Thursday, February 26, 2009

BUYER IS SUPREME: THE SELLER HAS NO CHOICE!



Food industry in India has achieved significant strides during the last 2 decades and food exports are increasing with more and more access to new markets, earning valuable foreign exchange. Quality and safety problems pose serious threats to smooth exports and frequent rejections of Indian foods in foreign ports are routine. Advent of protocols under ISO, HACCP, SAP etc was expected to help instill confidence amongst the buyers regarding the quality of food manufactured by the licensed production units. But this has not worked the way it was expected to do if we go by the records of the industry so far. The Salmonella scare of 2008 affecting tomatoes and jalapeno pepper, the latest involving peanut butter in USA and melamine tainted milk powder in China conclusively prove that there is no substitute to honest and conscientious efforts by the industry to discipline itself by eternal vigilance and uncompromising approach vis-a-vis safety and quality.

On an earlier occasion this blog had commented on the steps taken by FDA of USA to open offices in some parts of China, obvious intention being to pre-empt safety related problems affecting imports into USA. This action is on the premise that active involvement of the importer in the operations of the manufacturer would some how ensure strict compliance. Same approach was evident when FDA announced setting up of two offices in Delhi and Mumbai under the impression that every thing will be alright now on wards. But if the past records are any indication, it is doubtful if such intrusive steps can deliver the expected results.

FDA, which is under fire in its own country for its failure to protect the consumers due to the inefficient surveillance system in place, is burdened with both drug and food portfolios and it is not able to do justice to either of them. The open letter addressed by 100 scientists to the new President highlighting the corruption in FDA is still fresh in our memory. There is clamor for splitting FDA into two separate bodies, each devoting to drugs and foods exclusively. Added to this is the split responsibilities for food safety between USDA and FDA, former looking after meat and poultry regulation, rest being under FDA.

The current controversy on peanut contamination with Salmonella, originating in a plant in Georgia, was glaring at the regulators since 2001 but still no concrete action was taken to bring them to books. Interestingly this particular plant was regularly inspected by USDA personnel since the peanut butter supplied by this firm is distributed to school children under the national feeding program and still the culprit was not hauled up for violation of good manufacturing practices! This has caused recall of 1550 products in 45 states in the US because of the 575 illnesses reported due to peanut consumption. More scandalous is the fact that the peanut butter consignment rejected by the Canadian food authorities reentered USA through a border bridge between New York State and Canada though it was found to contain "filthy, putrid or decomposed substances unfit for food". The plant that manufactured the peanut butter under cloud in Atlanta, GA, was inspected by FDA authorities in 2001 and indicted for presence of cockroaches, molds, leaking roof and other sanitation problems but no follow up action was taken. USDA inspectors visited this plant routinely there after since peanut butter from this plant is regularly supplied for the school feeding programs across the country. A typical example of right hand not knowing what the left hand is doing!

If this is the efficiency of their surveillance program within USA, what a few officers, operating from the embassy in Delhi and consular office from Mumbai can achieve is a matter of conjecture. Probably the intrusive action may only delay shipments creating further problems to the Indian industry. It may justifiable for our industry to demand that once FDA clears their shipments in India there should not be any further time consuming procedural delays at the importing points. If this happens, some of the uncertainties associated with food exports to USA can be avoided. Since consumer is the king the seller may not have such a leverage with buyers under to day's economic scenario. At least Indian food industry can try striking a deal mutually acceptable to both the parties.

V.H.POTTY
http://vhpotty.blogspot.com/

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