Competitiveness of Indian Agriculture Capacity Building Programme on International Trade towards enhancement of Competitiveness of Indian Agriculture 5th-9th September, 2011 IIFT,New Delhi, India _____________ Sudhanshu Deputy General Manager, APEDA, Ministry of Commerce & Industry & Vice President, GS1 India Traceability and Traceability initiatives by APEDA

What is traceability in general ? Ability to trace the history, use or location of an entity by means of recorded information Ability to follow the movement of food through specified stages of production, processing and distribution

Traceability as per Codex Ability to follow the movement of food through specified stages of production, processing and distribution.” Codex Alimentarius Commission

Traceability as per ISO 8402 Ability to trace the history, application or location of an entity by means of recorded identifications Ability to clearly specify the requirements i.e. Period of time, point of origin and identification

What traceability implies ? Traceability may or may not be required or may begin at a certain point within the production chain or may end at a point before the end of the chain . Traceability may relate to : a) The origin of materials including raw materials b) The product processing history c) The distribution and location of the product after delivery

Why traceability is required ? Food safety and traceability is becoming concern of importing countries Due to increasing consumer awareness about food safety aspects, such tools are required

Traceability Drivers- Stringent Regulatory/buyer requirements Demanding regulations: US FDA’s speed related traceability requirement – 4 hrs. one up / one back reqmts. EU Food Law (178/2002 –General Principles and reqmts of European Food Law) U.S. Bioterrorism Act (2002) ISO 22005: 2007 HACCP (ISO 22000:205) BRC (British Retail Consortium), IFS (Int’l Food Std – German/French distribution cos) SQF (US Food Marketing Institute) Can-Trace (Canadian Food Law) Food Sanitation Law (Japan) HR 2749 – The Food Safety Enhancement Act of 2009 7

Traceability Drivers- Consumer concerns and needs Is this healthy? Does it contain peanuts or other allergens? Is the packaging recyclable? Are the employees treated well and paid fairly? Does this company act responsibly toward shareholders? Is the farming and harvesting done in a sustainable fashion? Could I get this less expensively? They ask themselves many questions before making a purchase. Today's consumers are informed and aware. Was this grown organically? Do they test their products on animals? 8

Rationale & Objective of Traceability Human health and safety Other non health consumer interest like, quality or to ascertain the genuineness of a particular declaration like “Organic” nature of food product Fair practices in food trade

Limitations - Traceability In countries where the produce/ product raw material, ingredients and components are produced by SMEs or procured through the market systems in smaller volumes, the backward identification of the product becomes quite difficult

Limitations - Traceability The countries having small farm holdings, there the marketable volumes are built up at the collection centers before being taken to a pack house or processing centre. In such case, traceability is possible only up to the stage of packhouse or processing center and not up to the primary level in normal course.

What approach is required ? Firstly, evolve national procedures & policies for Quality & Product Standardization, co-opting all stakeholders in the supply chain from Public and Private sector, for each product Secondly, put in place the Standards & Agencies Thirdly, build centralized, national level, internet based, traceability system, with low cost of ownership for large number of farmers & entrepreneurs

Final outcome - Traceability Provides a tool for the establishment of product authenticity, reliability, identification of the problem areas for the purposes of tracking and product recall

Ideal Traceability

Recent outbreak of E.Coli in Germany The issue began in the second week of May . More than 10,000 samples were taken and analyzed and E.Coli could not be detected and confirmed On 5th July , the case was closed after identification of the food and the source of infection The learning from the investigation was that the only way out is to intensify the investigation on tracing back and tracing forward

Traceability Drivers E.Coli contaminated spinach recall... ...became a criminal investigation Then it spread to lettuce China Milk Recall Lack of traceability exposes food companies to huge risks 16

Traceability Drivers U.S. – Toys Recall Recall of 9.5 million toys in US and 11 million in others countries. Europe – Belgium- Coca Cola Recall 5 months to recover the sales 249 cases of illnesses in Belgium Recall of 15 million cans and bottles Crisis cost $200 million in expenses and lost profit

67% of Food Companies with $5 B or More in Sales had Recalls that Cost $20 M Source: AMR Research 18

Source: AMR Research 19

Connection between traceability and recalls Traceability system provides: Visibility to location of food products/consignments in Supply Chain Unique identification of each player in Supply Chain (raw matls supplier to finished products mfgr to intermediate distribution chain partners to retailer) Unique identification of products/consignments and qty held in Supply Chain and by whom “Accurate, timely and fast recalls can only be effected if traceability systems which provide accurate product identification, partner identification and location of products/ consignments at all times are in place” Recall is a use case of traceability 20

Command and Control – national Recall situation Map Shows GLN (ship to) locations and quantities at Recall Release Time – shows highest quantities shipped to GA 21

Command and Control – global recall situation Map 22

Command and Control – Recall TV and Webinar 23

Traceability - APEDA initiatives

APEDA’s GrapeNet A traceability System for Fresh Grapes Exported from India to EU a pilot for promoting exports in Indian Agriculture Sector 25 25

Grapes Scenario in India Grapes is among the Top Ten Fruits of India, in terms of production 1.6 million metric tons produced, majority in Maharashtra, Andhra Pradesh & Karnataka 40000 plus farmers 100 plus exporters India is the 12th largest producer in the world, but among the highest in terms of productivity per hectare

Grape Growing States Maharashtra Andhra Pradesh Karnataka

What was done before GrapeNet ? Registration, record keeping & monitoring of farms Product standardization & inspection strengthened Implementation of Good Agricultural Practices Exports only from recognized pack-houses Pesticide Residue analysis by ISO-17025 NABL compliance labs. Setting up of NRL for periodic checks and alerts Regular training programs for all concerned

GrapeNet Initiative Direct stakeholders of APEDA are Exporters, Pack houses / processing plants, Laboratories & State Government Departments Farmers are indirect stake holders, through State Agriculture / Horticulture departments APEDA maintains and continues to offer more and more services through its website as a virtual office available 24 * 7 APEDA Exporters Pack houses Processing units Labs Other Agencies State Government Farmers Reaching out to Farmers, Pack houses, Shelling Units, processing units, etc., hitherto poor users of ICT / Internet , to introduce transparency in information flow, regulation and monitoring & improvement in efficiency

APEDA’s Implementation STAGE I: a Government of India regulation - Regulation of Export of Fresh Grapes from India through monitoring of pesticide residues. Standards to meet international market demands Agencies to test compliance with these standards And no export of fresh grapes can happen to European Union without adhering to this system. STAGE II: IT enable the regulation, compliance and monitoring integrating all the stakeholders in the supply chain of Grapes export from India, with a centralized database.

GrapeNet: Functions 31

Grapenet: Introduction Grapenet features An internet based traceability software system Monitors fresh grapes exported to the European Union upto the farm level. Direct stakeholders of APEDA are Exporters, Pack houses / processing plants, Laboratories & State Government Departments Farmers are indirect stake holders, through State Agriculture / Horticulture departments An end-to-end system for monitoring pesticide residue, achieve product standardization and facilitate tracing back from retail shelves to the farm of the Indian grower, through the various stages of sampling, testing, certification and packing. 32 32

GrapeNet at www.apeda.com 33 33

Phytosanitary Certificate (PSC) number S(MAH)2/GR/0000

S(MAH)2/GR/0000

Agmark Certificate Number GEO/GR/09/0000

GEO/GR/09/0000

Agmark Inspection Report ID 200922066513

200922066513

Residure Analysis Report 2/01335/02/0900

MH06091148102 2/01335/02/0900

Residue Analysis Report MH06091148102

MH06091148102

Authorised Packer

Exporter

Traceability at display Traceability through labels pasted on Pallets/Cartons Pasted in barcode as well as Human readable format Leads to the Plots from where Grapes have been sourced GrapeNet – a live preview 50

Results achieved Every consignment of fresh grapes during the last season from India to European Union was monitored through this system and no consignment was rejected due to quality reasons. The export of fresh grapes from India to European Union increased by 100% plus in the last year. The per unit realization for exporters directly and farmers indirectly went up from previous years due to the stringent standards defined and monitored in the grapes sector in India.

Growth in Export of Fresh Grapes from India(Up to 2009) Qty: ‘000 Mts Value: Million Dollars Quantity and Value

Why exports came down in 2009-10 and 2010-11 ? Due to finding of a plant growth regulator CCC in grapes consignment , the containers were put on hold by the importers that affected the exports. But the traceability system enabled us to immediately cease the problem after getting the information.

Major gains Self confidence among farmers Culture for food quality and safety Farmers earned 40% more value Benefits went to 40,000 farmers and 115 exporters FOB realization rose from 8 Euro to 11.5 Euro per carton of 3 kg. Value – addition through improved packaging EU labs accepted that Indian labs are better

Grapes Supply Chain Improvements Increased implementation of GAP Value addition through consumer packs Grading as per export standards Absolute efficiency of laboratories Traceability throughout the supply chain Zero paper-work & total accountability

National Award for E- Governance (Year 2008) E Asia Award (Year 2009) Accolades - GrapeNet National Award for E- Governance (Year 2008) E Asia Award (Year 2009)

Further Developments Success in grapes sector encouraged to replicate and set up traceability system for : Pomegranates (AnarNet) Organic products (TraceNet)- 1st Traceablity system in the world implemented at national level ( 5 lac+ farmers registered ) Peanuts (Peanut.Net) All fruits & Vegetables (HortiNet – Under development)