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Traceability
In Protecting Your
Brand Name
American Butter Institute
Chicago, IL
April 27, 2009
By
Gale Prince
Food Safety is Essential to Our
Business!!!
Under Magnifying Glass
In the end it was …
Or was it both?
Recent Food Safety Problems• 2006 Produce Safety was the top news story
– Spinach
• 2007 Product safety was the top news stories
– Peanut Butter
– Pet Food
– Canned Chili
– Ground Beef
• 2008
– Ground Beef
– Tomatoes and Peppers
• 2009
– Peanut Butter
– Pistachios
– ????????
Product Recalls Are Becoming More
Massive
• 25 million pounds • 22 million pounds • 1.8 million pounds• 143 million pounds• Over a year’s production of peanut butter• All production codes of chili sauces• Multiple brands by multiple mft’s of pet
food• Over 600 different food products recalled in
Europe– all related to one adulterated minor ingredient
• 30 Millions of toys recalled
Product Recalls Are Costly
• Preliminary recall costs reported by firms of recent recalls:– $56,000,000– $35,000,000– $60,000,000– $30,000,000– $37,000,000– $103,000,000– Some firms ceased business
• These costs do not include litigation costs• Nor does it include the cost in lost sales• Nor does it include the swings in stock market
Salmonella 2009
Source: Mn Dept Health AP Photo 012909
Congressional Hearings
Why the increase in food safety
Issues?
Why the Change?
• Concentration of food production
• Increased batch size
• Product changes
• Changes in food distribution
• Consumer has changed
• Science has changed
• Epidemiology has changed
Food Net Sentinel Sites
Represents about 15% of US population
CDC Food Net Trends
1996 -2008
Source: MMWR April 10, 2009
Center of Disease ControlPulse Net
Pulse Net Database
0
10000
20000
30000
40000
50000
60000
70000
1996 1998 2000 2002 2004 2006
PFGE patterns submitted to PulseNet Databases 1996- 2007
In 2007 ~ 30,000 patterns in E. coli O157 database
Source: CDC 2008
Electronic Communications
CDC Outbreak Response and Surveillance Team (ORST)
Slide Compliments of Dr. Art Liang Center of Disease Control and Prevention
Slide Compliments of Dr. Art Liang Center of Disease Control and Prevention
Slide Compliments of Dr. Art Liang Center of Disease Control and Prevention
Slide Compliments of Dr. Art Liang Center of Disease Control and Prevention
Slide Compliments of Dr. Art Liang Center of Disease Control and Prevention
Slide Compliments of Dr. Art Liang Center of Disease Control and Prevention
Slide Compliments of Dr. Art Liang Center of Disease Control and Prevention
Slide Compliments of Dr. Art Liang Center of Disease Control and Prevention
Slide Compliments of Dr. Art Liang Center of Disease Control and Prevention
Slide Compliments of Dr. Art Liang Center of Disease Control and Prevention
Peanut Butter 2009
Source: CDC 030609
Peanut Butter 2009
Source: CDC 030609
PCA Peanut Product Related RecallsJan 10 – Mar 10, 2009
0
10
20
30
40
10-
Jan
17-
Jan
24-
Jan
31-
Jan
7-
Feb
14-
Feb
21-
Feb
28-
Feb
7-
Mar
Recalls
Source: CDC & FDA
MN HD
State of TX Orders Recall
~ 500 Recalls Involving > 3,868 Products as of 3/28
Other Food Companies Recalls
PCA Recall
PCA Expands Recall
What does this tell us?
• The foodborne disease detectives have become
very good!
• The science and electronic capabilities of
epidemiology will continue to grow rapidly.
• Electronic communications links all of this
together with instant messaging.
• Provides a mechanism to identify a product that
is the vehicle for the pathogen.
Pet Food Recall
• Triggered questions on source of ingredients
in pet food, but…
Today Consumers More Vocal
More rapid communications when products
are not satisfactory.
Consumer Satisfaction
• Blogs
• Consumer Generated
Media (CGM)
Do Consumers care about
traceability?
Consumer Reaction to Recalls
• Harris Interactive Research-April 2007
– 79% aware of food recalls for past three years
– 29% felt recalls were “serious concern”
– 55% would switch brands temporarily
– 15% said they would never purchase the recalled
product
– 21% avoid purchasing any brand made by the
manufacturer of the recalled product
Consumer Research
Consumer Research
Source: FMI Trends 2008
Consumer Research
Source: FMI Trends 2008
Consumer Research
Source: FMI Trends 2008
Global Food Traceability
USA: high fructose corn syrup, sugar,
wheat flour (produce & milled), whole
grain oats, sunflower oil,
strawberry puree, cellulose, red dye #40
China: vitamin & mineral
supplements,
B1, B2, iron, folic acid),
honey
Scotland: sodium alginate
Italy: malic acid
Denmark: lecithin (soy)
Philippines: carrageenan
India: guar gum
Europe: citric acid
Source: Business Week July 30, 2007
Country of Origin Labeling Requirements
Farm Bills of 2002 and 2008
USDA Regulations
Final Rule
January 15, 2009
Effective
March 16, 2009
Public Health Security and Bioterrorism
Preparedness and Response Act of 2002
Signed into Law
June 12, 2002
FDA Established and Maintenance of Records for
Food
Regulations
Final Rule
Published December 9, 2004
Effective December 9, 2005
FDA Establishment and
Maintenance of Records 2005
• Proposal required lot codes of everything
coming into a retail store
• Final rule allowed for the use of:
– Commercial Paper
– Purchase orders
– Invoices
– Bill of Lading
Congressional Hearings
March 26, 2009
Hearings on
Traceability
Traceability Report
• Were able to trace 5
of 40 items
• Lack of lot code info
• Lack of records
• 25 % of facilities not
aware of record
keeping
requirements
Current Proposed Legislation
Traceability
• FDA Food Safety Modernization Act
SB-519 by Durbin of IL
• FDA Globalization Act of 2009
HR-759 by Dingell of MI
• Safe FEAST Act of 2009
HR-1332 by Costa of CA
• Establish a traceability system for food
SB 425 by Brown of OH
Current Problems
• Paper work challenge
• Manpower extensive and do
not provide rapid response
• Currently a universal systems does not exist to provide transfer of lot code information to achieve efficient and rapid transfer that would aid in epidemiology investigation
• SYSTEM NOT ADEQUATE TO PROTECT YOUR BRAND
Traceability
• Needs to be more rapid
• Needs to be standardized so electronic
exchange of data can be synchronized with
global harmonization of information
• Needs a platform for exchange of information
as product moves through the distribution
channels
Electronic TracingElectronic Tracing
UPC Bar Code
Identify company and product
First item to be scanned
on June 26, 1974
An idea that was born in 1932 by a grocer Wallace Flint
GS 1 USGS 1 US
•• Uniform Code Council (UCC)Uniform Code Council (UCC)
–– Managed UPC numbers in USAManaged UPC numbers in USA
•• Changed name to GS 1 USChanged name to GS 1 US
–– 20052005
•• Consumer package bar codeConsumer package bar code
GTINGTIN
Global Trading Item NumberGlobal Trading Item Number
Includes bar codes and RFIDIncludes bar codes and RFID
Bar CodeBar Code
•• Consumer UPCConsumer UPC–– Limitation to product ID Limitation to product ID
•• Case UPCCase UPC–– May be same as Consumer UPC or May be same as Consumer UPC or
–– May be different UPCMay be different UPC
–– May have extended bar code with lot code infoMay have extended bar code with lot code info
•• Pallet GTINPallet GTIN–– Contains Consumer UPC # in GTINContains Consumer UPC # in GTIN
–– May contain lot codeMay contain lot code
–– Pallet serial number Pallet serial number
Uniform Traceability System
• Food industry has begun to investigate and
implement electronic systems
• Breath - from farm to retail shelf
• For lot codes need to expand bar codes
• Result in change of food distribution
modifications
• Recent outbreaks are the driving focus
Traceability Benefits
• Multifaceted
• Help target resources during an investigation
• Minimize use of “Do Not Eat Warnings”
• Prevent erosion of public confidence
• Protect innocent food companies
• Protect your brand and your company
Traceability Benefits
• Universal Electronic System
– Less labor extensive
– More accurate
– Management tool
• Quality Assurance
• Financial Controls
• Production Controls
• Inventory Control Management
• Supplier Management Tool
– Fulfill consumer expectations
Food Safety is Essential to Our
Business!!!
Preventing Food Safety Problems
gÉ wÉgÉ wÉgÉ wÉgÉ wÉ1.
2.
3.
April 27, 2009April 27, 2009April 27, 2009April 27, 2009
Today you have an opportunity To prevent a food safety problem
By taking action in your operation
What are you going to do upon
Return to your job?
Responsibilities
Our Responsibilities
• Moral
–To do what is right for our customers
• Legal
–To meet regulatory requirements
• Both as a Corporation and Personally
Complacencyis a self-satisfaction especially when
accompanied by unawareness of
actual dangers or deficiencies.
- Merriam-Webster Dictionary
Complacency
• “We have been in business for 67 years and
we have never had a problem.”
• “We have always done it like that and it has
never been a problem.”
• “The inspector didn’t say anything about that
being a problem”
• “Peanut butter has always been a safe food”
Complacency
• What about your operation?
• Have you as a manager become complacent?
• Are you taking things for granted?
• Are you accepting less than what you should?
Complacency
WE Cannot Accept A Complacent
Attitude With
FOOD SAFETY
Food Safety is a Journey
Not a Destination!
You must continue to strive for
improvements each and every day
in protecting the consumer.
Consumer Reaction to Recalls
• Impact of major food safety issues on consumer purchasing decisions
– Consumer reported they would not purchase the
recall product in the future…
• 2005 - 6%
• 2006 - 38%
• 2008 - 15%
FMI Trends 2008