commodity markets

1. •Quality assurance.
•Concepts of quality in commodities.
• Methods of quality assurance grading and
standardization.
•Meaning of grading and standardization.
•Purpose of grading & advantages of grading
•Inspection and quality control.
•Indian standards.
Commodity Markets
Chapter 4
SYLLABUS CONTENT

2. the maintenance of a desired level of quality in a
service or product, especially by means of
attention to every stage of the process of delivery
or production.
prevention of mistakes in the delivery of
products and services.
Report incidents to board.

3. 1. Quality -is the merit of something. This includes
tangible properties such as durability and
intangible attributes such as aesthetics.
 Data Quality
 Design Quality
 Information Quality
 Product Quality
 Service Quality

4. 2.Quality Control- is the process of detecting mistakes in the production of
products and delivery of services. It is a process of ensuring that things
meet their function requirements, non-functional requirements and
detailedspecifications. Quality control may test every product produced
and every service interaction. Alternatively, quality control may test
representative samples. The following are common quality control
terms.
 Acceptance Sampling
 Customer Requirements
 Defect and Operational Testing
 Quality Objectives
 Specifications

5. 3. Quality assurance is the end-to-end process of
preventing mistakes in products and services. This
may encompass areas such as organizational
structure, processes, systems, design, reliability,
engineering and human factors.
Benchmarking
Compliance
Gap Analysis

6. The Prime Focus of
Quality Management Quality Assurance
Achieving results that satisfy the
requirements for quality.
Demonstrating that the
requirements for quality have been
(and can be) achieved.
Motivated by stakeholders internal
to the organization, especially the
organization’s management
Motivated by stakeholders,
especially customers, external to
the organization
Goal is to satisfy all stakeholders Goal is to satisfy all customers.
Effective, efficient, and continually
improving, overall quality-related
performance is the intended result.
Confidence in the organization’s
products is the intended result
Scope covers all activities that
affect the total quality-related
business results of the organization
Scope of demonstration coves
activities that directly affect quality-
related process and product results

7. 4. Qualitymanagement is the act of overseeing all activities
and tasks needed to maintain a desired level of excellence.
This includes the determination of a quality policy,
creating and implementing quality planning and
assurance, and quality control and quality improvement.
5. Total Quality Management a system of management based
on the principle that every member of staff must be
committed to maintaining high standards of work in every
aspect of a company's operations.

8. Hazard Analysis And Critical Control Points
Or HACCP
is a systematic preventive approach to food safetyfrom
biological, chemical, and physical hazards in
production processes that can cause the finished
product to be unsafe, and designs measurements to
reduce these risks to a safe level.

9.  1957 –ACE The USA and USSR race for –USSR launch Sputnik
 1960’s –Food Safety Identified as a SIGNIFICANT RISK to the MISSION
 1960’s – NASA & Pilsbury design the HACCP system HACCP
Implemented at Pilsbury Corporation to test the system’s effectiveness
 1970’s – HACCP adopted for Food Safety -The US Food and Drug
Administration adopted HACCP Reduce food poisoning cases
 1980’s – Use of HACCP system spreads in USA and Europe The need for
Global Trade Standards rised.
 1990’s – WHO- adopts HACCP- Food poison increased-std.
 1990’s – HACCP Legislation Introduced in the EU The EU makes
HACCP a Legal Requirement and all EU Countries implement HACCP
Laws HACCP

10. Analysis of potential food hazards
Identification of the points where food hazards
may occur
Decide which points are critical to ensuring food
safety
Implement effective control & monitoring at
critical control points
Review periodically, and whenever food
operations change

11.  Saves business money in the long run
 Avoids poisoning customers
 Food safety standards increase
 Ensures you are compliant with the law
 Food quality standards increase
 Organises the process to produce safe food
 Organises the staff promoting teamwork and efficiency
 Due diligence defence in court.

12. Standards are of three types
 Object standard
 Documentary standard
 Conceptual standard

13. Standardization is the process of fixing certain norms for the product.
These norms are established by customs or tradition or by certain
authority. It involves determination of basic characteristic of a product on
the basis of which the product can be divided into various groups. It also
means determining the standard of product to be produced with regard to
size, color, form, weight, shape and quality. Standards are model products
which form the basis of comparison.
Standardization is a application of standard to goods meant for
marketing with a view to further sub dividing them into several grades or
classes.

14.  Reliability: refers to stability or consistency of measurement
overtime.
 Validity: refers to a test’s ability to measure what it is supposed
to measure.
 Norms: is the normal or average performance.

15. Steps involved
 with the help of market research, sales statistics etc decides
what to sell in future.
 Then, define a standard range of products.
 from the range, ask the designer to develop minimum variety
of component to match the range.

16. STANDARDIZATION
PRODUCT
- Stock cost
reduction
- Consumer
mobility
- Improved
planning and
control
- Create
world-wide
uniformity
- Synergetic
effects.
PRICE
- Better
control
- Price
uniformity
PLACE
-Transfer of
experience
and
efficiency
- Economies
of scale.
PROMOTION
- Psychologi
cal
meaning
- Consumer
mobility
and
consistenc
y with
customers
- Synergetic
effects
PEOPLE AND
PROCESS
- Offer
universal
appeal
message
and
image.
- Achieve a
strong
corporate
identity
- Allow
better
identificat
ion by the
customer

17.  AGMARK for all agricultural product
 BIS HALLMARK (al hallmark) certifies the purity of gold jewellery.
 FPO MARK mandatory mark for all processed fruit products in India.
 INDIAORGANIC certification mark for organically farmed food
products.
 ISI MARK for industrial product. Certifies that a product conforms to
a set of standards laid by the BIS.
 TOXICITYLABEL is mandatory on the containers of pesticides sold in
India. Identifies the level of toxicity of the pesticide in four levels
 VEGETARIANMARK (green dot symbol) and the Non- VEGETARIAN
MARK (brown dot symbol), either of this is mandatory for packaged
food products.

19. Agricultural goods are standardized on the basis of different factors, based on which
they are classified into different grades
 On the basis of quantity, weight and measures.
 On the basis of size and shape.
 On the basis of color such as apples.
 On the basis of quality such as food grains and cotton.

20. It is uniform quality parameters of
commodity.
Eg:- a class of persons or things of the
same relative rank, quality, etc.
 Grading means sorting of unlike
lots of produce into different lots
according to quality specification
laid down.
 It implies the division of products
into classes made up of unit
possessing similar characteristics of
size and quality.
 Grading is mostly done in case of
raw materials, mineral products
and agricultural products

21.  Grading should be on the basis of standards, which are largely used
and easily understood
 Grading should be done on measurable quality factors.
 less Inter grade variations
 Grade standards should cover maximum percentage of the produce.
 Cost of grading operations should be less.
 Test for good grading norms is used by maximum percentage of the
market users.
 Unless the standards are economically meaningful to the trade they
are not accepted.
 Grading is sorting of unlike lots products into uniform categories
according to quality standards of the same product.

22.  Availability of loan on storage
 Storage as per different grades
 Protection measures
 No quality disputes
 Helps to estimate the plant location or warehouse
upgradation.

23.  Production of Large Scale
 Increase in Sales
 Quality Certainty
 Simplification of storage and marketing of different grades.
 Loans can be given based on stored goods as per the grade
 Easier to understand quality available for each grade in case of bulk
sale.
 Price comparison by consumers is easy to due to grade identity. The
buyer expects least or no risk in his purchases.
 Grading helps to create perfect competition in the market as it will
set a good standard of equivalent grades and materials competition.

24. Size – Big, medium, small, long, short, roundish, oblong etc.
Flavour – which in turn speaks of taste or class
Ripeness – raw, semi-ripe, ripe in case of fruits, oilseeds, pulses
and cereals.
Lengthof staple – in case of cotton and jute.
Location oriented – like Goa Alfanso, Bydagi chillies, Baiganpalli
mango, and Nagpur orange
Nasik grapes – having specific tastes, shape, colour etc.

25. The techniques of standardization and grading have not been
developed fully in India
 Lack of Standards & Grades
 Misuse of Standards & Grades
 Lack of Public Consciousness
-The reasons for lack of public consciousness are:
(i) low standard of living
(ii) Illiteracy
(iii) Dominance of rural population.
 Lack of Testing Facilities
 Lack of Facilities

26. Universally or widely accepted, agreed upon, or
established means of determining what something
should be.
eg:-In manufacturing, a measure of excellence or a state
of being free from defects, deficiencies and significant
variations

27. 
Export Quality Control & Inspection Act, 1963,

Is the apex body.

EIC is an advisory body to the Central Government, which is empoweredunder
the Act to:

Notify commodities which will be subject to quality control and/ or inspection
prior to export,

Establish standards of quality for such notified commodities, and

Specify the type of quality control and / or inspection to be applied to such
commodities.

28.  Certification of quality of food items for export through installation of
Food Safety Management Systems in the food processing units as per
international standards.
 Issue of different types of Certificates suchas Health, Authenticityetc. to
exporters under various product schemes for export.
 Issue of Certificates of Origin to exporters under various preferential
tariff schemes for export products.
 Training and technical assistance to the industry in installation of
Quality and Safety Management
 Recognition of Inspection Agencies as per ISO 17020 and Laboratories as
per ISO 17025 and utilizing them for export inspection andtesting.

29. The Bureauof IndianStandards (BIS)
•National standards body of India- under
•Aegis of ministry of consumer affairs,
• It is established by the bureau of Indian standards act, 1986
•The government recognized the role for standardization in gearing
industry to competitive efficiency and quality production.
•The Indian standards institution (ISI) was, therefore, set up in 1947 as a
registered society, under a government of India resolution.
OBJECTIVES:-
•Harmonious development of standardization, marking and quality
certification
•To provide new thrust to standardization and quality control
•To evolve a national strategy for according recognition to standards and
integrating them with growthand development of production and exports

30.  VISION
• To satisfy the customers' needs for quality of goods and services & To provide
efficient timely service.
• To work and act in such a way that each task, performed as individuals or as
corporate entity, leads to excellence and enhances the credibility and image
of the Organization.
 MISSION
• Harmonious development of standardization, marking and quality
certification
• To provide new thrust to standardization and quality control
• To evolve a national strategy for recognition to standards and integrating
them with growth and development of production and exports.

33.  Cement
 Household Electrical goods
 Batteries
 Food & Related Products
 Automobile Accessories
 Steel Products
 Stainless Steel Products
 Electrical Transformers
 Electrical Motors
 Capacitors

34. 34
BISTraining &
Testing
Standards
Formulation
Product
Certification
Hallmarking
System
Certification

35.  Standards Formulation- Indian Standards Institution (ISI) was established in year 1947
( Bureau of Indian Standards) with the
 objective of harmonious development of standardization activity in India.
 Strengthening of standardization activity would continue to be the main thrust of BIS,
being the core activity of the organization and keeping in view the rapid growth being
witnessed in the national economy along with fast paced industrialization and
technological advancements. In formulating Indian standards the following key factors
would be considered:
 i) Harmonization with international standards
 ii) New and emerging technology areas
 iii) Environmental concerns and other national priorities, regulatory requirements and
consumer needs.

36. The Product Certification Scheme of BIS aims at
providing Third Party Guarantee of quality, safety and
reliability of products to the customer.
Presence of ISI certification mark, known as Standard
Mark, on a product is an assurance of conformity to
the specifications.
Assured-surprise inspections and testing of samples,
drawn both from the market and factory.

37.  is the accurate determination and official recording of the proportionate
content of precious metal in precious metal articles. Hallmarks are thus
official marks used in many countries as a guarantee of purity or
fineness of precious metal articles.
 To protect the public against adulteration and to obligatemanufacturers
to maintain legal standards of fineness. In India, at present two precious
metals namely gold and silver have been brought under the purview of
Hallmarking.
 The BIS Hallmarking Scheme has been aligned with International
criteria on hallmarking. As per this scheme, licence is granted to the
jewellers by BIS under HallmarkingScheme. The BIS certified jewellers
can get their jewellery hallmarked from any of the BIS recognized
Assaying and HallmarkingCentres.
 BIShallmarking scheme for gold jewellery was launched on 11 April2000
& for silver jewellery in Oct. 2005.

38.  BIS labs- propose to continue providing training to the industry (i.e. BIS
licensees and applicants) as well as Central and StateGovt labs in testing
of various products as per relevant Indian Standards based on their
identified needs. Training programmes for products under certification,
are conducted as and when identified and proposed by ROs/BOs, in
consultation with BIS Labs.
i) Testing of UPVC Pipes as per IS 4985 at SRTC Chennai.
ii) Training programme on Packaged Drinking Water at BNTC Bangalore,
CTCC and WRTC Mumbai.
iii) Training programme on HSD Bars as per IS 1786 at PBTC.
iv) Training programme on Cement testing at CTCC Sahibabad.
v) Training programme on Cables as per IS 694 at CTCC Sahibabad and
WRTC Mumbai.

39.  BIS carried out product testing activity through a network of
eight testing centres in Regional and Branch offices. Samples
drawn by various branch offices of BIS during the course of
operation of product certification scheme are tested in these
centres for conformity.

40.  BIS is operating Management System Certification Schemes in
accordance with the international standard ISO/IEC 17021:2011. 2014-15
emphasis-
Ø Continuation of certificationof Government Departments and other
PublicServiceOrganizationunder BIS Service Quality Management
Systems Certification Scheme as per IS 15700:2005 on “Quality
Management Systems Requirements for Service Quality by Public
Sector Organization.”
Ø Accreditationof Food Safety Management Systems (FSMS) Certification
from National Accreditation Board for Certification Bodies (NABCB).

41. IMPORTANT AGENCIES INVOLVED IN QUALITY REGULATION
Directorate General of Health Services Prevention of FA
Ministry of Food Processing Industry FPO
Department of Industrial Policy & Promotion BIS & EC Acts
Directorate of Marketing and Inspection AGMARK
Department of Agriculture & Cooperation Plant Quarantine
Department of Animal Husbandry & Dairying MMPO
Department of Legal Metrology Weights & Measures Act
Bureau of Energy Efficiency Energy Conservation Act
Chief Controller of Explosives Indian Explosives Act
Directorate General of Mines Safety Coal Mines Regulations
Ministry for Road Transport CMVR
Central Pollution Control Board