Inspector Meerkat checking in with this week’s food fraud investigation: While scanning the Food Fraud Database, I found that coconut oil was recently added to the site. There have been six reported incidents of fraud in coconut oil since 2013, with the most recent incident reported May 2019. Five of the incidents involved coconut oils produced in India, and one incident involved products from the Philippines. Reasons for adulteration include fraudulent labeling claims, dilution or substitution with an alternate ingredient, and misrepresentation of botanical origin.
Even unprocessed fruit can be a target for food fraudsters. Fraudulent fruit does not only damage a company’s brand, but it also may have pesticide and other residue levels above the permitted limit. Counterfeit branding and packaging was used in exports of 2 tons of lemons from China. It is not the first time that such fraud happened and the affected company won a lawsuit earlier this year. To prevent such mislabeling in the future, the company finally registered its brand with Chinese authorities.
The COVID-19 crisis has exacerbated existing disconnects between food supply and demand. While some may be noticing these issues on a broader scale for the first time, the reality is that there have been challenges in our food supply chains for decades. A lack of accurate data and information sharing is the core of the problem and had greater impact due to the pandemic. Outdated technologies are preventing advancements and efficiencies, resulting in the paradox of mounting food insecurity and food waste.
To bridge this disconnect, the food industry needs to implement innovative AI and machine learning technologies to prevent shortages, overages and waste as COVID-19 subsides. Solutions that enable data sharing and collaboration are essential to build more resilient food supply chains for the future.
Data-sharing technologies that can help alleviate these problems have been under development for decades, but food supply chains have been slow to innovate compared to other industries. By reviewing the top four data-sharing technologies used in food industry and the year they were introduced to food supply chains, it’s evident that the pace of technology innovation and adoption needs to accelerate to advance the industry.
A History of Technology Adoption in the Food Industry
The Barcode – 19741
We’re all familiar with the barcode—that assemblage of lines translated into numbers and letters conveying information about a product. When a cashier scans a barcode, the correct price pops up on the POS, and the sale data is recorded for inventory management. Barcodes are inexpensive and easy to implement. However, they only provide basic information, such as a product’s name, type, and price. Also, while you can glean information from a barcode, you can’t change it or add information to it. In addition, barcodes only group products by category—as opposed to radio-frequency identification (RFID), which provides a different code for every single item.
EDI First Multi-Industry Standards – 19812
Electronic data interchange (EDI) is just what it sounds like—the concept of sharing information electronically instead of on paper. Since EDI standardizes documents and the way they’re transferred, communication between business partners along the supply chain is easier, more efficient, and human error is reduced. To share information via EDI, however, software is required. This software can be challenging for businesses to implement and requires IT expertise to handle updates and maintenance.
RFID in the Food Supply Chain – 20033
RFID and RFID tags are encoded with information that can be transmitted to a reader device via radio waves, allowing businesses to identify and track products and assets. The reader device translates the radio waves into usable data, which then lands in a database for tracking and analysis.
RFID tags hold a lot more data than barcodes—and data is accessible in remote locations and easily shared along the supply chain to boost transparency and trust. Unlike barcode scanners, which need a direct line of sight to a code, RFID readers can read multiple tags at once from any direction. Businesses can use RFID to track products from producer to supplier to retailer in real time.
In 2003, Walmart rolled out a pilot program requiring 100 of its suppliers to use RFID technology by 2005.3 However, the retail giant wasn’t able to scale up the program. While prices have dropped from 35–40 cents during Walmart’s pilot to just 5 cents each as of 2018, RFID tags are still more expensive than barcodes.4 They can also be harder to implement and configure. Since active tags have such a long reach, businesses also need to ensure that scammers can’t intercept sensitive data.
Blockchain – 20175
A blockchain is a digital ledger of blocks (records) used to record data across multiple transactions. Changes are recorded in real-time, making the history unfalsifiable and transparent. Along the food supply chain, users can tag food, materials, compliance certificates and more with a set of information that’s recorded on the blockchain. Partners can easily follow the item through the physical supply chain, and new information is recorded in real-time.
Blockchain is more secure and transparent, less vulnerable to fraud, and more scalable than technologies like RFID. When paired with embedded sensors and RFID tags, the tech offers easier record-keeping and better provenance tracking, so it can address and help solve traceability problems. Blockchain boosts trust by reducing food falsification and decreasing delays in the supply chain.6
On the negative side, the cost of transaction processing with blockchain is high. Not to mention, the technology is confusing to many, which hinders adoption. Finally, while more transparency is good news, there’s such a thing as too much transparency; there needs to be a balance, so competitors don’t have too much access to sensitive data.
Cloud-Based Demand Forecasting – 2019 to present7
Cloud-based demand forecasting uses machine learning and AI to predict demand for various products at different points in the food supply chain. This technology leverages other technologies on this list to enhance communication across supply chain partners and improve the accuracy of demand forecasting, resulting in less waste and more profit for the food industry. It enables huge volumes of data to be used to predict demand, including past buying patterns, market changes, weather, events and holidays, social media input and more to create a more accurate picture of demand.
The alternative to cloud-based demand forecasting that is still in use today involves Excel or manual spreadsheets and lots of number crunching, which are time-intensive and prone to human error. This manual approach is not a sustainable process, but AI, machine learning and automation can step in to resolve these issues.
Obtaining real-time insights from a centralized, accurate and accessible data source enables food suppliers, brokers, distributors, brands and retailers to share information and be nimble, improving their ability to adjust supply in response to factors influencing demand.8 This, in turn, reduces cost, time and food waste, since brands can accurately predict how much to produce down to the individual SKU level, where to send it and even what factors might impact it along the way.
Speeding Up Adoption
As illustrated in Figure 1, the pace of technology change in the food industry has been slow compared to other industries, such as music and telecommunications. But we now have the tools, the data and the brainpower to create more resilient food supply chains.
Given the inherent connectivity of partners in the food supply chain, we now need to work together to connect information systems in ways that give us the insights needed to deliver exactly the rights foods to the right places, at the right time. This will not only improve consumer satisfaction but will also protect revenue and margins up and down food supply chains and reduce global waste.
Based on a classification system that was established more than 150 years ago, wines from the world-renowned region of Bordeaux can fetch high prices and enjoy a high degree of recognition and popularity. The Conseil Interprofessionnel du Vin de Bordeaux (CIVB) and Chinese authorities set a precedent by sentencing a wine supplier for offering fake “Bordeaux” wines. Nearly 10,000 bottles of mislabeled “Bordeaux” wines were seized, and the guilty judgment included fines and a suspended prison sentence.
Pasta is widely consumed around the world, and prices have increased because people have been stockpiling it during the COVID-19 pandemic. Durum wheat, the basic wheat for pasta, is the second most cultivated wheat around the world after common bread wheat, claiming 15–30% higher prices, and therefore an attractive target for food fraud. Out of 150 Argentinian pasta samples that were analyzed with a new method based on Fourier transform infrared spectroscopy (FTIR), in combination with Partial-Least Squares Discriminant Analysis (PLS-DA) and Linear Discriminant Analysis (LDA), 112 were found to be altered with common wheat. Argentinian labeling law requires durum wheat pasta to be based on 100% durum wheat.
Since the early 20th century, food safety has been a paramount concern for consumers in the United States. Upton Sinclair’s The Jungle, which painted a bleak, brutal, and downright disgusting picture of turn-of-the-century food processing facilities led to the creation of some of the country’s first food safety laws. Today, federal agencies and statutes make up a comprehensive food safety system to ensure that the growth, distribution and consumption of foods are safe from start to finish.
While food safety has significantly improved in the century since Sinclair’s time, stories of major outbreaks of foodborne illnesses continue to pop up across the country. Over the past few years, a significant number of outbreaks as a result of pathogens have made the headlines. To mitigate the threat of public health crises and ensure food production and distribution is safe and secure, companies must rely on modern technology to trace the movement of food across the entire supply chain.
How Technology Is Changing the Food Industry
Technology is a powerful, innovative force that has changed the way even well established companies must do business in order to stay relevant. From easier access to nutritional information to digital solutions that make food manufacturing and distribution more efficient, greater consumer awareness driven by technology empowers consumers to make decisions that can greatly affect the food industry’s bottom line.
Technology-driven accountability is playing one outsized role in allowing consumers to make better choices about the foods they consume and purchase. Social media and smartphone apps connect consumers to a wealth of resources concerning the harmful effects of certain ingredients in their food, the source of products, and how particular items are made and produced. In 2015, for example, The Campbell Soup Company removed 13 ingredients from its traditional soup recipes as a result of a greater public demand to understand food sources. Neither food giants nor small producers should expect to remain immune from greater public scrutiny over food health and safety.
Nutritional research is also helping change the conversation around food, granting nutritionists and consumers alike greater access to food-related data. Through easily accessible scholarly journals, apps that provide real-time nutrition information, and meal tracking apps that help users log and understand what they’re eating, consumers can gain a better understanding of nutrition to make more informed choices about their daily food intake. Researchers can also use food-tracking apps to make discoveries about consumer behavior and foods that are eaten.
Technology is also being used to tackle food waste, one of the most pervasive problems facing the food industry. One-third of the total amount of food produced globally, amounting to nearly $1.2 trillion, goes to waste every year. Solving this pervasive crisis has become an industry imperative that is being tackled through a variety of innovative technologies to improve shelf-life, dynamically adjust pricing based on sell-by dates, and allow restaurants to automatically monitor their daily waste.
In the food manufacturing sector, digitally-connected supply chain systems are providing greater visibility into the production of foods and beverages. Supplier management technology delivers data that can be used to optimize processes and improve quality in real-time, making it easy to adjust to consumer demands, respond to logistics challenges, and boost government compliance. The enhanced operational benefits offered through improved supply chain visibility allows manufacturers to produce products faster, safer, and with greater transparency.
Online ordering has also ushered in a new era of food industry behavior. The growing assortment of online ordering apps has just given the consumer more control over quickly ordering their next meal. The trend in online ordering has also allowed restaurants to experiment with new business models like virtual kitchens that offer menus that are only available online.
IoT: The Future of Food Safety
From the farm to the carryout bag, the impact of technology on the greater food industry is already evident in daily practice. Through enhanced access to data, food producers can run an efficient supply chain that reduces waste, boosts productivity, and meets consumer demand in real-time. Using a variety of online resources, consumers are empowered to quickly make well-informed food purchases that are healthier, more convenient and more sustainable than ever before.
The Internet-of-Things (IoT) adds a layer of technology to the food manufacturing process to ensure greater food safety. A broad series of networked sensors, monitors, and other Internet-connected devices, IoT technology can oversee the entire food manufacturing and distribution process from the warehouse to the point of sale. Boosting transparency across the board, intelligent sensors and cameras can transform any food manufacturing operation into a highly visible, data-backed process that allows for better decision-making and improved real-time knowledge.
While IoT technology is a powerful tool that can improve the efficiency of restaurants and provide enhanced customer experiences, some of its greatest potential lies in its ability to safely monitor food preparation and production. Live data from IoT devices makes it possible to closely monitor food safety data points, allowing manufacturers and restaurants to reduce the risks of foodborne illness outbreaks through enhanced data collection and automated reporting.
Domino’s Pizza, for instance, embraced IoT technology to enhance management processes and monitor the food safety of its products. In the past, restaurants have relied on workers to record food temperatures, a practice that was occasionally overlooked and could lead to issues with health inspectors. Using IoT devices for real-time temperature monitoring, Domino’s automatically records and displays temperature levels of a store’s production, refrigeration, and exhaust systems, allowing employees to view conditions from a live dashboard.
In addition to boosting food safety, the comprehensive monitoring offered by IoT technology can help food companies reduce waste, keep more effective records, and analyze more data for improved operations.
IoT isn’t just a safe solution for improving food safety: It’s a smart solution.
Blockchain: The Future of Food Traceability
The ubiquity of QR codes has made it easy for consumers to quickly gain access to information by scanning an image with their smartphone. From accessing product manuals to downloading songs, QR codes make it simple to provide detailed and relevant content to users in a timely manner.
Blockchain technology provides a powerful opportunity to provide consumers with similar information about food safety. Able to instantaneously trace the lifecycle of food products, blockchain can report a food’s every point of contact throughout its journey from farm to table. By scanning a QR code, for instance, users can quickly access relevant information about a food product’s source, such as an animal’s health, and welfare. Shoppers at Carrefour, Europe’s largest retailer, area already using blockchain traceability to track the stage of production of free-range chickens across France.
Walmart piloted a blockchain implementation by tracing a package of sliced mangoes across every destination until it hit store shelves, from its origin at a farm in Mexico to intermittent stops at a hot-water treatment plant, U.S processing plant, and cold storage facility. Real-time product tracing can be conducted in just two seconds, enabling Walmart and other vendors to provide consumers with access to food safety information that could easily be updated should an outbreak or contamination occur.
Blockchain’s inherent transparency not only makes it possible to identify the safety of food production; it also enhances the safety of the business of food production itself. Because blockchain is based upon an immutable, anonymous ledger, record keeping and accounting can be made more secure and less prone to human error. Payments to farmers and other food suppliers can also become more transparent and equitable.
The High Tech Future of Food
Unlike the days of Sinclair’s The Jungle, food transparency is the name of today’s game. As consumers continue to demand greater access to better food on-demand, food producers must continue to find innovative ways of providing safe, healthy, and ethical solutions.
IoT devices and blockchain present food manufacturers with powerful technological solutions to solve complex problems. Brands choosing to rely on these innovations, such as Domino’s and Walmart, are helping ensure that food is produced, prepared and distributed with a foremost emphasis on health and safety. As these technologies continue to become more intelligent, well-connected, and embraced by leading food producers, consumers should rest assured that they’ll always be able to know exactly what they’re eating, where it’s from, and whether it’s safe.
Returning these vehicles and storage units to use for food is possible—but only with thorough cleaning and disinfection. The agency recommends the use of EPA-registered disinfectants that are suitable for the material being disinfected. It also recommends these disinfectants be effective against SARS-CoV-2 and foodborne pathogens. When disinfecting, it is important to adhere to the instructions for use for guidance on how many times application is required, the contact time needed, and effectiveness at refrigeration temperatures. For instances in which the interior surfaces have been in direct contact with blood or bodily fluids, the FDA guidance provides the scenarios in which the vehicles and storage units should not be returned to use for transporting or storing food for humans or animals.
OSHA has also stated that compressed air or water sprays should not be used to clean contaminated surfaces due to the risk of aerosolizing infectious material.
Due to the public health emergency, the guidance has been issued without the agency’s usual 60-day comment period.
On March 29, 2018, FDA announced the Nutrition Innovation Strategy, which signaled their intention to take a fresh look at what can be done to “reduce the burden of chronic disease through improved public nutrition.” The agency wants to facilitate consumers making better food choices to improve their health. At the same time, FDA has acknowledged that in many cases, changes in food processing technology has rendered outdated certain provisions of the regulations once written to both inform and protect the public. Therefore, FDA has developed a plan to move ahead to update its policy toolkit.
This multi-pronged approach includes modernizing food labeling, including food standards, health claims policy, ingredient labeling requirements and continuing implementation of the updated nutrition facts label, menu labeling, and reducing sodium in processed food products.
In particular, in trying to gather information to help determine the best approach to revising food standards of identity, FDA held a public meeting on September 27, 2019. FDA is attempting to provide room in the regulations for industry to be able to use modern and hopefully more healthful manufacturing methods while at the same time retaining the traditional characteristics and nutritional value of standardized food products.
During the public meeting, consumer advocacy groups, food industry trade groups and medical associations expressed many points of view as to what FDA should do to make the more than 250 food standards of identity more applicable to the modern food supply. FDA also took comments on updating food ingredient labeling requirements, including simplifying terms for ingredients such as vitamins. Because each food standard of identity is a regulation, it will be no small effort for the agency to update, remove or add standards of identity as needed. This meeting was a way to get input to help guide their decisions and priority—making for food standards and ingredient labeling revisions.
Obviously, with such a broad-based effort, the revisions and changes will be incremental. But the thing to keep in mind is that it all points to an effort to improve public health through the food supply as well as an effort to impactfully modernize the regulations. What follows is a very brief summary of some of FDA’s recent actions in this regard.
On December 30, 2019, FDA announced the final guidance on Serving Sizes, Dual-Column Labeling, which provided additional information about when dual column labeling for nutrition is required and what exemptions are in place to provide relief for certain products or package sizes.
On December 27, 2019, FDA reopened the comment period on the use of ultrafiltered (UF) milk in certain cheeses. When the proposed rule for UF milk in cheeses originally published in 2005, FDA received many comments. Essentially, ultrafiltration was a means to enhance the speed of cheese production, and the standard of identity cheeses were written before this technology was common and did not permit this type of process. FDA seeks to modernize the cheese standards while keeping intact the nature of these cheeses, and so the agency is eager to learn about what can be done to accommodate the new technology without losing the essence of the standards that consumers have come to expect. Because of the time lapse since the previous comment period, FDA is seeking more information to inform their rulemaking.
On October 25, 2019, FDA released a final rule revising the type size for calorie declarations on front of pack labeling for glass-front vending machines. The 2014 rule establishing calorie labeling for products sold from vending machines had provisions that were difficult for certain products to meet. This new rule recognizes those challenges and was an attempt by the agency to provide a middle ground for the industry to meet the requirements of visible calorie labeling on small packages sold in vending machines.
On August 15, 2019, FDA announced final guidance on converting units of measure for Folate, Niacin, and Vitamins A, D and E on the nutrition and supplement facts labels. The guidance provides help to the industry in meeting the requirements of the revised nutrition facts label.
Regarding updating the “healthy” claim on food products, when this term was originally defined by the agency, saturated fat was the nutrient of focus for these claims. However, since then, there are new focuses on health, such as added sugar and calories. In September 2016, FDA sought to modernize the claim, and provided an interim policy to guide its use.
In May 2019, FDA published a draft guidance to provide enforcement discretion for the use of the term “potassium chloride salt” on ingredient statements. In addition, in April 2019, FDA provided a draft guidance for the calculation of calories from a newer sweetener, Allulose.
As you can see, there are a lot of moving parts to FDA’s effort. What will be the impact on the food industry? Changes will most likely be gradual. Over time, there will be modifications to food standards of identity, and potentially claims, and both of these will cause label revisions. And, typically, there may be enforcement discretion by FDA to allow the industry time to revise their products and /or labeling as needed.
You will see FDA requests for information from the public and the industry on various related topics to the Nutrition Innovation Strategy, and guidance documents will be updated.
Unfortunately, alcoholic beverages are also prone to fraud involving the addition of substances that can cause illness or death. This often happens at the local level, with the production of “moonshine” or other unlicensed spirits. Some of the substances used have included methanol, isopropyl alcohol and industrial-grade alcohol.
One notable incident from the 1980s had global implications and severe market effects. Diethylene glycol was added to Austrian wines, resulting in recalls around the world when the adulteration was detected. Fortunately, no illnesses or deaths were reported. Just a year later, methanol added to Italian wine caused both hospitalizations and deaths. More recently, incidents involving the addition of methanol to spirits have caused deaths in India, China and Malaysia.
Authentication and traceability for alcoholic beverages, and specifically wines, lend themselves to technology-enabled solutions such as blockchain. On a lighter note, take a look at some of the labels documented by reporters covering the wine market in China. In a high value marketplace such as the wine business, there is no end to creativity in labeling.
Booze bootleggers are still quite active since there is a lot of money exchanging hands in the high-end wine and liquor business. Fake premium Penfolds wines, which can fetch several hundred dollars per bottle, as well as acclaimed brands of adulterated whisky, were discovered and seized in a liquor store in Cambodia. Besides the fake beverages, the raid also uncovered fake labels and packaging materials.
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