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Session 4. Bramley - Dual Standards in South Africa Produce Markets


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Session 4. Bramley - Dual Standards in South Africa Produce Markets

  1. 1. Dual food standards inSouth AfricaCerkia
  2. 2. ContextFollowing a number of high profile food safetyincidents, concern over food safety hasescalated in recent years.Consumer demands and liability risk has led toretailers demanding more onerous foodstandards
  3. 3. ContextWhile food standards reinforce consumerconfidence in a global food system and reducefood safety and quality risks for retailers, theyalso impact participation in the food system:– Proliferation of standards– Multiple audits– Onerous requirements in terms of documentation etc.
  4. 4. ContextPrivate standards are fast becoming the keyfactor in determining market access (Henson(2006).Particularly significant for small scale producers,with a growing body of research exploring theimpact of food safety standards on small scalefarmers’ ability to access international markets(Reardon et al. 2009; Henson and Humphrey,2010, Maertens, 2006).
  5. 5. ContextBut! Potential for standards to include SCF indeveloping countries in high value supplychains, which are driven by consumers’ demandfor quality (Ponte and Gibbon, 2005;Giovannucci, 2003).Impact of standards on participation in foodsupply chains dependant on the enabling policyand institutional environment.
  6. 6. ContextParadoxically, while food standards havebecome a major concern to market access fordeveloping countries, the lack of food safetystandards within these countries continue topose a threat to public health.Rising consumer demand for food safety butpublic regulatory frameworks remain insufficient:– Fragmentation– Overlapping mandates– Lack of coordination– Lack of monitoring and enforcement
  7. 7. QuestionCan dual standard development advancemarket access for emerging farmers whileat the same time ensuring public health.
  8. 8. Dual Standard SettingBoth public and private initiatives in a number ofdeveloping countries to adapt internationalstandards to account for local conditions in orderto ease access for local farmers to exportmarkets.
  9. 9. Dual Standards SettingGlobalGAP has programs to adapt theirstandards for so-called “local” production,creating less onerous procedures intended toprovide the most basic level of food safety andto be accessible to producers with littlebackground in food safety management =LocalGAP standardDevelopment of KenyaGAP and ChileGAP
  10. 10. Project outlineResearch question:Is there potential for dual standardsdevelopment in South Africa both from a publichealth and market access perspective?Could FPMS be driver for LocalGAP in SouthAfrica?
  11. 11. Fresh Produce Markets in SAPrimary mechanism for price formation, marketing anddistribution of fresh produce in SA.Around 60% of all fresh produce traded pass through theFPMs.Operate on commission basis with producers deliveringtheir produce to market agents who then sell the produceto buyers.Four largest markets represent 74% of volumes sold onFPMs in SA.
  12. 12. Fresh Produce Markets in SASUPPLIERSBoth large and small scale farmers deliver tofresh produce wholesale markets.Large scale commercial farmers still supply thebulk of produce sold on fresh produce wholesalemarkets, delivering between 80% - 90% of thesupply.Around 10% of produce sourced from emergingfarmers.
  13. 13. Fresh Produce Markets in SABUYERS:Both the formal and informal sectors are servedby FPMs in South AfricaInformal buyers including spaza shops, cornercafes, street hawkers – 60%Formal buyers– 40%.
  14. 14. Fresh Produce Markets in SABUYERS:Contrary to what is generally thought, retailersare topping up produce sourced throughcontract by buying on FPMs.Increasing trend - currently at around 10% ofFPMs sales.Potentially significant in terms of food safetydriver on FPMs.
  15. 15. Food Safety on FPMs Public regulatory framework provided by:Department of AgricultureDepartement of HeatlhBenchmarked to Codex standards Market itself more engaged in managing qualityrather than safety But it appears that at least on paper that foodregulation is sufficient.
  16. 16. Food Safety on FPMsProblem is lack of monitoring andenforcement:Lack of man-power by relevant authoritiesIrregular sampling donePoor lab facilitiesPoor capacity to test for pesticides
  17. 17. Food Safety on FPMs Even for retailers there is evidence to believethat they do not inspect for food safety forproduce procured at the market.Do not test for example for pesticides.
  18. 18. Potential for dual standardsGiven existing public regulatory framework, adual standard will only make sense where it canimprove on monitoring and enforcement of foodsafety.Value of dual standard not necessarily toprovide better standards, but in ensuring bettermonitoring and enforcement of food safety.
  19. 19. Retailer interest in dualstandard With retailers now returning to FPMs, albeit tosmall extent currently, a dual standard may bevehicle for retailers to:Overcome food safety concerns on FPMsdue to lack of public enforcement.
  20. 20. Retailer interest in dualstandardLiability concern for retailers: Consumer Protection Act 68 of 2008Concept of strict liability for defective productsAll supply chain participants liable unless it can beshown that damage did not result with the particularparty.Increased awareness of food safety and risk of claims
  21. 21. FPM interest in dual standard FPMs more concerned with quality than safety:Current lack of concern from consumer sideNot same liability concern as other supplychain participants However, competitive drive to attract retailersmay be a strong driver for implementing betterfood safety systems.
  22. 22. FPM interest in dual standard Showing compliance with a dual standard whichensure greater enforcement of food safety maybe way for FPMs who are competing to getretailers back on their markets to attract theretailers.
  23. 23. Potential for Dual Standards inSASo, the potential for a dual standard in SA seemsat this stage to depend on: Retailers requiring better food safety whenprocuring from FPMsFPMs responding to this concern byincreasing food safety by means of thisstandard.
  24. 24. Potential for Dual Standards in SA Retailer volume on FPM still perhaps too smallto drive this. But the competition between FPMs may drive it. Need to further explore: importance of retailers on these marketsCompetitive forces between FPMs
  25. 25. Potential for Dual Standards in SANeed to ask, is there really a need ifexisting framework is sufficient to ensurepublic health provided enforcement isupped?Crucial that enforcement be seen tohappen, confidence of buyers need to beestablished. Only then will it also addressthe need to improve market access.
  26. 26. Potential for Dual Standards in SADependant on the way in which retailersrespond to this.It seems therefore that the drive for improvedfood safety on FPMs through dual standard islikely to be driven by retailers.
  27. 27. Recent AdvancesMassmart Walmart, SPAR, Pick n Pay, ShopriteCheckers, Famous Brands, Fruit & Veg City andWoolworths (excluding Woolworths’ private labelsuppliers).Agreed to embark on the Single Food SafetyAudit.Designed and maintained by the Global FoodSafety Initiative (GFSI)Objective – do away with multiple food safetyaudits.
  28. 28. Thank you