Food EU 9

SWEET DEAL? Who really stands to benefit from Kraft’s takeover of Cadbury?

THE WHITE STUFF Arla Foods CEO Peder Tuborgh on the dairy giant’s ambitious cost-saving programme

EMERGENCY RESPONSE www.nextgenerationfood.com • Q2 2010

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How Danone turned a crisis into an opportunity

6/5/10 13:41:29

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FROM THE EDITOR 7

Future shock Technological advances are radically changing the food industry. Now we need to beat the fear factor.

W

e have a curious relationship with science. On the one hand, many of the things that make 21st century life such a breeze when compared to that of even our comparatively recent ancestors are a direct result of technological advancement. On the other hand, humankind’s tendency to play in God’s domain also generates an inordinate amount of unease. From the monster in Mary Shelley’s Frankenstein to killer robots from the future in the Terminator films, the unintended consequences of scientific discovery have long had the ability to strike fear into our hearts.

This becomes a bigger issue for food producers as the industry moves into increasingly hightech areas. The research and development underway at many food companies now closely resembles in its complexity the work being done by drug manufacturers in coming up with new pharmaceuticals. Foods are no longer just nice things to eat; many now boast quasi-medical properties which claim to improve digestive health

or lower cholesterol. Genetic modification of both plants and animals has become a reality, while the rapidly developing field of nanotechnology is also being explored as a potential ‘next big thing’.

While such developments promise to bring big benefits in the way food is grown, processed and packaged, the unmistakeable fact is that many view them with a profound sense of disquiet.

GM crops have been hugely divisive. Their proponents contend that genetically modified plants can be more resistant to disease and grow more easily in poorer conditions, characteristics that make them invaluable in the fight against global hunger. Opponents worry about their potential to interbreed with native species and damage natural biodiversity. Nanotechnology is viewed with such suspicion that, after establishing the Nanotek Consortium in 2000, Kraft got cold feet. It is now impossible to find any reference to nanotechnology anywhere in its corporate materials. Other major food groups have displayed similar reticence, seemingly conceding the

nanotech argument to the doom-mongers.

Our natural tendency to fear what we don’t understand is largely at fault for the reluctance to embrace these new technologies. Therefore it stands to reason that food producers and regulatory authorities need to do a better job of allaying consumer concerns. As it stands, bodies like the European Food Safety Authority can be frustratingly opaque when assessing new foods and ingredients. This leads to uncertainty that impedes consumer acceptance. Likewise, food producers’ reluctance to stand up and make a strong case for innovation deeply harms their cause. Changing the view of science from bogeyman to benefit is one of the industry’s key 21st century challenges. n

Huw Thomas, Editor

“It’s not only about innovating new

“We leveraged a crisis by not only

products for consumers and customers.

resetting the brand, but totally

ground have got to buy into it, so it’s

It’s also about ensuring that we are at

resetting the company.” Danone

got to be doable at the same time.”

the front in terms of using the best

Chairman and CEO, Franck Riboud

Peter King, Chair of the European

technology that you can find.” Arla

(page 78)

Livestock Association (page 96)

Foods CEO, Peder Tuborgh (page 32)

“Science is great, but the people on the

CONTENTS_may10 10/05/2010 13:33 Page 8

CONTENTS 8

THE FUTURE OF FOOD

26

84 Tiny technology The hopes and hazards of nanotechnology

Glass half full?

As Kraft completes its takeover of Cadbury, Huw Thomas asks if the deal is really good news for either party?

90 Making a splash A taste of what’s to come The evolution of smarter foods,

by Dr Trevor Davis

92 Consumer concerns A report on concern about new food applications

After a period of freefalling milk prices, Arla Foods CEO Peder Tuborgh explains how his company is getting back on track

32

CONTENTS_may10 10/05/2010 13:16 Page 9

CONTENTS 9

42

A global perspective

ASK THE EXPERT 36 Raquel Lenati, 3M 40 Adam Clements & Bjørn Hegstad, AcryliCon 60 Kevin Hastings, NCH Europe 100 Eric Chen, Raycome 104 Ricardo Gobbi, Evonik Degussa GmbH 110 Andrew Kinder, Infor 120 Keith Smallwood, Selerant

EXECUTIVE INTERVIEW 62 Peter Bird, ExxonMobil 64 Timo Jahen, Altro 70 Victor Ferrari, Horphag Research 76 Karl-Werner Quirin, FLAVEX Naturextrakte GmbH 102 Dag Andersen, Rubinum Animal Health 118 Debra Shumar, 3P Partners 130 Dieter Bergner, Huhtamaki

67

A healthy debate?

INDUSTRY INSIGHT 74 Ivo van der Linden, Purac Biochem BV 112 Mikael Nilsson, Minimpex 138 Ulrich Nielsen, Ishida Europe Ltd

NEXT BIG THING 38 Martin Brown, Exosect 58 Nicolas Samman, Petro-Canada

TROUBLESHOOTER 44 Martin Easter, Hygiena International 72 Emmanuel Michelot, Novozymes

44

Martin Easter

46

Charles Deibel

130

Dieter Bergner

42 A global perspective

78 Looking up

Tackling food safety issues involves wideranging international cooperation in order to reduce health risks along the food chain, says the WHO’s Jørgen Schlundt

CEO Franck Riboud explains how Danone turned a crisis into an opportunity and why the future lies in emerging markets

96 Farm fit 66 A healthy debate?

The food industry may be at risk of suffering the same fate as the pharmaceutical industry when it comes to the effect that regulation can have on innovation, says Ivan Baines

Next Generation Food sits down with Peter King of the European Livestock Association and hears about the organisation’s work to protect both the continent’s animals and its consumers

CONTENTS_may10 10/05/2010 13:16 Page 10

CONTENTS 10

IN THE BACK 140 Infographic 142 Comment 143 In review 144 Photo finish

ROUNDTABLE DISCUSSION 46 Safety with Raimund C. Hoenes of Glanbia Nutritionials, Charles Deibel of Deibel Laboratories, Inc., Christian Jansen of Hunter Associates Laboratory, Inc., Zoe Grosser of PerkinElmer, Franz Rappold of MayrMelnhof Karton AG and Jan Grøndal of Einar Willumsen

Cheese rolling

106 Covering all bases Companies need to diversify their supply base in order to reduce the vulnerability of the supply chain and increase efficiencies, says Douglas Kent

114 Chemistry lessons Carmen Doran and Domingo Traver of Novartis explain how Lean Six Sigma is changing the pharmaceutical industry and what food producers can learn from their experiences

124 Size matters Rachel Hackett of IGD explains how portion sizes given on packaging affect consumer behaviour and what information consumers need to see

132 Cutting corners Anne Roulin divulges what Nestlé is doing to reduce its carbon footprint and remain at the cutting edge of innovation Covering all bases

106

The NGF Summit 2010 7 - 9 September 2010 Grand Hotel Huis ter Duin, The Netherlands

Find Out More Contact NGF +44 (0)29 2072 9300

The NGF Summit is a three-day critical information gathering of the most influential and important CIOs from the food industry.

The NGF Summit is an opportunity to debate, benchmark and learn from other industry leaders.

A Controlled, Professional and Focused Environment

It is a C-level event reserved for 100 participants that includes expert workshops, facilitated roundtables, peer-to-peer A Proven Format networking, and coordinated technology This inspired and professional format meetings. has been used by over 100 executives as a rewarding platform for discussion and learning.

Next Generation Food Europe GDS Publishing, Queen Square House 18-21 QueenSquare, Bristol, BS1 4NH Tel: +44 117 9214000 E-mail: info@gdsinternational.com Legal Information The advertising and articles appearing within this publication reflect the opinions and attitudes of their respective authors and not necessarily those of the publisher or editors. We are not to be held accountable for unsolicited manuscripts, transparencies or photographs. All material within this magazine is ©2010 NGF.

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GDS International GDS Publishing, Queen Square House 18-21 QueenSquare, Bristol, BS1 4NH Tel: +44 117 9214000 E-mail: info@gdsinternational.com

10/5/10 14:41:00

UPFRONT

THE BRIEF

12

RETHINKING FOOD SECURITY

W

ill April’s volcanic ash cloud prompt a rethink of the way in which we consume food in Europe? That is the question on the lips of many of the continent’s farmers, retailers, suppliers and policymakers – not to mention consumers – following the recent grounding of European flights and its subsequent impact on global food supply chains.

For many in the food industry, the consequences of Eyjafjallajokul’s eruption – and the ash cloud it produced – have been as difficult to stomach as the volcano’s name has been hard to pronounce. The economic effects of Iceland’s still-spewing volcano extend beyond the hundreds of millions a day in lost airline revenues and tourism incomes, to include a devastating impact on

UPFRONT.indd 12

result of the globalisation of the industry. both retailers in the no-fly zone “Over the last generation or so, and the growers and suppliers individual palates and whole cuithey buy from in far-flung locasines have been reshaped around tions around the world. Farmers the expectation that everything is in Kenya, for example, were forced accessible – regardless of where it to dump hundreds of tonnes was harvested, hunted or caught of vegetables, fruit and – as long as one is close to flowers destined an airport and willing for the UK after to pay for the priviBritain grows the volcanic lege,” says Sasha ash cloud over Issenberg, author Europe grounded of The Sushi Econof what it eats cargo shipments omy: Globalization in and out of the and the Making of a country, while at the Modern Delicacy. “The same time laying off thouvolcano has transported us sands of workers; meanwhile, into a locavore fantasy, forcing us restaurants, grocers and superall onto the type of 100-mile diet markets across the region were that used to be imaginable only as left without countless products – a stunt.” grown on foreign soil and shipped Issenberg believes the ashwithin hours of harvesting to a cloud crisis was a huge wake-up store near you – that consumers call regarding the nature of today’s have become accustomed to as a complex food supply chains, and

60 percent

has brought a number of theoretical debates about food security – and in particular the way in which we purchase and consume foodstuffs in the West – to the fore.

For instance, the ‘just in time’ delivery and inventory models used today by most European supermarkets mean that while there is some stock kept in reserve, it is only enough to last for two or three days.

And while this is, on the surface, no big deal – Britain only air-freights between one and two percent of its foodstuffs, few of those count as staples, and nobody’s going to starve for want of an avocado – it does reveal the inherent fragility of the current system.

In Britain we grow only 60 percent of what we eat, while figures across the rest of Europe are roughly comparable. It begs the question of whether this is a sustainable (or even sensible) strategy given how other global supply chains have

10/5/10 13:07:32

UPFRONT

THE BRIEF

been disrupted in the past by sociopolitical considerations and natural disasters. A growing awareness of the proximity of peak oil – if it is not already upon us – has much of Western Europe wondering about Vladimir Putin’s mood swings, feudal politics in the Middle East and a variety of flawed energy alternatives. There is also a nervous recognition that water might be the next big issue of the 21st century, and concerns about the way in which China is flexing its economic muscle by buying up many of the world’s other resources. Is it time we started thinking in similar terms about the manner in which we source our food supplies?

Looked at through such a lens, much bandied-about terms like ‘local food’ and ‘provenance’ suddenly feel less like marketing buzzwords and more like viable lifestyle choices. Supporting local growers and small producers, becoming more self sufficient, and making an effort to understand the produce we eat and what it took to get it to our table can only be a good thing.

It doesn’t mean that we need to abandon imports altogether; after all, there are sound arguments that our food security is greater today than ever before for the very reason that we do not depend on a small number of sources, but trade with producers all over the world. After all, famines occur when local crops fail and people cannot buy supplies in from elsewhere.

As with most things, striking the right balance will be crucial.

What the volcano has done, however, is to kickstart the debate over how best to guarantee food security for the future and, hopefully, forced us to re-evaluate our whole approach to food – to value it more and waste it less. It sounds like common sense, doesn’t it?

UPFRONT.indd 13

13

NEWS IN PICTURES

A farmer holds a crates with tomatoes damaged by the insect Tuta absoluta, in Herakleion on the island of Crete, south of mainland Greece.

French farmers drive their tractors on the Place de la Bastille in Paris on April 27 as they demonstrate against wage cuts and to denounce the European Farm Policy.

Finance ministers from the United States, Canada, Spain and South Korea, as well as the leadership of the Bill & Melinda Gates Foundation, meet on April 22 to announce an initial contribution of US$880 million for a new fund to tackle global hunger and poverty.

10/5/10 14:45:35

UPFRONT

INTERNATIONAL NEWS

14

THE REAL THING? An unlikely newcomer has made the world of soft drinks a little more crowded: Bolivia has started producing a new fi zzy drink using the coca leaf. It is called ‘Coca Colla’ after the Colla people, the Andean tribes who cultivate coca in Bolivia, Chile and Argentina.

The new ‘energy soft drink’ is being made by a private company, but is backed by a government policy of industrialising the cultivation of the coca leaf. The leaf is a key element in the Andean people’s culture and economy.

However, it is also cocaine’s raw material.

As such, the drink faces significant hurdles as it looks to challenge beverage giants such as Red Bull and its near-namesake. With the notable exception of Coca-Cola, products using coca leaves are banned in most nations beyond the Andes, and exporting the beverage would require the International Narcotics Control Board to take the leaf off the list of dangerous drugs, where it has been since 1961.

UPFRONT.indd 14

FOOTING THE BILL Every year the United States is faced with a staggering US$152 billion dollar bill for acute foodborne illnesses, according to a study from Produce Safety Project entitled HealthRelated Costs from Foodborne Illness in the United States. A quarter of this burden can be attributed to fresh, canned and processed produce, which accounts for 19.7 million documented foodborne illnesses and costs US$39 million in economic losses. Each case costs an average of US$1960, with California, Texas, New York, Florida, Illinois and Pennsylvania the states worst hit.

The research also found that some foodborne diseases elicited a higher cost than others.

Listeria moncytogenes had a total economic cost that was almost half that of Campylobacter. Th is was despite the fact there were more than 400 times fewer Listeria cases than Campylobacter.

The Centers for Disease Control (CDC) estimates there are a total of 76million foodborne illness cases across the US each year, leading to 300,000 hospitalisations and 5000 deaths.

RUSSIA GOES ORGANIC Affordable organic food is rarely seen on Russian retail shelves, but rising import costs and growing demand have domestic organic producers looking for a bigger seat at Russian tables. And while the economic crisis has forced consumers to cut spending, new trends for healthier living could make Russia an exciting market for retailers and food producers alike.

According to Konstantin Vasilchishin, CEO of Organic Corporation, this market is set to rise substantially in the coming years.

“Moscow’s eco market accounts for US$80100 million and according to our estimates it can grow fivefold in as many years,” he says.

“We have two stores and plan to open a chain for our own productions to make organic more affordable.”

Most organic products are currently imported from abroad, and Vasilchishin believes products should be grown within 100 miles in order to make organic food affordable to a wider range of consumers. This would allow retailers to substitute imports and halve prices.

10/5/10 13:40:15

UPFRONT

INTERNATIONAL NEWS

MULTI-STOREY FARMING A high-tech, vertical farm situated in the UAE hopes to solve the challenges of farming in the desert – namely, the lack of fertile soil and arid temperatures. Vertical farms such as the proposed Oasis Tower in Dubai’s Zabeel Park have been devised as a way to minimise land use, reduce emissions from transport and make regions self-sustainable. In recent years, floods, droughts, wildfires and pollution have devastated traditional harvests and in many cases, it is expected to get worse.

For these reasons, inner-city farming makes sense. It would see uninhabited highrise buildings turned into multi-storey meadows using the latest hydroponic and aeroponic technologies to cultivate crops. It is also hoped that by using water-and-nutrient solutions or nutrient-laced mist, the entire production would be soil-free, therefore enabling the projects to use 90 percent less water than conventional farming. A vertical farm would also behave like a functional ecosystem, in which waste is recycled and water is recaptured by de-humidification for re-use.

UPFRONT.indd 15

15

HOT STUFF In India chilli is set for a new use: fighting terrorism. The bhut jolokia, or ‘ghost chilli’, is to be used in teargas-like grenades to immobilise suspects, according to defence officials.

The Indian army believes that the pungency of the ground seeds of the bhut jolokia – a capsicum hybrid that is reputed to be 100 times hotter than a jalapeño – could be harnessed in smoke grenades against rioters or to flush out terrorists in confined spaces. The army said the weapon could also be used in aerosol sprays by women warding off attackers.

The three-inch-long stubbly red pepper has been measured at 1,041,427 units on the Scoville scale, twice as hot as the next fieriest pepper, the Mexican red savina, and 200 times hotter than Tabasco sauce – so much so that it gained a place in Guinness World Records.

A jalapeño, by contrast, registers a measly 10,000 on the Scoville scale.

PET MEAT BAN A Chinese culinary tradition that dates back thousands of years may come to end as Chinese legal experts propose a ban on eating cats and dogs, according to The Guardian newspaper.

The contentious move will see a recommendation submitted to higher authorities as part of a draft bill to tackle animal abuse since recent years have seen a rise in the criticism of such practices on the part of the affluent, petloving, urban middle class.

The proposed ban calls for thousands of dog restaurants and butchers to be closed down and would impose 15 day prison sentences or fines of 500,000 yuan for individuals or businesses illegally selling or consuming pet meat.

10/5/10 14:42:31

UPFRONT

16

COUNTING THE CALORIE COST On average, a woman should be eating 2000 calories a day, while a man should be eating 2500. Plenty to play with, you would think – until you see the latest food on offer to you.

After KFC unveiled its Double Down Sandwich – a bun-less burger that substitutes fried chicken for bread – EU watchdogs have been setting their sights on the fast food industry over the calorie content in its food. And with good reason. For instance, the crispy ‘Original Recipe’ version of the Double Down Sandwich weighs in at 540 calories, its grilled equivalent 460.

But we can’t just point the finger at the Double Down; there are a plethora of other burgers on the market that are equally as bad. In fact, take a look at others on the market and you start to realise that the Double Down is just the tip of the iceberg. The Burger King Chicken Tendercrisp weighs in at 800 calories, for instance, while Jack-in-the-Box’s Ranch Chicken Club will reportedly set you back 700 calories. Turn your attention to beef burgers, and the calorie count gets even scarier. There’s 1320 in a Hardee’s Monster Thickburger, and 1350 for a Wendy’s Triple Baconator.

And it’s not just calories that are doing the damage. Enter cholesterol, salt and fat – the real heart stoppers. This is where the Double Down really comes into its own. The sandwich contains 145 milligrams of cholesterol (more than twice that of the Big Mac and about half of the recommended daily allowance) as well as 1380 milligrams of salt (the USDA recommends no more than 2400 per day) and 32 grams of fat (no more than 65 grams/day please, says the government).

KFC’s timing with the Double Down – which will be available through mid-May – may seem odd when many fast-food restaurants are promoting healthier menu items to please an increasingly health conscious public. “This is not a healthy choice,” says Walter Willett, Chairman of the Nutrition Department at the Harvard School of Public Health.

FAST FACT

HOW GREEN IS GREEN? Reducing our meat con- ing with Juha Helenius of the sumption is often touted as a way Department of Agricultural to drastically reduce Sciences at the University of greenhouse gas Helsinki, have calculated (GHG) emissions that emissions from the Going vegan but a new research cultivation of soil acwould reduce paper published in tually account for the GHG emissions the journal Progress majority of emissions in Industrial Ecology has created from food concluded that going consumption at 62 vegan would only reduce percent. GHG released emissions by a mere seven by cows and sheep account percent. for 24 percent and energy conHelmi Risku-Norja and Sirpa Kurppa sumption and fertilizer producof MTT Agrifood Research Finland, work- tion for eight percent each.

by 7%

UPFRONT.indd 16

The EU imported 1.6 million tonnes of meat and meat products in 2007 (half of which came from Brazil), and 0.3 million tonnes of dairy products and eggs (mostly from Switzerland and New Zealand).

Source: Eurostat

10/5/10 13:07:52

UPFRONT

17

TOO MUCH INFORMATION?

FAST FACT

Mobile phone apps are all the rage these days and there is practically an app for everything imaginable. Now, a group of young Germans has developed an app that will allow shoppers to point their mobile phone at the barcode of a product to reveal a brand’s ethical profi le.

The app is free to download and incorporates a price-comparison service as well as an electronic traffic light system to show consumers how healthy a particular product is and it can also give dietary and allergy advice. Barcoo, as the app is called, has been praised by consumer watchdogs for encouraging transparency but has also come under fi re from retailers who believe that such an app arms consumers with too much information.

FRENCH HALAL BOOM French retailers and restaurants are enjoying the rapidly expanding and highly profitable market in halal food and drink. A boom in sales of halal products, including alcohol-free bubbly and goose liver paté approved by Islamic law, is being driven by the emergence of an affluent middle class of young Muslims.

Known as the beurgeois – a play on bourgeois and the word beur, slang for a French person of North African descent – these new consumers have a spending power worth an estimated €5.5 billion a year, according to a poll by Solis.

The demand for halal products, currently increasing by an estimated 15 percent a year, has captured the attention of food giants such as the supermarket group Casino, which has stocked an increasing variety of halal foods – mostly meat products – for the last three years.

The fast-food chain Quick has a number of halal-only burger bars, while Muslim corner shops selling exclusively halal foods and drinks including eggs, turkey bacon and pork-free sausages as well as alcohol-free ‘ch ‘champagne’, known as Cham’Alal, are also flourishing. o Halal foie gras, first introduced into s supermarket chains a across the country two y years ago at the end of t Muslim feast of Rathe m madan, has proved an u unexpected success.

UPFRONT.indd 17

The food industry accounts for

90% of worldwide usage of intense sweeteners, with the remainder destined for pharmaceutical products.

Source: Leatherhead Food Research

GAUGING GREENHOUSE GASES In a recent report published by the Food and Agricultural Organization of the United Nations (FAO), the dairy sector’s greenhouse gas (GHG) emissions were calculated for the entire dairy food chain.

Samuel Jutzi, Director of FAO’s Animal Production and Health Division says: “Th is report is fundamental to understand and identify opportunities for reducing the environmental impact of the dairy sector while providing safe and nutritious foodstuffs.”

The results of the report show that the dairy sector accounts for around four percent of all global anthropogenic greenhouse gas emissions. Th is figure includes both emissions associated with the production, processing and transportation of milk products as well as emissions related to meat produced from animals originating from the dairy system.

In 2007, the dairy sector emitted 1969 million tonnes of carbon dioxide (CO2) equivalent, of which 1328 million tonnes are attributed to milk, 151 million tonnes to meat from culled dairy animals, and 490 million tonnes from calves from the dairy sector that were raised for meat.

Taking this a step further, the FAO intends to use a similar approach to quantify GHG emissions associated with other major livestock species, including buffalo, poultry, small ruminants and pigs. A fi nal report will be published in 2011.

10/5/10 13:07:57

FULLY AUTOMATIC In today’s high throughput, fast food environment, increasing the speed of customer service is a popular demand. Adding automation to the cooking process can eliminate potential manual errors, allow end users to create a ‘one-touch’ solution for setting cooking parameters and improve or maintain cooking consistency, and ultimately reduce production time and improve customer satisfaction.

Steel belt technology, such as that offered by Belt Technologies Europe, is key to manufacturing and improving automated food production systems. For example, a new automated commercial grill system, within which the precise positioning of two cooking platens is critical, relies upon the steel belts. Th rough their precise movement, the belts help to ensure that a programmable and repeatable distance is set between the two platens.

Steel drive tapes were chosen above cables and inclined planes for this application, largely due to their proven success in precision positioning applications and their availability in stainless steel to suit

UPFRONT.indd 18

the hygiene requirements of the food preparation industry.

In addition, the steel belts are of low mass and perform well without any lubrication. They are also highly durable and – in this application – provide near zero backlash, no stretch and offer high positioning repeatability.

The design of the grill system incorporates the use of the steel drive tape, attached to both the upper cooking plates and a drive pulley. A single button on the operator control panel activates the drive assemblies, moving the upper cooking plates to precisely the required position. As a result, the automated cooking system is providing consistent and predictable cooking performance.

Before implementation, the grill system was tested to determine reliability. After three million cycles it demonstrated no sign of fracture after review by an independent metallurgist. In continual operation there has been no evidence of measurable stretch after repeated use and no change in the structure of the tape since installation.

10/5/10 13:48:20

UPFRONT

WATER WORRIES

19

ADDICTED TO JUNK

The head of the European Commission’s water unit, Peter Gammeltoft, has suggested that one of the priorities in reforming the Common Agricultural Policy (CAP) should be water efficiency.

Given that farming accounts for two thirds of EU water use Gammeltoft says: “We cannot talk about water efficiency without talking about agriculture.” The CAP Health Check, which was the last reform, did seek to address this issue to some extent but more needs to be done, according to Gammeltoft.

He believes that rules regarding irrigation in Europe are currently not fully respected and he is also pushing for water use in biofuels and biomass to be addressed. In addition, he is calling for more data measuring the effect of changes in land use on water availability.

In 2012, the Commisssion will table a ‘Blueprint for Safeguarding Europe’s Water’, which will examine Member States’ implementation of EU water legislation and assess the potential for both water savings and increased water availability as well as climate resilience.

A study by scientists at the Scripps Research Institute in Florida has found that binging on junk food is as addictive as smoking or taking drugs.

According to the study, it could cause compulsive eating and obesity. American researchers found burgers, chips and sausages programmed a human brain into craving even more sugar, salt and fat laden food.

The researchers found laboratory rats became addicted to a bad diet just like people who became dependent on cocaine and heroin, which could go some way to explaining the rising obesity rates and the success of fast food outlets.

While the fi ndings cannot be directly transferred to human obesity, the study found that over-consumption of high-calorie food triggered addiction-like responses in the brain.

Dr. Paul Kenny, a neuroscientist who led the research, which was published online in Nature Neuroscience, said the study, which took nearly three years to complete, confirmed the “addictive” properties of junk food.

DOWNSIZING UNHEALTHY FOOD The UK Food Standards Agency (FSA) has stated that manufacturers need to produce smaller portions of less healthy food and drink options. The agency claims that single portions of some biscuits, cakes, buns and chocolate, which are heavy on sugar and saturated fats, should be sold in reduced size. The FSA is also recommending that drinks containing added sugar should be available in 250ml servings, not just the standard 330ml cans.

In February, a survey by the FSA revealed that people are eating too much added sugar, which is currently responsible for 12.5 percent of food energy intake on average, compared to the recommended 11 percent.

With a population where one in four is seriously overweight, over eating is becoming part of everyday culture and so the initiative has been well received by government officials who are currently being held to account for such worrying figures.

UPFRONT.indd 19

10/5/10 13:08:02

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SUSTAINABLE FOOD SEMINAR Seven European countries will meet next month in the Hague following an initiative of Minister Gerda Verburg of Agriculture, Nature and Food Quality, aimed to create closer collaboration in the field of sustainable food.

In May 2010, the directors of the ministries responsible for food in Denmark, Germany, France, Britain, Spain and Sweden will gather together for the fi rst time, in a meeting chaired by the Netherlands. The countries will compare notes on sustainable food production, and determine common objectives and the government resources in place for achieving sustainable production and consumption.

The role of Europe and the European Commission will also be addressed, as Minister Verburg believes coordinated international efforts are required to achieve sustainable food production. “In 2050 there will be nine billion mouths to feed in the world. Rising levels of prosperity lead to different diets, such as increased consumption of dairy and meat. There will also be less clean water and fertile land available, and we have to deal with the impact of climate change in the form of drought or floods. In view of these circumstances, sustainable global food production and consumption is essential,” said Verburg at the opening of the second edition of the international seminar Future of Food, in London.

The goal of the seminar, which will explore the role of bankers and retailers in the food system, is to bring together scientists, policy makers, entrepreneurs and civil society under the theme ‘Future of the global food system’.

Retailers are on the right track, according to Minister Verburg, prompted by a growing group of consumers who want sustainable products. She encourages supermarkets to continue offering products made with respect for people, the environment and animals.

The fi nancial sector can play a decisive role. Minister Verburg referred to the ING report on what it calls ‘the third industrial revolution’, which deals with multi-committed companies, or MCCs. A growing number of company strategies focus not only on profit, but also on human rights, good governance and responsible use of raw materials. “What is remarkable about these MCCs is that they usually have a higher market value than comparable companies with lower scores for corporate responsibility.”

Verburg believes banks should support MCCs and similar businesses more often, encourage sustainability in other companies, and should not hesitate to withdraw fi nancial support from unsustainable projects and fi nancial investments. “I think that is their moral duty. It is certainly the case for those bodies which last year were kept afloat by billions of Euros in government aid.”

For more information visit www.future-of-food.com

UPFRONT.indd 20

In the previous issue of NGF we took a look at the rise of sugar substitute Stevia and asked why the European Union has been so reluctant to authorise its use.

To read more of the stories from this issue head to www.nextgenerationfood.com

SUPPLY CHAIN GUIDE TNO, an independent research body from the Netherlands, has now published its supply chain guide online as a free download. The report, entitled Vulnerabilities in the food chain – a stakeholders guide, was first published in hard copy last year as a limited edition and contains information aimed at helping food processors to assess weaknesses in the food supply chain.

The EU-funded project was compiled by TNO in conjunction with 10 partners from Brazil and Europe and focuses on microbiological and chemical risks in the food supply chain and gives recommendations on how to manage and prioritise these risks.

The guide has two distinct sections, the first being a description of the system and the second being a number of articles containing relevant background information on international legislation, consumer behaviour and governmental decision-making.

10/5/10 13:08:04

UPFRONT

21

COLLABORATION BOOSTS INNOVATION The food industry in Denmark, a country recognised for its high levels of innovation by the World Economic Forum, has been the subject of a study into how food companies’ organisational set ups can affect how they commercialise innovative ideas.

Researchers from the Universities of Copenhagen, Manchester and Saskatchewan in Canada looked at vertical integration within the food industry and examined how food companies work with different levels of the food supply chain and network with external partners. They also looked at industry alliances and whether companies draw up sales contracts with their customers or sell products ‘on the spot’.

The result showed that greater degrees of network linkage and contractual arrangements have a positive effect on innovation.

SUSTAINABLE INVESTMENT Research from Datamonitor suggests a need for producers to invest in more sustainable packaging as consumers believe that levels are currently excessive.

Consumer demand for sustainable packaging is on the up and customer surveys carried out by Datamonitor in 2008 and 2009 revealed that reduced levels of packaging strongly influences purchasing decisions. These concerns, according to the review, were highest in the United Arab Emirates, Saudi Arabia and India, followed by Australia, France, the UK and Germany.

Consumers in Japan, the Netherlands and Sweden indicated that the issue would slightly influence their decisions.

The study shows that companies need to take action on packaging issues if they are to avoid alienating existing or new customers. It also highlights the fact that designing sustainability into packaging generates genuine operating efficiencies for manufacturers – such as reduced transport costs and waste resulting from utilising less packing.

UPFRONT.indd 21

Organic sales hit Organic sales may have previously held up during the recession, but new data has shown that in the last year, sales have fallen significantly.

In the last year in the UK, sales of organic food, drink and other products has fallen 12.9 percent as producers battle against a downturn in consumer demand and the worst trading climate in 20 years. The new data has found that shoppers have turned their backs on organic fruit, vegetables, meat and bread in order to save themselves some pennies.

As well as a fall in the shops, home delivery organic vegetable and fruit boxes also fell, with a 9.8 percent slump in sales, while sales of organic goods in supermarkets fell by 12.2 percent, and in the independent sector by 17.7 percent.

From a record high of UK£2.1 billion in 2008, sales of organic food fell to UK£1.84 billion last year, according to the Organic Market Report 2010, released at the Natural and Organic Products Europe show in London.

The three biggest categories of organic food in terms of retail value– dairy, fruit and vegetables, and fresh meat – saw supermarket sales fall by 6.5 percent, 14.8 percent and 22.7 percent respectively. But dairy remains overall the most popular food category, accounting for 33 percent of all sales.

Despite the slump, the report shows that sales of organic food are still three times higher than in 1999 and more than 50 percent higher than five years ago.

10/5/10 13:08:05

UPFRONT

22

Muhtar Kent, Chairman and Chief Executive of The Coca-Cola Company We’re just at the beginning stages of what I believe will be an era of unprecedented sustainability innovations. Over the course of 123 years, the men and women of the Coca-Cola system have built one of the world’s most recognised and valued brands. In fact, today, Coca-Cola is the second-most universally recognised term on the planet. Only the term ‘okay’ is recognised by more people around the world.

The strength, the resolve and the sustainability of our brand is directly related to the social license that we have earned from billions of consumers around the world over all these years. It’s an honour and a responsibility we don’t take lightly and which we will never take for granted.

In today’s connected global economy and interwoven social networks, a brand with 123 years of credibility can be discredited – and even destroyed – in a matter of 123 seconds. I would contend that as business leaders there is absolutely no responsibility that is more important for us to manage and uphold than our social license to operate. Without it, we are lost.

History has proven this time and again. In fact, while ‘social responsibility’ and ‘sustainability’ have gained great attention in recent years, these are by no means contemporary 21st century concepts. The values of business social responsibility are as old as written history.

A sustainable brand – an enduring brand – must also be a socially responsible brand. A brand, of course, is more than a logo, a design, or a slogan. Much more. It has a heartbeat, a soul and a psyche. It is the very core, the very essence, of an organisation.

A brand is a promise made to your consumers and customers, your employees, your investors, communities, vendors and suppliers. And trust is the glue that holds all those relationships together. Break a promise and you destroy a relationship. If a good brand is a promise, then a great brand is a promise kept.

As we endure a global fi nancial crisis brought on largely by a series of broken promises, the virtues of trust and socially responsible brands have never been more relevant.

Clearly, now is not the time to cut back on our sustainability efforts. In fact, I believe that businesses that effectively invest in sustainability innovations today will not only be in a better position when we come out of this crisis but that many will also make leapfrog gains in the marketplace.

UPFRONT.indd 22

10/5/10 13:08:12

UPFRONT

23

TOP 10

FOOD AT THE FOREFRONT

Major food and beverage companies ranked by their corporate social responsibility Source: Two Tomorrows

1 2 3 4 5 6 7 8 9 10

Unilever 64% Nestlé 59%

Danone 58% PepsiCo 51%

A new report published by the Confederation of the food and drink industries of the EU (CIAA) claims that the food and drinks industry is the largest manufacturing sector in Europe making up 13 percent of the industry and putting it ahead of the automobile and chemical industries.

Entitled Data & Trends of the European Food and Drink Industry 2009, the CIAA report states that the industry’s turnover increased three percent from 2007 to 2008 when it reached €965 billion.

The food and drinks industry is the leading employer in the EU, accounting for 4.4 million employees in 2008, making up 13.5 percent of the employment market, reveals the report. However, the sector is somewhat lagging behind the automobile and

chemical industries when it comes to labour productivity investing only €7500 per employee compared to €11,500 in automobile and €14,000 in chemicals.

R&D investment is also ‘insufficient’, according to the report, which says that expenditure in this area accounts for only 0.37 percent of food and drink output. This places the industry not only below other manufacturing industries in Europe but is also lower than the expenditure of food manufacturing sectors in other developed countries outside of Europe.

The CIAA also reports that the sector has experienced stable growth over the past decade although exports have decreased significantly over the same period. In 2008, food and drink exports accounted for 18 percent of the global export market, a drop from the 25 percent witnessed 10 years earlier.

Coca-Cola 49% FAST FACT

AB-InBev 46% Kraft 46% Today, almost

Heineken 39%

Tyson 28%

UPFRONT.indd 23

Kirin Holdings

23%

60%

of European savoury snack manufacturers have salt-reduced products in their portfolio.

This corresponds to more than 40% since the end of 2005.

Source: CIAA

TOP 10

Rice producing countries Source: International Rice research Institute

1 2 3 4 5 6 7 8 9 10

China India

Indonesia Bangladesh

Vietnam Thailand Myanmar Japan

Philippines Brazil

10/5/10 13:08:16

UPFRONT

24

SICKLY SWEET According to research published in the Archives of Internal Medicine, those who eat at least one bar of chocolate every week are more gloomy than those who only eat chocolate now and again. The fi ndings suggest that people who feel depressed eat about 55 percent more chocolate than their non-depressed peers. And the more depressed they feel, the more chocolate they tend to eat.

It’s believed by many that chocolate has the power to lift mood, but the US team says that scientific proof for this is lacking and that chocolate may be a cause rather than the cure for being depressed.

Of the 1000 adults who took part in the study, none of them were on antidepressants or had been diagnosed as clinically depressed by a doctor.

FOOD SUPERSTARS A number of foods have shown compararespondents frequently consuming “rich tively higher levels of growth since 2006, in” antioxidant foods. Likewise, Omegaaccording to a report by Decision Analyst 3s were named in the report as another on ingredient and healthy food trends. The ingredient with star status, whilst iron-rich foods concerned include almonds, berries, foods on the other hand have experienced a cinnamon, dark chocolate, ginger, decline in consumer interest. pomegranate juice and wal“Consumers, particunuts, which have become larly those in older age increasingly popular segments, are demandwith the over-45s. ing more from their of consumers eat Interest and faith foods as they seek vitamin and in whole grains has also proactive ways to risen and is particumanage their health,” mineral- fortified larly high amongst older the report says. functional foods consumers. Meanwhile, “If given a choice, interest in fiber has remained these consumers may opt relatively stable since 2006. for the product that is rich Nearly 50 percent of consumers in or fortified with a key ingrediquestioned for the report stated that they ent, not only because it provides a ‘health consumed vitamin and mineral-fortified boost’, but also because it provides the psyfunctional foods and beverages, with those chological satisfaction of positive lifestyle over 45 years of age showing the strongest management.” intentions to use dietary supplements.

Antioxidant foods have also experienced strong growth with 40 percent of

50%

FAST FACT China’s sugar imports are forecast to rise to

1. 5 million tonnes in 2010-11 Source: the US Department of Agriculture’s Beijing office.

UPFRONT.indd 24

10/5/10 13:08:18

UPFRONT 25

CATTLE POPULATION

DON’T MISS...

% OF EU - 27 TOTAL France

21% Other Member States

Germany

14%

39%

United Kingdom

12% Spain

Italy

7%

7%

LOOKING UP Danone turns a crisis into an opportunity P78

Source: Eurostat

COMPANY INDEX Q2 2010 Companies in this issue are indexed to the first page of the article in which each is mentioned.

3M 36, 37

Food Standards Agency 84, 92, 124

Novartis Pharma Technical Operations 114

3P Partners 118, 119

Glanbia Nutritionials 46, 53

Novozymes A/S 72, 73

AcryliCon 40

Grameen Bank 78

PerkinElmer 46, 47

Altro 64, 65

Henkel 137

Petro-Canada IFC, 58, 59

FARM FIT

Amcor 129

Horphag Research 70, 71

Pilgrim Software 123

ANL Plastics 135

Huhtamaki 130, 131, OBC

Protected Harvest 90

Arla Foods 32

Hunter Associates Laboratory, Inc. 46, 55

Provimi 4

Belt Technologies 18

Hygiena International 44, 45

Purac 74, 75

How the European Livestock Association is working too protect the continent’s animals and consumers P96

Cadbury 78

IBM 90

Rainforest Alliance 90

Capricorn Cheeses 90

IGD 124

Raycome 100, 101

Carrefour 78

Infor 2, 110, 111

Rubinum Animal Health 102, 103

Confederation of the Food and Drink

Ishida 138, IBC

Selerant 120, 121

Industries of the EU 84

Kraft 78

Supply Chain Council 106

Danone 78

Marine Stewardship Council 90

TNA Solutions 133

Deibel Laboratories, Inc. 46, 49

Marks & Spencer 90

Wal-Mart 78

E.LeClerc 78

Mars 90

World Health Organization 42

EFSA 66

Max Planck Institute 66

WRAP 124

Einar Willumsen 46, 51

Mayr-Melnhof Karton AG 46, 57

European Livestock Association 96

Meettheboss.com 95

Evonik Degussa GmbH 6, 104, 105

Minimpex 112, 113

Exosect 38, 39

Mintel 74

ExxonMobil 62, 63

Nanotechnology Industries Association 84

SIZE MATTERS

FAO 42

NCH Europe 60, 61

FLAVEX Naturextrakte GmbH 76, 77

Nestlé 132

Portion size informatioin and its effect on consumer behaviour P120

UPFRONT.indd 25

11/5/10 09:33:41

FEATURE

GLASS 26 www.nextgenerationfood.com

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10/5/10 14:43:48

As Kraft completes its takeover of Cadbury, Huw Thomas asks if the deal is really good news for either party?

O

n January 19, 2010 it fi nally happened. One of the biggest and most protracted business deals to hit the food industry for years fi nally drew to a close as shareholders of UK confectioner Cadbury fi nally agreed to accept the £12 billion (€14 billion) takeover bid from US giant Kraft .

The deal was the culmination of an affair that had been rumbling on for four months.

Initially approaching Cadbury with a cash and share deal in September 2009 worth £10.2 billion (€12 billion), Kraft was rebuffed, kicking off a period of fractious bartering between the two companies. It was only after a huge amount of public wrangling that Kraft fi nally got its man.

FULL?

www.nextgenerationfood.com 27

Cadbury Kraft.indd 27

10/5/10 14:44:06

TWO BECOME ONE TIMELINE OF A TAKEOVER 7

September 2009

22

September 2009

25

September 2009

30

September 2009

21

October 2009

9

November 2009

14

November 2009

18

November 2009

23

November 2009

4

December 2009

14

December 2009

5

January 2010

7

January 2010

12

January 2010

18

January 2010

Kraft food launches Cadbury takeover bid Cadbury tells Kraft to raise its bid or back off Peter Mandelson suggests foreign ownership of British companies could damage the country Kraft given November deadline for Cadbury bid Pressure on Kraft as Cadbury upbeat on results Kraft bid goes hostile Royal Bank of Scotland heavily criticised for helping to finance Kraft's bid Hershey and Ferrero emerge as possible bidders for Cadbury Cadbury's shares hit a two-month high after speculation Nestlé could bid for the company Kraft posts circular explaining bid to shareholders Cadbury launches official defence to Kraft’s bid Kraft sells pizza business to Nestlé to fund Cadbury offer European Commission sets conditions for Kraft buying Cadbury Cadbury issues final defence, attacking Kraft’s management Cadbury board recommends £12bn sale to Kraft

For Kraft , the Cadbury deal represented an excellent opportunity for a company still largely centred on the US to expand quickly into the European market. Particularly attractive was the UK confectioner’s strength in areas like chewing gum, a sector that has experienced strong growth in recent years, despite the difficult trading environment.

A combined Kraft-Cadbury would be expected to control some 25 percent of the gum market in Western Europe. In addition, the acquisition will make Kraft the world’s largest confectioner and the leader in sweet snacks.

The confections and snacks segments – at 30 percent and 21 percent respectively – will now make up the majority of Kraft’s portfolio. The deal also gives Kraft a foothold in emerging markets like India, South Africa and Turkey. Kraft contend that the takeover will enable cost savings in the region of $675 million (€527 million) per year, leading Kraft CEO Irene Rosenfeld to confidently predict a growth in earnings for 2011.

However, not everybody saw the tie up as such a good deal for the US company. Investor Warren Buffett, the closest thing the business world has to a soothsayer, was quick to voice his concerns that the acquisition might not be in Kraft’s best interests. In particular, he believed that the sale of Kraft’s frozen pizza business to Nestlé – completed in order to fi nance the deal – did not provide the best amount of value. Buffett’s words tend to carry a lot of weight in fi nancial circles. In this case their impact was potentially even greater as his fi rm Berkshire Hathaway is Kraft’s largest shareholder. In a statement issued two weeks before the deal fi nally went through Berkshire Hathaway said: “To state the matter simply, a shareholder voting ‘yes’ today is authorising a huge transaction without knowing its cost or the means of payment. What we know with certainty, however, is that Kraft stock, at its current price of $27, is a very expensive ‘currency’ to be used in an acquisition. In 2007, in fact, Kraft spent $3.6bn to repurchase shares at about $33 per share, presumably because the directors and management thought the shares to be worth more.”

Ultimately, Kraft’s management were able to push the Cadbury deal through without shareholder approval, much to Buffett’s chagrin. Speaking at the Berkshire Hathaway

28 www.nextgenerationfood.com

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10/5/10 14:44:22

TAKEOVER TALK Ahead of her company’s official move for Cadbury, Kraft CEO Irene Rosenfeld outlined why the UK confectioner looked like such a sweet deal.

Why is this proposed transaction right for Kraft Foods?

Irene Rosenfeld. I think it’s a logical next step in our transformation toward a high-growth, higher-margin company.

It’s the opportunity to combine two companies to create a global powerhouse in snacks, confectionary and quick meals that I think has the potential to benefit our brands, our employees, our consumers and certainly our shareholders. It would become a US$50 billion company. One that would have the scale, the scope and the resources to grow faster today and well into the future.

Where are the synergies you identified coming from?

IR. We see substantial synergies, pre-tax synergies, as a result of operational efficiencies in combining the two companies.

But equally important, we see excellent revenue synergies that come from increased investment in distribution, in marketing and new product development and so although it’s premature to talk about any of the specifics, we see tremendous benefits in combining the two companies.

Do you think this proposed transaction is feasible given the political considerations of acquiring a UK icon?

IR.Absolutely. We have tremendous respect for Cadbury, for its brands, for its proud heritage and just as we have done, they have made significant investments over the years in quality and innovation and marketing. Especially here in the UK it is an iconic business and it is one that has a very proud heritage and we have every intention of respecting that.

Why does this proposed transaction make sense for Cadbury?

IR. We have great respect for Cadbury, for its brands, for its employees and for its proud heritage, but I believe that in the current global economy the growth prospects are constrained and so we believe by bringing together these two great companies the opportunity to create a global powerhouse will enable it to compete far more effectively in the future.

For Cadbury’s shareholders we believe that the premium we have offered is a compelling one and we believe that the nature of our proposal provides both value certainty in the near term as well as the opportunity to benefit from the long-term upside in the synergies that come from combining these two great companies.

Why are you considering this proposal now?

IR. We’ve been following Cadbury for quite some time. Both companies are on solid footing. Kraft just reported very strong second quarter results, which suggests that we have made excellent progress in our turnaround. We continue to benefi t from the integration of the LU Biscuit business that we bought back in 2007 and similarly, Cadbury has made excellent progress against the Vision Into Action programme. So I think it’s an opportune time for both companies to come together and move together to the next level.

What commitments are you making in regards to jobs or manufacturing facilities?

IR. As you might imagine, it’s a little bit too early to make any specific commitments. But what I can say is that as we create this global powerhouse, there will be opportunities for talented employees from both companies to continue to have very attractive and successful careers. In addition, we can confirm that the existing contractual employment rights, particularly pension rights, of all Cadbury employees will be totally safeguarded.

Are there differences in the cultures of the two companies that are going to raise the integration risk?

IR. I think some of the great values that have guided the history of Cadbury have also guided the history of Kraft. And even if you look at some of the programmes that we have both chosen to pursue, our desire to make a difference in the communities in which we operate is similar. Kraft has pursued that avenue with our Kenco coffee – we’ve taken a very strong stance with respect to Rainforest Alliance coffee. Similarly, Cadbury has taken a very strong stance with respect to Fair Trade cocoa.

In both cases our desire is to help improve the lives of those who raise the crops that we use as inputs to make our own products and so I think culturally the two businesses are quite similar and I’m quite optimistic about the possibility of combining these two very strong, very proud cultures.

www.nextgenerationfood.com 29

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10/5/10 14:44:22

shareholder meeting in May, the so-called Sage of Omaha maintained his hard line.

“Both deals were dumb,” he said. “The pizza deal was particularly dumb. I just hated to see them give up a significant portion of those businesses to buy Cadbury. We expect to do some dumb things, but we get mad when other people do dumb things.”

The fact that the whole takeover saga dragged on for so long has cultural as well as financial roots. Cadbury is a British institution, founded by devout Quaker brothers in the 1840s and closely tied to the communities in which it has been based ever since. Brands like Dairy Milk and Creme Eggs have been a

British protesters voice their opposition to Kraft’s takeover bid

“The pizza deal was particularly dumb. I just hated to see them give up a significant portion of those businesses to buy Cadbury” Warren Buffet touchstone of childhood memory in the UK for generations. That these icons could soon be absorbed by a foreign corporation like Kraft has been tough to swallow for many patriotic and nostalgic Brits. Also, with its superpower days long behind it, Britain is unusually sensitive to any perceived imperialistic slight from its former colony. Viewed through this lens, the howls of protest that greeted news of the takeover make a degree of sense, even if they erroneously depict Cadbury – a global company with an annual income of €440 million – as a naïve British innocent menaced by a ravening corporate monster from across the Atlantic.

Nonetheless, these reactions do raise issues around exactly what the Cadbury brand means to many consumers. In the wake of the highly publicised battle for the fi rm, any deviation from the qualities and characteristics of products that consumers have been purchasing for decades will be quickly seized upon.

To preserve the value of its investment, Kraft must be extremely cautious about alienating customers who are notoriously set in their ways. The furore greeting Coco-Cola’s attempt to change its recipe in the 1980s should serve

30 www.nextgenerationfood.com

Cadbury Kraft.indd 30

10/5/10 14:44:23

as a stark warning to any company seeking to modify its well-loved products.

While concerns about perceived Britishness and recipe changes are essentially emotional in nature, there are obvious economic implications for the UK resulting from the deal. If Kraft is to find annual savings of $521 million, then cuts are going to have to be made somewhere. The fear is, that when it comes to the crunch, American jobs and facilities will be prioritised over British ones. Though Kraft made many positive noises about its commitment to British manufacturing while attempting to get the deal pushed through, considerable doubts remain over its long-term motives.

During the bidding process, Kraft made explicit promises about keeping open a UK factory at Somerdale. In a statement released in September 2009, the company said it would; “be in a position to continue to operate the Somerdale facility, which is currently planned to be closed ... thereby preserving UK manufacturing jobs.” Cadbury had already earmarked the facility for closure, moving production to a cheaper centre in Poland, so this pledge was warmly welcomed by both Cadbury employees and supporters of British manufacturing.

Unfortunately, Kraft’s enthusiasm for the Somerdale plant was to be short lived. Just days after the takeover was confi rmed, the US company declared that it would be shutting the factory after all, saying that plans for it’s closure were too advanced to be reversed.

The factory would close and 400 British jobs would be lost. Called to answer for the u-turn at a House of Commons Business Select Committee meeting, Kraft did its best to appear contrite. “We are truly sorry about that and I am personally sorry,” said the company’s Executive Vice President Marc Firestone in response to accusations that Kraft had raised and then dashed hopes. “I personally give you my apology for creating that uncertainty.”

It would be fair to say that the response to this mea culpa was not particularly positive.

Also criticising CEO Rosenfeld for her failure to appear before the committee in person, Jennie Formby, head of food and drink for the Unite union said: “Th is does not augur well for Cadbury workers. Kraft have been extremely dishonest and highly manipulative.”

UK Business Secretary Lord Mandelson, who at least secured a face-to-face meeting

with Rosenfeld, also expressed disappointment in the company’s actions. Speaking of his conversation with the Kraft CEO, Mandelson said: “She did reveal that over the next three months they would be looking at the management structures and personnel, and over the following four to six months, and only in that timeframe, would they be taking decisions about plants, production and the workforce that would be needed for that. So I think that ... rather than six months, we have decisions like this being taken and announced in six

Cadbury: key figures Revenue: €4.4 billion Net income: €440 million Employees: 45,000

Kraft: key figures Revenue: €31.4 billion Net income: €2 billion Employees: 98,000

days, is contrary to the working relationship that the CEO said that she would have, both with the company that Kraft were taking over here in this country, Cadbury, but also with the British Government.”

In fact, the government has been so perturbed by Kraft’s behaviour, and the possible impacts future such deals might have on the British economy, that a ‘Cadbury Law’ has even been proposed. Th is would prevent the

takeover of certain British companies deemed of particular importance to the nation unless two thirds of shareholders voted in favour.

Though the law is unlikely to be enacted any time soon, that it was even floated and received strong support indicates the depth of feeling on the issue.

But from Kraft’s perspective at least, all of the effort, the wrangling and the disagreements, will be worth it if the Cadburys deal eventually pays off. Unfortunately, this is far from certain. Though mergers and acquisitions are entered into to create synergies and efficiencies, this outcome is no dead cert.

A 2008 advisory from KPMG entitled All to play for: Striving for post deal success contains some major food for thought. According to the survey, only 42 percent of competitive deals deliver while 45 percent of them result in an actual reduction in profitability.

Given the major cultural and organisational differences between the two entities, successfully bringing them together in a way that can really deliver long-term shareholder value will be no easy task. There are a huge number of potential sticking points, not least how Cadbury’s long history of social responsibility and its increasingly close relationship with the Fair Trade movement will gel with Kraft’s corporate business model. Though the American company has pledged to maintain a commitment that would see 20,000 tonnes of cocoa sourced from Fair Trade-certified suppliers in 2010, Kraft’s involvement with the competing Rainforest Alliance buying scheme does present a potential challenge in the long-term.

Cultural issues aside, simple economics leave some big question marks. The fact is that Kraft ended up paying over 40 percent more than Cadbury’s share price over the last two years to make the deal happen. Even considering the growth potential in confectionery, this means that everything will have to go very right if the acquisition is to be judged a success. Kraft have to hope they can beat the odds and deliver real value, or the only people who could end up benefiting are the Cadbury shareholders who got such a good price for their stock. There are plenty of ways this seemingly sweet deal could leave a bitter aftertaste.

Only time will tell if Kraft have bitten off more than they can chew.

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PederTuborgh_ArlaFoods ED_26nov09 10/05/2010 14:20 Page 32

THE BIG INTERVIEW

MAKING A

After a period of freefalling milk prices, Arla Foods CEO Peder Tuborgh explains how his company is getting back on track.

32 www.nextgenerationfood.com

PederTuborgh_ArlaFoods ED_26nov09 10/05/2010 14:20 Page 33

F

or anyone who made a living selling milk, 2009 was a difficult year. Raw material prices plummeted as global demand for the white stuff slowed to a trickle. For many dairy companies, the unfavourable market conditions were a death knell, but for Denmark-headquartered Arla Foods, they prompted an ambitious programmeme of cost savings that have exceeded even the company’s own targets. Now looking ahead to a future of new products, territorial expansion and an ongoing growth strategy, CEO Peder Tuborgh has many reasons to believe that 2010 will be a far better year than its predecessor.

A major focus for the company over the course of last year was making savings, with a target of KR840 million. What were the key challenges you faced in making these gains without negatively impacting your business?

Peter Tuborgh. The target was KR840 million, but we actually achieved savings of KR1 billion, so we exceeded the target quite a bit. I think that the one major challenge in a big saving programme is, and will always be, an organisational one to convince the hundreds and hundreds of managers throughout the organisation in many countries, to buy into the idea of really going through all kinds of costs and projects. After that it’s executing the saving programme with speed and swiftness. It was and will also in the future be an organisational challenge to run such a programme, but I think we succeeded very nicely. I also think, looking back on it, that it was very healthy.

We are more competitive today than we were prior to this programme.

You’ve unveiled an ambitious growth strategy over the next few years.

How are you going to achieve this, given the difficult conditions, both in the dairy industry and the wider economy?

PT. We are very happy about our strategy here, the content of the strategy, how it’s described and the targets that we have. As regards to the overall turnover growth, we have moved the target a few years down the line so that it’s no longer 2013, but 2015. That’s being very realistic about the market modus operandi that we have seen in 2009. As you know, we have recently been through some very tough times.

What are the key spokes of your strategy in terms of growth over the next few years?

PT. Basically it is about three areas. There is a lot of detail behind them, of course, but it breaks down to three areas. One centres on innovation, and adding value to milk. Innovating new products and new product lines, the organic growth area. Second, it is to participate in whatever structural changes we see in our industry. We have a long track record over years and generations of doing that, and we’ll try to see if we can team up with other industrial players. There are many, many ways of doing that. If we can participate in the restructuring of our industry, it will keep on going and I think it will speed

“The one major challenge in a big saving programme will always be one to convince the hundreds of managers to buy into the idea”

And that was something you managed to do without negatively impacting your organisational effectiveness?

PT. Of course, there’s always a risk in doing such a thing, but we did it very quickly, defined the saving areas across the many countries and many, many functions, and we did that in a few weeks. I think the planning phase was in total three or four weeks, and from there on it was just about executing. The speed of the programme also ensured that we didn’t hurt the organisation for too long.

Peder Tuborg

h

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PederTuborgh_ArlaFoods ED_26nov09 10/05/2010 14:21 Page 34

up. Finally it’s also about keeping a very efficient and lean company. Those are the three strategic pillars.

vestments in the future in growing economies like Poland, Russia and to some extent the US. It’s definitely the Middle East, where we had the crisis back in 2006 and 2007. We recovered as much as could be expected, actually more than we could have hoped for, and so the Middle East is definitely on our radar going forward. And then it’s, of course, China, where we have a very good joint venture with the Mengniu Dairy Company, one the biggest dairy companies in China .

The dairy industry has had to endure some very challenging conditions over the last few years as milk prices plummeted. Was this purely down to a drop in consumer demand or can some blame be placed at the door of the EU’s dairy policy?

Are there particular challenges in terms of expanding in totally difPT. I do not think that it has had anything to do with EU’s ferent territories? Do you have to modify your approach demilk policy. I think the EU’s milk policies are more of a pending on where you’re looking to expand? consequence. I believe the real reason behind the ARLA ACHIEVED PT. Of course. On the one hand, we are very keen to globalise our tremendous drop in milk prices, if that’s what you’re approach to how we do processing, production and achieving synlooking at, was of course, the financial crisis, the ecoergies in our organisation. But on the other hand, we have a long nomic crisis that the whole world came into. That tradition of also adapting our approach to the markets, to whatevalso hurt our industry. You can call that a drop in OF SAVINGS IN er local conditions are needed. So, it’s a mix of a very global intent, global consumer demand, and also a shift from more 2009 you can say, but being very realistic about how we do it so that we also expensive products to cheaper products and more disadapt ourselves to whatever global conditions we face. Especially in the counted products. I think that had a major impact. One food area and in the milk area and the cheese area, consumption patterns also has to remember that at the end of 2008, where the fiare different and one has to be flexible. nancial crisis was really starting to hurt all industries, including our

KR 1 BILLION

own, we also had the melamine crisis in China.

For a while that led to a tremendous drop in consumption in China, and at the same time, we also had, in the end of 2007 and the beginning of 2008, and until the summer, one of the largest outputs of milk production throughout the world.

So, there was a combination of a large output and then consumer demand globally dropping, which was exacerbated by the melamine crisis. What we see today is that the Chinese consumption seems to be back on track and is growing very impressively, so we don’t have that factor at the moment.

What role does expanding into new markets play in Arla’s future plans, and which other places in the world are you currently targeting?

PT. We trade with many countries, but we have our stronghold in the northern European and European hemisphere. Our core markets are especially in northern Europe – UK, Scandinavia, Germany, Holland – those are the prime core markets, you can say. We have then also expressed that we will focus more in-

34 www.nextgenerationfood.com

Investment in processing is a key priority for Arla. Why is processing seen as being so important?

PT. It’s really about adding value, which is the right strategic way of expressing it. We’re a cooperative owned by 8000 farmers, and we are teaming up in other countries also with other farmers. It’s our obligation to add value to the milk that they process on their farms. The biggest source of our milk is in northern Europe, where the costs of living for our owners are higher than other places in the world. This means that we have only one way of going forward, and that’s adding value to milk and through means of innovating our products and innovating our technologies. .

Over the last year, companies like Nestlé have been able to take advantage of lower milk prices to improve their margins. I assume that the way Arla is structured meant that you couldn’t do the same?

PederTuborgh_ArlaFoods ED_26nov09 10/05/2010 14:21 Page 35

China crisis As if the global situation was not hostile enough over the last few years, the scandal of melamine tainted milk powder in China further rocked consumer demand. Officially responsible for the deaths of at least six babies plus the sickening of tens of thousands more – though there is widespread belief that even these figures underestimate the true extent of the damage caused – the deliberate contamination led to the execution of two dairy officials, numerous prison terms and millions of dollars of fines. Centred around the firm Sanlu, the crisis caused considerable embarrassment to the Chinese authorities ahead of the Republic’s hosting of the Olympic Games. Despite the strong response in this case unscrupulous, producers adding melamine to products in order to artificially raise their protein content has become an all too common problem in China, where regulators have struggled to cope with the problem. Pet food adulterated with the substance found its way to the US in 2007 and, more worryingly, melamine tainted dairy products have been found on Chinese shop shelves as recently as January of this year. In an age of global trade where contaminated products can quickly find their way into the shopping baskets of consumers across the world, this is an issue with potentially massive implications. The dairy industry in particular can certainly do without any more bad news.

PT. We were born the other way around, you can say. We are a cooperative owned by farmers, which means that our prime objective is to maximise the price of milk. That’s quite different. This is a reality for all cooperatives, it is something that we enjoy and it gives us a very clear obligation to add value to milk. If you look at many other countries, in Europe you will find that there are many other organisations like us. There are many big cooperatives that have exactly the same mission in life.

What role does technological innovation play in improving your processing capabilities and developing new products for sale?

PT. Innovation goes in all kinds of directions. It’s not only about innovating new products for consumers and customers. It’s also about ensuring that we are at the front in terms of using the best technology that you can find.

You talk about adding value to milk. What kind of key trend and product areas are looking to do that in?

PT. We are very keen on health issues and healthy products. We are very keen on and investing a lot of R&D in that area. We’re also focusing investing a lot of our R&D in innovation efforts in the area of making natural products. I think we are today one of, if not the, largest milk or dairy cooperative in terms of the size of our organic milk pool. We have more than 500 million litres of organic milk, so that’s just one example of something that we’re pursuing. We believe that there are many other trends.

There is one clear trend, that consumers wish to make sure that the products, the food that they’re eating is as natural as possible. That’s at least the position we’re looking at. So, health and naturalness are very clear drivers in our innovation strategy. n

Commodities and prices €/ton

Milk powder Butter Cheese

4000

3000

2000 2006

2007

2008

2009

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ASK THE EXPERT

The checklist Raquel Lenati outlines the key considerations for selecting an effective product testing programme.

P

rotecting companies and brands while maximising productivity is essential; however, providing the highest quality product is paramount. Together with up-to-date Hazard Analysis Critical Control Points (HACCP) and prerequisite programmes, many food and beverage processors have proven proactive environmental monitoring and regular product testing are long-term money and time-savers. These are also essential steps to ensuring people consume high-quality, safe and wholesome food products. A variety of microbiology testing methods and hygiene monitoring solutions are available to help meet processing plants’ needs and ultimately improve their overall profitability. When considering microbiological testing of environmental and product samples, identifying cost-effective options that best utilise facilities’ available labour will affect the method companies select.

Internal versus external Typically, two options exist for microbiology analysis: in-house testing, which involves starting or using an internal lab, or third party testing whereby all work is contracted to an external laboratory.

Besides situations where regulatory agencies require samples be tested in an accredited laboratory, sending some environmental and food samples to a third party lab for testing has its advantages. For instance, some testing methods may demand expertise beyond the scope of internal staff while other tests may require special equipment that companies do not have or may not be ready to acquire.

Fortunately, plenty of quality assurance and food safety checks exist, which can be easily done in-house. These include microbial and adenosine triphosphate (ATP) testing. The methods that do not require enrichment steps and offer low to no risk of cross-contamination

in the lab are the best options for starting an in-house microbiology testing venture.

Offering the quality and standardisation of rigorous manufacturing processes available in the market, many in-house testing methods are simple, provide quick results and are costeffective as shipping costs and time in transit are eliminated and they do not require highly trained technicians.

The ability to produce environmental and product microbial test results in-house also awards manufacturers the power and freedom to further investigate their processes, materials and equipment. With this data readily available, food and beverage processing plants have a better understanding of potential contamination sources and can use such data to track any latent hot spots or growth niches

Certification and education Upon selecting a testing method it’s important to ensure it is properly validated and approved for the type of commodity and environmental surfaces being tested. Review whether the method is accepted by internationally recognised organisations, such as the International Organization for Standardization (ISO), Association of Analytical Communities (AOAC) and the French national organisation for standardisation, AFNOR, as well as domestic regulatory bodies, or provincial regulators.

If exporting product, governing bodies of other countries will need to be consulted.

Further, learn about Good Laboratory Practices (GLP) by referring to guidelines such as ISO 17025, which specifies the general requirements to carry out tests and calibrations,

“A variety of microbiology testing methods and hygiene monitoring solutions are available to help meet processing plants’ needs and ultimately improve their overall profitability”

of microorganisms over time. Should plants wish to take testing a step further, effective data management, tracking and trending can help identify imminent issues, offering the opportunity to identify and prevent larger food safety and quality issues associated with the environment, ingredients or processes.

Testing in-house, however, does have challenges. It is not easy to keep up with regulatory changes, international trends and new methodologies. By taking time to talk to suppliers, food industry colleagues, related industry associations and food safety experts, facilities will fi nd the best solution for food safety and quality verifications for their needs.

including sampling. And understand the microbial limits the processing environment, raw materials and fi nished product samples should meet. International guidelines such as the Codex Allimentarius and the International Commission on Microbiological Specification for Foods (ICMSF) as well as regulators’ guidelines are great starting points to set microbiological specifications for environmental and product results.

Raquel Lenati is a microbiology professional services advisor for 3M Canada. 3M is a trusted global leader of food and beverage safety and quality monitoring solutions. Lenati has earned a MSc in microbiology and BSc in food sciences. She worked within the food industry with HACCP and quality assurance programmes before joining 3M.

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NEXT BIG THING

Moth to moth Martin Brown explains how innovative pheromone research is breathing new life into pest management.

T

he launch of an environmentallyfriendly, zero residue moth control system by Exosect is being welcomed by the food production industry as a key step in pesticide reduction management in stored product foods.

Exosect, established as an innovative provider of Intelligent Pest Management (IPM) solutions, has developed a sustainable, organic compliant, non-chemical solution, Exosex SPTab, which launched initially in the UK in February 2010.

The company has also developed its own Residue Reduction Charter to heighten the focus on chemical reduction in food processing and storage.

As the focus for food production moves increasingly from the farm to the factory, Exosect’s new product marks a response to the increasing demand from retailers and consumers for safe, high quality stored product foods with reduced pesticide residues.

Martin Brown, Managing Director at Exosect, explains: “Pesticides in food factories have traditionally taken the form of fumigation or spray processes, which can produce residue levels that have already become unacceptable in some EU countries.

“We believe that there will soon be increasing consumer pressure to add to the regulatory pressure on retailers, suppliers and manufacturers to use residue-free pest management solutions and demonstrate active reduction in pesticide use.”

Legislation is, however, not the only driver for change. Food manufacturers currently rely predominantly on moth control processes requiring factory shutdown and lost production.

The Exosex SPTab is completely unobtrusive and avoids the need for plant shutdown. In addition there is no adverse impact on monitor-

ing trap data collection. The product is placed powder and the confusion effect is automatiinside a bespoke dispenser, located at five metre cally passed on. The result is a state of auto intervals throughout a manufacturing facility. confusion amongst the male moth population Exosex SPTab is easy to deploy, requires no leading to effective mating disruption and special application equipment and can remain population control. active for any required length of time.

“The SPTab product is unique in that it To ensure that optimum performance is is derived from a natural sustainable plant achieved from the outset, Exosect will work source. Organically approved products are alongside expert Pest Control Operators to ever increasing their appeal and this combines provide set up, training and technical support with the extensive range of other product benas and when required. efits – such as enabling facilities to function “Insightful retailers and manufacturers as usual during treatment – to provide an will not simply succumb to change but will unbeatable solution. We are already experilead in the challenge of pesticide reduction encing very high levels of interest in the new management,” says Brown. product,” adds Brown.

“By focusing on a move The product was towards zero residue, the made available in the UK industry could revoluin January 2010. Exosect tionise the way in which it is also preparing a Euromanages the protection of pean rollout, with plans products into the future. to launch the product in Exosex SPTab represents a Germany, France, Holfi rst step in intelligent and land and Italy in Spring informed pesticide reduc2010. tion management.”

Exosect is focused on Exosex SPTab is a the development of Intelsmall tablet consisting of ligent Pest Management Exosect’s unique Entostat solutions. Its innovative Martin Brown is Managing Director powder, which is combined and cost-effective prodof Exosect and has over 25 years of with minute quantities of ucts help growers, food experience in agrochemical sales, marketing and business operations the female sex pheromone, manufacturers and proroles with ICI, Astra Zeneca and Syngenta covering UK, Africa, Middle common to all five of the cessors to actively reduce East, Turkey, Pakistan and Eastern major moth pests in food protheir use of pesticides.

Europe. Before joining Exosect, Martin worked in a senior management cessing: Plodia interpunctella, These products are used role within a major international agricultural distribution company Ephestia elutella, Ephestia globally in a wide range expanding and developing their kuehniella, Ephestia figulilella of sectors including crop distribution and retail operations in Eastern Europe. and Cadra cautella. protection (agriculture, A male carrying Enhorticulture and stored tostat powder will form a mobile pheromone products), apiculture, amenity and public dispenser, producing ‘false’ pheromone trails, health. Exosect was a SOFHT (Society of which attract additional males. Contact beFood Hygiene and Technology) award winner tween the males ensures that the Entostat in 2008.

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ASK THE EXPERT

Slipping up on regulations Adam Clements and Bjørn Hegstad look at the most cost effective ways to stay compliant with current flooring legislation.

M floo My oor is my money machine,” said one client, “from the moment I cannot work on the floor, I cannot earn money”

I

n these hard economic times, we are all looking to save money. But sometimes saving a few pounds in the short term can cost an awful lot more long term. The EU regulation on the hygiene of foodstuff s states that “floor surfaces are to be maintained in a sound condition and be easy to clean and, where necessary to disinfect. Th is will require the use of impervious, non-absorbent, washable and non-toxic materials.”

Th is means that anywhere food is prepared, treated or processed, floors need to permit good food hygiene practice offering ease of cleaning and protection against contamination, between and during operations.

Floors can therefore often be seen as a necessary evil as without them hygiene inspectors will not allow production. It is tempting to pick the cheapest option to satisfy the inspectors and comply with regulations, however poor quality floors not only lack performance, but will also require sustained maintenance.

Cheap epoxies and PUs often wear badly in wet and heavily trafficked areas, cracks in the surface will often lead to delamination and the systems inherently contain micro-pores and pinholes. Acrylic floors degrade over time and become spongy and porous. These areas need repairing to comply with EU regulations and will often be picked up during hygiene inspections. However, patching floors inevitably leads to further failures as each cut in a floor becomes a cold joint, which can also be described as a crack that allows water access to the bond line and promotes delamination. Th is patch will then need re-doing later on, and so the cycle continues. Floor wears. Patch repaired. Patch repaired again slightly larger. And so on, until the floor looks like a patchwork quilt and aesthetics demand the whole room re-done.

The cost of the patches may not be much materially, but the shutdown time soon adds up. Planning and logistics, extra shift work leading up to and after the works, loss of production, post operation cleaning and post work cleaning. With epoxy floors taking up to 14 days to fully cure, that’s a lot of shutdown to ensure the floor repair achieves full strength. In reality, most people begin operations far too early and water will damage the chemical cure process, thus weakening the floor repair further. Although PU floors cure within three days, this is often still too long. The acrylic floors have an advantage here with

their two-hour cure, but the area still needs shutting down or clearing sufficiently. By paying for a quality flooring system, these repairs and shutdowns will be minimal, leaving you compliant, in production for longer periods and ultimately saving money.

Another way of preventing cross contamination or to improve microbial counts within the factory is to add an anti-microbial agent to the floor, and lots of manufacturers are offering this option. There are many types on the market, from biocides like Microban, to active ions like silver. All will have some effect, but again some are better than others. Active ions and particles are simply stirred into the resin before application. Th is leaves them randomly distributed across the surface, and the evenness relies on the correct mixing ratio and thoroughness.

Certain biocides, however, are added to the flooring resins during manufacture. Microban for example is added at the polymerisation stage, and the particles actually disperse and migrate “inter-molecularly” around the resin. Only this type can be certified, as there will be a known amount in any given section of flooring. Th is certification can allow you to sell at the same or a higher price than your competition.

For example, Noons Foods in Southall, London, a manufacturer of ready meals, chose Microban enriched floors over their whole facility.

Th is enabled them to win a lucrative contract with Sainsbury’s – without competing on price.

However it is also important to note that anti-microbial flooring is not a substitute for good hygiene. The floors are designed to reduce peak microbial loads between washes, and not replace washing. So it is still important to have a floor that can be easily cleaned, one without pinholes, pores or abrasion.

Another area that is vitally important is slip resistance. HSE have updated their slip resistance guidelines in its Food Information Sheet No 22. Their previous coefficient of friction (CofF) guideline of 0.36 was updated. While the limit remains, what they now state is that consideration must be given to the likely contamination. Too often products are checked for slip resistance in the dry and wet only. If a floor is to be used in a food factory, it needs to have a CofF of over 0.36 with oils and fats or product on the floor. Supermarkets need to think about their slip resistance with grapes (far more slippery than bananas contrary to popular belief). Engineering workshops need to test with oil etc.

HSE recently published a case study on one accident. A kitchen worker slipped over and fractured her skull. The resulting injuries were severe and meant that she was unlikely to work again. HSE ended up prosecuting the employer, and the company was ordered to pay over €40,667 including prosecution costs. On hearing the case the District

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Judge said: “Th is was a very serious accident, one which was wholly preventable. Every employer has a duty under law to protect its employees from physical harm – something that [the company] blatantly failed to do. There had been four similar accidents in their kitchen during the previous 12 months, yet they still failed to act.”

The inspector served an Improvement Notice on the company to require them to deal with the slip risks to employees. After a number of other options were considered by the company, but concluded to be inadequate or inappropriate, they eventually replaced the floor surface with one that was suitable for use in an area where the total elimination of floor contaminants would never be possible. The new floor was specified to provide enough grip, even in wet or contaminated conditions.

The current recognised slip resistance test is the Pendulum Test as developed especially for HSE by Sheffield Laboratories. Ensure your flooring manufacturer has HSE approved slip results for their flooring, and can prove that even with your likely contamination, the fl oor will remain above legal guidelines. It is wise to test your current floors as well, as

many floors oft en considered compliant, could now fall foul of these updated regulations.

Please remember that almost everything you do in your factory will take place on a floor of some kind. Therefore it is vitally important to consider all the implications and lifetime costs of that floor, and how it may impact on future operations.

AcryliCon floors comply with current EU regulations, and we have EEC and FDA approval for contact with food. Microban can be added to the system, which is already the easiest to clean flooring on the market.

With a proven lifespan of over 30 years, high compressive strength and excellent wear resistance, AcryliCon is fast becoming the safe choice in flooring. AcryliCon has offices across the globe, from the US to China. Please see our website for details of your nearest office.

Bjørn Hegstad Adam Clements is Mnaaging Director of Acrylicon Distribution in the UK. Bjørn Hegstad, is a chemical engineer and President of AcryliCon. He has made the challenges of industrial fl ooring his own and dealt with and solved these challenges during his 30 years of experience and expertise. He has developed and established AcryliCon in Norway, Sweden, Finland, England, Ireland, Middle East, Canada, USA and internationally to deal with contracts outside the company’s established areas.

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FOOD SAFETY

A global perspective Tackling food safety issues involves wide-ranging international cooperation in order to reduce health risks along the food chain from producer to consumer, says WHO’s Jørgen Schlundt.

T

he consumption of unsafe food poses a very real and serious threat to public health. The World Health Organization (WHO) estimates that foodborne and waterborne diarrhoeal diseases kill about 2.2 million people annually. Over the past 20 years there have been incidences of serious foodborne disease outbreaks documented in every continent, which serve to illustrate the truly global nature of food safety.

WHO therefore responds to threats that arise from issues of food safety in an equally wide-ranging fashion. Jørgen Schlundt is the Director of the Department of Food Safety and Zoonosis at WHO and he stresses the need for issues of food safety to be tackled from a global perspective.

“Food that is produced in the world is constantly moving across borders so there is no reason to look at this issue from a regional perspective.

Also, if we want developing countries to progress economically we have to fi nd a way of allowing them to export what they can, and for most

developing countries this is food. Therefore it’s very important that we try to look at food safety across the whole globe,” says Schlundt.

In its international approach, WHO focuses on three main areas, the first of which is achieving scientific agreement. “At the global level we’re trying to get the best science together and present that to all member states,” says Schlundt. “There is no need for 192 countries in the world to each define the science for themselves. We are trying to make sure that we are a broker for good scientific knowledge.”

Once agreement has been reached, the next step is to turn this scientific knowledge into international standards. Th is is done through the Codex Alimentarius Commission, created in 1963 by FAO and WHO. The third area of focus is communicating information. An important initiative that was set up in this area is of course the International Food Safety Authorities Network (INFOSAN). The rapid globalisation of food production and trade has obviously increased the potential likelihood of international incidents involving contaminated food. INFO-

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SAN, another joint initiative from FAO and WHO, ensures closer communication and collaboration among national food safety authorities at the international level.

“We now have 175 countries that all link into this network, reporting when they have problems. So if any major problems arise we can now share information between the countries, and we do that on a day-to-day basis,” says Schlundt. “Some of the big events recently have been related to melamine in China and dioxin in pork in Ireland, and we also have an ongoing issue with hepatitis in foods. INFOSAN allows us to share information between the food safety authorities so that they can take action when necessary.”

However, this communication does not stop with the authorities. Food safety programmes are increasingly focusing on Salmonella a farm-to-fork approach as an effective means of reducing incidences of foodborne disease outbreaks. Th is holistic approach involves consideration of every step in the chain, from raw material to However, microbiological issues are not the only priority for WHO. food consumption.

Chemical hazards are also cause for concern. “There are a number of Schlundt therefore emphasises the need for clear communication chemical issues from mould in food, which is a particular problem in with consumers in order to protect them from the various foodborne developing countries, to new substances that are found in food, such as diseases they are threatened by. “Everybody involved in the food chain, acrylamide – a substance created when potatoes or other types of food including the consumer in their kitchen, has to take responsibility for are heated above 120 degrees Celsius.” food safety,” says Schlundt.

According to Schlundt, changing the available scientific knowledge “They cannot do that unless they know what to do. Therefore we have into international standards in the Codex has actually been far more sucdeveloped very simple key messages that are the same all over the world. cessful for chemical issues than it has been for microbiological issues.

We are promoting them and they have been translated into 70 languages “We have had chemical expert groups since back in the 1960s, so over now. We also have training systems to go with that,” he explains. the past 50 years the Codex has covered chemical issues very effectively, Of particular concern at the moment, according to Schlundt, are but only in the last 10 years have we really started to efficiently move into microbiological hazards, many of which are related to food production the microbiological area. We initiated an expert group on microbiologianimals. “Salmonella and campylobacter are two bacteria that we know cal risk assessment called JEMRA,” Schlundt explains. we can do something about in the primary production sector, thereby Progress is being made though as further expert groups are being limiting the risk for the consumer, says Schlundt. set up. The most recent scientific advice and knowledge on melamine has “For a very long time now the EU has been implementing the now been taken into the codex and standards are being discussed.

Zoonotic Directive. Th is means that you must be able to report data for Assessing the risks posed by chemical and microbiological hazards, both animals and humans. If you do that you can link problems to their and by new food-related technologies, is something that is high on the source and then do something about it”. agenda of WHO. Together with FAO, it has done a lot of work in relation to genetically modified food and has had a number of expert consultations on the topic since the 1990s, which have focused on the plants, the micro-organisms and the animals that could be genetically modified.

“We have defi ned ways of doing the risk assessment and we have defi ned what should be done before putting something on the market.

Most countries are now following our advice. The only region in the world where there is still concern for genetically modified food is Europe, which I believe relates to poor communication from a lot of food safety authorities in Europe,” says Schlundt.

Nanotechnology, he believes, should be viewed in the same way. “We have initiated the fi rst FAO/WHO expert meeting on nanotechnology, As far as these zoonotic diseases are concerned, the WHO strongly which has been suggesting ways to think about doing risk assessments supports the integration and consolidation of the agricultural and food of nanotechnology. There might be special issues with nanotechnology industries. “We have to get the different sectors to work together,” says that we haven’t looked at before simply because the nanoparticles are Schlundt. “Going back more than 10 years in the EU system, there was so small. We need to get the science together, defi ne how we should do really no collaboration between the agricultural sector and the health the risk assessment, and do it before putting something on the market,” sector. But now that has changed a lot, although it’s still not optimal.” explains Schlundt.

“Actually the only region in the world where there is still concern for genetically modified food is Europe, which I believe relates to poor communication from a lot of food safety authorities in Europe”

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TROUBLESHOOTER

Making the right choice How do you choose the right ATP test system that delivers both performance and value for money?

Martin Easter replies: Adenosine Triphosphate (ATP) bioluminescence is a technique that has been used as a monitor of the hygienic status in food production facilities since 1980.

The application of ATP hygiene monitoring is intended as a direct, objective test of cleaning to verify the removal of product residues. This biological test has exquisite sensitivity but has a natural variability. Accordingly, the hygiene monitoring application is not intended to be used as a precise determination of ATP content.

The results from ATP surface hygiene monitoring are different to those of microbial enumeration methods and give additional information that the microbial test cannot provide. ATP tests are not intended to replace microbial tests but there is concurrent direct correlation between the results of the two methods because cleaning simultaneously removes both organic residues and microbes.

The components of ATP systems include instrument, its detector, and the reagents that are finely balanced. These determine the background noise and performance characteristics of the system. The most important features are repeatability, sensitivity and accuracy, as well as robustness, low capital cost and maintenance costs. Modern solid-state systems can deliver great performance but also great value because they are low cost, low voltage, and stable.

The largest ever laboratory study of commercially available ATP hygiene monitoring systems was conducted by a leading independent food safety and quality laboratory.

The comprehensive study generated over 5000 results and it determined linearity, repeatability, and sensitivity of six systems from leading suppliers when tested against ATP, microbes and a variety of foodstuffs over a wide dilution range.

Statistical analysis was applied to the results, which are summarised in the table below.

Neogen and Charm ceased to become linear below a set RLU threshold where only zero RLU values were displayed by the instrument. These systems also showed the highest amount of variation with CV of 86 and 123 percent compared to the average for the technology of 26 percent.

System

Linearity

The limit of detection of Kikkoman, Neogen and Charm systems was 10 fmols ATP, which is not sufficient to meet typical industry Pass levels of five to 10 fmols ATP. BioControl and Charm have high RLU outputs per unit of ATP but this high RLU does not impart greater sensitivity or better performance to the system.

3M CleanTrace and Charm systems were the least accurate in that they detected only 50 percent of the sample.

The most precise, accurate and repeatable system was the Hygiena SystemSURE Plus with either Ultrasnap or Supersnap swabs with CV of nine percent and sensitivities of one and 0.17 fmols ATP respectively. „ Dr. Martin Easter is an expert in rapid microbiological testing.

Working in the ďŹ elds of food safety and quality management he has managed several government funded research programmes. As General Manager for Hygiena International he directs all business development activities to bring the market new and convenient test methods.

Variability

Sensitivity

(r)

Blank (Background at zero ATP)

Output (RLU) Medium (at 1000 fmols ATP)

(CV%)

Limit of detection (fmols ATP)

BioControl MVP with Lightning swab

0.982

283

975,941

39

1.1

3M UniLite NG with CleanTrace swab

0.988

4.3

7386

26

1.3

Charm Novalum with Pocketswab Plus

0.949

0

418,517*

86

10.0

Hygiena SystemsSURE Plus with Ultrasnap swab

0.988

0+

1589

28

1.0

Hygiena SystemsSURE Plus with Supersnap swab

0.987

0+

4949

9

0.17

Kikkoman PD20 with LuciPak swabs

0.985

14.3

1227

12

10.0

Neogen AccuPoint with Accupoint swab

0.976

0

15,649*

123

10.0

* does not detect below 10 fmols at which level the instrument shows 0 RLU + systemsSURE is the only system with genuine low background that is linear to zero RLU

44 www.nextgenerationfood.com

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ROUNDTABLE

SAFE Next Generation Food consults the experts on the issue of safety in the food industry.

What are the implications for food producers that fail to take sufficient care of safety issues?

Raimund C. Hoenes. Recent food scandals have shown that there is still a lack of knowledge regarding food safety within the worldwide food and nutrition industries. Some players in the industry may be motivated merely by achieving high levels of profit and therefore show an alarmingly low level of business ethics as a result. The economic downturn has caused additional victims as many companies are under intense pressure to reduce their costs in order to remain profitable. Compromising on food safety is a simple and immediate way to reduce overheads. However, the consequences that can and most certainly will come with it over time are immense. A food producer that is exposed for delivering poor quality products runs the risk of permanently damaging its reputation. To recover from a damaged reputation is a difficult task in any industry, but in the food and nutrition industries in particular, it is an undertaking deemed near to impossible.

Charles Deibel. The largest issue is the potential for the product to get into commerce and potentially hurt consumers. Testing at all stages of production from ingredients to finished products, as well as environmental samples and correct nutritional labelling, can all be considered a form of ‘brand insurance’.

Those companies that do not protect their brand may not have a brand to pro-

46 www.nextgenerationfood.com

tect in the event of a recall or loss of consumer trust. To provide financial protection and brand protection, many companies now use external labs to monitor their in-house labs and some test exclusively using external labs. This is one way to off-load the risk of testing.

Franz Rappold. Food safety is not only the most essential topic for a food producer but for the whole supply chain, including the packaging angle. MayrMelnHof, representing one of the packaging materials most largely in demand – carton board – takes that task incredibly seriously. As market leader in Europe we constantly monitor our products in our own excellently equipped laboratories as well as carry out external assessments by independent institutions (i.e. ISEGA) and continuously improve all processes and procedures at our production sites and within the chain of custody.

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Charles Deibel is President of Deibel Laboratories, Inc., an internationally recognised firm providing food and product safety testing, quality control evaluations, scientific consulting and training for industry leading food manufacturers, as well as family run operations.

Christian Jansen joined Hunter Associates Laboratory, Inc., in 2004 as the European Sales Manager, responsible for sales channel development, expanding the service and support network and key customer contact.

He studied business administration and entrepreneurial finance at the TUM Business School in Munich.

Zoe Grosser, PhD is Director, Food and Environmental Markets, for the Analytical Science Division of PerkinElmer. She has been with PerkinElmer for more than 20 years, holding a variety of marketing, product development and product support roles through the years.

Raimund C. Hoenes is the CEO of Glanbia Nutritionials Customized Premix Solutions unit, which provides micronutrient premixes to the food, beverage and supplement industries and operates four strategically located plants on three continents. He has 15 years of industry experience and has held positions in Europe, the US and Mexico focused on business growth. He holds a PhD and MSc from the University of St Gallen, Switzerland.

Franz Rappold is a member of the Management Board of Mayr-Melnhof Karton AG with a dedicated responsibility for all sales activities of the Group cartonboard segment, MM Karton. He is President of Cepi Carton Brussels (Confederation of European Paper Industry) and member of VDP/VMK – Germany (Paper + Cartonboard Association).

“Carton board is the most environmentally friendly packaging, recyclable and biodegradable, made from renewable or even recycled sources” Franz Rappold

already too big a problem. By the time the eye or an instrument can see the hazard it is already beyond safe consumpJan Grøndal has an MBA from AVT Business School, an MSc in Food tion levels. There is also a connection between appearance Science and a PhD in Food Chemistry and Food Technology. In 2008 he and quality. It is unacceptable for a customer to notice a difwas appointed CEO for the flavour company Einar Willumsen. Prior to his ference when comparing two of the same product, as he or current position, he held various positions within Carlsberg, Lundbeck, she will think the difference is caused by poor quality. It may Aqualon, Hercules Inc, CP Kelco ApS and Einar Willumsen. Dr Grøndal is or may not be considered a safety issue but it could well be Chairman for the Danish Flavour Organisation and a member of the IFT interpreted as contamination or a mistake during producand several other professional organisations. tion. For example, a pale tomato sauce may indicate a lack of flavour while a brownish tomato sauce may indicate too much processing or contamination from the container.

Established standards are controlled and measured by quality management More serious concerns come from medical products where customers may systems such as ISO 9001, and hygiene management systems EN 15593 and consider this a problem with active ingredients for the medicine. Another exINREKA-HACCP-Standard, as well as chain of custody systems, like ample is peanuts, as they are roasted to a high temperature to ensure removal FSC&PEFC. Risk management and the root-cause analysis are an essential of salmonella bacteria. If the product is heated too high or stays in the oven part of our management systems and ensure a safe production of board and too long then the nut will appear far too dark for customer expectation and packaging for food applications. Thus we have built up a strong reputation have a burnt taste. So here you can see colour can be used as an early control for reliable food safety within the industry. to ensure processing is correct and consistent.

Christian Jansen. Appearance measurement techniques can be used to indicate safety. However, by the time the problem is visible to the human eye it is

48 www.nextgenerationfood.com

Jan Grøndal. Food safety is the most important issue for any food producer or food ingredient supplier. It is core to our industry that consumers are safe

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when consuming the finished food and beverage. This requires the highest food safety standards in the complete supply chain. If food producers fail to take sufficient care of safety issues – either due to inadequate internal procedures or due to lack of control over the supply chain – the impact is huge.

Consumers’ health and wellbeing is at stake, as is the reputation of the business. We have seen time and again that it takes many good examples to compensate for one bad. Any failure to comply in this area will eventually affect the whole food business.

Zoe Grosser. As public concern and the global understanding of human health issues associated with food safety and quality continues to increase, food producers that fail to take sufficient care of safety issues will increasingly get more and more public exposure. This may result in recalls, fines and other unwanted publicity, and government regulations will be tightened. The ultimate negative impact could be damage to their brand name, which will result in longerterm business effects.

How have pressures, challenges or aims within the industry changed the needs of companies when it comes to food safety?

ZG. Globalisation of economies, increasing competition and increased population and affluence in developing countries have caused the world to become smaller and this global nature of business also extends to food. As the import and export of foods increases and ingredient suppliers can potentially be located several time zones away, it is becoming more difficult to comprehensively inspect suppliers, therefore testing and traceability of ingredients has become an increasingly important issue. In addition, the appearance of adulterants previously unknown, such as melamine in infant formula, puts increasing pressure and stress on existing processes and systems for food safety. As an example, approximately 80 percent of the fish and shellfish consumed in the US is imported.

Approximately 30 percent of the fruit and nuts is imported. So food is not being produced and eaten in the same place. Different local regulations on pesticides, soil cleanliness, antibiotic use, and other factors may potentially affect the quality of food delivered to the consuming country, especially when examined in light of the destination country’s regulations.

CJ. If a brand cannot control the consistent appearance of its product then why would customers think they are able to produce a safe product? Quality is quality. If it is poor in one area than most likely it is poor in other areas. People see the product first with their eyes. The very first judgement they make is visual. The colour of food can cause someone to become excited with anticipation or push a plate of food away. Colour is a determining factor in whether we pick one fruit or vegetable over another, just as taste is. For these reasons, measuring the colour of food is essential for a manufacturer to provide a product that a consumer will see as desirable even before they taste or smell it.

Manufacturers are concerned with the effects of pasteurisation, freezing and shelf life on the colour of foods and have developed additives to preserve food colour, such as acid solutions for fruits and sodium benzoate. Colours themselves, such as tartrazine and azorubine, are added to increase the natural colour of a food and make it more palatable to the human eye.

Because customers are able to detect slight differences in colour in food and in packaging, accurate measurement of the desired colour for a manufacturer is critical to their sales and profits.

RH. There are many challenges facing a company, particularly financial pressures in times of economic turmoil. In an ideal case, nothing should ever influence food safety, no matter what.

Unfortunately this is not the case, as we all know only too well.

In times of an economic downturn it is even more important to have sophisticated and effective quality systems in place. It is vital to never compromise the standards and aims that were once set. Businesses are forced to react to pressures and challenges, but quality and therefore food safety should be maintained at all times.

Customers will notice a shift in quality standards. Though they may put their suppliers under pressure to lower prices, it is of tremendous importance to show the value of quality. We see quality and safety playing a larger role than ever before. When many companies are inclined to take a step back when facing tough times, it becomes the ultimate opportunity to further strengthen your market position and reputation. This can be achieved by continuously supplying premium quality products, thus ensuring a high level of food safety.

“If food producers fail to take sufficient care of safety issues – either due to inadequate internal procedures or due to lack of control over the supply chain – the impact is huge” Jan Grøndal

JG. Nowadays there is much more awareness about food safety than before.

Due to the international free flow of information, an incident anywhere in the world will immediately have global implications. Therefore any supplier in the food supply chain must be fully updated on any rising (or potentially rising) food safety issues within their respective sphere of interest, and be prepared to act appropriately.

50 www.nextgenerationfood.com

FR. Saving packaging is a permanent focus. The change over time, however, relates particularly to the fact that measurement devices are swiftly improv-

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ing allowing measurement in smaller scales. Five years ago we measured concentrations in ppm (1ppm=1mg/kg); now we are talking about ppb (1ppb=0,001mg/kg). Therefore MM scientists are equipped with instruments of the latest technology to ensure that all our products completely fulfil the legal requirements and standards as well as support governmental and EU authorities with analysis and know-how for their future decisions.

CD. Most companies are sourcing higher end technologies to speed the production process, while still maintaining a highly accurate assay. The need to get results quickly, in order to increase profit for short dated products or eliminate storage costs when warehouse space is limited, has increased interest in technology with fast turn-around times. The US industry in particular is overhauling its food safety programmes, with companies performing process validations, as well as increasing surveillance testing on in coming raw commodities. Many EU companies that have clients in the US are forced to follow these new initiatives as well.

How can your solutions and expertise help food producers to ensure that their products meet the high standards demanded by consumers and regulators?

CD. We offer a complete solution towards food safety products from testing to consulting (audits, validations, training and special projects). Our labs, including our new European operation in Milan, Italy, offer a full testing solution for microbiological and chemical testing as well as expertise in consulting services. Dr Deibel was one of the founding fathers of HACCP back in the early 1970s, with its roots in a prevention based approach to food safety. The work that we do with our clients is to encourage more prevention-based initiatives and testing programmes rather than a reactive strategy, such as finished product testing alone.

FR. MM’s quality management covers the entire value chain, from raw material for carton board production to product checks on the point of sale. All raw and process materials must pass our strict internal quality procedures in line with all regulatory recommendations, i.e. the recommendation XXXVI of the German “BfR”.

Our state-of-the-art production facilities are configured with online measurement devices. Together with the laboratory tests, dozen of parameters are matched in our quality computer security system to ensure that all our products comply with the provisions of valid regulations, i.e.

No.1935/2004 of the European Parliament and the council of 27.10.2004 concerning materials and articles for food contact. Additional traceability is key for us and therefore we keep samples of our products, including all measured parameters for more than two years. Beyond that, many multinational FMCG companies rely on our expertise for food safety analysis of their product packaging.

On the basis of these comprehensive and constant quality checks, we are able to issue a statement of applicability to all our products intended to be brought into contact with food. We can offer the broadest range of different carton board qualities for all kinds of food applications and always evaluate the whole packaging against the specific demands of the packed food to recommend the most appropriate carton board based on virgin fibre or recycled fibre.

Furthermore, all our mills and printing plants producing for the food industry are HACCP-certified.

“Recent food scandals have shown that there is still a lack of knowledge regarding food safety within the worldwide food and nutrition industries” Raimund C. Hoenes

52 www.nextgenerationfood.com

JG. Einar Willumsen has decided to go all the way to ensure our products meet the highest food safety standards.

This means we have decided to implement a fully automated traceability system in our factories to allow the

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Customized Premix Solutions Innovations in Functionality

Glanbia Nutritionals Gewerbestrasse 3 78359 Orsingen-Nenzingen Germany Phone +49 7774-9397-0; GNDECustomerService@glanbia.com; www.glanbianutritionals.com

SAFETY RT_5May 10/05/2010 13:19 Page 54

fastest possible reaction in the event of an incident. Furthermore, Einar Willumsen has decided to implement a fully automated technical documentation system in order to ensure our customers the fastest possible access to any technical information on the flavours and compounds we supply that they may require. Manual traceability and technical documentation will certainly meet the formal requirements of the regulators, but automated systems are so much quicker. And if an incident should occur, fast and appropriate reaction is crucial.

RH. At the core of our business is a proven and stringent quality system. We apply a whole range of quality standards to ensure peace of mind for our customers – amongst them: ISO 9001:2008, ISO 22000, IFS (International Food Standard), GMP (Good Manufacturing Practices). Our quality system supports us in our efforts to continuously improve the high standard of our products – even under the toughest economic environment. Being an established business in the industry allows us to draw on our vast experience and make use of our established relationships with producers and suppliers to ensure that our customers get safe products. Everything from the purchasing to manufacture through to the packaging is considered, to ensure that the products meet the high standards demanded by consumers and regulators. We have supplier audit programmes in place and apply extensive testing regimes to incoming goods as well as our finished products. This provides our customers the guarantee that the very sensitive micronutrient premixes they receive from us, which provide the nutritional functionality in their products, are safe to use and in full compliance with the specifications agreed.

grape juice and arsenic in domestic baby juice, can be measured with this technology.

Food and beverage producers face the challenge of meeting safety and increasing tighter quality standards while reducing costs to meet the challenges of global competition. Manual entry of chemical analysis data is labour intensive and creates the potential for typographical errors. Implementation of laboratory information management systems (LIMS) that interface with laboratory instrumentation, such as our LABWORKS foodLIMS, can effectively increase organisational productivity and data quality in food labs.

“It is unacceptable for a customer to notice a difference when comparing two of the same product as he or she will think the difference is caused by poor quality”

CJ. Food products are tremendously varied and best practice requires a measurement approach that works for each type of product. Different food products require different instruments. You do not use the same technique to measure liquids as cookies or nuts. HunterLab has been in the business of colour and appearance measurement for over 57 years. Our very first commercial instrument was used to measure Crisco for Procter & Gamble. Since that time we have developed an array of colour instruments for portable, desktop and on-line measurement of food products. This broad range coupled with our many years of applied experience with food products makes us the industry leader in this area.

What role does research and development play in your business? Can you describe any recent innovations in your product lines?

ZG. Research and development are critically important in instrument development. New technology and new computer capabilities both contribute to what might be possible in the future. Customers demand instruments that are easier to use, take up less space and cost less.

Regulatory agencies demand lower detection limits and instruments that are less expensive to run, making tax dollars go further. The most recent PerkinElmer instrument introduction is the NexION 300 ICP-MS for trace metal analysis. We talked to customers before starting the project to ensure their perspective was incorporated to the fullest extent possible. The instrument is smaller, highly stable and incorporates a choice of interference correction techniques to ensure accurate results.

Customers interested in the analysis of food can be highly productive using this technology for semi-quantitative or quantitative metals analysis.

Christian Jansen ZG. PerkinElmer is a global company focused on improving the health and safety of people and their environment. We are focused on the important outcomes that our technologies make possible, such as a safe and sustainable food supply chain. We are a FR. Research and development plays a vital part in MM’s strategy. Combined leader in development and production of analytical solutions (instruments, with our long-term experience, financial solidity and the partnerships with consumables, software, applications and services) used in detecting contasuccessful customers, we are confident we will continue to strength our leadmination and adulterants in food, beverages, flavours and agriculture. For ership position. For example, the findings of our most recent in-depth trials example, our Clarus GC/MS can be used to detect organic contamination of unprinted and printed folding boxes resulted in the use of only ‘low miin food, such as melamine in milk. Inorganic techniques such as our gration inks’ for packaging with direct food contact. The effect of migrants NexION ICP-MS family can be used to evaluate metal contamination in coming from carton board, whether recovered or virgin fibre-based, is small. food. Several situations seen in the last few years, such as lead in imported Nearly all migrants originate from ink, varnish and glue, with clear differences 54 www.nextgenerationfood.com

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detectable on the type of ink. The cooperation with all suppliers enables ongoing improvements of raw and process materials and technologies.

Carton board – regardless if recovered or virgin fibre-based – provides the end consumer with packaging that is safe and compliant with food regulations.

Furthermore, carton board is the most environmentally friendly packaging, recyclable and biodegradable, made from renewable or even recycled sources. In addition, carton board has some of the lowest CO2 emission values of all packaging materials, throughout the entire valueadded chain.

JG. The flavour business is innovation driven. The soul of most food and beverage products is the flavour. A recent survey in Denmark by the Danish Flavour Organisation revealed that more than 70 percent of consumers rated flavour as the most important characteristic of a food and beverage product. That is the reason the development of the right flavour of a new food and beverage product is the key to success in many cases. Getting the taste right and doing it fast is key to success in the flavour business. There is a limit to how many brand new tastes can be invented but flavour innovation involves new combinations of tastes and modification of already existing tastes. As an example, Einar Willumsen has launched a range of South African inspired flavours to be used in food and beverages. This range includes new existing taste combinations not commonly seen in industrial food and beverages. Another example is our new range of vanilla flavours or our new range of pure, tasting natural tea extracts, which offer the possibility to develop delicious new food and beverages. Innovation is part of the daily routine in a world where speed and taste matter more than anything else.

ment geometry was further optimised since it is the ideal geometry for colour measurement in food, especially when doing readings in glass containers (or polycarbonate as an alternative).

The D25LT colorimeter’s large viewing area of 95mm is optimised for measuring the colour of coarse, nonhomogeneous and irregularly shaped products. It can be used in the food industry to measure samples such as cookies, crackers, chips, beans, spices or pasta. A brand new development is the SpectraTrend HT, an online non-contact colour and height measurement system providing full spectral information in the visible range and using long life LED light source.

CD. Deibel Labs in Gainsville, FL, is designated the Special Projects lab and “As public concern and the global much of our R&D is performed at this understanding of human health location. The Technical Services issues associated with food safety Director, Dr Steven Goodfellow, has and quality continues to increase, over 40 years of experience in food microbiology, food safety and microbiofood producers that fail to take logical pathogens, sanitation, HACCP, sufficient care of safety issues will TQC/TQM, food processing, and plant increasingly get more and more management. Even though a test kit public exposure” may get AFNOR, ISO or AOAC approval, it is still possible that the techZoe Grosser nology may not be the best for a given product line. We perform ‘method performance qualifications’ for our clients to help them source the best rapid or cultural assays for their product lines. Due to the large numbers of tests CJ. HunterLab has increased its efforts in research and development over the performed at Deibel Labs, on many occasions, we have seen trending prior past years. The variety of applications has driven us to develop systems deto the manufacture of the kit. This early identification of trends has allowed signed for specific applications. Especially circumferential 45°/0° measureus to not only make adjustments quickly to limit the impact on our clients but also to notify the manufacturer so they can limit the impact on other users.

“Testing at all stages of production from ingredients to finished products, as well as environmental samples and correct nutritional labelling, can all be considered a form of ‘brand insurance’” Charles Deibel

56 www.nextgenerationfood.com

RH. In the global fortification business it is of utmost significance to be at the forefront in the exploration of science and the dynamics that drive the nutrition industry. In order to defend our market position, we constantly search for new product ideas and innovative raw materials. The provision of micronutrient premixes that add a competitive edge to our customers’ end product will ensure that they can stay ahead of their competitors – which in turn secures our position in the market and ultimately ensures the survival of our business. We operate in a fast-moving industry. Consequently, it is imperative that we are on top of all trends and innovations that occur. n

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NEXT BIG THING

Making a breakthrough Nicolas Samman details the latest advances in anti-microbial efficacy testing for lubricants.

P Dr. Nicolas Samman is Manager, Grease Product Development and has driven PetroCanada’s leadership position in new grease technologies. He is a member of the Royal Society of Chemistry and is a Chartered Chemist. Dr. Samman was also recognised as a finalist in the Best Product Development Team category for the International Stevie Business Awards in 2007 for his development work on greases with anti-microbial efficacy.

etro-Canada’s new research breakthrough in the field of anti-microbial lubricant protection from degradation by micro-organisms resulted in the development of Purity FG2 with Microl MAX. With an emphasis on innovation, we sought out new technologies that would improve the product formulation performance relative to our fi rst generation pioneering product Purity FG2 with Microl.

Th is advance in Food Grade Microl anti-microbial product additive protection system is EPA registered, National Sanitation Foundation (NSF) and FDA approved as an anti-microbial preservative in lubricants that may have incidental contact with food. As a result, the food grade product with this lubricant preservative is considered a Treated Article by EPA. The product is approved as kosher and halal as well as certified as peanut-free and free from other major food related allergens.

The new Purity FG with Microl MAX line addresses the food processing industry’s ever-vigilant concern with the safety of products – including lubricants for incidental contact. To satisfy our customers and meet their needs in this field, we conducted several product anti-microbial preservation efficacy tests at several test laboratories capable of assessing the microbiological stability of the product when exposed to such micro-organisms. The test protocols employed are similar to those used in the microbiological and pharmaceutical industries. There were two main tests conducted, namely the Zone of Inhibition test and the 28-day Cream Cheese Challenge test.

The Zone of Inhibition test was developed through collaboration with a pharmaceutical microbiology testing laboratory. Th is test entailed culturing the micro-organism in a broth for a prescribed period of time, which was then mixed with the culture medium at a certain concentration and allowed to set. A plug of grease was then put into the culture medium, which was incubated at a prescribed temperature and duration.

The Zone of Inhibition was then measured for Purity FG2 with Microl MAX and compared to regular food grade product. The Purity FG2 with Microl MAX developed a Zone of Inhibition measuring 4-5mm in size around the grease plug compared to the absence of such Zone of Inhibition for the regular food grade grease.

Th is proof of performance is a strong indication of the potency of the anti-microbial product protection system and its efficacy in preserving the grease from degradation

by inhibiting their growth when it comes in contact with materials bearing the micro-organisms.

The 28-day Cream Cheese Challenge test is a standard test commonly used by microbiological laboratories to test lubricants and other materials used in food processing plants to determine the efficacy of the anti-microbial additive product protection system under conditions similar to what is encountered in food processing plants.

The test consisted of three parts and was conducted at a food industry recognised external laboratory. In the first part, the grease is exposed solely to water in the presence of the micro-organism. In the second part, the grease is exposed solely to cream cheese in the presence of the micro-organism, which simulates the nutrient for the micro-organisms. In the third part, the grease is exposed to the cream cheese as well as water in the presence of the micro-organism representing the real life conditions at the plant where wet conditions prevail and food particles can ingress into the lubricated parts of the food processing machinery.

On comparing the test results for the regular food grade grease and Purity FG2 with Microl MAX, the potency of the Microl anti-microbial product protection system and its efficacy in preserving the grease from degradation by inhibiting their growth when it comes in contact with materials containing the micro-organisms is clearly demonstrated in the photograph below.

ZONE OF INHIBITION TEST Purity FG2 with Microl Max Grease

Regular Food Grade Grease

Zone of Inhibition

This information is based upon standard laboratory tests and is provided for comparative purposes to substantiate antimicrobinl activity for non-public health applications. Microl product protection inhibits the growth of micro-organisms that cause odours and product degradation.

58 www.nextgenerationfood.com

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ASK THE EXPERT

Grease is the word Kevin Hastings discusses the effects that over or under lubrication can have on bearing life in the food industry.

W

e still have a misconception that food safe lubricants do not perform as well in critical situations as standard lubricants. To the contrary, in many cases food grade lubricants stand up better to the effects of washer washout and steam. A critical issue we face in our industry is rather the effects of improper lubrication.

Having the best grease for the application does not always guarantee success. Over 36 percent of all bearing failures result from incorrect specification or poor application of the lubricant. Bearings can be over lubricated or even starved of lubricant. Both situations

(loads, temperature, environment, contamination risks, etc.). Continuous re-lubrication is often used when the re-lubrication intervals are short. A bearing that is running “hot” does not always imply that it needs more lubricant.

The correct amount of grease in a bearing will allow the oil to be squeezed out to lubricate the surfaces. If there is too much grease, then the oil cannot leak out properly. Th is causes poorer surface lubrication and increases frictional heat. Th is increased temperature can lead to accelerated oxidation of the lubricant, which increases the thickness of the lubricant.

Th is, in turn, leads to poorer lubrication, higher temperatures and eventual bearing failure. On the other hand if the positive con-

“The correct amount of grease in a bearing will allow the oil to be squeezed out to lubricate the surfaces. If there is too much grease, then the oil cannot leak out properly” can lead to premature bearing failure. A bearing’s life could be increased dramatically by choosing the right lubricant, at the right relubrication intervals with the proper lubrication application equipment.

The amount of grease can be calculated from the type of bearing used, the frequency of replenishment and the application conditions

dition is present, where a bearing is starved of lubricant, then the operating temperature will naturally also be high. Adding the right amount of grease is extremely important to lubricate the surfaces properly, which helps to reduce the operating temperatures.

Over-lubrication of bearings is one factor that can cause premature bearing failure, how-

ever it is often easy to diagnose by keeping a check on the operating temperatures. Th is not only helps reduce the operating cost of replacing expensive bearings, but can also reduce the amount of lubricant needed, not to mention the effects of downtime. Automatic lubrication equipment, if set up correctly, can also help deliver the correct amount of grease at the right time to ensure uniform performance and steady operating temperatures.

Water and steam wash downs can also remove the grease, leaving the bearings exposed. However, moving to more resistant grease, especially if the system design does not allow good protection from the cleaning process, will resolve this problem.

An additional consideration that can affect equipment life is the mixing of old and new greases that are incompatible. Th is can increase operating temperatures for two separate and distinct reasons, even when the correct amount of grease is applied. If the combined mixture softens, it leads to the lubricant seeping away from the bearing. If the mixture hardens, it can reduce its ability to lubricate. It is always good practice to remove as much of the old grease as possible to avoid this issue.

Kevin Hastings has been working in the lubricating industry for 45 years and he has been lecturing and teaching for over 25. He has conducted over 3000 seminars around the world for major corporations such as General Motors, Ford, Boeing, Coca-Cola, and US Steel. He is also a member of the NLGI, ASLE, SAE, and API associations.

60 www.nextgenerationfood.com

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EXECUTIVE INTERVIEW

SMOOTH OPERATORS Food grade lubricants can bring big benefits for producers, says Peter Bird.

What are the key benefits for food manufacturers in using food grade lubricants over traditional solutions?

Peter Bird. Food processors often cite food safety, energy costs and labour as three important issues affecting equipment reliability and productivity. Thanks to advancements in lubricant chemistries, using modern, premium quality lubricants that are suitable for food machinery applications where incidental food contact with the machinery lubricants may occur, can help support all three of these areas. What’s more, they can help minimise the potential for product recalls, maintain brand integrity and improve equipment performance, potentially enhancing a company’s productivity in the face of these tight economic times.

What are the cost implications of selecting food grade lubricants?

PB. By following the recommended guidelines from a lubricant manufacturer, plant managers and maintenance professionals are better able to turn converting an entire food or beverage processing facility to H1 registered lubricants into a manageable task within their existing risk management systems – while at the same time helping their company optimise production, promote food quality and ensure the brand integrity of its products.

Do they offer good ROI for manufacturers?

PB. Along with delivering exceptional performance and long lasting equipment protection, premium quality synthetic H1 lubricants can also generate significant cost and energy savings. For example, in proprietary worm gear bench tests, ExxonMobil’s Mobil SHC Cibus 460 synthetic H1 registered lubricant demonstrated up to 3 percent overall efficiency improvement compared to Mobilgear 600 XP 460, a mineral oil based product.

Moreover, high performance synthetic H1 hydraulic oils can last up to two times longer than conventional ExxonMobil mineral based hydraulic oils, whilst maintaining a high degree of system cleanliness. Long life and clean systems can reduce the costs and risks associated with frequent oil changes and unplanned component failures.

What features and attributes should manufacturers look for when selecting food grade lubricants?

PB. First and foremost, the food processor should conduct a plant audit to run alongside local HACCP procedures and to establish whether contamination What different applications can food grade lubriof the food is possible by lubricating oils or greases. cants be employed in?

If, based on that risk assessment, the answer comes PB. Most high performance H1 lubricants are apback positive, the processor should select an H1 luplicable for the full spectrum of hydraulic, gear and Peter Bird is Marketing Advisor for Food Processing Machinery bricant. H1 lubricants are formulated with base oils air compressor applications. In some instances, the Lubricants, ExxonMobil Lubricants & Specialties. Bird and components that comply with FDA 178.3570 same lubricant can be used in both compressors and is part of ExxonMobil’s Europe, and are suitable for applications in machinery that hydraulic systems. Other applications include greasAfrica and Middle East zone Industrial Lubricants marketing could result in the lubricant potentially having es for medium and high temperature applications, team with special responsibility for the food and beverage ‘incidental contact’ with the food or beverage vacuum pump oils, heat transfer oils and aerosols. processing industry. He has been being manufactured. in the oil industry for 23 years.

Then the processor should look for other features Do they offer versatility and flexibility? and benefits on offer from the lubricant. High perPB. Absolutely. A high-performance synthetic H1 regformance synthetic H1 lubricants are often engineered using advanced istered food machinery lubricant can help plant managers and maintesynthetic base stocks that fi rstly exhibit outstanding load-carrying propnance professionals consolidate lubricants through its ability to provide erties to help prolong equipment life and secondly low internal friction, excellent equipment protection in a wide range of applications. which helps to reduce energy costs. Also look for a lubricant that offers Mobil SHC Cibus lubricants are designed to provide food and beverlong term-oxidation stability, anti-rust and anti-corrosion features – all age processors with high performance lubrication and long service life, of which can reduce the potential of unscheduled downtime associated even under extreme operating conditions such as freezers and cookers. with component replacement. Finally, choose lubricants that can be used In addition to being manufactured in equipment where cross contamiin applications for both below and above the processing line, helping to nation is minimised, Mobil SHC Cibus Series lubricants are formulated reduce inventory costs and the risk of contamination from using non H1 to nut-, wheat- and gluten free and suitable under Kosher and Halal registered lubricants. dietary law.

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EXECUTIVE INTERVIEW

Flawless victory A strong and reliable flooring system is an essential component in the fight to maintain hygiene and safety in food production, says Timo Jahen.

What specific properties are required from industrial interior surfaces in the food production and processing industry?

Timo Jahnen. The food production industry presents some particular challenges when it comes to interior surfaces. Extreme temperatures at both ends of the scale, a high risk of spillages and exposure to chemicals make this a very demanding environment. Under EU regulations, interior surfaces must be smooth, non-absorbent and easy to clean and disinfect. Furthermore, walls and floors must be durable and impact resistant.

Health and safety is also a consideration. With the necessary handling of a wide range of food and drink substances and chemicals it’s no wonder that accidents are common in the food industry, particularly slippages on wet floor surfaces.

The selection of correct interior floors and walls can help to reduce the risk of employee accidents as well as food contamination. Floor coverings in food production must be able to withstand spillages of foods and liquids, but also to provide a slip resistant surface for employees to walk upon. Specialist safety flooring is an ideal choice, offering enough surface roughness to provide grip while still being easy to clean to meet food hygiene requirements.

Hygiene is of paramount importance in the food industry. What role do interior surfaces have to play in safeguarding against contamination?

TJ. The food production environment is oft en hot and damp, providing a breeding ground for bacteria.

Because of this, surfaces need to be impermeable and impact resistant so no cracks can appear and no water can penetrate allowing bacteria to grow. Impermeable surfaces with an integral bacteriostat to inhibit bacterial growth, combined with a fi nish that makes them easy to clean, can contribute enormously to providing a long lasting hygienic solution or the food production industry.

What is it about your product that sets you apart from the competition? Are there particular technologies or techniques that are unique to you?

TJ. Thanks to advances in technology and manufacture, specialist surfaces offering advanced hygiene, durabil-

ity and ease of cleaning are now available to provide unrivalled performance in the extreme environments of mass food production.

The key difference with Altro’s PVC safety flooring and hygienic wall cladding is the impermeable surface that is watertight, does not crack and needs no grout.

Floors and walls are fully bonded to the substrate, and corner installations are pencil rounded so there are no 90 degree angles. All this means that there is nowhere for bacteria to hide. Both the walling system and Altro’s heavy duty safety flooring range are tough and designed to withstand the demands of man and machinery in the food industry.

“The selection of correct interior floors and walls can help to reduce the risk of employee accidents as well as food contamination”

In the current business climate any downtime in a factory or processing plant has to be avoided. Is it possible to install durable and effective interior surfaces while minimising disruption?

TJ. Sheet material such as Altro PVC safety flooring and wall cladding are significantly quicker to install than traditional materials; the flexibility and simplicity of the system means less down time when installing.

In the case of Whiterock wall cladding, there are also additional savings in substrate preparation as panels can be fi xed directly to most sound and dry substrates including good quality brick or block work, rendering, plasterboard, plywood, ceramic tiles and plasters.

Timo Jahen started his career in the fl ooring business over 12 years ago with Altro, one of the world leaders in specialist fl oor and wall covering. After two years experience in the field and four years in marketing he takes over responsibility for the German speaking countries in Europe as Area Manager.

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HEALTH CLAIMS

The food industry may be at risk of suffering the same fate as the pharmaceutical industry when it comes to the effect that regulation can have on innovation, says Ivan Baines.

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orking for the Max Planck Society as part of the Institute of Molecular Cell Biology and Genetics, Ivan Baines has had plenty of experience working in partnership with both pharmaceutical and food companies on biomedical research. It is this experience that has enabled him to draw certain conclusions about the current regulatory landscape within the food industry, which, he says, has some strong parallels with the situation in the pharmaceutical industry.

“The pharmaceutical sector is subject to very stringent regulatory controls. The reasons are very well justified, because at the end of the dayy patient safety is a critical element of health care practice,” says Baines. “However, it is also well recognised as having restricted innovation to some extent. The reason is because it now costs somewhere between US$800 million and US$1.2 billion to bring a drug to market, and getting there takes about 17 years.”

To clear the regulatory hurdles, many pharmaceutical companies tend to play it safe in terms of the properties of the drugs that they develop. As the investment is generally so high, many companies avoid taking a higher risk approach as this increases the risk of falling afoul of the regulatory hurdles. “It is now well appreciated that it is quite hard to bring innovative new drugs to market,” says Baines.

Th is is the parallel that Baines draws with the evolution of the regulatory environment in the European food industry. The regulation that was adopted by EU decision makers in December 2006 lays down harmonised EU-wide rules for the use of health or nutritional claims on foodstuffs based on nutrient profi les. Th is regulation was implemented in 2009 and contains two particular articles that are proving problematic for many in the food and nutrition industry – Articles 13 and 14.

“What these two articles mean is that in order to make a generic health claim about a food based on an ingredient, one has to prove the same benefit of the complete food with all of its ingredients as compared to the single ingredient,” says Baines pointing out that the extensive and costly preclinical trials are why it takes so long for the pharmaceutical industry to bring new drugs to market.

However, one thing that Baines does not dispute is the importance of regulation in ensuring food safety. “There is consensus in the consumer sector and in the food industry that safety should not be compromised and in Europe there are very high standards for proving the safety of food products brought to market,” he says.

“Now the question is, if a food product states that it has a benefit and the safety is proven, how critical is it that that product has the full extent of benefit that it’s stated to have on the label? In other words, where a yogurt claims to contribute to a healthy heart, how important is it to prove that this is the case in a clinical trial?”

For Baines, as long as there are no safety issues concerned with food product, he doesn’t see the problem with making specific health claims.

Whilst many opponents claim that these health benefits, if unproven, become mere marketing tools for food companies, Baines does not consider this a bad thing.

“I don’t see a huge harm in being able to use it as a marketing tool, as long as the foods are absolutely safe,” says Baines as he outlines that people who seek out food products that claim to have added health benefits are often in pursuit of a healthier lifestyle. “The conviction of having a healthy diet leads to a lifestyle change that actually has a benefit well beyond the food product itself. In other words, the impact of having socalled nutraceuticals or health promoting food products goes beyond the ingredients in the foods themselves,” he explains.

The pharmaceutical model that is being used as the basis for these regulations is simply not the right model, according to Baines and he believes that the legislation has, to some extent, taken on a life of its own.

“Everyone is a little confused as to why there’s suddenly this stringent requirement for proving the benefits in regard to health claims, when safety has already been proven and overall it’s well recognised that healthy food products promote healthy living.”

Where Baines does see a problem and a risk is in what he refers to as negative marketing, a phenomenon he says is quite prevalent in the US where food products are marketed through the absence of an ingredient. Products that are sodium free or cholesterol free for example often have higher levels of other ingredients added to them in order to compensate for the lack of that ingredient and to ensure that the product remains tasty, says Baines. Th is, he says, creates an imbalance in food ingredients, which can be harmful.

“What’s not good is to start prejudicing the profi le of foods to have very high amounts of one ingredient, where it’s not known whether it has benefits. Like pharmaceuticals, it’s all about dosing,” says Baines. “Th is may now happen in foods if they’re having to include single ingredients in much higher doses to be able to make the health claim, which in fact will end up being unhealthy because it’s disrupting the balance of ingredients,” he explains.

The regulation on health claims requires EFSA to assess all available scientific data submitted to substantiate the claims and then submit its opinion, before the European Commission and Member States decide whether to authorise the claims for use on food, taking into account EFSA’s opinions.

EFSA has already released two batches of Article 13 opinions, the first in October 2009 and the second in February this year. The results have been a huge blow to the food and nutraceuticals industry, as twothirds of the initial batch of claims were rejected by EFSA. “What has happened is that a number of companies have actually withdrawn their products from the market, because they are afraid of

“The conviction of having a healthy diet leads to a lifestyle change that actually has a benefit well beyond the food product itself”

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tter si In April a le mpanies and small co m iu ed m e, larg food and rope in the Eu ss ro ac m fro nt to José ustry was se d in n io it tr nu t of the so, Presiden ro ar B el u Man calling for ommission, C n ea p ro Eu n to stop interventio al n so ” er p his of “positive n of the list o ti p o . ad es e th s in batch ealth claim h al n io ct n fu

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a negative review from EFSA and this has had a very serious impact on both their image and their marketing of the product,” says Baines.

He also highlights that the legislation on health claims is biased towards larger companies, as they are more likely to have the resources to fi nance the types of studies required to prove the health benefits of their products. Th is leaves smaller companies, who are more innovative than their larger counterparts, unable to compete.

“It’s also a concern with regards to Europe’s competitiveness in the health and wellness global market, which is a hugely growing market.

It grew 60 percent from 2002 to 2007. It’s compromising European competitiveness because those regulations do not exist in Asia or in the United States.

“It’s putting a much greater burden on European companies and the European market, and it means that R&D in this area may move overseas,” says Baines once again looking to the pharmaceuticals industry to draw his parallels.

And the occurrence of this R&D exodus is worryingly imminent in Baines’ opinion. He suggests that companies may even be looking to ship their R&D elsewhere before this year is out.

Research has unfortunately been profoundly affected by the health claims legislation. “What has been particularly affected is where food

companies have performed very innovative empirical research, for example where they’ve used model organisms to see which food products actually have an impact on longevity. Now these are studies you can’t perform in any kind of clinical environment. If you did they would take 15 generations and 300 years to be able to prove,” explains Baines.

“They need to accept that foods are not like pharmaceuticals.

They’re not being taken to cure a life-threatening disease” “That’s extraordinarily useful research and it’s no longer admissible because it doesn’t satisfy the requirements of the review process. So it is compromising the scientific completeness of the peer review process, because in fact the types of studies that food companies have performed are quite frequently good science.”

With the threat of a European R&D exodus looming, Baines is convinced that ignoring the unrest in the ranks is not something that EFSA or the European Commission can afford to ignore. “It seems like there’s a fairly unanimous voice saying that this doesn’t make sense and I think that they will have to sit up and take notice. My fear is that it may be too late,” says Baines.

If the European authorities were to take action to alleviate some of the burden that the new regulations have placed on the shoulders of the food and nutraceuticals industry, Baines suggests that broadening the scope of permissible scientific evidence to admit the types of studies that have been the basis for making claims in the past would be a good place to start.

“They need to accept that foods are not like pharmaceuticals. They’re not being taken to cure a life-threatening disease. They’re helping to shift into a healthier lifestyle. And as such it’s acceptable to consider the full breadth of scientific evidence, including empirical observation and model organism studies, and the full breadth of studies that are performed by food companies,” he explains.

There have admittedly been some changes taking place since the overwhelming number of EFSA rejections.

Many of those claims originally submitted under Article 13.1 of the regulation have been rejigged and resubmitted under article 13.5 for proprietary and emerging science.

It’s not yet clear if this will prove successful, but what is clear is that something needs to be done if we are to avoid the potential brain drain of European R&D that many in the industry are starting to fear.

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EXECUTIVE INTERVIEW

The gold standard Victor Ferrari sheds some light on recent Pycnogenol research areas and its functional food and beverage applications.

tive ingredient with other safe and efficacious ingredients, backed by research, the result is a highly performing product with all ingredients synergistically working together to deliver optional health benefits to the end consumer.

Describe the latest research on Pycnogenol and how this science transfers to foods and beverages?

Victor Ferrari.Pycnogenol has matured as a sup-

plement ingredient and companies globally are embracing the product in functional foods and beverages. Known as a ‘gold standard’ within the natural products industry, Pycnogenol is supported by over 40 years of research – making it one of the safest and most researched ingredients available today.

Research and development is a top priority for us and on average a new Pycnogenol research study is published every three weeks. Most recently, a study was published on how Pycnogenol naturally reduces blood pressure, counteracting kidney damage caused by hypertension. Previous studies on blood pressure have also revealed Pycnogenol favourably affects the normalisation of blood pressure by releasing arterial constriction. Cardiovascular health is one of the strongest Pycnogenol applications. Other basic properties include anti-inflammatory, potent antioxidant and the ability to restore a healthy production of nitric oxide.

The opportunities for functional food and beverage applications for heart health are abundant. In fact, several of our customers have translated these scientific benefits to actual products, including antioxidant fruit drinks and functional beverages that combat inflammation caused by allergies and hay fever. Another recent study published in the Journal of Ocular Pharmacology and Therapeutics found Pycnogenol can improve microcirculation, retinal edema and visual acuity in early stages of diabetic retinopathy. Pycnogenol boasts a number of studies on eye health to support these new findings, and we are currently exploring functional food and beverage solutions in this category.

We’ve also launched a proprietary combination supplement of Pycnogenol and bilberry and look forward to developing new partnerships

70 www.nextgenerationfood.com

The European foods sector is looking for unique functional food and beverage products that can drive innovation forward. How does Pycnogenol fit into the mix?

VF. Today, health conscious consumers are some

As CEO of Horphag Research, Victor Ferrari oversees worldwide operations of the company, including international expansion and worldwide introduction of Pycnogenol. Ferrari spearheaded Generally Recognised As Safe (GRAS) certification, validated manufacturing processes following Good Agricultural Practice (GAP), Good Manufacturing Practice (GMP) and continues to invest millions of dollars a year in research, totalling more than 270 scientific publications.

this year. I’d also like to note a recent study on the anti-inflammatory properties of Pycnogenol, published in International Immunopharmacology.

Researchers found that Pycnogenol inhibits the generation of COX-2 and 5-LOX, naturally occurring enzymes associated with a host of inflammatory conditions. In addition to this research, Pycnogenol promotes joint mobility and flexibility and naturally relieves aching. These are crucial benefits as we look to developing joint health drinks and foods.

What do you look for in an ideal business partner that equates to a successful finished product?

VF. Working with an ‘ideal’ business partner will

more often than not equate to a successful finished product. It’s always exciting to work with smart, global and local companies that have similar business practices and philosophies revolving around scientific research and development. In my experience, when Pycnogenol is used as an ac-

of the savviest shoppers around. They are making the effort to educate themselves on specialty ingredients in the foods and drinks they consume.

While they may have their favourites, they are always seeking innovative and unique products and ingredients to incorporate into their usual mix, provided they bring specific health benefits to the table. With fierce competition for store space, innovation is paving the way.

It’s important to ask yourself the same questions that are flashing through a consumer’s mind as they pick up a new beverage or food item. What makes a product unique or stand out? What are the health benefits? What research or safety data backs up the claims? What is the added value? Pycnogenol

“It’s always exciting to work with smart, global and local companies that have similar philosophies revolving around scientific research and development” fits into the mix because it is an extremely versatile extract that offers an array of health benefits. The botanical antioxidant can either be the lead active ingredient in your product, and stand alone, or be part of a combination of active ingredients. It’s that effective – and we have the research to prove it. n

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TROUBLESHOOTER

Reducing acrylamide How do you effectively reduce the level of acrylamide in starchy foods that have been baked or fried? Emmanuel Michelot tackles your question.

firmed that studies indicate that acrytheir tempting flavour and appealing look – a lamide is a human health concern. sizable bonus for food manufacturers that are Although there are ways to decrease searching for acrylamide-reducing solutions exposure to acrylamide, there is no and worry about the continued allure of their way to completely eliminate it. products for consumers.

The main mechanisms that Acrylaway was launched in 2007 and has cause the formation of acrylamide been proven to substantially reduce acrylamide are commonly found in starchy across a broad range of foods such as biscuits, foods – reducing sugars and the crisp breads, crackers, and potato-based amino acid asparagine. During the snacks, and lab, pilot and production tests in baking or frying stage, a process French fry production also indicate feasible called the Maillard reaction – or acrylamide reduction. With today’s consumers when non-enzymatic browning becoming more conscious and cautious about occurs – is essenwhat they eat, society is tial for impordemanding that food is tant colour and not only tasty and of high flavour develquality, but also safe and opments in baked, fried and toasthealthy. Acrylaway effeced foods. Through a cascade of tively reduces acrylamide reactions, the side chain of aslevels while preserving paragine is converted into acryeating quality – and in lamide. Intensive research is being turn, offers manufacturers carried out to investigate ways to peace of mind in knowing prevent acrylamide formation in they are producing appealfoods, but many of these methods ing snacks with signifilimit not only acrylamide formacantly reduced acrylamide tion but also the formation of delevels. n sired Maillard products, effecting Emmanuel Michelot graduated as a Food Technologist Engineer taste, appearance and other sensoand has over 20 years of sales, marketing and business ry characteristics. development experience at Acrylaway enzymatically reNovozymes A/S. He is currently the Regional Marketing Manager moves the amino acid asparagine for Europe, the Middle East and Africa for Novozymes’ Food & by converting it into aspartic Nutrition enzyme business. acid, enabling the other ingredients to remain part of the Maillard reaction. This means the level of acrylamide is significantly reduced, but the final products retain

reland writes: Caroline from Dublin, I the news, t hi ly nt e c re e id m la “When acry med confident e se ry t us d in d oo f the his matter t g in ak t n e be d ha it that e. What is an seriously for some tim uce acrylamide effective way to red ng the taste ri e t al y sl ou ri se ut ho wit al product? in f he t of e ur xt e t and

S

ince the discovery in 2002 that acrylamide is formed when starchy foods are baked or fried at high temperatures, food manufacturers have been challenged as to how to effectively reduce its concentration in their products. The Confederation of the Food and Drink Industries of the EU (CIAA), launched an acrylamide reduction Toolbox to offer the most efficient solutions to assist the affected industries. The Toolbox is a combination of suggestions for changes in raw materials, processes and recipes, with importance placed on the fact that the brand specific customer acceptance of the final products should not be impacted. Asparaginases, such as Novozymes Acrylaway, are one of proven and effective options within the Toolkit.

Although the potential risk to humans by dietary exposure to acrylamide is not yet fully known, numerous studies are currently in progress on an international level to collect the data needed to make an informed evaluation.

During their last evaluation meeting in late February 2010, JECFA, the joint FAO/WHO Expert Committee on Food Additives, recon-

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INDUSTRY INSIGHT

Nature preserves Consumers are looking for less artificial ways to keep foods fresh, says Ivo van der Linden.

C

onscientious consumers in believe the products are ‘better’ for them, all demographics are examand that they promote overall health, as well ining the foods they eat more as help them avoid negatives such as toxins, closely, steering clear of pesticides and additives. Plus, many believe products they view as noththey taste better and have higher quality. ing more than a chemical cocktail. They are Not only are people looking for natural instead migrating to more natural products, products, the majority – more than 70 percent, made from ingredients with names they can according to NMI – monitor food and beverpronounce and that they recognise from their age labels. Half of consumers base their food own pantries. selection on the ingredient list, and about half Concurrently, from a microbial standare also looking for a short list of ingredients. point, it’s a veritable jungle out there. SalNMI fi nds over a third of consumers (37 monella in peanut butter and frozen potpies. percent) rate natural preservatives as “benefiListeria in cheese and meats. E.coli in hamcial”. But, because of the perception that artiburgers and pepperoni pizza, are all pushing ficial equals “bad”, half of consumers would consumer demand for safer foods. be more likely to purchase a product with The convergence of these two issues natural preservatives, rather than a product means that food product designers need to containing artificial preservatives. What’s carefully consider their product formulations more, 55 percent of the segment identified as and choose ingredients that mesh the latest a “natural channel shopper” exhibit the highproduct-protection technology with a natural est willingness to pay a five percent premium ingredient list. for a food product with natural preservatives “Although convenience and the environvs one with artificial preservatives. ment are popular talking Fermentation is recogpoints today, these benefits nised in most legislation did not receive anywhere as being a natural way to near the same level of attenpreserve foods. Clearly tion as ‘natural’ claims did,” this fact puts Purac in an explains Lynn Dornblaser, excellent position as it has leading new product expert, been fermenting natural L+ Mintel, in a release announclactic acid for more than 80 ing this megatrend. “With years and having a major economic struggles driving share in preserving foods people toward a simpler way for decades with lactic acid of life, we expect that food and lactates. and drink manufacturers Purac’s core compewill continue to prize natutence has always been the ral, wholesome benefits well fermentation of lactic acid, into 2010 and beyond.” so why not use that techIvo van der Linden is Category Manager Preservation for Purac.

That’s not surprising, nology to ferment other based in The Netherlands. He has given the market for natural micro-organisms, creating a Bsc. in Food Technology and a history of working in the food foods and beverages. Accordproducts that we can use industry and food ingredients for more than 10 years. Van der ing to The Natural Marketin food to inhibit bacteria Linden is responsible for the ing Institute, 79 percent of growth? The resulting line strategy of Purac to become leader in natural preservation. consumers are natural food of fermentation based nonand beverage users. They microbial preservatives will

broaden the scope of problems that we can attack. Examples of application areas could include beverage, ready-to-eat meals, sauces and dressings, meat products, etc.

The company has developed new labelfriendly products that can help extend shelf life and fight pathogenic organisms in a wide variety of foods. These ingredients in the PuraQ family can carry simple label statements like cultured (cane or corn) sugar and vinegar. The ingredients include PuraQ Xtend to control spoilage organisms, PuraQ Safe to

“Our products are made with ‘natural’ bio-based ingredients, not unsustainable petrochemicals” control pathogens like Listeria and PuraQ Verdad for label friendly preservation solutions controlling spoilage and pathogens Besides, consumers are becoming more label conscious, and value more natural products, the development of our new PuraQ portfolio is the way to answer the need of the market. Our products are made with ‘natural’ bio-based ingredients, not unsustainable petrochemicals, and we can call it ‘cultured sugar’ and ‘anti-microbial’, which doesn’t have the negative connotations that ‘preservative’ could have. “The industry is complaining that there aren’t enough natural preservatives around, so these new products could become a significant pillar of our company’s future success. Products like these will establish us as a leader in natural preservation in the food industry instead of merely being known as a lactic acid based preservatives company.

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EXECUTIVE INTERVIEW

Extracting value from innovation Dr. Karl-Werner Quirin explains how strong innovation is an essential element of business success in a competitive global market.

FLAVEX is already a long-term player on the market; can you explain its core activity?

Karl-Werner Quirin. The company was founded 24 years ago by Dr. D. Gerard and myself in the form of a university spin off. Since that time, the focus of activity has not changed. Of course, over the years there have been developments in order to improve infrastructure, procedures and products but we still concentrate on production of supercritical botanical extracts exclusively at our Germany-based site. Th is means we care about all the relevant steps from analysis of botanical starting materials, their conditioning, supercritical extraction, extract processing right up to batch related certification of products. All this is done under one roof in a traceable and documented way. Th is allows us to guarantee product consistency, purity and authenticity. Our extracts are offered worldwide in the B2B field as flavouring or active ingredients for food and supplements, cosmetics and perfumery.

On the other hand our activity is not directed towards downstream processing especially not in food industry since this is a fragmented field with beverages, dairy, meat, salty and sweet products to mention but a few. Such value added procedures are traditionally offered by flavour houses and not in our primary interest.

lion building project, which provides an additional 2000 square metres of space for laboratory, storage, handling and fi lling of extracts under improved standards, and additional office area as well.

Besides that, we are presently installing another high-pressure extraction plant, which will improve our capacity and flexibility. The particular feature of the new plant is that it can handle high amounts of ethanol as co-solvent. Ethanol is the only solvent that fits to the natural character of CO2 and it can even preserve the organic certified status of extracts if it is obtained from organic grain. The new extraction process expands the lipophilic character of pure CO2 extracts to more polar constituents for example phenolics, which are a big group of actives present in many interesting plants. The intention is not to replace traditional hydro-alcoholic extraction but to establish a new series of products that will be marketed as HPE (High Pressure Ethanol) extracts later on. But this needs some time and further development.

What constitutes your business success?

KWQ. On the one hand it is down to the sustainable long-term concentration on key business. On the other hand, it is because our activity has always been R&D driven. Th is includes improving procedures, looking for new opportunities and efforts to present one to two new products per year. The company’s competence and its advanced extraction technology were acknowledged by the Frost & Sullivan Technology Innovation Award at the end of 2005.

According to Frost & Sullivan, over the years FLAVEX has earned a reputation for producing the fi nest CO2 extracts.

How did FLAVEX experience last year’s financial downturn?

KWQ. As a producer we depend of course on our industrial clients, which again rely on the purchasing patterns of the end consumer. It was our impression that the first half of 2009 was characterised by some uncertainty on the markets. As an understandable consequence, customers reacted with precaution by reducing stocks and optimising procedures.

Accordingly, we saw some slowdown in sales despite good positioning as clients come from different countries and different industries. Fortunately there was no lasting reticence and after the summer holidays we faced increasing demand, which more than compensated for the decline in the first half of the year. Th is lets us look ahead with optimism.

An important factor that has contributed to our success is the excellent infrastructure facilities, which have continuously supported technological breakthroughs and various product innovations. Other factors are the company’s foundation of strict quality measures and the detailed documentation of products and procedures. It is our credo that knowledge creates innovation and innovation creates markets. Innovative strength is an essential element in global competition.

How do you see the future of the company?

KWQ. It is the intention to remain private and independent and further develop the strength of the business. We have just completed a €3 mil-

Dr. Karl-Werner Quirin is Managing Director of FLAVEX Naturextrakte GmbH. He is a chemist and received his PhD in 1984 from the University of Saarland, Institute of Pharmacognosy and Analytical Phytochemistry. For 24 years he has worked as CEO of FLAVEX Naturextrakte GmbH, a company producing specialty botanical extracts for cosmetics, food and dietary supplements on the base of supercritical CO2-extraction.

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FEATURE

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up Looking CEO Franck Riboud explains how Danone turned a crisis into an opportunity and why the future lies in emerging markets.

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hen does lowering your prices lead to a rise in profits?

The temptation might be to say never, but it is precisely the approach Groupe Danone took with some of its biggest brands in response to the treacherous business climate of the last few years. As part of its Reset Programme, the company took advantage of depressed milk costs to lower its prices on products like probiotic yoghurt drink Actimel in key markets. Taking the results for Poland as an example, the process clearly yielded some positive outcomes. By reducing the price of Actimel by 30 percent, the consumer base was increased by 50 percent, reaching a record value in the final two months of 2009.

For the organisation’s Chairman and CEO Franck Riboud these results vindicate Danone’s response to an incredibly difficult trading environment. “The most important thing for me, and I explained that last year, was to be sure that Danone will not suffer from the crisis but, rather leverage the crisis to reinforce our position,” he says. “If I look at the market share of, and even the volume market share of all our brands in every country, in every business of Danone, let’s say in 90 percent of the countries and the businesses we gained market share, so that’s the best answer for us.”

Additionally, the way in which Danone has negotiated the recent turbulence gives the CEO a great deal of hope for the future, hope that companies which failed to take similarly radical action might not be feeling this year. “If we look at 2010, we are more confident in our ability to deliver what we expect than we were in 2008. If you remember we were one of the first to say that even in the emerging countries there will be a slowdown,” Riboud continues. "We totally reset the group and we did it in a context that was more easy than the context you will have tomorrow, because we decided to leverage the positive impact of the raw material to develop the volume of our brands.

Those who are going to do that next year will have more trouble executing it. So the strategy was a good one for sure. The most difficult thing is not creating a strategy, but ensuring that you deliver the result you expect. And when I look at the figures for 2009,

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Danone worldwide

Central Europe 13,648 employees No.1 in fresh dairy products No. 1 in medical nutrition 19 plants

Western Europe 16,087 employees No.1 in fresh dairy products No.1 in baby nutrition No. 1 in medical nutrition No2 in bottled waters 36 plants

North America 2401 employees No.1 in fresh dairy products 6 plants

Latin America 21,084 employees No.1 in fresh dairy products No.1 in bottled waters 33 factories

clearly the management of this company found a way to deliver what we expected from the strategy.”

All in all Danone hit a growth in sales of seven percent last year. While not a massive jump, it exceeded what many would have predicted at the end of 2008 and has clearly instilled a little more confidence in the organisation.

Whereas the company declined to provide any concrete forecasts at the beginning of 2009, this year they have laid out some clear targets. Though current predictions place 2010 growth as being flat, only matching that of last year, analysts have indicated that this may be a conscious effort to under promise and over deliver. This seems like a plausible assessment, especially seeing as any company seeking to emulate Danone’s reset plan is going to find it a far trickier proposition in 2010 than in 2009. Having already done much of the hard work Danone is now in a position to explore other ways to achieve bigger top line growth. “Is it easier for the competition to answer to our reset plan next year, or was that easier last year?” says Riboud. “That was definitively easier last year because everybody, every company was benefiting from the positive raw material impact. Tomorrow, you will have to answer not having the positive impact of the raw materials, so it’s going to be tougher to deliver a reset plan. Not for us, it’s done.”

The impact of the last few years on Danone’s relationships with the retailers that sell its products has been significant. Some voices had even been predicting the ‘death of the brand’ with lower cost products grabbing market share as buyers became more concerned with price than the name on the label. Riboud however thinks that those writing eulogies for branded products are acting prematurely. “For example in France, with the hypermarket channel, they react and they gain share,” he says. “Hard discounts are not declining but they are stabilising which means that brands are gaining market

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Africa and Middle East 4620 employees No.1 in fresh dairy products 15 plants

Asia-Pacific 23,136 employees No.1 in bottled waters No.2 in baby nutrition 50 plants

share.” In turn, as supermarkets rush to corner the market in lower cost alternatives to familiar brands, that puts them under pressure. Margins are tightened meaning that the increase in share might not provide the financial benefits that the retailers seek. Riboud sees the best possible outcome to be a future where producers like Danone and major retailers work more closely together to the benefit of all. “The vision I have is a positive one, because more and more, we can’t find a solution just within our company. We must work together. So perhaps that was a disagreement a few years ago, but clearly now if I look at the way we work with Carrefour, with E.LeClerc, with Wal-Mart, with all of them, we have a business plan, we have long-term objectives, and we know what we have to put behind this to deliver the result.”

A key focus in Danone’s strategy is building customer base in emerging territories. This has led the company into an unusual collaboration in Bangladesh with Nobel Peace Prize-winner and founder of Grameen Bank, Professor Muhammad Yunus. In a break from the normal corporate model, the small-scale initiative is chiefly focused on making social rather than financial gains. In recognition of the fact that around 50 percent of Bangladeshi children suffer from malnutrition, the small factory – 200km north of the capital Dhaka – manufactures nutritionally reinforced yoghurt at a price affordable to local people. Additionally, the plant sources most of its raw material locally, providing a much-needed economic boost to farmers in the area.

Finally, much of the product is distributed to nearby villages by a network of local people, accompanied by Danone officials explaining the health benefits the yoghurt can bring. Given that a single cup of the yoghurt, marketed under the name Shoktidoi (‘energy’ in Bengali) can provide as much as 30 percent of a child’s daily nutritional requirements, the initiative has some potentially far-reaching benefits for the people of Bangladesh.

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Healthy skepticism?

Unsurprisingly, there are also gains for Danone beyond just doing a good deed. This small-scale approach has allowed the company to test the waters rather than diving head first into entirely unfamiliar territory. Projects such as this give invaluable insights into doing business in new markets, particularly the different approach to sales and marketing that is required in places like South Asia.

Riboud himself is adamant that successful expansion into traditionally less affluent territories is about much more than just keeping prices low.

“Knowledge of the consumer is a real battle, especially in an emerging country,” he says. “Looking at the success we have with baby food in Indonesia, did we reduce the price in baby food? Answer, no, because especially in emerging countries where the buying power is less, if you reduce the price of your baby food product, you will lose market share. It’s a direct link between quality and price.

Is it a reason not to look at the consumer who doesn’t have the buying power to buy your expensive product? No, our job is to find the right answer for the consumer, and that’s the reason why we launched this product in Indonesia. And, obviously, as usual in Danone, if it is a success in a country, we will roll out in the other one, because the only thing we know, the best we know, is to roll out the best practice, and we are organised to do that as quickly as possible.”

A common route for an organisation of Danone’s size seeking to expand into new markets is large-scale acquisition. However, while acquisition certainly plays a part in the company’s plans, anyone awaiting something on the scale of Kraft’s recent takeover of Cadbury is likely to be disappointed. “Last year, we opened two or three countries and we will continue to do it,” Riboud explains. “The question is, how are we going to open the countries without starting from scratch? For example, in Egypt we bought a very, very small company, not because of the company itself, but because it helped us to grow faster. You get the energy, you get the facilities, you get the trucks, you get the warehouse. In some countries you grow much faster by buying somebody, even if it’s a very small company, than to start from scratch.”

However, this doesn’t mean that the only expansion route is through acquisition. Essentially each new territory is evaluated on a case by case basis: it could mean a completely new enterprise, the takeover of an existing company, a completely new product line or the promotion of an existing brand. It helps that Danone is already in possession of a network that covers much of the globe. “More and more we are going to see how we can open new countries by launching new products or products existing in other countries, leveraging the organisation we have,” Riboud confirms. Thus the business already in operation in Russia can be exploited to extend the company’s reach eastwards, while Shanghai’s dairy business is seen as a jumping-off point to other Chinese regions. Given that China, even at a comparatively early stage, offers a potential market three times the size of Belgium, shows just how important these geographical footholds can be.

Moving forward, it seems Danone has much to be optimistic about.

Having negotiated a rocky few years with a great deal of success, the company’s strategy has been vindicated and has left it in a strong position to continue its recent momentum. For Riboud at least, 2009’s hard work has paid off, and 2010 promises more of the same. “We leveraged a crisis by not only resetting the brand, but totally resetting the company, giving us all the tools we need to continue to build and accelerate,” he says. “The balance sheet is part of that. And at the end, I think it’s a good illustration of the confidence of the Board on the ability of the management to continue to build the company mid-term and long-term.” n

The latest chapter in the seemingly endless tussle between Danone and the European Food Safety Authority over probiotics was written in April 2010 when the producer of Activia and Actimel withdrew key health claims from EFSA’s assessment system. While cynics might suggest that this undermines the increasingly big promises some companies make about the health impacts of so-called functional foods, Danone contends that the withdrawal is merely a symptom of the frustrating opacity of EFSA’s certification process.

The story has a ring of Groundhog Day about it. It was almost exactly a year ago that Danone withdrew similar claims from EFSA assessment.

Indeed, the claims were only resubmitted within the last six months, each backed with nearly a dozen specific clinical trials. So what’s the problem?

According to Danone’s representatives, the virtual impossibility of acquiring status updates or even clear instructions on EFSA’s scientific requirements has left the company, as well as many of its peers, all at sea. Speaking of Danone’s decision, the company’s Vice President of external affairs and Head of EU regulatory affairs, Patrick O’Quin said: “This complete lack of contact is one of the main issues we and the rest of the industry has.” This statement is backed up by a letter recently sent to EC President José Manuel Barroso by the industry group European Health Claims Alliance, calling for major changes in the way health claim assessments are managed.

For Danone, attention is now being turned to the EFSA stakeholder meeting scheduled for June as the best chance to seek clarification and get the stalled approval process moving again. Until then, the company will temper the claims it makes about its products. Better that than risk its long-term health by staking future on a decision seemingly being made in the dark.

F U T U R E F OOD

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THE FUTURE OF FOOD In recent years, the long-term forecast for global food security has become increasingly worrying.

Population growth, increased demand for meat and dairy products, adverse weather conditions and the use of traditional food crops for biofuel, amongst other things, have combined to create a perfect storm that has driven up food prices beyond all expectations.

Finding a solution to these challenges has become a priority and scientists are increasingly turning to new technologies as a potential means for averting a worldwide food crisis. Over the next 11 pages Next Generation Food takes a closer look at some of the innovations that are being explored and the concerns they are raising.

84 Tiny technology IdentiďŹ ed by many as a disruptive technology, it is undeniable that nanotechnology has the potential to completely change the game in many business sectors.

The food industry has a lot to gain from nanotech but is treading carefully due to the many concerns over its safety.

90 A taste of things to come

92 Consumer concerns

Mankind has endeavoured to improve agricultural yields and control pests through selective breeding since time immemorial, but new techniques used today involve biotechnology and nutritional science, as increasingly demanding consumers expect more from their food.

Technological advances concerning the food we eat have always incited a certain amount of resistance. Awareness of novel technologies, trust in the regulatory authorities and the perception of the beneďŹ ts and risks involved, all play an important role in the success or failure of emerging technologies.

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NANOTECHNOLOGY

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Tiny

technology Nanotechnology has been around for years now, but as its potential applications become of more interest to the food industry, questions inevitably arise as to its safety. Next Generation Food explores the hopes and hazards of this small-scale science.

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hen new technologies are introduced, a certain amount of scepticism and apprehension is to be anticipated, if only for the fact that people are unsure of what to expect. Food, of course, is one area where people are particularly sensitive to change and technological advances are often met with resilience and even hostility, particularly when it comes to the scientific manipulation of food. Th is may be due to the fact that for most people, food is not seen in purely functional terms; rather, it is part of a much bigger social and psychological picture that includes attitudes to health, the environment, and science.

It comes as no surprise then to see that the developments in nanotechnology in the food industry are eliciting concerns from the public. However, as we have learnt from past experiences, many new technologies – once they overcome the fear factor – can offer consumers a number of benefits. The mandatory pasteurisation of milk was fiercely resisted in the 1930s and 1940s when it was introduced, despite the fact that it prevented approximately 2500 deaths a year from bovine tuberculosis in the United Kingdom.

Steffi Friedrichs is Director General of the Nanotechnology Industries Association and she believes that public perception is without a doubt one of the main hurdles to further development of nanotechnologies in the food industry. “Consumer perception is that if it is called technology it’s something to do with it being new and artificial and therefore it has to be bad.

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tivity, or changed electronic, optical or magnetic behaviour. Such materials therefore have applications in many sectors, ranging from healthcare to construction and electronics. In the food sector, there are various possible applications for nanotechnology that would have wideranging benefits for both consumers and industry.

Beate Kettlitz, Director of Food Policy, Science and R&D at the Confederation of Food and Drink Industries of the EU, says: “Food packaging products that are currently under development, such as nanosensors in plastic packaging, for example, can detect gases given off by food when it spoils and the packaging itself changes colour to alert you that food has gone bad.

“Plastic fi lms are being developed that will allow the food to stay fresher longer. These fi lms are packed with silicate nanoparticles to reduce the flow of oxygen into the package and the moisture that leaks out of the package,” says Kettlitz.

“Nanoparticles are also being used to deliver vitamins or other nutrients in food and beverages without affecting the taste or appearance. Research is also being conducted to develop nano-capsules containing nutrients that would be released when nanosensors detect a deficiency in your body. Basically this research could result in a super vitamin storage system in your body that gives you just what you need, when you need it,” she explains.

Another potential use includes the development of anti-microbial and anti-stick surfaces for use in food Non-stick nanotech surfaces inside bottles could mean that hard to reach manufacturing processes, which would reduce the tenketchup becomes a thing of the past dency for machinery to clog, and as a result, the amount of downtime required for cleaning. The agricultural sector could also benefit from the development of nanotechnol“In the food area in particular, because people are ingesting it, the ogy in applications such as novel delivery systems for the more effective use of words that imply innovation are not normally what consumuse of pesticides and the development of slow-release fertilizers. ers would associate with the current drive for nostalgic, natural and Currently, it is difficult to gauge precisely the extent to which nanohealthy eating. When you’re saying that vegetables are much more technologies are being used in the food sector. According to the Food healthy than processed foods, and at the same time you want consumStandards Agency (FSA), “it is not possible to provide a defi nitive list ers to buy something that has been enhanced by technology, there is a of nanofoods and nanoscale food contact materials on the EU market, contradiction in terms,” says Friedrichs. primarily because of the absence of an EU-wide register or inventory”.

However, if the public had a better understanding of what nanoThe UK House of Lords Science and Technology Committee rectechnology actually is and its potential benefits, their perception of it ommended in their (1st report of Session 2009-10) Nanotechnologies may likely be a little less negative. After all, without a positive reception and Food that the FSA develop a confidential database of information from the public, the future of nanotechnology within the food sector is on nanomaterials in development in the food sector to assist in the deanything but certain. Until now though, this information has not really velopment of appropriate risk assessment procedures. been communicated to the public and industry has erred on the side of Kettlitz stresses that no engineered nanomaterials are currently caution regarding the amounts of information being released. being used by CIAA members in Europe, to the best of her knowledge.

She also emphasises the need to distinguish between the natural ocPotential Applications currence of nanoparticles (such as in protein, fat or sugar molecules), In short, nanotechnology is the study of the controlling of matter their presence through conventional processing techniques (such as on an atomic and molecular scale. Within this size-range, materials milling, homogenising and emulsifying) and where particle size has can exhibit new and unusual properties, such as altered chemical reacbeen deliberately engineered to behave differently.

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Market growth Companies may not actually be putting nanomaterials into food on the European market at the moment but this may well change in coming years as the technology develops. Food packaging involving the use of nanomaterials is the application that will most likely appear fi rst in the mass market. But professionals working in the field anticipate the availability of healthier food as a result of the application of nanotechnologies in the relatively near future.

In 2007, Cientifica produced a report in which it predicted that the value of products containing nanotechnologies in the food sector worldwide would grow from €316 million in 2006 to €4.8 billion in 2012, a growth of 1400 percent within six years.

Estimates also suggest that 400 companies worldwide are currently involved in research into the applications of nanotechnologies in food or food packaging.

However, until more is known on the issue of nanotechnology and its uses in the food industry, particularly with regards to the potential health and safety risks, widespread commercialisation of such products is unlikely. Concerns have arisen regarding the novel properties of nanomaterials and how such materials may react with the body following ingestion.

The small size of nanomaterials may be a cause for concern in itself, irrespective of any novel properties, due to their ability to breach cellular barriers. The exceptional mobility of nanomaterials, both inside and outside cells, is a particular worry for the scientific community as it presents the possibility for nanomaterials to accumulate in certain organs. Nanomaterials also have a large surface area to mass ratio, which tends to make them very reactive and potentially harmful.

However, there are also numerous gaps in our knowledge of the risks associated with the use of nanomaterials. Further research is said to be needed in the following areas: characterization and detection of nanomaterials; behaviour of nanomaterials in the gut; effects on the human foetus; food specific research; subsequent movement of nanomaterials within the body; chronic effects; and development of validated toxicological tests.

The concept of nanotechnology The concept of nanotechnology was fi rst envisaged by Professor Richard P Feynman, winner of the Nobel Prize in Physics 1965, in his 1959 lecture There’s Plenty of Room at the Bottom in which he explored the possibility of arranging matter at the atomic level. The term ‘nanotechnology’ was not coined however until 1974, when Professor Norio Taniguchi of Tokyo Science University used it to refer to the ability to engineer materials precisely at the nanoscale.

Source: House of Lords January 2010 report Nanotechnologies and Food

In order to fi ll these knowledge gaps Friedrichs believes that a greater degree of co-operation is required. “Obviously there is a lot of money going into safety research now, but what we would like to see is a strengthened and consolidated safety approach rather than piecemeal monies here and there.

“Because of the uncertainties that are unfolding with regard to what we need to know, nanotechnologies and nanomaterials are something that could only be dealt with on a global scale. So we are calling for a consolidated approach at OECD level. The OECD is in fact now running a project where it is looking into 40 different nanomaterials that have been identified as being of specific interest,” says Friedrichs.

And she is not alone in taking this view. Support for increased international cooperation on information-sharing and driving forward a shared research agenda appears strong.

However, simply fi lling the knowledge gaps is not sufficient to ensure safety and regulation clearly plays a role here too. Until now, regulatory efforts in Europe have concentrated on applying existing regulations to nanotechnologies and amending them as necessary.

Questions have therefore arisen as to whether existing regulation is in fact adequate enough to protect consumers from the potential risks of nanotechnologies.

Kettlitz has total faith in the system. “Engineered nanomaterials require prior approval in the EU before they can be used. We trust that

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Current food sector legislation Novel foods regulation Regulation EC/258/97 applies to novel food and food ingredients. Novel foods are defi ned as foods and food ingredients that have not been used for human consumption to a significant degree in the European Community before 15 May 1997 and the Regulation subjects all novel foods and foods manufactured using novel processes to a mandatory pre-market approval system.

In January 2008, the European Commission published a proposal to revise and update the Novel Foods Regulation. Various proposals have been discussed by the Commission, Parliament and Council. (The draft regulation is currently going through the codecision procedure. A defi nition of nanomaterials has been introduced at the request of the European Parliament, and supported by the Council. Discussions are continuing on

how to bring nanotechnologies specifically into the revised regulation.

Food additives Food additives are regulated under Directive 89/107/EC and associated legislation. The Directive is based on the principle that only additives which are explicitly authorised may be used in food.

From early 2010, a list of approved additives, including vitamins and minerals, will come into force. Inclusion of additives on the list will be decided by the Commission on the basis of an Opinion from the European Food Safety Authority (EFSA). Those included will often have limits set on their use, for example restrictions on the quantities permitted for use.

The new regulations also specify that where the starting material used, or the process by which an additive is produced, is significantly differ-

ent (for example, through a change in particle size), it must go through a fresh authorisation process, including a new safety evaluation.

Food contact materials Regulation EC/1935/2004 covers all materials which are intended to come into contact with foodstuffs, either directly or indirectly. The Commission or Member States may request the EFSA to conduct a safety evaluation of any substance or compound used in the manufacture of a food contact material. Certain materials, including plastic, are subject to additional measures. The Commission has proposed updating the Regulation governing food contact plastics to specify that a deliberately altered particle size should not be used, even behind a migration barrier, without specific authorisation.

Food supplements Food supplements are regulated under Directive 2002/46/EC, which states that only vitamins and minerals on an approved list may be used as food supplements. New substances may be considered for inclusion on the list, but only after a safety assessment by EFSA. Source: House of Lords January 2010 report Nanotechnologies and Food

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1/3 nm wide

100,000 nm

7,000 nm

What is nanoscience ?

Nanoscience is the science of the very small. A nanometre (nm) is one thousand millionth of a metre. A sheet of paper is about 100,000 nm thick, a red blood cell is about 7000 nm in diameter and an atom of gold is about 1⁄3 nm wide. Th ree hundred million nanoparticles, each 100 nm wide, could fit on to the head of a single pin.

Source: House of Lords January 2010 report Nanotechnologies and Food

EFSA will evaluate potential applications and address any potential risk that could occur due to new properties,” she says. “The regulatory framework is appropriate both with EFSA and well-experienced risk assessors and we all agree that Europe has one of the strictest food regulation systems in place in the world.”

Friedrichs tends to agree: “The regulation in Europe at the moment is enough to protect the consumer from any health and safety risks with regard to nanotechnology because it guarantees the safety of the product. There might need to be additional guidelines as to how that regulation is implemented, but the regulation as such is sufficient.”

Regulatary control However, as the technology advances, many are asking whether current regulation will be able to adequately control the next genera-

tion nanotechnologies and nanomaterials. Whilst some experts believe that general legislation provides an adequate safety net for consumers, others disagree saying that it may well prevent companies from knowingly placing unsafe foods on the market, however it offers no protection in situations where companies are not aware that their product may be unsafe.

In response to these concerns, the House of Lords Science and Technology Committee has recommended that the FSA formally reviews the suitability of legislation every three years to ensure that regulatory oversight and risk assessment keeps pace with developments in this technology.

However, even if there were no doubts regarding the suitability of legislation, the issue of enforceability is still a cause for concern. It is up to individual member states to ensure that legislation is enforced and there are two major issues of concern that have been raised in this area. Firstly, there is the issue of risk assessment and secondly that of imports and the availability of products over the internet.

The potential long-term effects of any new technology can be difficult to assess and it is therefore important that no products reach the market before undergoing thorough risk assessments by the relevant authority, which is usually EFSA. In order to provide consumers with the greatest security and ensure that products can be fully safety assessed, risk assessments must be carried out on a case-by-case basis and products assessed on their own merits.

Regarding imports, the member states of the EU have a legal duty to ensure that all food products brought into Europe meet the necessary food safety requirements. However, this system is not without its weaknesses, especially when it comes to the internet, which is far harder to monitor and regulate. Furthermore, although local authorities have the power to check any food products that arrive at European ports, they do not currently have the tools to check for nanomaterials in imported foods.

Th is situation makes it clear that any regulations governing these technologies really need to be developed in a harmonised manner due to the fact that the resulting regulatory system will undeniably affect global food trade. The obvious body for ensuring this is the Codex Alimentarius, which held an expert consultation on the matter in June 2009. Other international bodies that may well play a role are the United Nations Environmental Programme and the WHO. A number of experts have also raised the issue of a register of applications of nanotechnology in the food sector, which could be used as an information tool to help clarify the state of the market. Amongst academic circles this idea has garnered a fair amount of support, whilst industry has already proven to be less than enthusiastic about the proposal. The idea of forcing companies to disclose commercially sensitive information about their research could have a negative effect on R&D and many now fear a migration of nanotech research to other countries where no such obligation exists.

The issue of nanotechnology in the food industry is clearly a complex one fraught with hazards. But at the same time it holds great hope for the future, depending on how things play out. Time will tell what direction it will take.

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FOOD TECHNOLOGY

A taste of things to come As technological advances increase in sophistication and consumers demand food that combines health benefits with authenticity and sustainability, we will see the evolution of smarter foods. By Dr Trevor Davis

T

he use of technology is essential to create an increasingly instrumented, interconnected and intelligent food chain. For example, using sensing and tracing technologies such as radio frequency identification and barcodes will enhance visibility as food moves through complex processing steps, lowering waste and confi rming provenance.

Bringing intelligence to the food chain also means supporting marketing claims through capturing, leveraging and sharing standardised data and integrated information on the functional properties of products. Hence the expression “an apple a day keeps the doctor away” embodies two major trends in the future of food: the notion of a product that is at the same time authentic (traceable from ‘the farm to the fork’) and natural, yet also having health giving, functional properties in the same way as one might think of a medicine.

Much of what we eat today is simply a development of what nature has provided for us in the past. Historically, mankind has worked towards improving agricultural yields and controlling pests rather than understanding the impact of foodstuffs on human biology. Until the late 20th Century, changes in food consumption were driven by farmers and food processors. They re-formulated older recipes and experimented with selective breeding of crops and animals in order to provide alternative food options.

However, in recent years these practices are being overtaken by new techniques. These techniques involve genetic modification to develop plants and animals with more desirable traits, enabling better agricultural productivity and increased beneficial effects of consumption. Genetic modification also offers the prospect of a reduction in pesticides and hormones in the food supply chain; not wholly natural cultivation, but a step towards those principles.

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Genomics isn’t the only game in town, however. There is currently a rapid growth in the appliance of biological and nutritional sciences (and related disciplines such as bioinformatics) to foodstuff s. During the 1980s the Japanese coined the phrase “functional food” to describe products that could claim health benefits on their labels. Making these claims requires evidence-based science rather than marketing spin.

The functional food – and related nutraceutical – market is expected to exceed €77bn this year, and so is a key focus for many R&D departments of food and beverage companies.

There have already been scientific and commercial successes with fibre and vitamin enrichment of cereals, omega-3 and 6 fatty acids in spreads, energy boosting formulations in sports drinks and probiotics in dairy products to aid digestive health. Even small improvements driven by scientific claims can have a big impact: within one year of reaching the US market, Campbell’s Reduced Sodium Soup exceeded €77m in sales.

Science isn’t the only driver for functional products. Consumers are more aware of the role of diet in health, appearance and wellness. For many years low-fat and lowsugar alternatives sufficed, but today’s ‘omni-consumers’ have access to more information and are more demanding. Th is is particularly true in the wealthier markets with ageing populations where foods that promote longevity and vitality are viewed as part of a preventative health regime and a means to delay the broader effects of ageing. Th is can mean natural ingredients with newly proven functionality, as well as the latest molecular engineering output. Products in the development pipeline even include ‘cosmeceuticals’ that will improve your hair and skin condition from the inside out.

There is still a degree of scepticism about such marketing claims and this has led to the establishment of numerous specialist centres such the UK’s first research centre dedicated to functional foods at Oxford Brookes University. The services offered to the food industry show the direction that the leaders are taking: measurement of metabolic rate, analysis of blood glucose and lipids such as cholesterol, monitoring of hormones such as insulin, and provision of a wide range of exotic technologies for measuring sensory responses and examining food structures with electron microscopy. All of this is a far cry from the familiar chemistry laboratories of the 20th Century food scientist.

Added to which, the public is becoming increasingly aware of the importance of the sustainability implications of their food choices. Support for NGOs such as the Rainforest Alliance is based on a growing realisation that the current model for food production, distribution and consumption is not sustainable. For example, based on current population trends, there will be a defi nite requirement to increase the food supply 70-100 percent by 2050. Agriculture is already the largest human use of water and occupies an estimated 69 percent of total landmass.

Issues such as climate change and drought, volatile energy prices, arable

land limitations and the diversion of land for biofuels are increasing pressure for greener alternatives.

The hysteria over what has been commonly described as “GM foods” is well documented – the public view of these ‘frankenfoods’ has typically been less than positive. It may be, however, that the widespread concern over sustainability issues lead to a less strident opposition to these foods as the public comes to understand the benefits of Genetically Modified Organisms. For example, a USDA-ARS, Mars, and IBM joint project is currently sequencing and analysing the cacoa genome. The aim is to produce a cacoa tree that can thrive in soil that has been depleted of nutrients, drought or water shortages. These trees will protect the livelihood of small farmers in the Americas and Africa and at the same time enable Mars to achieve fully sustainable production by 2020.

Sustainability concerns are also fuelling the rise in fair trade as a global movement and the myriad of certification schemes such as the Marine Stewardship Council and Protected Harvest. Recently there has been a dramatic rise in long-distance, cross-border trade in food: in the US, imports account for nearly 60 percent of the fruit and vegetables consumed, and 75 percent of the seafood. The impact of food miles on carbon emissions is significant, and despite complex regulations, inspection regimes do not prevent food scares occurring, some with tragic consequences on a vast scale. Is it any wonder that consumer desire for more local, ethical and authentic approaches to food production also continues to grow?

The global organic food market is one indicator of consumer preference for authenticity and that market alone grew to over €38bn in 2008.

However, beyond the requirement for organic food, consumers are seeking a clear understanding of provenance (with full traceability and safety control), limited quantities of artificial additives, humane animal husbandry and traditional farming methods. Chain retailers such as Marks & Spencer include the name of the farmer or grower on labels as well as the specific UK county the food was produced in. Some producers, such as Capricorn Cheeses in Somerset even put the picture of named goats on their produce to re-enforce authenticity. RFID tags and sophisticated analytics are making all of this easier.

So where is this taking us? The twin trends of natural ingredients and increasing use of biotechnology and nutritional science will deliver more and more antioxidant fighting goji berry snack bars and pomegranate drinks, marshmallows that prevent wrinkles, and chocolates that make you smarter. You can be sure that those products will be fully traceable and sustainable as well. But this is only the start, as companies explore the potential for foods tailored to individuals and able to mitigate specific diseases. Th is combination of the old wisdom of healing herbs and the new science seems set to deliver a new era of smarter food for smarter consumers.

“the public is becoming increasingly aware of the importance of the sustainability implications of their food choices”

Dr Trevor Davis is Global Subject Expert, NPDI in Consumer Products, IBM

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PUBLIC OPINION

Any new technologies are bound to cause a certain amount of apprehension, but none so much as those used in food applications, according to a recent report.

CONSUMER CONCERNS

I

n March 2009, the Social Research Unit of the UK’s Food Standards Agency (FSA) published a report that examined public attitudes to emerging food technologies. The report is based on academic research and a number of surveys that have been carried out both in Europe and further afield.

It is not surprising that when faced with novel food technologies, the attitude of most Europeans is one of wariness, uncertainty and occasionally negativity. Th is is nothing new and the public has a long history of suspicion towards and resistance to new technologies.

For many Europeans, food is a complex subject and attitudes toward it are not formed in isolation. Many other factors play important roles in helping us to develop our opinions including health, the environment, science and past experiences, the report says. These external factors may help to explain why the use of emerging technologies are deemed to be less acceptable in food applications than in industrial or medical applications.

In addition, most people are not wholly aware of these novel technologies and their use in the food sector. For example, in the UK studies have shown that the majority of consumers have not heard the term nanotechnology before. Th is is not the case with all novel technologies

GM food Unprompted awareness of genetically modified food (GM) is low, and GM is not a front of mind concern for the majority of people.

In a 2005 Eurobarometer survey of Europeans and biotechnology 80 percent of the public were familiar with GM foods but only 27 percent actually supported it and 58 percent rejected it outright.

Several studies find that consumers are more certain of the risks of GM than the benefits, and that risks have a stronger influence on overall attitudes.

The Eurobarometer study also showed that EU consumers have an overall positive view of medical applications of GM technology: despite viewing it as risky, they are strongly aware of the potential benefits, which leads to an overall evaluation that medical applications are morally acceptable and should be encouraged. In comparison, uncertainty about the benefits and usefulness of food applications mean that, for the majority, the risks outweighed the benefits.

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Animal cloning In October 2008 Eurobarometer published an analytical report entitled Europeans’ attitudes to animal cloning. Over 25,000 randomly selected citizens aged 15 years and above were interviewed in the 27 EU Member States. The main findings are featured below: A large majority of EU citizens (81 percent ) said they knew the term animal cloning, and answered correctly that “cloning is making an identical copy of an existing animal”. Only seven percent of the interviewees said they had never heard of animal cloning.

Faced with several statements regarding the ethics of animal cloning, the vast majority of EU citizens agreed that:

· the long-term effects of animal cloning on nature were · · ·

unknown (84 percent ) animal cloning might lead to human cloning (77 percent ) animal cloning was morally wrong (61 percent) cloning might decrease the genetic diversity within livestock populations (63 percent ).

A quarter of EU citizens (23 percent) answered that animal cloning to preserve endangered animals would be justifiable without constraints, while 44 percent were willing to accept such cloning under certain circumstances. Similar proportions accepted animal cloning to improve robustness of animals against diseases (16 percent and 41 percent, respectively).

EU citizens were significantly less willing to accept animal cloning for food production purposes: 58 percent said that such cloning could never be justified.

however. For instance, an impressive 81 percent of UK consumers surveyed by Eurobarometer in 2008 had heard of animal cloning and 94 percent of those asked in another survey had heard of GM. These high levels of awareness in the UK can probably be put down to the amount of media attention that both technologies have garnered over recent years. But awareness of novel technologies does not necessarily mean that the public actually understands the science behind them.

The report details how consumers in the US would appear to have a more positive attitude towards the use of emerging technologies for food applications compared to those in Europe. One of the reasons that the report puts forward to explain this is the fact that attitudes towards science and technology generally tend to be more positive in the US as do levels of trust in regulatory authorities.

The potential benefits offered by novel technologies, in particular GM, also means that more positive attitudes can be perceived in Asia and developing countries.

Meanwhile, attitudes within the EU differ substantially. UK respondents to the Eurobarometer (2008) for example were significantly

Three-quarters of interviewees also agreed that there could be ethical grounds for rejecting animal cloning, and 69 percent agreed that animal cloning would risk treating animals as commodities rather than creatures with feelings.

38 percent of respondents answered that none of the potential benefits presented to them (health or economic) would justify breeding cloned animals for food production.

Respondents who agreed that such benefits exist, chose the fact that animal cloning might help to solve the worldwide food problems as the single most important benefit to justify cloning (31 percent).

Only three out of 10 respondents agreed that using cloning for food production would be much more efficient in the long run and lower the cost of food products for consumers, and 16 percent thought that animal cloning for food production would be necessary for the European food industry to be competitive.

A majority of EU citizens said that it was unlikely that they would buy meat or milk from cloned animals, even if a trusted source stated that such products were safe to eat: 20 percent said it was somewhat unlikely and 43 percent answered it was not at all likely.

Eight out of 10 EU citizens (83 percent) said that special labelling should be required if food products from the offspring of cloned animals become available in the shops.

Source: Europeans’ attitudes towards animal cloning (2008)

Novel foods The public is generally reported to be suspicious of novel food processes, but some researchers have noted that if people are given an explanation of the technology and its purpose, their views tend to be more positive.

Attitudes are shaped by risk and benefit perceptions, as well as trust in the food industry and regulators, and the perceived naturalness of the resulting food product.

Women and older people have been found to have the highest levels of concern.

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less likely to think that animal cloning is morally wrong than the EU average, according to the report.

Likewise, attitudes to the different technologies also vary and the most positive responses are currently received for functional foods.

Th is could be down to a number of reasons but the report suggests that the most likely are probably the clear consumer benefits, low perceived risk and processes that are not unfamiliar or unimaginable to consumers, such as adding extra vitamins to certain foods.

Whilst functional foods are generally well perceived, consumers tend to have the greatest concerns regarding GM and animal cloning, closely followed by nanotechnologies, which are to be ingested. ‘Playing God’ and making irreversible changes to nature have been cited in the report as two of the main reasons why consumers display the most

“Awareness of novel technologies does not necessarily mean that the public actually understands the science behind them” moral and ethical concerns regarding these technologies in particular.

From the evidence examined, the FSA report concludes that the main determinant in shaping public attitudes towards emerging food technologies is in fact a personal evaluation of perceived risks and benefits. Whilst the risks, to both human health and the environment, have been well documented and reported in the media in recent years, uncertainty remains a major contributing factor to the concerns surrounding novel technologies.

Finally, the report highlights the fact that in most locations, the media, government and industry tend to be the least trusted sources of information. People are particularly sceptical about the motives of ‘big business’, suspecting that the driver is profit, rather than consumer benefit.

Nanotechnology Awareness of nanotechnologies is low. In a 2004 public opinion poll published jointly by the Royal Society and Royal Academy of Engineering just 29 percent of the public claimed they had heard of nanotechnology, while only 19 percent were able to give some definition of it, whether accurate or not. Of those who were able to offer a definition of nanotechnology, 68 percent said it would make things better in the future.

Although general attitudes towards nanotechnologies seem fairly positive, people seem less convinced about the potential benefits of food applications and are sceptical about why these are being developed.

In general, use of nanotechnologies in packaging may be seen more positively than their use in food.

Women seem to perceive fewer potential benefits from food applications than men and seem less likely to want to buy food that has been treated using nanotechnologies.

Meanwhile, older people may be more likely than others to see the usefulness of packaging applications.

Concerns towards nanotechnologies in general include their effectiveness, long-term side-effects and the ability of regulators and others to ensure safety and to ensure that developments benefit the general public.

Other factors affecting peoples’ attitudes towards nanotechnologies include their scientific knowledge, their general outlook or worldview and where they have received information from.

Source: An Evidence Review of Public Attitudes to Emerging Food Technologies (2009)

Functional food People are generally sceptical or suspicious towards functional foods and there is a degree of scepticism about food manufacturers’ motives and about the veracity of health claims.

Belief in the effectiveness of functional foods, and experience and/or fear of disease have been linked to positive attitudes.

Attitudes are not generally hostile though and the public do not consider them very risky.

Women and older people appear to have more positive attitudes towards functional food than men or younger people.

Views on functional foods vary depending on the base product or ‘carrier’, the added functional ingredient, and the combination of the two (naturally occurring combinations are preferred).

Consumption of functional foods is strongly influenced by a perceived need for the product, and to a lesser extent by a belief in the health benefits.

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Next Generation Food sits down with Peter King of the European Livestock Association and hears about the organisation’s work to protect both the continent’s animals and its consumers.

The ELA was set up initially in response to the 2001 foot-and-mouth crisis in the UK. What was the thinking behind its formation?

Peter King. One of the big issues over that was there were vast amounts of information and opinions that were coming from all over the place, and it was almost impossible with the sheer volume of data to actually figure out which things being said were credible and which weren’t, so a group of us in England and Europe decided it would be great if there was a forum where we could only publicise information that was credible and clean and not driven by political or commercial interests. It was like a platform really, and it took no time at all to attract some really eminent scientists and livestock keepers and consumers, so it was like a meeting place for those three groups, and ultimately for NGOs and people in the commission as well.

We’re strong advocates of vaccination, and we’ve got virologists and people who spend their entire lives studying diseases like foot-

and-mouth and so on. That was the foundation of it, but it’s gone from there really. Any other issues to do with livestock welfare and health and consumer wellbeing as well come within our interest and remit.

We actually became a registered charity, fi rstly in Germany, but then transferred to Holland for administrative purposes. We’ve had support from the Dutch government. We’ve had support from the EU who were glad that we came in. It’s just gone from there really.

Most recently we’ve had some real concerns over H1N1. Do you think that better animal health practices could have stopped this becoming the big issue that it threatened to be?

PK. We’re not unrealistic. We know that food has to be produced at an affordable price, but with industrial scale production there are inherent risks. Obviously if you squeeze thousands of chickens into a shed of a certain size, or pigs or whatever, then the chances of disease are

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ANIMAL HEALTH

Next Generation Food sits down with Peter King of the European Livestock Association and hears about the organisation’s work to protect both the continent’s animals and its consumers.

The ELA was set up initially in response to the 2001 foot-and-mouth crisis in the UK. What was the thinking behind its formation?

Peter King. One of the big issues over that was there were vast amounts of information and opinions that were coming from all over the place, and it was almost impossible with the sheer volume of data to actually figure out which things being said were credible and which weren’t, so a group of us in England and Europe decided it would be great if there was a forum where we could only publicise information that was credible and clean and not driven by political or commercial interests. It was like a platform really, and it took no time at all to attract some really eminent scientists and livestock keepers and consumers, so it was like a meeting place for those three groups, and ultimately for NGOs and people in the commission as well.

We’re strong advocates of vaccination, and we’ve got virologists and people who spend their entire lives studying diseases like foot-

and-mouth and so on. That was the foundation of it, but it’s gone from there really. Any other issues to do with livestock welfare and health and consumer wellbeing as well come within our interest and remit.

We actually became a registered charity, fi rstly in Germany, but then transferred to Holland for administrative purposes. We’ve had support from the Dutch government. We’ve had support from the EU who were glad that we came in. It’s just gone from there really.

Most recently we’ve had some real concerns over H1N1. Do you think that better animal health practices could have stopped this becoming the big issue that it threatened to be?

PK. We’re not unrealistic. We know that food has to be produced at an affordable price, but with industrial scale production there are inherent risks. Obviously if you squeeze thousands of chickens into a shed of a certain size, or pigs or whatever, then the chances of disease are

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greatly increased. So, once we understand there has to be commercial scale production, there’s a balance to be struck, and there are practices that can be involved that are good for the welfare of the stock and for the quality of the food.

Vaccines obviously play a big part in this, and the readiness of any particular country to be able to respond and in fact do anything it can to prevent a disease outbreak. It’s an easy thing for me to say in a sentence, but that’s a hugely costly enterprise to undertake, but you can’t responsibly do one without the other, in our opinion.

You say it’s an expensive business trying to tackle these issues. Is there a real will from both animal producers and government to work on these problems?

PK. I think it varies. Most governments do take it seriously, but typically bureaucracy and the conditions imposed make it far less effective on the ground. The welfare issue is major, and there really is confused thinking about it. We’re aware of gradual controls being placed on intensive farming, but we’re also aware of the wishes of the welfare lobby to ban

some types of livestock, which is another thing, like horned cattle for instance. Some supposed experts are proposing that horned cattle should not be used. They regard horns on cattle as barbaric, vestigial traits, but those of us that care about native breeds would say that’s a load of rubbish. If you’re in a situation where horns are a problem you can dehorn them. And usually horned cattle are ok if you don’t overcrowd them.

But there’s another extreme, for instance with Belgium Blue Cattle, which can have difficulty giving birth naturally. A lot of them have numerous caesarians. To quite a lot of people, that’s unacceptable, as is a turkey that has been bred to such a size that they can’t mate naturally.

So, you’ve got two extremes. Sometimes people even suggest that animals in their natural habitat, such as on a hill or in an extreme weather region where they’ve been naturally adapted over years and years, they’d argue that those animals are suffering welfare problems because they look poorer in the winter, whereas they’ve been bred specifically to withstand that environment. It’s a very complicated situation, and we’re aware of the whole scope of it.

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Would you agree that education is key in these areas?

PK. Education is key. And, again, we like that we’re playing our part in that. But I think somehow the people responsible for the governments and responsible for implementing these health and welfare policies need to cut through the red tape and not make the administration of such programmes too burdensome.

You mentioned that as an organisation you are principally sciencefocused. Do you think that that science-based approach to animal health is something that is generally understood?

PK. It’s science and practice. Science is great, but the people on the ground have got to buy into it, so it’s got to be doable at the same time.

Again, it’s education. For example, when electronic identification was being brought in, the perception on the ground of a lot of animal keepers was that this would be too burdensome and they might even stop keeping livestock. Again, that’s the bureaucracy slowing down progress; we believe in animal identification because that helps to track and trace and contain disease. It’s a complicated issue, and more could be done on both levels. Obviously governments have to do something about disease control, because in the long run it costs them even more than not having a proper disease control program. But on the welfare side there’s a lot more that should be done in terms of education of both the consumers and the keepers, whether they’re small scale or industrial.

What is that pan European cooperation like amongst both producers and the regulators across the continent?

PK. Fundamental principles can be agreed, but the problem is that conditions vary throughout Europe so that the techniques and systems that you’d want to apply in a particular territory are bound to vary, which is a difficulty.

That might be an inherent weakness of the European union: The fact that the conditions in each of the member states vary both politically and fi nancially. In our case, the case of animal production and food production and so-on, everybody’s got a different set of problems and different infrastructures through which to operate. What is important is that systems in management that are applied in whatever territory are applied or recorded very clearly and shown on the finished product so that it’s evident to the consumer in any particular country. Again, this is all really idealistic. Recognizing the differences in the different countries is just as important. If you’ve got some guy keeping goats in the Pyrenees, it’s different than for somebody keeping goats on a commercial scale in Holland, so each individual territory has to have its own protocols. But there needs to be a combined approach and as much cooperation as possible, and for me, that’s the ultimate about Europe. The whole thing about Europe is you get so much bad press about it all, but it’s absolutely thrilling when we all get together. We really do feel like we’re all working together in one situation, and I think that we set quite a good example of a pan European approach.

“The bottom line is animals are sentient beings, and they need to be kept properly with full considerations for their health and welfare”

What from your perspective are the most pressing health and welfare issues currently facing European livestock producers?

PK. Finding a better way of keeping animals with better guarantees for their welfare and health. More investments into developing vaccines for emerging diseases ahead of the game rather than doing some fi refighting job and having to wait for vaccines. The downside of that, of course, is you may end up with stocks of vaccines for a threat that didn’t materialise. But I would argue that that would be a better outcome than the disease appearing without anybody being ready with the fi nancial consequences and the welfare consequences and the economic consequences to the keepers. So it’s a tough nettle to grasp, but more resources for preemptive vaccine production are essential.

If we all work together on this we can tackle it. That’s the whole thing about the ELA. It’s European rather than just English or UK or Dutch.

If we all work together on that, then there should be consensus. On the other side, perhaps if we had a unified approach with the vaccine producers, they could take a more long-term view. If they could plan far enough ahead to know that there would be a concerted effort to produce preemptive vaccines, perhaps they might actually be able to come up with a better price. Again, I know all this sounds very idealistic, but we all know the outcome of not being ahead of the game.

How likely is it that some kind of framework of key standards could be agreed on any time soon?

PK. I’m never optimistic on a timescale. It almost is like we’re pushing a rock up a hill. But the people that think this stuff up in central Brussels for instance, I think they always need to be reminded of the fact that there may need to be delegations in particular territories for particular reasons. There should be a flexible approach but with an overall umbrella that embraces the fundamental principles of how animals should be kept and how food should be safe and good.

What would the key features of a Europe-wide set of standards need to look like?

PK. We have to work backwards, because I think the consumers are becoming more and more aware of industrial practices. I mentioned Belgium Blue. It was actually on the package that this beef is from the Belgium Blue and there was a list of the reasons why it was difficult beef to produce, it would put people off from ever buying it, so that’s the one extreme. And then you’ve got some other guy who wants to make cheese from unpasteurised milk who’s being prevented from doing so by legislation, so it’s a huge, huge problem. I don’t think it’s an easy thing to do, but I think if organisations like ours were involved in the development of those plans, we’d come up with something that was practical and workable. But we would build a huge amount of leeway for individual govern-

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ment. The bottom line is animals are sentient beings, and they need to be kept properly with full considerations for their health and welfare. If you don’t have that, the rest of it is just not acceptable.

We don’t say we’ve got the answer for the whole problem, but what we’d like to be able to do is present information that is reliable and unbiased. A lot of information that is publicised is generated by sources sponsored by special interest groups. Quite often companies or scientists are sponsored by commercial interests.

The only information we’ll publish is stuff that’s independent and that isn’t written by political or commercial interest. Th at’s the biggest need of all. To inform people and help to make things happen there has to be a source of reliable information. We’re not only concerned with

food and livestock production, but we’re also very committed to genetic conservation. Native breeds, and all that comes with them, need support and encouragement and development and publicity in order that they don’t disappear, so genetic variation in livestock in Europe is a huge issue, and that’s something we’re also very committed to and do a lot of work on. Native breeds make a huge contribution to habitat conservation and climate change. And you know what they say, eat them to save them.

Peter King is Executive Committee Chair for the European Livestock Association. and has been a breeder of pedigree livestock for over 20 years. King served as National Field Officer for the Rare Breeds Survival Trust for eight years. He is Founder Member of the Traditional Hereford Breeders Club and Council Member for the Rare Breeds Survival Trust. He is an author and traditional livestock consultant, and Convenor and Founder Chairman of ELA.

Is climate change impacting animal disease?

A According to the UK’s Department for U Environment & Rural E Affairs, there is evidence A tto suggest that climate cchange has affected, directly or indirectly, d tthe occurrence and distribution of certain d livestock diseases, and is likely to continue to do so. Often climate change does not act on its own, but in conjunction with other factors which may also be changing. Farmers and vets alike need to be aware of changing conditions and the possible consequences.

Changes in climate could bring more rainfall at certain times of the year, and result in serious flooding. There are a number of consequences of increased flooding. It can spread manure, silage and sewage across fields, spreading diseasecarrying organisms. Another potential consequence of flooded fields is that livestock may be confined to smaller areas with opportunities for more mixing of different breeds and species – for example, sheep and cows having to share grazing pastures. Increased rainfall may also alter the abundance and type of habitats available for disease-spreading invertebrates such as midges, mosquitoes and mud snails.

The increase in temperatures raises a number of questions. Could warmer daytime temperatures cause livestock to pack together for longer periods of time in order to be in the shade? Will increased temperatures result in a longer grass-growing season, therefore increasing the opportunity for contact between livestock and wildlife due to more extensive farming practice?

Warmer night-time temperatures could prove favourable for many disease-carrying insects that fly and feed at night.

Higher temperatures may already have helped the spread of bluetongue virus by midges in northern Europe, and there is evidence to indicate that midges are able to transmit certain livestock viruses more efficiently at higher temperatures. Other midge-borne viruses that infect livestock include African horse sickness virus and epizootic haemorrhagic disease virus, neither of which have ever occurred in this country.

The increase in the movement of produce and people around the world also provides more opportunities for disease spread. For example, insects such as mosquitoes may hitch a ride to other locations and be released into the environment on arrival, and pathogens may be introduced through entry of infected humans, livestock and animal products.

ACTION POINTS Draw up contingency plans for extreme weather conditions, such as flooding and drought, to reduce mixing of livestock species Cover potential water containers such as buckets and old tyres, which could serve as breeding grounds for mosquitoes Try to encourage tadpoles and dragonflies on farms as they may help keep down mosquito larvae in ponds Take steps to minimise risk of animal slurries being spread onto fields and into watercourses by flooding Herd and flock health plans need to be reviewed annually and adjusted in the light of information on disease surveillance and changing disease patterns published by disease surveillance programmes Take care to verify the health status of animals before bringing them into your herd/flock, to avoid introducing new diseases

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ASK THE EXPERT

The whole hog

wise, feaces had been drastically reduced and neither was E. coli detected.

Immunity High mortality and sickness have plagued the modern swine industry. Extensive POD test results have proven its ability in promoting the animal’s self-defence system and eradicating toxins and growth inhibitors in the feed. Healthy pigs obviously give rise to better feed conversion rate and better quality of meat. Absence of deployment of antibiotics in feed became the norm. Survival rates of less than 70 percent have risen to better than 98 percent. The offspring per sow rate of 22.5 also increased to 27.5.

Natural confluent environment

Eric Chen outlines key measures to reduce the environmental impact of pig farming while also improving efficiency.

M

ost people recognise that motor vehicle emissions are a major source of global warming. Yet not many know that the livestock industry collectively produces about 51 percent more greenhouse gases than all the other industries combined. However, a global conversion to veganism as a solution to reduce carbon emissions appears highly unlikely. A more realistic approach to curtail swine farm greenhouse gas emissions embraces three key components. First, maximising swine feed utilisation for conversion to either meat or energy minimises generation of animal waste.

The second component is that the feed should effectuate the growth of healthy swine with minimum to nil mortality, thereby drastically reducing the consequential waste treatment and disposal. The third tenet entails the provision of an environment and setting that are conducive to healthy, active swine growth – indeed a good practice that is being increasingly adopted by owners and operators.Th is articulated three-pronged approach results in a significant reduction of greenhouse gases, hence mitigating global warming.

Of significant assistance in the struggle to make pig farming more environmentally sound is POD, a thoroughly R&D tested, in situ performance proven and acclaimed glaci-

ated natural organic product. To achieve the objectives implicit in the three components would necessitate three distinctive, integrated elements which, respectively, enable an active effective metabolism; restore, establish and maintain a strong immunity; and augment environmentally confluent management.

The reduction in toxic gases, plus solid and liquid wastes present in the living settings, is most conducive to healthy, energetic pigs at all stages of growing process. The owner/operator would also greatly benefit from much less capital, operation and maintenance costs of barns and peripheral facilities, such as ventilation, waste treatment and disposal. Last but not least, the old nightmarish regulatory compliance and associated issues can become far less arduous.

“POD has laid the foundation of a natural environmental swine operation system under which carbon emissions and resulting global warming are significantly reduced”

The fi rst two are intrinsic attributes of POD and the third, although extrinsic, is substantially complemented by POD. In essence, it is an integrated natural environmental swine operation system.

Metabolism The typical feed conversion rate of 3.5 was appreciated to 2.3, meaning a saving of 35 percent in feed. As most of the protein was digested to become meat, generations of ammonia and hydrogen sulphides were reduced in tandem from > 400 ppm to < 20 ppm. Like-

In conclusion, POD has laid the foundation of a natural environmental swine operation system under which carbon emissions and resulting global warming are significantly reduced while substantial cost-savings, good quality of meat and high productivity are also realised. Who are the winners? The environment, the owners and operators, the consumers and, naturally, the pigs themselves.

Dr Eric Chen received his PhD of Agriculture in 1994 from Clemson University in South Carolina, US. He, as the leader, and his team have been engaged in the nonchemical organic farming campaign for the last decade in Asia and in developing scientific effective modern agriculture for farmers.

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EXECUTIVE INTERVIEW

Micro-managing animal health Dag Andersen explains how using micro-organisms in animal feed can help to improve animal health and reduce the spread of foodborne diseases.

What positive impacts can the use of micro-organisms in animal feed have on overall animal health?

Dag Andersen. Animal nutrition has experienced many changes in the last few decades, not only in the private sector, but in the public sector as well. Technology and science has permitted the industry to improve the limits of growth and performance of the animals.

Today, the next step that needs to be taken care of is the products that are used. They must still achieve the highest performance parameters, but they must be from a natural origin.

Firstly, micro-organisms fulfi l the natural origin and have shown growth and performance improvement in many scientific and field trials. Secondly, micro-organisms have other advantages besides being natural and having positive effects on growth and performance; they also support the immune response system and therefore can reduce the emergence of diseases in animals.

Another aspect that has worried society recently is the use of antibiotics. By using micro-organisms, there is a reduction of potential diseases, and therefore, less use of antibiotics. It is very important to point out that between micro-organisms, many modes of action are described, and even if they all claim to reduce pathogen bacteria in the gut, which is responsible for many of the diseases, not so many of them can prove exactly which one. In this case, B. Toyoi is one of the most studied micro-organisms and with more studied effects among micro-organisms.

“Probiotics, which are also used in human food, are becoming an important element in animal nutrition” Does the growing interest in organic food products have any effect on your business or are you able to align your products with consumers desire for ‘natural’ products?

DA. Defi nitely, the growing interest in organic food has a very positive effect on our business. Our micro-organism B. Toyoi is a natural product and therefore the use of it in organically fed animals means that all the positive effects of the product will be shown without any interference from other side effects that might mask the effect.

Dag Andersen, MBA is the General Manager of Rubinum Animal Health. Since 2005 he has been in charge of the international expansion of Toyocerin for the European market and since 2008 for the worldwide market. He is also the Export Manager of Andersen S.A. and is in charge of the international expansion of vet drugs for animal production.

ease is observed, therefore, medication costs are reduced, and last but not least, studies have shown a better response to vaccination due to the improvement of the immune response.

B. Toyoi is the micro-organism that has been registered in the European Union for the longest time and is also the one that has more registrations in different categories and species. Today, Toyocerin is registered as a feed additive in the EU and many other countries worldwide in all main animal production categories for fattening swine, turkey, chicken, rabbits and cattle.

Can the use of micro-organisms in animal feed present real ROI for animal producers?

DA. B. Toyoi has demonstrated through many trials, both in-vivo and in-vitro, that the growth and performance parameters are enhannced, by improvement of nutrient absorption, reduction of IgG, mortality reduction, production of some digestible enzymes etc. In addition, a reduction in the incidence of dis-

What are your key areas of focus at the moment? Are there particular health challenges that you are currently devoting your energies towards?

DA. As a producer of a feed additive that will be ingested by an animal that will later be consumed by people, it is our fi rst priority to study if B. Toyoi can reduce the possibility of transferring any zoonotic agent to humans through animal products. In this regard, today we know that B.Toyoi has a positive effect reducing Salmonella, E.Coli and many other pathogen bacteria. Our next step is to study Campylobacter reduction.

In conclusion, probiotics, which are also used in human food, are becoming an important element in animal nutrition and all the positive effects and knowledge about them are investigated today both on the animal and on the human side. It is very encouraging that both industries are heading in the same direction.

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The probiotic of choice for an optimal gut function in farm animals

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ASK THE EXPERT

MEATING EXPECTATIONS Dr Ricardo Gobbi explains the breakthrough innovation that is supporting sustainable meat production.

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ne of the big challenges for this century is to produce food for the growing world with the available limited resources. The demand for meat products will strengthen in parallel with the rising population and the increasing incomes of a large fraction of the world’s population.

Nutrition of farm animals has contributed greatly, over the past decades, to improved efficiency in meat production. Optimisation in production efficiency plays a central role in balancing increasing demand for food and feed with reasonable pressure on land, biodiversity and water resources.

Currently, researchers around the world are searching for the future solutions in feed formulations that will allow full expression of the genetic potential of pigs, poultry, cattle and fish to convert feed into protein for human nutrition in the form of meat, eggs and milk.

The feed industry is playing an important role in shaping the future by supporting investigations in basic science. Breakthroughs in basic science are fundamental to making major advances in animal production.

An interesting example of this contribution is the discovery by design in a hypothesis-driven research with guanidinoacetic acid (GAA). Eight years ago, entrepreneurs, supported by visionary feed industry managers, raised a hypothesis on the conditional necessity of GAA for high yield farm animals due its involvement in the energy metabolism. Th is hypothesis has been investigated by a network of research institutes in Europe, the US and Brazil.

Background for such an idea was the observation that use of alternative protein sources other than animal protein for feed formulation is steadily increasing in livestock production. As those protein sources often do

not match the nutritional needs of specific livestock and poultry, there are efforts to provide ingredients that close the nutritional gaps of animal diets with lesser or no animal protein.

One of those affected nutrients is creatine. The only physiological precursor of creatine is GAA, which has much more favourable chemical and physiological properties compared to its metabolic derivative creatine and accordingly is more suitable for use in animal nutrition.

The animal’s physiological demand for GAA and creatine can be supplied directly by creatine from fish or meat in the animal diet or by endogenous synthesis from the amino acids arginine and glycine to form GAA in the kidneys, which is later methylated in the liver to form creatine. Traditionally, metabolic synthesis and feeding proteins of animal origin provided an adequate supply.

Diets with reduced amounts of animal protein or without any animal protein are deficient in creatine and this cannot fully be compensated for by de novo synthesis.

Physiological research and animal trials have shown that supplementation of GAA can act as a source of creatine particularly with such diets low in animal protein content or without any animal protein, significantly and consistently improving the efficiency in animal production. Th is improved efficiency is achieved through better feed conversion (less feed needed to produce same amount of meat), higher daily weight gain (faster growth rate) and benefits in carcass composition (more meat especially breast meat).

The crown of this achievement was the recognition by the European Food and Safety Authority (EFSA) of the efficacy and safety of GAA and later acceptance and publication by the European Commission of the authorisation regulation giving to GAA the status of nutritional feed additive in October 2009.

GAA is now offered commercially in Europe with the trademark CreAMINO being a granulated preparation of guanidinoacetic acid to match the handling needs of the feed industry as a dust – free and – free flowing product.

Adoption of this new nutritional concept by feed manufacturers and animal producers will contribute to an improvement in the sustainability of animal production, particularly by improving animal efficiency and consequently lowering production costs and pressure on resources and the environment.

Ricardo Gobbi is Marketing Manager within Evonik´s Business Unit Health & Nutrition located in HanauWolfgang, Germany. Prior to his current position he worked in technical sales of pharmaceutical ingredients and feed additives and in the pharmaceutical industry in research and development. He studied Pharmacy and Biochemistry at the University of Sao Paulo, Brazil.

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SUPPLY CHAIN

Following the recession, companies need to diversify their supply base in order to reduce the vulnerability of the supply chain and increase efďŹ ciencies, says Douglas Kent, European Chairman of the Supply Chain Council.

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he economic downturn brought many companies, both large and small, to their knees and only the hardiest of supply chains managed not to fall victim to the turbulent conditions that beset the global economy. As markets collapsed, sales fell and profits went into freefall, supply chain managers found themselves in a very difficult position, faced with the need to cut costs at a time when operating costs were naturally increasing due to lower demand and lower throughputs.

The recession certainly forced supply chain managers to revaluate.

“Probably the biggest impact was the fact that many of the players in the supply base have introduced a great deal of risk into the supply chain because many of them have gone under or have themselves been quite vulnerable,” says Kent.

Those who were perhaps sourcing from smaller companies would have certainly felt the effects as those smaller companies were often worse hit. Many then found themselves having to look for new suppliers, which has increased the supply base risk element within the supply chain and brought with it a great deal of vulnerability.

However, as we now head out of recession, Kent believes that there is a lot we can learn from this experience and he has quite a few suggestions as to how companies can protect themselves from these vulnerabilities in the post-recession business climate.

Firstly, he believes that companies need to gain a better understanding of the vulnerabilities that are present in their supply base.

“They need to really look deeper in order to understand the fi nancials associated with their suppliers. If they fi nd that a particular supplier is quite vulnerable then they may need to introduce a second source,” says Kent.

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Another way in which Kent believes that companies can best place themselves to foresee any changes in the unpredictable business landscape is to build diversity into business structures and supply chains.

“They really need to understand the cost of risk that’s being introduced.

The measure is called value-added risk, or VAR, and really what you’re looking at there is the potential for a disaster occurring.”

Kent suggests that companies need to assess the probability of such a disaster against its potential impact and they need to get better at making those sort of trade-offs. Therefore, the introduction of risk and risk mitigation becomes incredibly important, according to Kent.

Aside from examining the fi nancial situation of suppliers, companies would do well to work on improving their planning and their understanding of demand variabilities. Better sales and operational planning (S&OP) and understanding which customers and products have a higher forecast accuracy is one way to ensure that the supply chain is more robust, says Kent.

When times are good it is very easy for companies to lose track of the importance of making efficiencies within the supply chain, particularly when the need is not so pressing. However, when the economy takes a

nosedive, efficiencies tend to shoot right up the supply chain manager’s agenda and one way of achieving these efficiencies is through supply chain network design.

“What I mean by this,” says Kent, “is that they’ve got to be constantly looking at the best ways to manufacture and deliver products to their customer base.” Th is requires companies to realise that products do not necessarily have to follow a certain supply chain configuration throughout their entire lifecycle and it is worthwhile to shift manufacturing or logistics in order to meet economic requirements.

However, redesigning the supply chain to improve efficiencies can mean that certain other sacrifices may need to be made. The important thing is to ensure a balance and this necessitates a good understanding of the requirements and the realisation that not all supply chain requirements need to be treated the same.

“We shouldn’t try to paint the customer base with the same brush and say every customer requires 99 percent on-time delivery and offsite flexibility of 20 percent or 30 percent over their forecasted amount.

We need to look at each one of those configurations differently and then make those choices,” says Kent. “That’s where a lot of companies have failed. The reality is that we need to treat customers fairly, but not necessarily equally.”

Th is is a challenge for most companies, according to Kent, and he says that many sales people have a hard time understanding this concept. “If we take on-time delivery as the major service metric, a two percent increase in on-time delivery from 90 percent to 92 percent has a different cost than moving from 96 to 98 percent. The closer you get to perfect, every percentage increase in service is much more costly. A lot of salespeople who are making commitments to their end customers don’t understand that there’s a cost differential there, and that’s where the supply chain needs to educate,” explains Kent.

When talking about improving efficiencies in the supply chain Six Sigma and Lean cannot be ignored and Kent points out that many companies are now starting to realise that combining the two adds far more value. However, he also explains that Lean needs to be extended throughout the whole supply chain if the maximum benefits are to be had.

“If you become incredibly efficient in manufacturing but you’re not Lean at all in the planning and sourcing areas, then that Lean initiative in manufacturing will have a limited effect. So it’s about extending Lean and Six Sigma

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outside of manufacturing and leaning the whole of the supply chain,” explains Kent.

He also says that leaning your own is only the beginning and to get the full impact of this you really need to ensure that your customers and suppliers follow your lead. Citing Toyota, which he admits may not be the best example today, Kent says that the car manufacturer did not see the results of their Lean initiative until they extended it to their supply base.

One of the other consequences of the recession is that companies have started to see benefits to the issue of sustainability far and above the environmental aspects. Sustainability can also offer cost savings in the supply chain and Kent believes that most companies are now focusing on three key aspects – ecological, economic and service.

“Every decision taken in the supply chain should be measured against those three standards: is it ecologically viable; are we being responsible to our environment; is it an economically viable solution?” asks Kent. Companies must be careful, he says, that in becoming more green they are not pricing themselves out of the market and they are not failing to deliver the service requirements to the customer.

“In the food supply chain this is of paramount importance, because the service requirements are probably the strongest in the industry because retailers demand a very high level of service,” says Kent.

Some companies are even starting to reassess their supply chains and are re-examining where they are sourcing their products from.

For example, many companies that decided to source from abroad for economic reasons have since compared the cost saving with the cost of transportation and the environmental cost and have realised that the saving may not be worth it after all.

“There has been some movement in the industry to suggest a rethinking of global sourcing and to some degree a movement back to regionally-based sourcing because the economic advantage is not what it was initially thought to be,” says Kent.

Transportation in particular has been under close scrutiny as pressure increases from the retailers. Rail transport continues to be more ecologically responsible than road transport for example and many retailers, particularly in the UK are putting pressure on manufacturers to display the so-called ‘food miles’ on their packaging and this is something that manufacturers will have to respond to.

However, pressure will also come directly from the customers, who, given the choice, are shown to choose products that are least harmful to the environment, as long as the price is not vastly higher. “It’s really a matter of how sensitive the customer is relative to the trade off between ecological and economic,” says Kent. “But I still think that the pressure is more likely to come from the retailer than directly from the consumer.”

Another aspect of sustainability that has been seen to affect the supply

chain is the need for transparency, which was illustrated last month as Nestlé came under fi re from consumer activists and non-governmental groups on Facebook and Twitter for it’s sourcing of palm oil. Consumers are demanding more visibility regarding the sourcing of food ingredients and as a result companies need to ensure that they get this information from their supply base in order to prevent such backlashes.

However, there is also a very practical element to enhancing this transparency. “There is going to be a constraint in supply coming up, as companies have already seen with things like cocoa for example, and there will be an increase in prices and lead times. Where transparency fails is not necessarily between the manufacturer, the retailer and the consumer, but between the supplier of the ingredient and the manufacturer. And sometimes we just don’t have the level of transparency that is necessary,” says Kent.

A similar scenario can be seen in relation to traceability in the food chain in order to ensure food safety. Recent problems with food contamination and recalls in the USA have only highlighted the need for greater traceability. “If a supply chain disaster, such as Salmonella poisoning, happens then it is expected that a manufacturer can trace back all the way to the source of supply to fi nd where it initiated.

Neither the general public nor the government are willing to accept that you can’t trace that back,” says Kent.

“A lot of companies can do it, but it takes a great deal of effort to trace it back. When this situation occurs there’s not a lot of time to respond.

In most cases it’s a matter of data management, so they have to be able to do lot tracking throughout the entire supply chain. They have to know which lots coming from which suppliers might have been introduced within the supply chain that are affected,” says Kent.

Health and safety standards are obviously of paramount importance in the food industry and the majority of companies focus on employee training as a way of ensuring safety. During recessionary times, many companies tend to cut their training budgets but Kent says that what is really required is for companies to stick to their guns in making sure that employees are well trained and that sufficient monitoring programmes are in place enabling any trending on safety related issues to be spotted in advance so that the information can be shared across the supply chain and across the different business units.

Training on its own however, is not enough and technology has an important role to play. “Certainly, IT information systems are important, but in many cases companies are also introducing technologies like barcoding or RFID to provide the traceability aspect,” explains Kent.

And luckily innovations like RFID tracking are now becoming far more accessible as the price comes down. As with most new technologies, the expense made it prohibitive for many of the smaller companies in the industry, but as the volume has increased, the price has correspondingly decreased opening up the market and offering a safer future.

“Certainly, IT information systems are important, but in many cases companies are also introducing technologies like barcoding or RFID to provide the traceability aspect”

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ASK THE EXPERT

Road to recovery Andrew Kinder outlines how manufacturers can cut costs and not quality as economic conditions start to improve.

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iven the difficult conditions that have prevailed in manufacturing throughout the economic downturn, you may think that the only good course of action is to stay hunkered down and wait for it to all blow over for good.

Thankfully, however, there are plenty of sings that recovery is underway across Europe and there are a number of actions that manufacturers can take to accelerate their own recovery.

Infor offer five strategic actions that organisations can undertake today. These actions are not only cost effective, but can help manufacturers immediately, putting them in a better position to take advantage of the recovery.

Smart move #1 – Protect cash. Businesses recognise the critical importance of cash management, particularly at times when capital and credit are difficult to come by. One way in which manufacturers can release cash is through reducing inventory and work-in-process levels. Infor has observed an uptake in technology solutions around demand and inventory optimisation in the past year and resurgence in interest in Sales and Operations Planning (S&OP).

Smart move #2 – Pursuit of productivity. One measure that is consistent among manufacturing leaders is their relentless focus on productivity, whether this be their production assets, people, warehousing or transport. It makes sense to make the optimum use of existing resources before investing in new products, especially in current times. Technology solutions that help you achieve this are in vogue. An example of this is production scheduling which, through intelligent sequencing, a plant can reduce time lost due to changeovers by 30 percent and reduce costs through the reduction of overtime or other shift premiums.

Smart move #3 – Go green. Whatever your beliefs on the causes of climate change, it is certain that over the next decade manufacturers will need to adapt to operating in an increasingly carbon constrained economy. Government legislation will demand it, important customers will select their suppliers based on it, and having a sustainability strategy for manufacturers is not just good environmental stewardship, it makes good business sense too. Reducing energy use, re-

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ducing waste and recycling materials saves money. One way in which manufacturers can profit from this is through Infor’s EAM Asset Sustainability solution. Since 80 percent of the total cost of operating an asset can be in the energy it consumes over its lifecycle, it makes sense to monitor this intently. By maintaining equipment at its peak performance energy bills can be cut by eight to 20 percent.

Smart move #4 – Rent instead of buying. You may want to adopt new technology to help you to a stronger, faster recovery but huge upfront costs are a tough sell in a tightmoney environment, no matter how big the future payoff might be. An alternative might be to subscribe to business software rather than buy it outright. This preserves cash and without the upfront payment associated with purchased software, has the financial effect of shortening the time to benefit. Software as a Service (SaaS) or Application Managed Services (AMS) are both alternative deployment options offered by Infor to help companies address cost or resource concerns.

Smart move #5 – Upgrade your business software. Almost all manufacturers have some form of enterprise resource planning (ERP) system and the normal agreement includes an annual maintenance and support fee entitling customers to the latest versions. Research across the industry, however, shows that the majority of organisations are not on the latest release of their software, with many on versions several years old and facing an uphill effort and high cost to update to the latest version. In effect, this means companies are not getting the full value of their software investment and are missing out on newer capabilities that could help improve efficiencies and innovate processes. Infor has tackled this problem with Infor Flex. n

Andrew Kinder is the Director of Solutions Marketing at Infor. He is responsible for setting the strategy, determining focus industries, aligning forward development direction and driving global execution through marketing and sales enablement and has a background and particular interest in enterprise resource planning.

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INDUSTRY INSIGHT

The missing link Mikael Nilsson outlines the basic fundamentals of the supply chain and how fully understanding it can maximise profitability and customer satisfaction.

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supply chain is a row of activities set up between a supplier and a customer with the purpose to provide value to a customer. If the supply chain is smooth it’s also profitable and in this article I will show how you can make your supply chain more smooth.

While the parts of the supply chain can be different from case to case, the sequence generally follows the pattern of marketing, ordering, manufacturing, delivery, payment and interaction.

While all the activities contribute to the profitability, the most important part is step number one. Marketing is as essential for a business as the blood is for a body. If the marketing doesn’t work, no business is generated and if no business is generated you make no money. So you must make the marketing work properly and one way to do that is through the internet.

“As it’s much cheaper to keep an existing customer than to get a new one, the interaction part is important to generate future business” When the customers know that you exist and have a product or service to offer, they must be able to send you correct orders in a smooth way. There are many opportunities here but the customers have to know how to order and what information you need.

With a correct order, the manufacturing process can start. This part is the most specific one and it is difficult to describe common things that can go wrong. But one way to deal with general problems is to look for bottlenecks

Mikael Nilsson is the founder of Minimpex and has a Masters degree in applied logistics from the Royal Institute of Technology, the number one technological institution in Sweden. Nilsson has a background in the telecom business where he has knowledge of the entire supply chain from manufacturing via transportation to customer. He has worked in a dozen countries and has experience from a wide range of cultures.

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and see what you can do to eliminate them.

The same bottleneck approach can be used in the delivery part as well.

How about the flight capacity to the destination? Is it tricky to pass the goods through customs? Would it be profitable to hire someone to deliver to the customers? These are just a few of the questions you can ask when attempting to maximise efficiency in this area.

While the manufacturing and delivery parts are similar, the ordering and the payment parts also have some things in common. The customer has to know how to pay and you must inform them how.

As it’s much cheaper to keep an existing customer than to get a new one, the interaction part is important to generate future business. It enables you to inform the customers about future offers and provides customers with the opportunity to give you feedback if they are satisfied with your performance or if there is something you could improve.

So here we are with a couple of questions to be answered regarding your business. I wish you good luck with your efforts and look forward to hearing from you to see what we can do together in order to improve your profitability. n

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Mikael Nilsson Trading Consult Utg책rdsv채gen 18 19144 Sollentuna Tel: +46-73-6493268 Email: mikael@minimpex.com WEB: www.minimpex.com www.BuildItBeforeYouNeedIt.com

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LEAN SIX SIGMA

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As the food industry seeks to improve its efficiency in all areas of operation, there is much it can learn from other business areas. Here, Carmen Doran, Global Operational Excellence Champion, and Domingo Traver, Head of Supply Chain Excellence and IQP for Novartis Pharma Technical Operations, tell us about their company’s progress in implementing these processes.

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s Global Operational Excellence Champion, Carmen Doran supports all 23 sites for Novartis Pharma’s technical operations as well as the global support functions, by providing a systematic training and certification programme across the organisation. This aims to foster a culture of operational excellence (internally referred to as IQP: innovation, quality and productivity). She comments that operational excellence in Novartis Pharma covers a wide range of topics, tools and techniques, which allow flexibility in identifying the best approach for a specific problem or opportunity.

“The philosophies of Lean and Six Sigma represent a way of thinking and looking at a problem, in order to understand the root cause(s) and then solve the problem in a sustainable manner,” she explains. “This approach is different to the traditional management styles focusing on short term ‘quick fix’ solutions rather than on identifying the problem correctly and ensuring the solution is effective and sustainable long-term. We try to use this approach across all areas of the business.”

“We apply the same approach in non-manufacturing environments as we do in production. It’s a natural progression that we need support functions aligned to the new way of working and thinking in manufacturing. Like a lot of companies, Novartis started to apply these methodologies and philosophies in the manufacturing area first, and now the ideas are spreading to the rest of the business. In manufacturing it’s very easy to see the processes and to work on the processes because that’s what is right in front of your eyes. In other business areas, some of the work we do focuses on simply making the process transparent,” explains Doran.

As a global IQP champion at Novartis, Doran explains how she has a lot more requests to provide Lean support than she has time for; these come from people who have heard about Lean through their colleagues or through seeing the benefits themselves. In order to accommodate what Doran explains as a “pull system” for IQP support, Novartis has its IQP champions across the world, operating different skills in different areas and matching the business needs with the company’s resources.

“What has made the Lean and Six Sigma thinking successful is the combination of the technical process improvements, cultural aspects and a clear strategic direction which fosters, for all involved, a passion to strive for operational excellence” Initially set out as two different methods, Lean and Six Sigma are very much interlinked and constantly evolving, a development that Doran notes to be present in Novartis Pharma technical operations. She explains how previously projects would solely use Lean and focus on reducing waste, or would apply a Six Sigma approach to reducing variability. “The Lean philosophy is to have flow through the process and to do this, you need to have processes you can rely on. A stable and reliable process is then the foundation for continuous improvement. So Lean and Six Sigma go hand in hand to achieve operational excellence.

“We look at the flow of value all the way through our processes down to the customer, whoever the customer may be; in our case, this is ultimately the patient. If we look at some of the supporting functions like HR, we’ve been applying the Lean and Six Sigma way of thinking to these processes, going through the steps of identifying the problem, understanding the customer needs and root causes of the problem and then finding the solution which matches to those. By doing so, we are for instance ensuring the improvement and sustainability for recruitment processes where the benefiting customers are actually both the employee and the business.

Carmen Doran is Global Operational Excellence Champion in Novartis Pharma Technical Operations.

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“We often use an external pair of eyes on a process. That external view of speech and interactions between people, and explains that although may come from another internal function, another manufacturing site or a Novartis publishes its IQP project results on the internal website and in global function. Novartis has a strong network of people across the globe, all newsletters, most results are seen from the effects of a strong network. with different backgrounds, but all working on Lean and Six Sigma in a rather Monthly teleconferences with IQP champion networks, ad hoc teleconunified manner. They are capable of implementing various problem-solving ferences and regular meetings focus on the challenges facing the site, the tools and methodologies in projects and of linking them together to create a successes, their goals and what’s in store for the future. culture leading towards operational excellence,” “Although the sites are on the same jourshe explains. ney, they’re all at different stages, but they’re Pharma technical operations has successfulall looking for alignment through our operaly handled some natural resistance to change and tional excellence scorecard. We have a very In 1995, Harvard Business School to the use of these new processes thanks to strong clear strategic direction for operational excelprofessor and change management leadership endorsement, although Doran admits lence in Novartis Pharma Technical guru John Kotter published a book that there are still some people who are coming Operations which allows all of the sites to entitled Leading Change, within which round to the idea. Enthusiasm for a new project, move in the same direction. That’s one of the he outlined his now well-known eightshe points out, is often created upon seeing the reasons we’ve been successfully able to turn step change process: results. If a person working on a project has enthose challenges along the journey at a site into joyed it and demonstrated good results, then othsomething that has been enjoyable and re1. Create sense of urgency ers can judge for themselves. warding.”

Open an honest dialogue about what’s Novartis Pharma is certainly not alone in happening in the marketplace Expansion facing these challenges. The pharmaceutical inAs a global company, Novartis Pharma dustry has been dogged by pressures to reduce 2. Form a guiding coalition Technical Operations has sites located across the costs in light of the recent economic crisis. “We Set up strong leadership by gaining US, Europe and Asia. Prior to taking up her curcould focus on cost, but the better way is to focus support from key people rent role, Doran worked in the company’s reon the speed and the agility of the processes,” excently opened Pharmaceutical Operations site in plains Doran.

3. Create a vision Singapore. She explains that there are variations “One of the biggest concerns for all pharHelp people see for themselves what in the take-up of Lean Six Sigma across different maceutical companies is the speed at which they you’re trying to achieve locations, but not always in the way you might are able to adapt to change. A lot of our processthink. “The difference for us in terms of adoption es can be improved, and maybe we haven’t had 4. Communicate the vision is not necessarily the culture but the maturity of the challenge that some of the faster-moving Talk often about and apply your vision the site. When you have a site which has been consumer industries have had in terms of reacas much as possible around for 50 years where you have people with tion to market requirements. Those companies a lot of history at that site, then it takes a different who can respond quickly to the market needs by 5. Remove obstacles approach for them to change their way of thinkbeing flexible and reducing their cycle times, Check continually for barriers to ing than if you have a brand new site like both in manufacturing and in development, will change Singapore. For them, everything is new. be the ones who can overcome these challenges.”

“We can show them results from other Added pressures come from the highly reg6. Create short-term wins sites, and there isn’t that resistance to change ulated nature of the industry. “None of us would Give your people an early taste of because they understand how it works togethwant to take medicine if it wasn’t highly regulatvictory er in the overall business model. So rather than ed,” says Doran. However, she notes that the people’s cultural differences, adoption depends pharma industry must also recognise that it is 7. Build on change on the lifecycle of the site,” says Doran. not alone in terms of the level of regulation it Keep looking for improvements In order to meet the challenges that often must undergo, pointing to the aerospace indusaccompany such implementations, she calls try as facing similar challenges. To combat these 8. Anchor change in your upon the company’s network of IQP champiconcerns, she points out that there are opportuculture ons: each site has a single point of contact for nities to collaborate more closely with regulatoMake sure change is embedded in all best practice sharing. “If I have a site in ry agencies such as the FDA, which welcomes every aspect of your organisation China that needs some input from a site in the positive changes.

US, they can directly contact the local IQP “At the end of the day, what I feel has made champion and ask about the results and learnthe Lean and Six Sigma thinking successful for us ings.” is the combination of the technical process imCommunication between the multiple sites is essential, and is faciliprovements, cultural aspects and a clear strategic direction which fosters, for tated by the central IQP team. Doran places most emphasis on the power all involved, a passion to strive for operational excellence,” she concludes. n

The Kotter model

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MAKING IT HAPPEN Domingo Traver Head of Supply Chain Excellence and IQP at Novartis Pharma Technical Operations talks about the satisfaction he derives from the successful implementation of Lean and Six Sigma in the pharmaceutical supply chain.

H

ealthcare markets around the world are rapidly evolving and pharmaceutical companies need to be prepared to address these changes. For example, regulators and payers are becoming more challenging while patients are taking a more active role in their disease management. All of this affects the pharmaceutical business, where increasing efficiencies can support future growth.

As Domingo Traver explains, rather than reinventing the wheel, it makes sense for pharmaceutical companies to draw lessons from what their counterparts in other industries have already done. He describes how the processes of Lean and Six Sigma – pioneered by Toyota and Motorola respectively – have taken hold within Technical Operations organisation at Novartis Pharma, where he is Head of Supply Chain Excellence and IQP. “The idea was first that we implement Lean to reduce waste in our processes, and then apply Six Sigma to reduce variability; it’s a two-step process,” he explains. “We have implemented the Lean phase, and in certain areas, such as quality assurance, we have also begun to apply Six Sigma. For example, Lean has been implemented in the different operational units, it is now time to link all of these units together. IQP is the internal name: innovation, quality and productivity for the operational excellence or continuous processing programme.”

In his role at Novartis Pharma, Traver looks after logistics and IQP, as well as leading the multimarket network for supply chain. He points to the fact that the current level of regulation and quality control within the pharmaceutical industry has a direct impact on the development and implementation of new efficiency processes. While regulation is necessary to ensure the safety of the end products, Lean and Six Sigma can additionally help to support the overall processes.

“For example,” Traver points out, “existing procedures may show that a particular process takes eight hours. By understanding your internal processes and applying Lean techniques, you will be able to demonstrate improvements and hence reduce the time required. Lean, therefore, challenges your current processes and technologies while at the same time making them more efficient.”

Another challenge can lie in implementing such changes across an entire organisation, which is why the Technical

Operations unit at Novartis Pharma started with several pilot programmes. After the successful implementation of these pilots, the initiative has now been rolled out across global functions, such as supply chain.

Creating change Prior to taking up his current position, Traver was Functional Champion IQP for Novartis PharmOps Spain, where he was principally in charge of deploying IQP and aligning IQP efforts with the global Technical Operations vision and strategy. He was leader of the Lean – POO (Process Oriented Organisation) project that ended with the implementation of the new organisational structure in Barbera in May, 2007.

“It was a very interesting project, because it included two elements,” he recalls. “One was the pure implementation of Lean Six Sigma – hence, applying the techniques and helping the teams understand what these techniques mean and how to use them. The other element was about POO, which was aimed at changing the organisation’s culture and mindset in regard to how people approach business operations. Among others, this included a change in management tools as well as business understanding.

“We used the Kotter model, starting with the ‘burning platform’. This allowed us to see how people behaved differently after POO had been initiated a number of weeks previously. This was really exciting to me, as you could see how the organisation as a whole had improved .

“You have different people behaving in different ways; for example, some may be afraid of change. Generally, there will always be 10 percent of people who are quite change resistant. However, you can manage these 10 percent by demonstrating how the other 90 percent benefited from new processes and a new culture. I was very happy that despite the challenges we managed the turn-around.”

Traver feels that Lean and Six Sigma have a strong future within the pharmaceutical industry, as well as in other industries. He points out that there are many areas in which these concepts are yet to be introduced.

“Lean Six Sigma helps us to improve our processes and to reduce variability. It is really helpful in many industries, and yet there are parts of the world that still have not taken advantage of it. So I would say overall that there is a lot of future in this yet.”

“Lean Six Sigma helps us to improve our processes and to reduce variability”

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EXECUTIVE INTERVIEW

Quality control Debra Shumar explains how the disciplines of Six Sigma and Lean can change the culture of a company to focus more on quality and efficiency in order to improve employee and customer satisfaction.

How do companies sustain a continuous quality improvement focused culture using these tools?

DS.The formal elements of strategy, structure, systems and infrastructure coupled with the informal elements of people, competencies, behaviours, relationships and culture must move in harmony over the long haul if companies are to create a new culture of sustainability through the use of Six Sigma and Lean tools. The primary reason for doing this is so that the architecture behind Six Sigma and Lean initiative supports the new culture for the organisation of ongoing continuous improvement.

How do companies sustain a culture of quality while maintaining a consistent level of customer satisfaction?

Debra Shumar. Creating a steady vision and getting people at all levels of the organisation engaged with the idea of quality creates a culture that improves and enriches what people do, the knowledge they utilise and the products and services they produce. Promoting a culture of quality that inherently embraces continuous improvement will achieve higher levels of employee and customer satisfaction. Assuring that in a Management Review Process (MRP), quality metrics are reviewed is also key to sustaining an environment of quality and customer satisfaction. It is important to understand what processes and or products need to be improved then apply the appropriate tool to the area of concern. This area is where 3P Partners’ services such as Six Sigma and Lean are critical.

Quality is very critical within the food industry.

How do 3P Partner’s Six Sigma and Lean tools help the organisation to improve quality?

DS. Quality standards and regulation have been a key part of a company’s structure for years. But today, with so many companies buying, selling, downsizing and out-sourcing, assuring that quality is kept at to the highest level is a paramount concern. As the food industry continues to improve costs and efficiency while maintaining compliance to regulation, it is important to provide a constant vision and focus about how our tools (Six Sigma and Lean) impact the workforce. Six Sigma and Lean are tools to assist the engagement of employees at all levels of the organisation and are critical to improving operating efficiency and quality.

What do companies need to do to effectively use these tools?

DS. There are several key factors that can help any organisation achieve success with the implementation of a Six Sigma or Lean initiative or pro-

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Debra Shumar is President and founder of 3P Partners. Former positions include VP Global Product Quality for Whirlpool and SVP Quality, Continuous Improvement, Engineering and Technology at ArvinMeritor. These responsibilities included product and process quality, warranty, supplier development, continuous process improvement and business excellence initiatives with people supportive strategies. Shumar is a certified Lean instructor and trained in the discipline of Six Sigma.

gramme. Some factors to consider are the leadership’s commitment to assuring the vision aligns with the organisation, a communication plan, skills and education training for all employees to drive improvement, profitability, return on investment, and an evaluation of the structure to support the realignment of resources and functions while trying to incur minimal risk to the organisation and customers. Companies must also be willing to admit when a process is not proceeding as planned and make necessary adjustments.

“Companies must also be willing to admit when a process is not proceeding as planned and make necessary adjustments” Why is culture so important to quality?

DS. Culture is as important to quality as the effort it takes to solve problems, improve productivity, downsize, merge, acquire business or drive organisational change. But when the culture of the organisation does not embrace shared quality ideals, many organisations never fully utilise their resources, thereby diminishing productivity and improvement within the organisation. Providing the who, what, why and how while providing steady vision and engaging with people at all levels of the organisation will create a ‘Culture of Quality’ to achieve greater levels of employee and customer satisfaction. To change how an organisation’s culture drives quality, the organisation must require future quality to be the fundamental and pre-eminent focus. n

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ASK THE EXPERT

Life signs

The race is now on for the healthier products.

Who will reformulate their products the fastest?

And who will ensure compliance across the most agencies for a single recipe?

Keith Smallwood explains how PLM can be essential in maximising a healthier bottom line.

W

hat do consumers want?

What is their biggest demand? Ironically, their biggest new thing demanded from consumers is to actually be smaller.

Consumers want healthier options. While they do have favourite brands, they seek out the healthier options to minimise their waistlines.

Not only a concern of the consumers, governments and leaders present initiatives to corporations for lower calories, sugar, sodium and trans fats. “We need you not just to tweak around the edges but to entirely rethink the products that you're offering, the information that you provide about these products and how you market those products to our children.” These were the words of US fi rst lady, Michelle Obama.

Th is is not only an issue for a single country, food and beverage corporations must create global recipes to meet the needs and compliance issues of several countries. The race is now on for the healthier products. Who will reformulate their products the fastest?

And who will ensure compliance across the most agencies for a single recipe?

Creating a healthier product requires a healthier solution – one that unites instead of divides the team members from their data and provides not only the essential tools, but progressive tools to expedite innovation. Best in class corporations opt for an integrated approach with Product Lifecycle Management (PLM) and legacy systems.

With secured connections, team members can collaborate effectively, creating and viewing

aging what they have. In other words, don’t reinvent the wheel.

What type of tools should you have for a healthier product innovation? We can name only a few in this short space, but we will emphasise the need for a product developone comprehensive picture, providing precise, ment module that looks more than just at the accurate data of all New Product Development present, but also at your past and future. Th is and Introduction (NPDI) worldwide. should include Rapid Prototyping to Target, But the overhauling of a product line is Recipe Templates (base recipes with add-on more than a single picture. It is a movement flavourings for faster formulation), and a that demands robust tools. It requires vision Formula Optimiser. Th is last tool allows you that must be seen by all team members through to select current formulas, defi ne an objecall stages of the product lifecycle. tive, constraints, and alternate ingredients.

As stated by the fi rst lady, a critical and within seconds, recalculate a healthier component is the marketing of products, the formula that would have once taken days or claims made and the product’s ability to live up even weeks. to the claim. How will corporations be able to While still in development, team members quickly optimise their product lines and beat can run regulatory analysis on the formula for their competition to market? compliance issues in each region where the We can begin by examining the traditionproduct will be distributed (including claims, al concept to validation lifecycle such as low fat). In addition, (although we do understand corporations can continue to each product lifecycle has its track the progress of the projvariances). The traditional NPDI ect, including variances and the relied on linear task-to-task current snapshot of the product delivery, with a fi nal check on at the time with specifications quality at validation. (as well as make global changes, Best in class corporations generate template-driven Bill now diverge from the rest. of Materials, nutritional labelThey realise that to beat their ling, ingredient lists, and fi nal competition to a global market, product specifications). they must now align their tasks While slow and steady once Keith Smallwood has worked in parallel stages with quality may have won a race—fast, in the global FMCG sector since 1989. He has extensive stage checkpoints and eventsafe, and secure now holds the experience working on a driven notification alerts. key to success. Selerant’s webwide range of NPDI and Supply Chain-related In addition to the parallel based PLM solution, DevEX projects within different CPG Categories. More recently, tasks timeframe, developers has the tools for corporations Smallwood has focussed on can also expedite the innoto quickly optimise formuladelivering Product Lifecycle Management-based vation stage with advanced tions for a healthier consumer, business improvement programmes within global searches, unique calculations, all while ensuring compliance R&D organisations. analysis, and by simply leverin a global market.

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PACKAGING

size matters Rachel Hackett, Nutrition and ScientiďŹ c Affairs Manager at IGD, explains how portion sizes given on packaging affect consumer behaviour and what consumers actually need to see on the packaging regarding nutrition information and portion size.

O

besity is a growing concern in modern society. The consequences of energy imbalance were set out in stark detail in the 2007 UK government Foresight report Tackling Obesities: Future Choices. By 2050 Britain could be a mainly obese society, at increased risk of chronic diseases such as type 2 diabetes, cardiovascular disease and some cancers. The severe impact on health and quality of life of this scenario would be matched by an additional burden on the health service, estimated at â&#x201A;Ź7.5 billion. The government and food and grocery industry have therefore been increasingly concerned with enabling consumers to make informed decisions on how to eat a healthy, balanced diet.

So, we can clearly see nutrition information displayed on food and drink labelling, but what about portion size? How do consumers know how much to eat and does the amount of food presented, either prepackaged or served on a plate affect the amount a person eats?

An academic workshop convened by the Food Standards Agency in 2008 to assess the evidence around portion size, its impact on energy intake and weight, reported that there was sufficient evidence to take action.

For the food industry, portion size is an important consideration for food labelling. If manufacturers wish to provide information per portion or per serving, in addition to per 100g or 100ml specified in legislation, they must first determine what a portion is for that product.

On-pack labelling One of the ways in which this has been done is to provide nutrition information on food and drink labels. Although only legally required where a nutrition or health claim is made, many food manufacturers routinely provide back-of-pack nutrition information across their product ranges and some also provide it on front-of-pack.

Determining portion size Our Industry Nutrition Strategy Group (INSG) convened a working group to examine what the industry and other stakeholders were using to determine portion sizes and how this information was being communicated. The working group looked across a range of organisations in

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Consumer behaviour Overall, the INSG found that there was an obvious lack of consistency in how portion size was communicated. So, how does this affect consumer behaviour? To fi nd out, we carried out research exploring consumers’ views about portion size information on food and drinks.

In a series of consumer interviews and focus groups, we explored attitudes, understanding and the use of portion size information on prepackaged foods as well as the uses of different portion sizes.

The concept of food portion size appeared quite novel to consumers, except to those who were regulating their intake for weight loss or medical purposes. Otherwise many did not consider the amount of food they ate.

For the preparation of meals, portion sizes purchased and consumed were determined largely by habit and experience. When we asked our consumers how they know how much food to eat, 48 percent of those questioned cited ‘experience’, while 21 percent just ate what was in front of them until they felt full. Only three percent followed the recommended serving information on a product.

Only 38 percent of people surveyed said they measured out foods during preparation. Where this was the case, it was most likely to be for starchy foods such as pasta and rice. Guidance on portion size appeared more acceptable for these products, whereas for other staples such as milk and bread, it was not seen as necessary.

Knowledge of portion sizes appropriate for children was variable, with evidence of children as young as five years receiving the same quantity of food as adults. Generally, children had a great deal of control about what they ate, the quantity of the food and the frequency.

Some questioned the relevance of portion size information for products consumed as snacks or for indulgence, while others claimed that an indication of the nutrition information per portion would help them to ho much they should consume. Portion information did judge how not get much attention where share-packs were consumed am among groups. Individual portions were, however, regarded as important for foods eaten as snacks by children, largely to prevent arguments and pestering.

Portion information was also used by shoppers of people measure the food and grocery sector, as well as government, buying main meal products. Th is was driven by conout food during NGOs and healthcare professional groups. cern that there should be sufficient food to feed the preparation Results showed that despite the variety of orfamily and was particularly relevant when products ganisations and businesses communicating portion n w purchased for the fi rst time. Some would go to the were size information, most sourced their information from ma lengths leng of removing packaging to reassure themselves that consistent set of food or nutrition-based criteria originating there was sufficient food. from government or expert body publications. However, the applicaOur research found that serving sizes provided on main meal tion of these criteria varied according to the owner’s or another body’s products such as ready meals were generally regarded as too small and interpretation. guidance across products lacked credibility due to perceived individual In addition, non-nutrition related factors influenced fi nal portion variation. Credibility of information across food categories is imporsizes, particularly for the food industry. Consumer perception regarding tant – where portion size was regarded as unrealistic for one category it value for money, consistency within a category and meeting expectations tended to impact the credibility of others. were among the considerations.

However, despite the similarities underpinning approaches to porPortion size information tion size, the group found much variation in the way in which it was Consumers showed some preferences for formats used to express communicated. For example, different formats might be used for front portion size on food labels. One problem was the lack of concept of parand back-of-pack information, or the language used in the portion inforticular weights where these were given as a portion. For an individual mation differed to that used elsewhere on the pack. product, consumers might have difficulty in visualising what the quanti-

“By 2050 Britain could be a mainly obese society, at increased risk of chronic diseases such as type 2 diabetes, cardiovascular disease and some cancers”

Only 38%

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ty specified might look like in a bowl or on a plate. Nutrition information given per unit, item or pack, where this was a single serving, was most popular, reflecting the preference for simple forms of information.

Packages containing products of more than one serving frequently provide the nutrition information for a fraction of the pack. Th is was not considered helpful by many participants, unless an indication of the number of servings or portions in a pack was included. However, for some food types such as sauces used in main meal preparation, respondents indicated that once the pack was opened it was likely to be used regardless of the clarity of portion indication.

Our research revealed the types of portion size information consumers wanted to see on products. Firstly, they want simple, clear guidance, e.g. nutrition information displayed per unit, per item or an indication of the number of servings in the pack where products are not discrete single-serve items. Secondly, consumers would prefer systems using familiar objects to help judge appropriate portions, e.g. guidance given in numbers of teaspoons or tablespoons. Finally, portion markings on the side of packs are desired.

Any guidance should, however, take care not to be over-prescriptive.

When we asked consumers who they thought was responsible for providing guidance on the amount of food they should eat, 75 percent said it was the responsibility of the individual.

IGD guidelines Our Industry Nutrition Strategy Group used the fi ndings of the research to develop voluntary guidelines on communicating portion size to consumers. These have been made available to food businesses to help them with both on-pack information and other communications aimed to help consumers understand and manage the quantity of food they need to eat. We also devised a checklist to give guidelines for portion size information on packaged retail products. (See pg 127)

Consumer communications In addition to labelling of packaged retail goods, the guidelines provide suggestions for other consumer communications about portion size.

These include the opportunity to visualise portions on the pack where possible, such as using side of pack markings for pourable products, or markings on the side of blocks, such as for butter or cheese.

Consumers responded positively to the use of everyday objects to help express portion size, such as tablespoons full, matchbox, or tennis ball sized etc. Use of these in consumer communications is therefore encouraged.

The voluntary guidelines recognise that there are gaps in our understanding of consumer behaviour that still need to be addressed, for example, there is little information on which to base guidance on communication to customers by caterers.

We also found that out-of-home eating is a complex area, with consumers adopting different behaviours compared to when buying products in shops, or preparing food at home.

Recommendations We made a number of recommendations for further work alongside the voluntary guidelines.

“One problem was the lack of concept of particular weights where these were given as a portion” The INSG suggested that there is a role for a user-friendly, online portion size tool, similar to that developed by WRAP for their ‘Love Food Hate Waste’ campaign. Such a tool was seen as being beneficial to both food businesses and consumers in helping to provide consistent messages about portion size.

Development of a standard set of everyday objects for comparison, as discussed above, would also be helpful in consumer communications about portion size. Along these lines also, development of purse-sized picture cards showing portion sizes of common foods in the context of everyday objects would help consumers.

In a survey of dieticians, who regularly advise patients on portion sizes of food and drinks, we found that information on food labels was under-used. The support of healthcare professionals, government and educators is needed to help encourage consumers to use the portion size information on food labels and give them confidence in the guidance provided.

A key recommendation of the report therefore was that food businesses should engage with healthcare professionals and the relevant government departments to further develop portion size guidance.

The voluntary guidelines on communicating portion size to consumers were published in October 2009. Food businesses are encouraged to use them to provide portion size information in a way that consumers fi nd easy to understand and helpful.

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CHECKLIST IGD guideline checklist for portion size information on packaged retail products A portion or serving size is provided Simply providing a portion size on pack, and giving the nutrition information for that portion size where possible (and not just per 100g or 100ml) increases visibility and makes the concept of portion size more familiar to consumers.

It is clear from the label how the product is intended to be used, and this is consistent with the nutrition information in terms of portion size Our work did not set out to establish portion sizes for different product categories. The voluntary guidelines suggest that portion sizes should be based on how products are intended to be used â&#x20AC;&#x201C; if it is intended that the product be consumed in one eating occasion, the portion size should reflect this.

Consumers may require different advice if it is possible for the product to be consumed in more than one way, such as some recipe dishes. A vegetable accompaniment may also be used as a vegetarian main meal and the nutrition information should be provided to reflect both scenarios.

Language used in marketing text is consistent with that used for the nutrition information Marketing text and images should be consistent with the terminology used in the portion size information. This helps to clarify that the portion size information refers directly to the product contained in the pack, and to a clear quantity of that product.

Language is consistent with same brand products in the category Consistency across product ranges from individual businesses is helpful to consumers who may purchase or compare other products from one brand.

Additional wording or descriptions are used to reinforce portion size messages Indicating to consumers that the information provided is guidance may be helpful where judgement is required such as for pasta or cereals. For example, suggesting that the quantity given is a â&#x20AC;&#x153;typical servingâ&#x20AC;? avoids appearing over-prescriptive but reinforces a message about portion size.

Language used in the nutrition information is the same on the front and back-of-pack Our research did not reveal any obvious consumer preferences for terms such as portion or serving etc. However, confusion sometimes resulted when the language used on a single pack was inconsistent.

The terms used on front and backof-pack should be the same.

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PACKAGING FOCUS

“Reducing waste would provide significant financial and environmental benefits and improve resource efficiency”

Prevention Retailers and brands are making an effort to reduce the impacts of packaging, by minimising waste and increasing recycling rates, and recycling content in packaging. This research suggests there is scope to make further efficiency savings either through further optimisation or through greater use of returnable transit packaging, where its appropriate, logisticmanager.com reports.

Recycling rates for packaging of 92 percent have been achieved for retail and 60 percent for distribution. Progress is also being made in diverting food from landfill, such as to anaerobic digestion or to charities such as FareShare. Much of the activity undertaken by retailers regarding their food waste so far seems to have focused on landfill diversion rather than waste prevention.

The report acknowledges that while retailers and brands have been making an effort to reduce their packaging and reduce food waste, more still needs to be done.

The report makes several recommendations for better waste prevention within the retail supply chain, including:

Mounting food waste in the supply chain

By Jodie Humphries

A

report by the Waste & Resources Action Programme (WRAP) has found that the food and drink supply chain generates more than 11 million tonnes of food waste and five million tonnes of packaging waste each year. The estimated cost to the UK economy is UK£17 billion, with UKP£5 billion of that total attributed to the supply chain.

Overall, waste is 18.4 million tonnes per year (mt/y), of which 11.9 mt is household and 7.5 mt supply-chain related. Reducing waste would provide significant financial and environmental benefits and improve resource efficiency.

Last year WRAP commissioned DHL Exel Supply Chain to conduct a study to investigate the levels of product damage, packaging and food waste occurring within the UK food and drink supply chain, focusing on three key stages – manufacture, distribution and retail. Following the completion of this study, WRAP commissioned Oakdene Hollins to build upon the DHL study with the aim of developing a baseline of waste arisings within the UK food and drink supply chain, and to identify opportunities for cost savings, improved resource efficiencies and future interventions.

The report Waste arisings in the supply of food and drink to households in the UK shows that by far the largest proportion of waste comes from households, which generate 11.9 million tonnes of food and packaging waste – almost 65 percent of the total. The manufacturing process generates 27 percent or five million tonnes of waste. Distribution and retail account for much smaller proportions of the total waste generated, although there is still scope to reduce waste in these areas.

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• • • • • • • • •

Measuring waste Quantifying waste arisings at sub-category level Improving forecasting and working in partnership with suppliers Shifting the emphasis from waste management to waste minimisation Considering how the surplus food and drink waste could be redistributed, recycled or recovered Behavioural change through improving communications Optimising packaging specifications Retailers playing a key role in supporting waste prevention Delivering change through sectoral initiatives such as the Courtauld Commitment

The report also emphasised the importance of campaigns, such as Love Food Hate Waste, in encouraging households to make better use of the food they buy and to save money. n

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EXECUTIVE INTERVIEW

Getting better all the time Dieter Bergner explains why continuous improvement is key to business success.

What has happened since Huhtamaki announced its European Consumer Goods business would go under strategic review at the end of 2008?

Dieter Bergner. After the decision, our management team identified certain important objectives in order to stabilise the consumer goods business during the complicated operational and administrative carve-out from the other businesses. We committed to a common understanding that our business would not suffer from the separation process.

After 15 months, the Rigid Consumer Goods Plastic business in Europe is operationally and legally separated from the parent. Now employees and management are keen to understand what the common future will look like.

What role did continuous improvement projects play during this period?

DB. It was essential to focus our workforce not only on carve-out activities, but to build the future management teams and assert ourselves as a new and robust packaging company. Continuous improvement projects have helped us not to lose track of our daily business. A strong focus on cash flow management and manufacturing performance, and its constant improvement, has helped to create a very positive team spirit. Th is positive momentum has meant that our business has achieved good fi nancial and operational results.

There has been improvement in quality and supply performance, while inventories have been reduced significantly. These actions have defi nitely boosted business, even making us an industry benchmark in some areas, while preparing our business for a new future.

Today, Consumer Goods Europe is running with 40 percent of its 2007 operating working capital, an outcome of continuous improvement throughout all management layers.

How has continuous improvement in Consumer Goods Europe developed since the beginning?

for operational improvements. A handful of performance incentives, broken down at local levels, do the rest.

Today, improvements are outlined by middle and lower management into small portions of achievable targets for our local workforce. Th is has helped us to continue our improvement at a time when all the managerâ&#x20AC;&#x2122;s efforts were dominated by the carve out process.

Dieter Bergner started his consumer food packaging career in metal packaging with Crown Cork & Seal and Impress Metal Packaging. With some 11 years experience behind him he joined Huhtamaki as Operations President for Rigid Packaging Europe, where he worked for four years before taking over Consumer Goods Europe as Managing Director.

DB. Our continuous improvement process has developed year on year. Like many others, it was a top down approach when we started measuring operational performance in 2005.

The programme focused on line and labour efficiency as well as on waste reduction and recovery by technology, and the manufacturing process. At the same time, we announced safety, quality and supply performance to be our top objectives and started to benchmark key performance indicators (KPIs) between our units.

We made a thorough job, gradually implementing measurement and reporting tools so that we were able to speak to everyone, from management to operators, about actual achievements and future targets. Since then weekly business reviews and activity based efficiency reports go alongside our target setting

Which achievements do you want to highlight especially?

DB. All fi nancial and operational KPIs have developed to the point that our performance in certain areas has become a benchmark to the industry. An example is employee safety, an area that has improved drastically: we have reduced the LTIF (lost time incident frequency) by 400 percent. And, as mentioned before, we have more than halved our working capital while notably improving our supply performance at the same time.

What are the future targets to be achieved by continuous improvement?

DB. Continuous improvement is the capability of an organisation to handle interdisciplinary projects in a cost and time efficient way. Many of our processes are disciplined to continuously improve our performance towards the customer, for example through new product development, integrated supply chains or simply by achieving high reliability in what we are doing.

Our strategy is to provide our customers with the highest level of performance, in terms of new product development as well as product quality and service, thereby providing added value to their business and helping them to develop their market share.

We will continue to translate market requirements into internal KPIs in order to integrate as many of our employees into this value chain as possible. Continuous improvement will play a major role in building our future company profi le. Â&#x201E;

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PACKAGING

CUTTING CORNERS With the issue of sustainability on the minds of all in the packaging industry, Nestlé’s Head of Global Packaging, Anne Roulin, divulges what the company is doing to reduce its carbon footprint and still remain innovative.

A

s the issue of sustainability weighs ever more on the shoulders of food and beverage producers, packaging innovators are on the hunt to increase resource efficiency, eliminate the production of waste and reduce their environmental impact through improved design and the use of alternative materials.

One company breaking barriers to spearhead this new trend is Nestlé, with its bold embracement of new packaging ideas and early adoption of promising new technologies. As Head of Global Packaging, Anne Roulin has her fi nger on the pulse when it comes to understanding the direction that packaging producers now need to take.

Nestlé has had great success in the UK in terms of the work it has done to reduce the packaging used for Easter eggs and Christmas

selection boxes. Is this initiative something that has been solely reserved to the UK or has it been rolled out on a larger scale? Also, do you intend to use the same strategy for any other products?

Anne Roulin. Defi nitely. Th is is a programme that we’ve had in place since 1991. Every year we have projects related to reducing the weight and volume of packaging and we track it on a worldwide basis. The last two years have been particularly successful. In 2008 we reduced it by 58 million kilos. We thought this was really outstanding, but in 2009 we actually did slightly better at 59 million kilos. Th is is obviously a huge amount and it’s really taken tens of hundreds of projects around the world in different areas to get to this result. However, we think that we’re going to come to a kind of plateau, because if you keep on going like that then fi nally you’ll have no packaging left .

So we’re taking a different approach now because we realised it’s

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going to be getting more difficult – we’ve actually implemented very big IT platform across the company, which we call Globe. Part of this IT platform relates to purchasing. Now we’re capable of analysing the worldwide purchasing arena, which is around 150,000 purchasing events around the world for packaging alone. We’re taking that data and analysing it to be able to decide on what the biggest opportunities are, then we can focus our efforts and resources on the big projects rather than a lot of small ones.

We’ve got a number of different areas in different types of packaging where we’re looking at bringing various businesses together as well.

Nestlé Waters launched a three litre, stackable PET water bottle in North America in 2006, which won an award for best packaging innovation design. Can you explain the background to this and give details of the response that it received? Was it made available outside the US? AR. That was actually developed by my team when I was responsible for packaging in Nestlé Waters and it was developed in our R&D centre in France. It was a response to a very specific demand in the US as they were having a lot of problems with their larger sized containers being out of stock on the shelves as obviously you can’t get many on a typical grocery store shelf – and if they’re selling fast they needed a different solution.

They were looking for a display ready pallet that had ideally no second repackaging. We had teased them because it should be a pallet that held together like magic. We actually nicknamed the project the Holy Grail.

The only way to do it was to have something stackable, so the packages inter-nested. We didn’t quite achieve absolutely no secondary packaging, but instead a very limited amount of stretch wrap to hold the whole pallet. It defi nitely did boost sales. It was rolled out in a range of our Nestlé Waters brand in the US. However, that particular design wasn’t rolled out to Europe or other parts of the world. We do buy less of that format, especially in Europe, and that tends to be either even larger ones or the more standard formatted one in a half litre. There wasn’t really the same customer demand in other parts of the world.

Consumers everywhere are becoming increasingly aware of the need to lessen their impact on the environment. The amount of waste we

create obviously plays a large part of this. How does Nestlé go abo about combining convenient and ethical benefits with packaging innovation?

AR. Well, Well that’s part of the challenge of creating ggood packaging. We’re having to balan ance many different factors together – convenience and ethical benefits are only two of them. There are plenty of others as well. We have to fi nd the right combination here. For ex example, we’re currently rolling out this programme based on life cycle assessm sessment, but it’s a much quicker, simpler way o of analysing the difference between different packaging choices versus specific application applications. For a trend user, within about an hour or so you compare different scenarios in terms of environmental impact. The interesting thing is tha that you can analyse a range of different environmental impacts.

It’s not only climate change with greenhouse gas emissions and CO2 footprints that a lot of other people are talking about. We also look at water usage, land usage, the effect on air pollution, the effect on soil pollution and of course the energy expenditure. The kind of output we get from this is like a spider plot where you can very easily compare one material with another. Th is allows us to really analyse the trade-off between different packaging material choices for specific applications and sometimes the results are very surprising and not what you’d intuitively think. Th is gives us facts and figures to base our packaging development on and make the right choices right at the beginning of the process.

“We don’t believe there’s a good or bad material intrinsically, rather that the correct material for the right application is of pivotal importance” What are the main benefits that Nestlé has experienced from employing eco-design in packaging?

AR. Well, there’s a number of them, especially sometimes comparing paper and plastic laminate. Many consumers think paper is good and plastic is bad; something you see but it’s certainly not the case. We don’t believe there’s a good or bad material intrinsically, rather that the correct material for the right application is of pivotal importance. Also, the term ‘bio-plastics’ is slightly vague. It’s one that we struggle with because in one sense it’s used to relate to biodegradable materials, but in another sense it’s used for materials from new and sustainable sources. It’s really the latter part that we’re investigating because one-day oil will run out and we’ll need to have other sources of material for packaging.

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Secondly, through the work we’ve done with TK and full life cycle effects, we can see that bio-plastics of the future will enable us to decrease the environmental impact of our packaging. Th is is the main reason for us working in this area. Th is joint venture is actually a sponsorship at the Ecoles Des Mines with a number of other companies. Specifically, we’re doing this because we realise that there is little fundamental research going on in the area of bio-plastics.

Most of it is individual companies working on specific solutions, which we feel should be underpinned with more basic research – and the Ecoles Des Mines is particularly well equipped for this. Along with their research goes teaching, so they’ll be working with students with a sound understanding. In parallel with that, we’re working with various companies to evaluate solutions using bio-plastics. We’ve implemented a few of them and we have more coming along in the pipeline.

Nestlé has been exploring the opportunities that the Kansei engineering approach brings to packaging design. Today, Kansei is one of the specific tools in Nestlé’s Packaging and Design toolbox for consumer centric development. Can you tell us about the work that is being done in this arena?

AR. Kansei was a technique originally developed in Japan and is used to link the emotional response of a consumer to the actual product. It’s also called affective engineering and is a very interesting technique. We’ve piloted it in a number of different areas, but it’s only one of the techniques that we’re using within this whole area of affective engineering. Within our basic research centre, which is close to here in Lozan, we’ve got a group that is working on the psychological reaction of consumers with products and packaging. Kansei is one of the tools we have in our toolbox.

Apart from that, we’re developing specific physical methodologies in

order to link physical premises to consumer reactions. One of the things that Nestlé has done is to sponsor a programme in Lozan on the brain and mind in relation to food and packaging. We’re adopting new techniques looking outside of the food industry like we’ve done with Kansei.

We’re developing a few techniques internally whilst also being constantly involved in research at universities. It’s quite a long-term approach, but it’s something you start six months prior and you get the magic results.

Protecting the authenticity of food and drink is a major concern for many manufacturers. What packaging schedules, if any, does Nestlé employ to protect against counterfeiting?

AR. Well, I wouldn’t say that it’s a major concern in the food industry today. We suspect that there could be more in the future, as a report by the Organisation for Economic Cooperation and Development (OECD) indicates that food could be an issue in the future, so we’re adopting different strategies as appropriate.

Ensuring food safety and freshness is obviously a very important role of packaging. What innovations are we seeing at the moment that could help to further increase the levels of safety and freshness?

AR. We have a huge problem with packaging safety, so we’re really pushing for much more transparency through the whole supply chain. Th is is a programme that we started three years ago to really work in partnership with our suppliers to understand all the components much better.

Th is has led our suppliers to work more closely with their suppliers. In the first round of pilots we’ve had 50 major suppliers working with us from around the world. In addition, we’ve been working a lot on changing our auditing process. Th is should really induce a change in the food industry as a whole.

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INDUSTRY INSIGHT

Line of

business Ulrich Nielsen talks about the types of challenges that bring food manufacturers and packers to his door.

S

pecialising in the complex interactions between packing line units, Ishida Solutions is the new department of Ishida Europe that provides innovative solutions to optimise overall plant and line efficiency. Every member of the team can draw on some 15 and 25 years of groundbreaking experience within the global food industry, and are available for consultation in one-off sessions or regular update meetings, and follow a project through to completion.

Dealing mainly with companies large enough to have strong views about such issues as efficiency, return on investment or return on floor space, Ishida is proud to offer its clients solutions, not products. General consultations lead on to more focused investigations and discussions, followed by concrete proposals with firm improvement objectives. There are a number of factors driving this, including the need to improve profitability of the packing operation through greater efficiency, to make products and processes safer, to improve product quality, cut waste and reduce labour.

Efficiency: a major driver Taking advantage of the automation technology that’s out there right now, and combining it in the right way – can improve the efficiency of the packaging line, consequently maximising profit.

A classic example is the poultry industry, where the eight pieces from a standard cut chicken are, in many companies, still packed using graders. Th is is a relatively slow process involving significant manual labour. It would slow things down even more to weigh fi rst the wings, then legs, then breasts, so you end up with several graders, each taking

up considerable floor space and a lot of people, just to run chicken packing on a modest scale.

The right automation technology could allow you to set up an operation processing, for example, 24,000 birds per hour using smaller, fewer machines and with reduced labour.

In this example you save money by packing more product per shift , as well as benefiting from an increased floor space and a saving of 40 percent on labour costs. Weighing on modern equipment is not only faster but much more accurate, and one can readily increase packed products by significant amounts.

The role of safety in packing line innovation Just looking, for example, at the rate at which lawsuits against caterers are multiplying, you can see how safety concerns are very close to profitability concerns.

Everyone knows the importance of safety in meat packing, but recently Ishida implemented a system to make the process of packing salads traceable throughout for a major European salad producer. This new system can tell you, from the unique pack number, where the salad came from, the exact gas mixture used during sealing and the temperature of the product.

It is possible to recover the X-ray of each particular pack, a photograph of the label, the checkweigher data and the seal tester information. Any claim that, for example, there was a stone or a piece of metal in that pack is, therefore, going to be categorically provable or disprovable.

The impact of quality An example of the impact of quality that comes to mind is current

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thinking on organic food, and the conviction that ‘better’ means more real. As a result, meals made with fresh ingredients will have a perceived advantage over those made with frozen ingredients. Many of the recent advances enable packing lines to handle fresh meat, or meat in a sticky sauce, just about as rapidly and accurately as hard, frozen meat pieces, making this an area in which quality can be immediately improved.

delays and, due to the hygiene regulations, a high volume of wasted trays.

Ishida devised a greatly simplified system for delivering trays to lines that allowed one person to easily service seven packing lines, meaning an 80 percent reduction in the labour involved and virtually eliminated the chance for error.

Rationalising pallet handling Reducing packaging materials Brand-owners and packers seek to use less materials per pack, and to cut down on materials wastage in order to save money. For a useful analysis of this kind of challenge it is necessary to look at the process as a whole. Take, for example, the production of trays of sliced meat.

There is often a difference in the size of meat slices, so in order to avoid product over hanging the seal area the tray size is chosen to match the largest slice size. One of Ishida’s interventions involved automatic previewing of the slices, linked to a system for turning trays wide-side-on to larger slices as necessary: this enabled a reduction of the standard tray size by 10 percent, with a corresponding saving in tray material.

In order to reduce costs on tray sealing, Ishida has also been pioneering ways of stretching fi lm over the sealing tool, saving on fi lm by reducing its thickness. Following this, it devised a way of freeing the fi lm web from the tool after sealing, delivering further savings.

During an audit of a major packing plant, attention was drawn to the question of getting the right empty trays to the right packing line at the right time – a serious challenge in a busy, high volume packing operation. The operation was quite labour intensive and inevitably many trays were ending up in the wrong place at the wrong time, causing costly

Another aspect of production that can eat up labour, time and profit is pallet handling. Here, a key source of production hold-ups is when the part of the palletising system serving one line goes wrong, forcing all to stop. Using a modular system, it is possible to allow palletising for each line to operate independently, dramatically reducing hold-ups, and still to reduce the necessary labour by around 90 percent. Furthermore there are other features that can be built in, such as the ability to handle mixed pallets, suitable for delivery to a relatively low volume of retail outlets, for example, or a facility to use the empty pallets to pass materials back to the line as they are needed.

Ulrich Carlin Nielsen is Business Development Manager, Large Solutions for Ishida Europe Ltd and a member of the board. He has spent the last 25 years using his in-depth application knowledge to design food factories, including those for some of the world’s largest food manufacturers, as well as developing new machines and registering several patents along the way.

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INFOGRAPHIC 140

Salt mountains How much salt does our food contain?

Burger King Triple Whopper with Cheese and Mayo 1590 mg

Wendy’s Double with everything and cheese

McDonald’s Big mac

1440 mg

1040 mg

McDonald’s Small Fries 160mg

Chicken Noodle

Cream of Mushroom

1160 mg

Tomato 744 mg

918 mg

Beef Gravy

Steak

Pesto

Salsa

Spaghetti

Soy

291 mg

262 mg

730 mg

139 mg

848 mg

914 mg

Potato Chips

Cheese Puffs

Pretzels

Chex mix

Beef Jerky

Popcorn

149 mg

258 mg

385 mg

288 mg

438 mg

97 mg

Cornflakes Mayonnaise 80 mg

Peanut Butter

Capers

Ketchup

255 mg

178 mg

201 mg

Instant Raisin Bran Cheerios 362 mg 213 mg Oatmeal

Blueberry Oat Bran 115 mg Muffin 255 mg

Special K

Cocoa Puffs

224mg

171 mg

253 mg

150 mg

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INFOGRAPHIC 141

Fast Food

Soups

Sauces

Bread

Cereals

Snacks

Condiments

Canned Vegetables

Daily recommended amount

Average UK intake 8600 mg

5000 mg

Burger King Whopper with Cheese 1450 mg

Onion

Vegetable

1053 mg

791 mg

Plain Bagel

Foccacia

561 mg

308 mg

Plain Croissant

Bread Crumbs 2111 mg

212 mg

Corn 273 mg

Sources:

Mushrooms 400 mg

Baked Beans 504 mg

Carrots Chopped 300 mg Tomatoes 290 mg

The salt content figures are the average salt content by food type per serving, not brand, for packaged and processed foods.

Items displayed are based on a selection of popular food types, loosely linked to personal taste of creator.

Created by Robin Richards | twitter: @ripetungi www.alsosalt.com www.food-facts.suite101.com www.annecollins.com

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COMMENT 142

Do you give a monkeys about palm oil?

Inexpensive and versatile, palm oil’s popularity in the western world is legend. But can our conscience cope with the destruction its production causes?

E

ven the most moralistic must often wrestle with their own internal demons. Take your average Greenpeace demonstrator. The ‘Greenness’ of their endeavours – jetting all over the world to put the mockers on the latest environmental outrage to pique their interest – might be easily called into question. And the ‘Peace’ bit? Breaking and entering, graffiti, vandalism and intimidation are acts that ordinarily earn an ASBO, not widespread respect.

An activist’s response to these charges would be that their actions raise the profi le of issues that may have gone unnoticed, so a little contradictory “do as we say, not as we do” thinking can be excused. But then what happens when the cameras are switched off, the protestors go home and put their well-travelled feet up? Do they refuel with a Kit Kat bar (chief target for the anti-Nestlé mob) in front of their made-in-Taiwan TV? Where does their moral compass point when thoughts turn to the economic opportunities their actions often

PALM OIL COMMENT.indd 142

deny individuals in the third world? Economic opportunities that they themselves enjoyed in order to acquire such a conscience?

And so to palm oil. Techniques used in its production in countries such as Malaysia (the world’s leading producer of palm oil, supplying 13 million tonnes per year) and Indonesia (one of the biggest emitters of greenhouse gases in the world) have attracted controversy. At a consumer level, palm oil is a cheap alternative to trans fatty acids. It is found in a variety of chocolate products, cakes, noodles, crisps and other snacks. You’ve almost certainly eaten large quantities of it yourself, despite the oil’s reputation taking a hit some 20 years ago when US studies suggested a link between the oil and heart disease.

Palm oil is used extensively by a number of food giants, most notably Nestlé, which buys up a fair proportion of the 26 million tonnes that are produced annually in tropical countries. Its production requires intense farming that can strip vast swathes of rainfor-

est, destroying the natural habitat of a number of endangered species. Not only is palm oil production responsible for the destruction of carbon dioxide-absorbing rainforests, but it also adds harmful gases to the environment.

No wonder Greenpeace have made it their public enemy No.1.

In April this year, Greenpeace campaigners launched an audacious stunt at Nestlé’s annual shareholders’ meeting, breaking into the roof of the hall and abseiling in bearing a banner that read: “Nestlé, Give the orangutans a break!”, while a number of other activists campaigned outside the building – in the Swiss city of Lausanne – handing out leaflets while dressed as orangutans. The great apes’ natural habitat in Borneo has been severely affected by the actions of some of Nestlé’s largest providers of palm oil, particularly the Sinar Mas company.

Little more than a month before this stunt Nestlé became embroiled in a Facebook row, amateurishly fending off accusatory comments from some 90,000 ‘fans’ of their page; their unethical practices called into question by an army of disgruntled and vocal consumers.

In this increasingly opinionated world of ours, social networking sites such as Facebook and Twitter provide a voice for the voiceless, and Nestlé will have to learn to adapt to a consumer base that has both the means and the will to create a PR storm for them.

However, consumers also have a responsibility to tally their own sensibilities and morals with those of the demands of big business.

Current projections by the Oil World trade journal anticipate that we will consume double the amount of palm oil annually by 2050. Th ird World nations are growing at an unprecedented rate; their economies are racing headlong into the free market that has so benefited the western world for centuries. To them, sustainable and ethical business practices come a distant second behind hard profit. Western consumers and campaigners need only look at their own countries’ pasts before tutting their condemnation, and work towards a solution that suits both sensibilities.

10/5/10 16:19:03

IN REVIEW 143

On the shelf NGF looks at the latest crop of books covering the food industry.

Building Strong Brands

By David A. Aaker In his previous book, Managing Brand Equity, David Aaker set out the value of a brand as a strategic asset and a companyâ&#x20AC;&#x2122;s primary source of competitive advantage. In this new work, Aaker demonstrates how to break out of tthe box by considering emotional and self-expressive benefits and by introducing the brand-as-person, brand-asorganisation, and brand-as-symbol perspectives. He also outlines how to manage the brand system to achieve clarity and synergy, to adapt to a changing environment, and to leverage brand assets into new markets and products.

NGF SAYS: A fascinating look at what can often be a difficult subject to quantify. Points are clearly spelled out; N perhaps a little too clearly at times. Most of the case studies are US-based, which makes it immediate for European p readers.

Delivering Performance in Food Supply Chains D

By C. Mena and G. Stevens B Th is book looks at developments in food supply chains, covering a wide range of topics, from relationships in the ssupply chain, to quality management systems and voluntary initiatives for supply chain sustainability. It consideers the fundamental role of relationship management in supply chains, including an overview of performance measurement, discusses the alignment of supply and demand, and reviews sales and operations planning and m marketing strategies for competitive advantage in the food industry. m N NGF SAYS: Packed with detailed information, this comprehensive work will prove indispensable for those ccharged with optimising supply chains in the food industry. While the language can be quite dense, the resulting kknowledge makes it worth sticking with.

The Economics of Food: How Feeding and Fueling the Planet Affects Food Prices T

By Patrick Westhoff I the past few years, food prices have risen sharply and fallen again. With biofuel production on the rise, are prices In sset to soar again? In The Economics of Food, Patrick Westhoff untangles the complex global relationships between food, f energy and economics. He explores the hidden relationships between the food on our plates and the gas in our o car; looks at whether economic recovery could lead directly to massive inflation in both food and energy; and examines e the effect of food prices on world hunger.

NGF N SAYS: A very readable examination of the relationship between food and energy production, which provides a well-balanced look at the factors that led to the recent rise and drop in food prices. A must read for anyone seeking i to understand the food vs fuel debate.

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PHOTO FINISH 144 Competitors participate in the Stilton Cheese Rolling competition on Stilton High Street on May 3, 2010 in Stilton, England.

The annual event of cheese rolling sees teams of four compete against each other to be crowned the ‘Stilton Cheese Rolling Champions’.

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