Burkhard Rüther University of Bonn, Germany Risk management of unintended GMO contamination in the supply chain of maize and processed maize products Burkhard Rüther University of Bonn, Germany

Background RASFF shows an incomplete picture Source: BVL 2009 Source: European Commission 2009 RASFF shows an incomplete picture Contaminations in seeds are not included Contaminations off the market are mostly not reported GMO contamination risk results from imported products rice, sweet potatoes, maize, maize gluten feed … Source: Bundesamt für Verbraucherschutz und Lebensmittelsicherheit. Standortregister 2009. Portal of the  European Commission, DG Health and Consumers, Rapid Alert System for Food and Feed at “http://ec.europa.eu/food/food/rapidalert/index_en.htm”

How to manage the GMO risk? Source: Dörner, Horvath, Kagermann (2000): Praxis des Risikomanagements, p.109 Source: Dörner, Horvath, Kagermann 2000

Problem and Objective Problem No complete and reliable historical data available Quantitative risk analysis not feasible Objective Raise data in order to provide information for enterprise risk management Expert interviews as best information at hand

Data Collection Interviews in the German maize food chain 1st stage: personal interviews 2nd stage: formalized online interviews 450 invitations 18 data sets build the basis for further analysis (4%)

Risk assessment - Method Extended FMEA Evaluation of 3 risk characteristics (1-10 scale) probability of a GMO contamination within the next 12 month (Pc) probability of non-detection of a GMO contamination within the company (Pd) economic impact of a GMO contamination (I) The Risk Priority Number represents the GMO risk for company k

Risk assessment - Characteristics Mean risk characteristics “Seed” (n = 4) “Farm” (n = 3) “Processing” (n = 11) Probability of a GMO contamination within the next 12 month 4.00 3.50 4.55 Probability of non-detection of a GMO contamination within the company 3.60 6.00 5.91 Economic impact of a GMO contamination 4.80 1.25 4.73 Risk Priority Number 80.80 27.25 95.36

Risk assessment – Economic impact factors Mean impact factors “Seed” (n = 4) “Farm” (n = 3) “Processing” (n = 11) Loss in value of contaminated products 26.86 17.19 8.08 Reduction of profit due to business interruption 12.23 15.63 16.62 Decreasing brand equity 19.36 14.84 18.21 Deprivation of certificates (e.g. organic or marketing programs) 10.75 8.87 Delisting by food wholesale and retailers - 18.24 Costs of product withdrawal 15.61 14.21 Liability for losses in other companies (except costs of product withdrawal) 15.19 19.53 15.78 26.86 17.19 16.62 19.36 18.21 18.24 15.61 17.19 19.53

Risk control - Method Self-explicated model Compositional approach of preference measurement less cognitive skills on data providing capabilities greater ease in data collection Utility function for company k wjk = the respondents k’s self-explicated importance weights for attribute j, uijk = the respondents k’s self-explicated scores for level i of attribute j. Part-worths (wjkuijk) indicate the effectiveness in reducing the risk of losses through GMO contaminations

Risk control – Measure overview Mean effectiveness of risk reducing measures Control biological processes Change crop rotation of conventional plants Installing pollen barrier around GM planting areas Controlling secondary growth of GM plants Advanced distances to GM planting areas (up to GM free zones) Advanced information to neighbors of GM planting areas Control technical processes Cleaning of machines, transport- and storage containers Spatial segregation of GM and conventional material flow Control goods receiving PCR analysis while receiving plant products or in supplying companies Certificates on the non-existence of GMO in plant products Quality management certificates of supplying companies Personal examination of supplying companies Crisis management Implementing a crisis handbook Regular crisis practice Implementing a crisis management group Implement a system for withdrawing products from the market Archiving retain samples of products sold Implement a traceability system

Risk control –The “seed” block Mean effectiveness of risk reducing measures Effectiveness (n = 4) (k = 16) Ranking Control biological processes Installing pollen barrier around GM planting areas 10.86 3 Control technical processes Cleaning of machines, transport- and storage containers 14.17 2 Spatial segregation of GM and conventional material flow 15.83 1 Control goods receiving Crisis management

Risk control – The “farm” block Mean effectiveness of risk reducing measures Effectiveness (n = 4) (k = 11) Ranking Control biological processes Control technical processes Control goods receiving PCR analysis while receiving plant products or in supplying companies 18.61 3 Certificates on the non-existence of GMO in plant products 20.56 2 Personal examination of supplying companies 21.11 1 Crisis management

Risk control – The “processing” block Mean effectiveness of risk reducing measures Effectiveness (n = 4) (k = 12) Ranking Control biological processes Control technical processes Control goods receiving PCR analysis while receiving plant products or in supplying companies 20.70 1 Certificates on the non-existence of GMO in plant products 14.05 3 Personal examination of supplying companies 17.88 2 Crisis management

Risk control – Ranking overview Mean effectiveness of risk reducing measures Rankings “seed” “farm” “processing“ Control biological processes Change crop rotation of conventional plants Installing pollen barrier around GM planting areas 3 Controlling secondary growth of GM plants Advanced distances to GM planting areas (up to GM free zones) Advanced information to neighbors of GM planting areas Control technical processes Cleaning of machines, transport- and storage containers 2 Spatial segregation of GM and conventional material flow 1 Control goods receiving PCR analysis while receiving plant products or in supplying companies Certificates on the non-existence of GMO in plant products Quality management certificates of supplying companies Personal examination of supplying companies Crisis management Implementing a crisis handbook Regular crisis practice Implementing a crisis management group Implement a system for withdrawing products from the market Archiving retain samples of products sold Implement a traceability system

Conclusion – Risk assessment GMO risk is perceived low or moderate in maize producing and processing companies Seed breeding companies and farms are more concerned with product related losses Processing companies are more concerned with intangible losses

Conclusion – Risk control Differences in the effectiveness of measures for risk reduction exist Crisis management is less important than more preventive risk measures Seed breeding companies emphasis more on control of biological and technical processes Farms and processing companies emphasis more on control of products receiving

Outlook Enlarge the sample size to improve quality of results Analyze the chain in more detail Include decompositional instruments

Questions?

Risk control – Relative weights Measure group seed (n1 = 4) (k2 = 4) farm (n1 = 3) (k2 = 3) processing (n1 = 11) Control biological processes 41.25 13.33 - Control technical processes 30.00 22.82 Control goods receiving 11.25 73.33 64.14 Crisis management 17.50 13.05 Total 100 W3 = 0.291, P = 0.32 W3 = 0.233, P = 0.49 W3 = 0.361, P = 0.01

Conclusion – Data quality Presented data derived from experts opinion Partly not significant results Small sample size Potential differences in underlying risk situations Results not representative

Risk control –The “seed” block Mean values of attributes and top 3 risk reducing measures Effectiveness (n = 4) (k = 16) Ranking Control biological processes (5 measures) 41.25 Installing pollen barrier around GM planting areas (10.86) 3 Control technical processes (2 measures) 30.00 Cleaning of machines, transport- and storage containers (14.17) 2 Spatial segregation of GM and conventional material flow (15.83) 1 Control goods receiving (4 measures) 11.25 Crisis management (6 measures) 17.50 Total 100

Risk control – The “farm” block Mean values of attributes and top 3 risk reducing measures Effectiveness (n = 4) (k = 11) Ranking Control biological processes (5 measures) 13.33 Control technical processes (2 measures) Control goods receiving (4 measures) 73.33 PCR analysis while receiving products or in supplying companies (18.61) 3 Certificates on the non-existence of GMO in plant products (20.56) 2 Personal examination of supplying companies (21.11) 1 Crisis management (6 measures) - Total 100

Risk control – The “processing” block Mean values of attributes and top 3 risk reducing measures Effectiveness (n = 4) (k = 11) Ranking Control biological processes (5 measures) - Control technical processes (2 measures) 22.82 Control goods receiving (4 measures) 64.14 PCR analysis while receiving products or in supplying companies (20.70) 1 Certificates on the non-existence of GMO in plant products (14.05) 3 Personal examination of supplying companies (17.88) 2 Crisis management (6 measures) 13.05 Total 100