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Wednesday, January 8, 2020

DATA - THE IMPORTANT IN AGRIFOOD INDUSTRY


Why is data important in the agri-food industry?.  The agri-food supply chain especially in developing economies such as Malaysia can be characterised as the interaction of black boxes where each segment of the supply chain has limited information and control over the previous and/or subsequent segment. Globalisation brings about an additional set of challenges as the supply chain transcends national boundaries and jurisdictions. Food fraud and mislabelling cause loss not only to consumers but also to the exporting industry as a whole. For example, in 2016, the United States (US) Food and Drug Administration (FDA) placed shrimps and prawns from Peninsular Malaysia on “import alert” over the alleged presence of nitrofurans and/or chloramphenicol residues in the seafood. The move implies that the FDA has the right to detain imports of shrimps and prawns from Peninsular Malaysia without inspection53. This is despite Malaysia banning the use of these drugs in aquaculture farming. Being one of the top ten exporters of prawns and shrimps to the US, the import alert caused anxiety among Malaysia’s shrimp producers. From a different side of the story, according to Larry Olmsted, the author of “Real Food, Fake Food”, because of the US ban on Chinese-farmed shrimps due to the presence of unapproved drugs, some suppliers have been shipping their drug-stained shrimps to Malaysia. These shrimps are then relabelled as Malaysian products for the US 52 A node is a participant’s computer connected to the Blockchain. 

This claim is however are difficult to substantiate without complete and transparent data of the shrimp supply chain right from the producer to the consumer. A transparent supply chain data in Malaysia may also benefit the premium food sub-sector. In 2011, China’s authorities blamed imports from Malaysia regarding the discovery of high nitrite levels found on red bird’s nest. This allegation, however, baffled Malaysia’s bird nest exporters since Malaysia had never been known to be a producer of red bird’s nest55. According to How Ban (2011), what could have happened was that some players in the industry might have sold fake bird’s nest claimed to be from Malaysia for a quick profit. Beside bird’s nest, fake Musang King durians also captured the attention of the Ministry of Trade, Co-operatives and Consumerism (now the Ministry of Domestic Trade and Consumer Affairs). A few traders in the country have been found selling durians of a different variety from Musang King durians to foreign tourists as they are an easy target56. The availability of a complete and transparent food supply chain data updated in real-time could help prevent false labelling. Aside from preventing fraud and the mislabelling of food, complete agri food data are also necessary for effective policymaking and monitoring especially for regulated food such as rice. In the US, most grains and oilseeds produced are traceable from farm production to consumption57. This sort of data, however, is unavailable for Malaysia’s rice industry, and other food industries for that matter. Thus, it is difficult to know, for instance, the productivity and profitability of a particular farm, profit margin across the supply chain, and the appropriate farmgate and consumer price level, let alone to determine the compliance with MyGAP, HACCP and Good Manufacturing Practice.

Supply chain management involves not only the transfer of products from producers to consumers but also58: (1) Payments, credit and working capital; (2) Technology and advanced techniques; (3) Ownership rights; and (4) Information on consumer demand. Blockchain technology has the potential to increase the efficiency of transactions of all the items above. The application of Blockchain technology offers complete, transparent, reliable and timely data that would elevate consumers’ trust towards food products and allow data acquisition by the public and private sector without delay. The latter may help food industry players to effectively respond to market demand and the government to better formulate agricultural policy. That's how data is important... Thanks.

By,
M Anem,
Senior Agronomist,
Precint 11, Putrajaya,
WP Putrajaya, 
Malaysia.

(1 Ramadan 1440H).

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