio recall, have directed the focus to these specific commodities, we cannot afford to ignore the fact that the problems that caused the contamination occur throughout the nut industry and are even more severe in the case of many imported nuts and seeds where there is a lack of control. How would the scenario unfold if overseas nut processing facilities were subjected to the same scrutiny, vigilance and thoroughness as the domestic processors? Many questions would have to be answered. Keep in mind that although individual companies may carry out their due diligence, the industry will be judged based on the lowest common denominator.
The True Costs of a Recall are Staggering
Although our main concern in today's difficult economy may be our day to day existence, we cannot ignore the big picture. Recently, businesses that were economically healthy and viable have come to an end almost overnight as a result of the overwhelming costs involved in a recall. Keep in mind that it is not just the nut ingredient that needs to be recalled. It is every product that the ingredient is found in, and in many cases the full retail price plus fines will be levied. The amount of recall insurance that would be necessary in order to cover these costs would be staggering. And if, as in the case of the contaminated peanuts, lives are lost, the devastation cannot even be measured in financial terms.
The Challenge for Our Industry Leaders
Years ago, industry leaders paved the way to the future. As recently as a few decades ago, that road was not strewn with the roadblocks and concerns that must be dealt with today. This creates a whole new challenge for those who are trying to navigate through uncharted waters. On a daily basis we receive e-mails, news reports, editorials and articles calling for more regulation of the food importing process, yet the reaction to this has not been proactive. Has this been talked about so much that we've become desensitized ? This is dangerous, because the day that it really happens, when legislation is put in place and the industry is forced to comply, many will be ill prepared. Recent events in the nut industry make this all the more likely to happen, as nuts have certainly moved up on the list of suspect food products.
Responsible Sourcing - The Right Path to Take
We should all be sourcing responsibly because it is the right and moral thing to do. Let's not forget that lives were lost because of the salmonella contamination found in peanut butter. Those who believe that as an industry we can keep our dirty laundry in the closet are mistaken. Until we address these issues by developing and implementing a solution we will continue to be in a very, very vulnerable position. Most of the food legislation that has been proposed to congress tells us what we need to do, but in no way provides us with the means and the "how" to do it. We as an industry must find an acceptable solution that is effective and practical.
How Do We Enforce Responsible Sourcing?
A major industry buyer recently asked "How do we enforce responsible sourcing initiatives like the CCC?" My answer was : "Just insist upon it." The only way that we will be able to develop systems of responsible sourcing is if industry buyers demand it. Consumers need to know that their food products have been sourced responsibly. If buyers ask for responsible sourcing initiatives to be put into action, they will be. If importers demand certification from the overseas facilities they source from, they will get it. When it comes right down to it, if revenue hinges on taking responsibility for what they produce, they will do what they need to in order to make the sale. A monitoring agency with staff that understands the industry needs to be an integral part of this procedure.
The CCC Can Help
The CCC offers a system that addresses exactly what is soon to be be required of our industry. We are not saying that it is the only way to go, but it is a comprehensive, turnkey system which ensures traceability and responsible sourcing. We would be happy to discuss our certification/tracking program, and to provide a demonstration.
Please do not hesitate to contact David Rosenthal or Mary Smith at 804-745-2848.
Monday, March 9, 2009
More on "The High Cost of Saving Money"
On February 17, 2009, we published an article by food safety expert David Troster entitled "The High Cost of Saving Money". We received the following comment from a concerned buyer.
L.M said...
"What happens when you pay extra and are assured that product is inspected multiple times? Is that still the buyers fault? Going to the top packers paying extra and still having a problem?"
David Troster responded with further clarification on why it is so important that high standards be maintained at each processing step, and how this saves both money and reduces risk to buyer and seller alike.
Here is David's response:
"Dear LM,
Thanks for your comment.
L.M said...
"What happens when you pay extra and are assured that product is inspected multiple times? Is that still the buyers fault? Going to the top packers paying extra and still having a problem?"
David Troster responded with further clarification on why it is so important that high standards be maintained at each processing step, and how this saves both money and reduces risk to buyer and seller alike.
Here is David's response:
"Dear LM,
Thanks for your comment.
What I am arguing for is actually a reduction in expensive post production testing: "Quality Control" as it is known. Rather, we should be using systems of "Quality Assurance".
Quality Control vs. Quality Assurance
Quality Control by its nature is expensive and not very accurate. Example, in a container we may have 1600 x 12.5kg cartons. Let's say that one of those cartons contains a defect that would cause a recall. The only way to find that carton is to test all 1600 cartons. Result: You find the problem carton but you have probably lost the entire load – Wonderful? Sampling say five or ten cartons would probably not find the defect, so do you use that lot and risk your reputation? Of course not!
In Quality Assurance we look to:
- The systems of production;
- Identify real potential hazards;
- Make sure that proper preventative measures are implemented.
The way that you as a buyer would understand that these proper preventative measures are in place is to have your supplier(s) audited and to have a targeted regime of testing as verification that the systems are working.
Quality Assurance through Third Party Auditing
Your real problem is that without a third party audit you really have no way of knowing who are the good shippers in terms of food safety. I know many factories that are owned and operated by very good and honourable people. They never default, test result are always excellent. They are top packers, but their products still cause product recalls. Why? They may be good at business , but with regards to food safety they are only beginners.
Proper third party, independent auditing and the help and advice that can go with it can give both sides confidence. For the seller, they have increased confidence that their product is the right product for the buyer, and the buyer can understand that they have purchased the right product for them.
In many cases if I can get the factory 'sorted' the risk and therefore the associated higher costs can be eliminated without detriment to anybody's bottom line. So if we get it right, profits can be maintained or improved, costs lowered and that is a great help to sales. Not to mention happier consumers!
____________________________________________________________
David Troster is a Food Safety Consultant with thirty years experience in many areas of the food and hospitality industries. David's areas of work include:
- A practical approach to developing working HACCP systems integrated into your operating system.
- Training Directors and Managers in Food Safety.
- Supply chain auditing, identifying the hazards and helping you eliminate them.Factory design.
- Advice on European legal requirements.
If you need more details or have a specific question then please e-mail David at troster@netone.com.tr
Wednesday, March 4, 2009
The Cashew Market...Not a Laughing Matter
This year's Cashew Market Update at the recent Peanut and Tree Nut Processors' Convention ended with a segment that included a tongue in cheek version of financial acronyms, substituting their meaning with phrases illustrating the recent debacles in the cashew industry: CD = Contract Defaults, MBS = Might Be Shipped, etc. There were also joking references as to what constitutes a "Top Tier Shipper", "Medium Shipper" etc. - "a top tier shipper ships good quality product that arrives on time..." No mention was made of the standards adhered to by the facility itself, in terms of sanitation, Good Manufacturing Practices, etc. This is certainly not the time to simplify the supplier selection and screening procedure.
$40 Million in Lost Trade Differentials is No Joke
Although presented in the spirit of comic relief, the reality is not a laughing matter. The fact is that over 2000 containers of cashews were defaulted on last year, which resulted in over $40 million in lost trade differentials during 2008. The dramatic price increases that resulted caused added problems in our industry at a time when we did not need another obstacle to dissuade retailers from purchasing nut products.
We have seen how devastating it can be if we are unaware of conditions in facilities that directly affect the integrity of the food products produced (the recent peanut recall is an all too painful example). We have seen the result of purchasing based on pricing only, with limited information on the caliber of the facilities or the integrity of the supplier.
It's time that we started to learn more about where and from whom we source our food products. We need to know our suppliers, and be certain that the agricultural products we import and offer for public consumption are processed under acceptable conditions. The fact is, conditions in these facilities directly affect the integrity of the food products we offer to consumers. We also have a moral responsibility to do everything in our power to ensure that workers who produce the goods we import are fairly treated and compensated.
A More Holistic Business Philosophy
The business models that have been recently in fashion have emphasized the maximization of short term profits. Perhaps it is time to revisit a business philosophy that is more comprehensive, one that has a basis in psychology, sociology, economics, and statistics. I'm referring to the teachings of the late Dr. W. Edwards Deming, who is widely credited with being a major factor in Japan's amazing recovery and rise to becoming a world economic power after the devastation of World War II.
14 Key Principles and The Seven Wastes
Dr. Deming developed a management system based on 14 key principles designed to increase business effectiveness. He also cited seven obstacles to development "The Seven Wastes" which could cause a business or business sector to stall. Among the most important of the 14 principles is "Build quality into a product throughout production". Another key principle is "End the practice of awarding business on the basis of price tag alone; instead, try a long-term relationship based on established loyalty and trust."
Impromptu Fixes Are Costly
Increasingly, in the cashew business, price became the driving factor behind every transaction. Even when there were quality problems, even when there had been devastating defaults, the supplier who could offer the lowest price was the one who got the business. Quality problems were common, but were dealt with on a case by case basis. Infestation? Freeze it for two weeks and hope you don't miss the retailers deadline. Scorched? Do your best to fix it in the roast. Foreign material? Hope that your added production costs for unanticipated refinement don't eat too much into your profit margin. You've been advised that your supplier will not ship the cashews you contracted? Quick, try to find some on the spot market (probably at a significantly higher price), or devise a delaying tactic and see how long you can keep your customer at bay. It's impossible to guess how much these impromptu 'fixes' may have cost the industry, but we do know that the price tag for the defaults, which were mostly by Vietnam, was in the neighborhood of $40 million.
Stop Stamping Out Fires
The second part of Dr. Deming's management system,"The Seven Wastes" contains another principle that could have avoided the default disaster ; "One of the worst mistakes a company can make is to focus on short term profits, as opposed to long term goals." In the short term, "buy cheap" may look like the way to go. But the road to true success lies in developing a steady, reliable supply, and consistently delivering high quality to our customers.
It is outside the scope of this article to delineate Dr. Deming's management principles in their entirety, but they merit consideration. It would be appropriate to end this article with one of his best known quotes "Stamping out fires is a lot of fun, but it is only putting things back the way they were." Many in the cashew industry have become adept at dealing with crisis after crisis. Isn't it time we became proactive and improved things at the source?
Forging Strategic Partnerships
The CCC is a means to forge strategic partnerships with quality overseas suppliers. It empowers the buyer with the knowledge that their product has been handled responsibly at the source, and can be traced back with accuracy.
The CCC has come under a great deal of resistance from segments of the American importing community. The next time you are on the phone with your importer, ask the question "Why would you be against an initiative to support responsible sourcing from facilities that maintain good manufacturing practices and fair labor conditions?". Let them give you an answer and feel free to post it in this blog .
If you have any specific questions about our program, please feel free to call either David Rosenthal or Mary Smith at 804-745-2848.
$40 Million in Lost Trade Differentials is No Joke
Although presented in the spirit of comic relief, the reality is not a laughing matter. The fact is that over 2000 containers of cashews were defaulted on last year, which resulted in over $40 million in lost trade differentials during 2008. The dramatic price increases that resulted caused added problems in our industry at a time when we did not need another obstacle to dissuade retailers from purchasing nut products.
We have seen how devastating it can be if we are unaware of conditions in facilities that directly affect the integrity of the food products produced (the recent peanut recall is an all too painful example). We have seen the result of purchasing based on pricing only, with limited information on the caliber of the facilities or the integrity of the supplier.
It's time that we started to learn more about where and from whom we source our food products. We need to know our suppliers, and be certain that the agricultural products we import and offer for public consumption are processed under acceptable conditions. The fact is, conditions in these facilities directly affect the integrity of the food products we offer to consumers. We also have a moral responsibility to do everything in our power to ensure that workers who produce the goods we import are fairly treated and compensated.
A More Holistic Business Philosophy
The business models that have been recently in fashion have emphasized the maximization of short term profits. Perhaps it is time to revisit a business philosophy that is more comprehensive, one that has a basis in psychology, sociology, economics, and statistics. I'm referring to the teachings of the late Dr. W. Edwards Deming, who is widely credited with being a major factor in Japan's amazing recovery and rise to becoming a world economic power after the devastation of World War II.
14 Key Principles and The Seven Wastes
Dr. Deming developed a management system based on 14 key principles designed to increase business effectiveness. He also cited seven obstacles to development "The Seven Wastes" which could cause a business or business sector to stall. Among the most important of the 14 principles is "Build quality into a product throughout production". Another key principle is "End the practice of awarding business on the basis of price tag alone; instead, try a long-term relationship based on established loyalty and trust."
Impromptu Fixes Are Costly
Increasingly, in the cashew business, price became the driving factor behind every transaction. Even when there were quality problems, even when there had been devastating defaults, the supplier who could offer the lowest price was the one who got the business. Quality problems were common, but were dealt with on a case by case basis. Infestation? Freeze it for two weeks and hope you don't miss the retailers deadline. Scorched? Do your best to fix it in the roast. Foreign material? Hope that your added production costs for unanticipated refinement don't eat too much into your profit margin. You've been advised that your supplier will not ship the cashews you contracted? Quick, try to find some on the spot market (probably at a significantly higher price), or devise a delaying tactic and see how long you can keep your customer at bay. It's impossible to guess how much these impromptu 'fixes' may have cost the industry, but we do know that the price tag for the defaults, which were mostly by Vietnam, was in the neighborhood of $40 million.
Stop Stamping Out Fires
The second part of Dr. Deming's management system,"The Seven Wastes" contains another principle that could have avoided the default disaster ; "One of the worst mistakes a company can make is to focus on short term profits, as opposed to long term goals." In the short term, "buy cheap" may look like the way to go. But the road to true success lies in developing a steady, reliable supply, and consistently delivering high quality to our customers.
It is outside the scope of this article to delineate Dr. Deming's management principles in their entirety, but they merit consideration. It would be appropriate to end this article with one of his best known quotes "Stamping out fires is a lot of fun, but it is only putting things back the way they were." Many in the cashew industry have become adept at dealing with crisis after crisis. Isn't it time we became proactive and improved things at the source?
Forging Strategic Partnerships
The CCC is a means to forge strategic partnerships with quality overseas suppliers. It empowers the buyer with the knowledge that their product has been handled responsibly at the source, and can be traced back with accuracy.
The CCC has come under a great deal of resistance from segments of the American importing community. The next time you are on the phone with your importer, ask the question "Why would you be against an initiative to support responsible sourcing from facilities that maintain good manufacturing practices and fair labor conditions?". Let them give you an answer and feel free to post it in this blog .
If you have any specific questions about our program, please feel free to call either David Rosenthal or Mary Smith at 804-745-2848.
Tuesday, February 17, 2009
The High Cost of Saving Money
Food safety expert David Troster contributed the following article, which illustrates a common scenario - what initially looks to be a cheap price turns out to be an expensive problem.
Cutting Costs the Right Way
The Buyer's Dilema - Keeping Costs Down
"Stop the line, there's glass in the product!"
Production, Quality Control and Factory Manager all run to the line to see what's happened. There it is,a piece of glass, colorless, hard to spot in the fruit, with sharp chipped edges.
Where'd that come from?" They all ask. Everyone was sure it was not their factory. They had glass control systems in place. "It's in the raw material so it's a buying problem." The buyer was shown the glass and he shrugged. The story unfolded: Always under pressure to keep costs down he'd done just that and purchased a cheap lot from a trader. The information he had was that the fruit was the right size and color, plus QC had received a sample case and approved it. All in all it looked OK and the price was right.
Factory Manager's Dilema - Cleaning up the Buyer's Bargain
The Factory Manager then started to put the buyer right. "First thing to remember is that testing is just part of a verification process where we make sure that the people before us in the food chain have got it right. Testing cannot and never will tell you the complete story. With the cheap price we saved $100/tonne but what of the costs of using that material? The whole lot is suspect so it can't be used in case there's a product recall. It will have to be dumped and that will cost money. We need a replacement lot and buying spot is not going to make the Directors happy. The line is stopped till the replacement stock comes, so who pays the wages while we wait for it? Then there's the loss of profit on top of it all. Cheap lots can be very expensive and high risk."
"If the primary processor has problems then we all do"
It's happened like this many times before, but the clever ones learn. In today's high speed manufacture one must understand in detail the whole of the food chain, and that starts with the farmer or grower, who needs to provide quality produce. Primary processors are very important since it's their task to clean up and pack the product. Unfortunately this is where foreign bodies sometimes slip in. Fruit on trees does not have mineral stones embedded in its surface, nor are there glass windows in a commercial orchard. If the primary processor has problems then we all do.
The solution is very simple. In addition to product testing, audit the supplier and identify the potential hazards, then work with that supplier to eliminate or reduce those hazards. In many instances what is needed is common sense, and it need not be costly. For example to keep out flying insects along with cats, dogs, and rodents - close the doors and screen the open windows. To prevent glass shards, replace glass windows with plastic, cover lights and only allow essential glass on site. The cost of these sorts of controls are nothing when compared to having to pay for a line being idle because bad product was supplied, or being faced with the costs of a product recall. The price of a product recall is your reputation and your business.
The True Cheap Option
Prevention is always the cheaper option. There may be costs involved in setting up the system, but long term customer relationships with happy satisfied shoppers make it worthwhile to start your preventive works today. The peace of mind alone is worth it!
____________________________________________
David Troster is a Food Safety Consultant with thirty years experience in many areas of the food and hospitality industries. David's areas of work include:
If you need more details or have a specific question then please e-mail David at troster@netone.com.tr
Cutting Costs the Right Way
The Buyer's Dilema - Keeping Costs Down
"Stop the line, there's glass in the product!"
Production, Quality Control and Factory Manager all run to the line to see what's happened. There it is,a piece of glass, colorless, hard to spot in the fruit, with sharp chipped edges.
Where'd that come from?" They all ask. Everyone was sure it was not their factory. They had glass control systems in place. "It's in the raw material so it's a buying problem." The buyer was shown the glass and he shrugged. The story unfolded: Always under pressure to keep costs down he'd done just that and purchased a cheap lot from a trader. The information he had was that the fruit was the right size and color, plus QC had received a sample case and approved it. All in all it looked OK and the price was right.
Factory Manager's Dilema - Cleaning up the Buyer's Bargain
The Factory Manager then started to put the buyer right. "First thing to remember is that testing is just part of a verification process where we make sure that the people before us in the food chain have got it right. Testing cannot and never will tell you the complete story. With the cheap price we saved $100/tonne but what of the costs of using that material? The whole lot is suspect so it can't be used in case there's a product recall. It will have to be dumped and that will cost money. We need a replacement lot and buying spot is not going to make the Directors happy. The line is stopped till the replacement stock comes, so who pays the wages while we wait for it? Then there's the loss of profit on top of it all. Cheap lots can be very expensive and high risk."
"If the primary processor has problems then we all do"
It's happened like this many times before, but the clever ones learn. In today's high speed manufacture one must understand in detail the whole of the food chain, and that starts with the farmer or grower, who needs to provide quality produce. Primary processors are very important since it's their task to clean up and pack the product. Unfortunately this is where foreign bodies sometimes slip in. Fruit on trees does not have mineral stones embedded in its surface, nor are there glass windows in a commercial orchard. If the primary processor has problems then we all do.
The solution is very simple. In addition to product testing, audit the supplier and identify the potential hazards, then work with that supplier to eliminate or reduce those hazards. In many instances what is needed is common sense, and it need not be costly. For example to keep out flying insects along with cats, dogs, and rodents - close the doors and screen the open windows. To prevent glass shards, replace glass windows with plastic, cover lights and only allow essential glass on site. The cost of these sorts of controls are nothing when compared to having to pay for a line being idle because bad product was supplied, or being faced with the costs of a product recall. The price of a product recall is your reputation and your business.
The True Cheap Option
Prevention is always the cheaper option. There may be costs involved in setting up the system, but long term customer relationships with happy satisfied shoppers make it worthwhile to start your preventive works today. The peace of mind alone is worth it!
____________________________________________
David Troster is a Food Safety Consultant with thirty years experience in many areas of the food and hospitality industries. David's areas of work include:
A practical approach to developing working HACCP systems integrated into your operating system.
Training Directors and Managers in Food Safety.
Supply chain auditing, identifying the hazards and helping you eliminate them.
Factory design.
Advice on European legal requirements.
If you need more details or have a specific question then please e-mail David at troster@netone.com.tr
Tuesday, February 3, 2009
Action Plan for Food Safety and Responsible Sourcing
At the recent PTNPA convention, we gave a presentation entitled "An Ounce of Prevention or a Metric Ton of Cure". (CLICK to view) We would like to propose a solution. We have been working for the past two years on the development of a program that addresses the issues that make the nut and agricultural industry vulnerable, and offers a turnkey system to protect us from the kind of situation that has resulted from the recent peanut recall.
FDA Globalization Act of 2009
Although there has been heavy focus on domestic oversight, the fact is that we know even less about where and to what standards our imported food products are processed. Ignorance is no longer an excuse that will be tolerated. Legislators have come down very hard on the people they feel were responsible for ensuring public safety. Congressmen John Dingell, Bart Stupak and Frank Pallone Jr. have incorporated higher standards of accountability in their most recent draft of the Food and Drug Administration Globalization Act of 2009. This act can be viewed in full at the following link:
http://rs6.net/tn.jsp?t=v7awjxcab.0.0.987yumcab.0&p=http%3A%2F%2Fptnpa.org%2Fnews_pdf%2FDingell-Bill-HR.pdf&id=preview
Now is the time for industry self evaluation. Would our current system stand up to government and consumer scrutiny? It doesn't matter if individual companies have this ability. We need to set standards for the entire industry. We are only as strong as our weakest link.
The CCC Solution
The CCC system presents a preventative approach to responsible sourcing and food safety and addresses many aspects of the FDA Globalization Act.
Step One: Identification - The CCC system first identifies those suppliers who subscribe to good manufacturing practices. Companies that need help in establishing GMPs can utlilize our consulting services to assist them in bringing their facilities up to the necessary standards.
Step Two: Inspection - Through a third party audit by independent unbiased inspectors using industry experts who have a background not only in Quality Control and production, but also a working knowledge of the industries being inspected.
Step Three: Certification - Once the identification and inspection process is completed, these facilities will be certified under the guidelines of the CCC.
Step Four: Tracking - The CCC has developed a user friendly, comprehensive tracking system software called CONCERNTRAK©. During the inspection process our auditor interviews two key production personnel. These individuals are fingerprinted via a biometric identification procedure. To ensure a higher level of security, only these prescreened personnel can enter data into the system. CONCERNTRAK© enables the end user to trace lots back to the production line and produces verifiable documentation, making this process quick and easy. Each carton is labeled with the tracking number and sealed to ensure a tamper resistant box that can be cross referenced with all documentation.
Step Five: Promotion - Our logos for Cashew Concern Certification and Commodity Concern Certification enable manufacturers to convey the message to consumers that they have done their due diligence to responsibly source the food products under their brand name.
Step Six: Protection - The integrity of our industry is protected when we take steps to adopt programs such as that of the CCC, to ensure the safety of our food production through a system of self regulation. If an incident should occur, at least we have a system in place to present to the authorities. Having no viable system to ensure traceability and responsible food sourcing will highlight our deficiencies, and would present an embarrassment to the industry.
Building a Solid Foundation to Establish a Healthy Future for the Imported Food Industry
FDA Globalization Act of 2009
Although there has been heavy focus on domestic oversight, the fact is that we know even less about where and to what standards our imported food products are processed. Ignorance is no longer an excuse that will be tolerated. Legislators have come down very hard on the people they feel were responsible for ensuring public safety. Congressmen John Dingell, Bart Stupak and Frank Pallone Jr. have incorporated higher standards of accountability in their most recent draft of the Food and Drug Administration Globalization Act of 2009. This act can be viewed in full at the following link:
http://rs6.net/tn.jsp?t=v7awjxcab.0.0.987yumcab.0&p=http%3A%2F%2Fptnpa.org%2Fnews_pdf%2FDingell-Bill-HR.pdf&id=preview
Now is the time for industry self evaluation. Would our current system stand up to government and consumer scrutiny? It doesn't matter if individual companies have this ability. We need to set standards for the entire industry. We are only as strong as our weakest link.
The CCC Solution
The CCC system presents a preventative approach to responsible sourcing and food safety and addresses many aspects of the FDA Globalization Act.
Step One: Identification - The CCC system first identifies those suppliers who subscribe to good manufacturing practices. Companies that need help in establishing GMPs can utlilize our consulting services to assist them in bringing their facilities up to the necessary standards.
Step Two: Inspection - Through a third party audit by independent unbiased inspectors using industry experts who have a background not only in Quality Control and production, but also a working knowledge of the industries being inspected.
Step Three: Certification - Once the identification and inspection process is completed, these facilities will be certified under the guidelines of the CCC.
Step Four: Tracking - The CCC has developed a user friendly, comprehensive tracking system software called CONCERNTRAK©. During the inspection process our auditor interviews two key production personnel. These individuals are fingerprinted via a biometric identification procedure. To ensure a higher level of security, only these prescreened personnel can enter data into the system. CONCERNTRAK© enables the end user to trace lots back to the production line and produces verifiable documentation, making this process quick and easy. Each carton is labeled with the tracking number and sealed to ensure a tamper resistant box that can be cross referenced with all documentation.
Step Five: Promotion - Our logos for Cashew Concern Certification and Commodity Concern Certification enable manufacturers to convey the message to consumers that they have done their due diligence to responsibly source the food products under their brand name.
Step Six: Protection - The integrity of our industry is protected when we take steps to adopt programs such as that of the CCC, to ensure the safety of our food production through a system of self regulation. If an incident should occur, at least we have a system in place to present to the authorities. Having no viable system to ensure traceability and responsible food sourcing will highlight our deficiencies, and would present an embarrassment to the industry.
The "Ounce of Prevention"
We can no longer assume that it will be "business as usual". With the current climate in Washngton we can be sure that sooner rather than later our industry will be called upon to explain the procedures and systems we have put in place to ensure responsible sourcing. We have two choices. We can start now to develop these systems using countless hours of time and energy or, we can adopt a turnkey system, such as that offered by the CCC where two years of research and development have already been done. This is our "ounce of prevention". It will certainly be more tolerable than a potential metric ton of cure.
Identification*Inspection*Certification* Tracking*Promotion*Protection
We can no longer assume that it will be "business as usual". With the current climate in Washngton we can be sure that sooner rather than later our industry will be called upon to explain the procedures and systems we have put in place to ensure responsible sourcing. We have two choices. We can start now to develop these systems using countless hours of time and energy or, we can adopt a turnkey system, such as that offered by the CCC where two years of research and development have already been done. This is our "ounce of prevention". It will certainly be more tolerable than a potential metric ton of cure.
Identification*Inspection*Certification* Tracking*Promotion*Protection
Building a Solid Foundation to Establish a Healthy Future for the Imported Food Industry
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