Chain of events: a blog of Food Chain Intelligence

The Government is calling for submissions on a national food security plan. It intends drawing upon ideas and suggestions to develop policy options for a national food plan, but not formally responding to specific submissions or issues.

An “issues paper” has been published, which includes the general consultation questions listed in this summary, plus further detailed questions on specific topics.

The summary of the questions to respond are:
Question 1: What is the most important thing you think a national food plan should try to achieve?
Question 2: What do you think the vision and objectives for a national food plan should be?
Question 3: What do you see as the major risks to Australia’s food supply in the coming years and decades? How could they be avoided or managed more effectively?
Question 4: What does food security mean to you? How would this be achieved? How would we know if/when we are food secure?
Question 5: What are the most important benefits that Australian consumers get or should get from our food supply? Why?
Question 6: What two or three actions:
• by the government sector would most benefit food consumers?
• by the non-government sector would most benefit food consumers?
Question 7: What do you see as the major opportunities for Australia’s food industry in the coming years and decades? How could they be realised?
Question 8: What two or three actions:
• by the government sector would most benefit businesses that make,
distribute and sell food?
• by the non-government sectors would most benefit businesses that
make, distribute and sell food?
Question 9: What specific food policy and regulatory functions within or between governments:
• overlap?
• are at cross-purposes?
• have gaps?
Question 10: Which regulation or regulatory regime poses the greatest burden on the food industry along the food supply chain (production, processing/manufacturing, transport and logistics, wholesale, retail)? What could be done to reduce this burden?
Question 11: What two or three actions:
• by the government sector would most benefit communities that are
highly dependent on food production, processing, distribution or sale?
• by the non-government sector would most benefit communities that are highly dependent on food production, processing, distribution or sale?

The agriculture representatives to the G20 developed an action plan to tackle food price volatility and enhance food security. This document is based on the outcomes of a report commissioned by the World Bank, the UN’s Food and Agriculture Organisation and the International Monetary Fund, among others. The communique will be submitted to the leaders attending the G20 in November this year. The document has the following key recommendations:

1. Increase agricultural production and productivity on a sustainable basis.

2. Increase market information and transparency in order to better anchor expectations from governments and economic operators.

3. Strengthen international policy coordination in order to enhance confidence in international markets and to prevent and respond to food market crises more efficiently.

4. Improve and develop risk management tools for governments, firms
and farmers in order to build capacity to manage and mitigate the risks associated with food price volatility, in particular in the poorest countries.

5. Improve the functioning of agricultural commodities’ derivatives markets, through the work of Finance Ministers and Central Bank Governors.

Point 1 is of particular interest to R&D organisations because the mechanisms proposed to achieve an increase in productivity include an agreement to strengthen agricultural research and innovation and support results based agricultural research for development through national agricultural research systems, the Consultative Group on International Agricultural Research (CGIAR) and the Global Forum on Agricultural Research (GFAR).

Further, the promotion of technology transfers, knowledge sharing and capacity building through North-South, South-South and triangular cooperation is emphasized in the document, as is innovation in plant breeding and strengthening internationally agreed legal mechanisms for plant varieties.

The first G20 conference on agricultural research for development,involving the most important agricultural research centers, will be held in Montpellier on 12 and 13 September 2011 and the G20 seminar on Agricultural Productivity to be held in October 2011. There is ongoing work by FAO and interested G20 members to develop a platform for capacity building in tropical agriculture in developing countries.

Another initiative in the document is the launch of an International Research Initiative for Wheat Improvement (IRIWI) in order to coordinate research efforts on this important crop for food security. Research work on rice through CGIAR, the International Rice Research Institute (IRRI), the Global Rice Science Partnership (GRiSP) and the Coalition for African Rice Development (CARD) was also highlighted.

The goal to increase investment in agriculture is expected to be achieved through public-private partnership on investments, based on a value-chain approach, for services (e.g. financial services, agricultural education and extension services), infrastructure and equipment for production (such as irrigation), agroprocessing, access to markets (e.g. transport, storage, communication) and for reduction of pre and post-harvest losses.

Countries, international organizations and the private sector are encouraged to increase investment in developing countries agriculture, and in activities strongly linked to agricultural productivity growth, food security and generation of income in rural areas, such as agricultural institutions, extension services, cooperatives, research, roads, ports, cold chain, power, storage, irrigation systems, information and communication technology, climate change mitigation and adaptation.

The group welcomes the initiative of Multilateral and Regional Development Banks to scale up their interventions. We encourage further interaction with the Development Working Group and the joint Finance / Development Ministerial Meeting in September 2011. G20 encourages the Banks’ coordination efforts including the Joint Working Group on Food and Water Security to develop an Action Plan on Food and Water Security by November 2011.

The triple challenge for agriculture was articulated as meeting food security objectives while adapting to climate change and reducing its contribution to greenhouse gas emissions. To achieve this, R&D on climate change adaptation -especially for smallholder farmers- and mitigation technologies, was highlighted as a crucial element in developing countries.

The document also discusses the importance of strengthening international and regional networks, national and international standards, information, surveillance and traceability systems, good governance and official services, to ensure an early detection and a rapid response to biological threats, facilitate trade flows and contribute to global food security.

Another important point was the removal of food export restrictions or extraordinary taxes for food purchased for non-commercial humanitarian purposes by WFP and agree not to impose them in the future. The G20 will seek support within the United Nations agencies and will also recommend the adoption of a resolution by the WTO for the Ministerial Conference in December 2011.

The launch of a Global Agricultural Geo-Monitoring Initiative is also crucial, in my view.This initiative will strengthen global agricultural monitoring by improving the use of remote sensing tools for crop production projections and weather forecasting. The initiative will involve representatives from various organizations and institutions interested in enhancing international monitoring capabilities around the world, including the organizations that comprise the GEO Agricultural Monitoring Community of Practice (FAO,
World Meteorological Organization - WMO, etc.) created in 2007 by GEO. The roles of the various actors in this initiative will be defined by June 2010; Australia should seek to have a strong role here.

Also important is the establishment of a Rapid Response Forum within the framework of the Agricultural Market Information System (AMIS). Through the participation of senior, capital-based agricultural policy officials from the major producing, exporting and importing countries, the Rapid Response Forum will promote early exchange of key information on and discussion of prevention and responses to crises among policy-makers and assist in mobilizing wide and rapid political support for appropriate policy response and actions on issues affecting agricultural production and markets in times of crisis.

The Rapid Response Forum will:

- assess information and analyses from AMIS Secretariat on the current global market situation and outlook;

- receive information and assessments electronically from early warning systems on the extent to which global market developments affect vulnerable countries and assess the ensuing implications for food security;

- when the market situation and outlook as evaluated by the AMIS Secretariat indicates a potential crisis, meet to discuss and promote appropriate policy options on issues affecting agricultural production and markets (but not seek influence on humanitarian responses); and,

- work closely with the Committee on World Food Security (CFS) to promote greater policy convergence and strengthen policy linkages at global level.

FAO will be in charge of forming this group, with the first meeting to be organized in the second half of 2011 involving countries and international organizations to discuss processes and scheduling. Again, a very important initiative where Australia should be represented.

In regards to emergency humanitarian food reserves, the G20 will support the preparation of a feasibility study and a proposal for a pilot. The WFP
and other international organizations will establish by the end of June 2011 a working group with bilateral development partners and potential eligible countries in a particular region that could participate in an emergency humanitarian food reserves pilot, involving expertise from the civil society and the private sector. The final proposal for a pilot for the emergency humanitarian food reserves will be discussed at the Joint Finance / Development Ministerial Meeting in September 2011.

All considered, the response of G20 shows that food security is an issue that will be taken seriously internationally. I find many of these initiatives novel and exciting. However, the reduction of biofuel production from food sources and the reduction of export bans was significantly opposed by the US, Brazil and China. The draft of the communique did include a call for a feasibility study on flexible mandates to restrict biofuel production from food supplies in times of food scarcity. However, the final version does not contain this important addition. However, the G20 did agree on exempting food purchased for humanitarian purposes from export bans.

The latter recommendation is unlikely to resolve the live cattle ban for Australian producers, where the ban is seen as a positive step toward supporting local farmers in Indonesia.

I will be presenting a seminar organised by UNISA School of Management and the Logistics Association of Australia.

The seminars’ contents include a broad review of the drivers propelling the use of innovative technologies in cold chain logistics and case studies of the application of emerging technologies in:

a) Tracking, traceability and monitoring for safety and quality (including RFID).
b) Innovation in refrigerated transport.
c) Innovation in thermal packaging for vaccines and foods.
d) Innovation in value adding services.

Examples will include the management of chilled and frozen foods and pharmaceutical products.

To attend this event, please book through the LAA’s website .

With little fanfare, the latest statistics from DAFF about the state of the food industry were published on December 1, 2010.

Some notes about the trends of Australian exports reflected in these statistics were published by ABC news and Food Magazine. The former talks about the negative effect of the high parity of the Aussie dollar on food exports, which has triggered a loss of value by 13%. The Food Magazine says that “Australian exports are going strong”. According to Senator Joe Ludwig, we produce “far more food than we can consume.” Which is excellent, but producing lots does not necessarily mean that all products reach the markets (supply chain vision, please!).

Anyway, the part that interests me the most is how the food processing R&D sector is performing. I understand that these statistics reflect only the processing sector, they do not encompass production of raw materials (agriculture R&D).

The sectors with greatest growth in R&D funding in the past 6 years are bakery products and dairy processing. Meat processing has seen a decrease in R&D , particularly in 2009. The same observation applies to flour & cereals. Oil and fats have seen a decrease in the already low R&D investment. Fruit & vegetable processing R&D has remained relatively steady.

The following graph shows that CAPEX in R&D has remained flat. Progressive manufacturers of food equipment would need to make a strong case for a company to invest in technology still in experimental stages.

Current expenditure, in the other hand, is increasing. And it has increased by $1,380.5 million since 2003. To me, this shows that food processors are seeing the value of R&D in their operations. Good news for R&D organisations that can show a financial case for their innovations.

Croakey has an interesting post on the debate about how inclusive the National Food Policy Working Group is. While the CEO of Choice is part of the group, it has been justly pointed out that the group does not have representatives concerned with public health (e.g. obesity, healthy diets). The disconnection of the newly formed group with the Preventative Health Task Force and the Prime Minister’s Science, Engineering and Innovation Council (PMSEIC) were also pointed out.

The PMSEIC in particular released a report entitled “Australia and Food Security in a Changing World“. If you type the title and search for a link, the first link where you can download the report is not the Chief Scientist office, by the way. I found the link through “the funneled web“, a website that contains notes of interest to Australia’s Higher Education sector. Clearly, they have a better website ranking than the Chief Scientist office (note to Penny Sackett: must invest in social media and search engine tools ).

In any case, I want to make sure than in this debate we do listen to what the PMSEIC has to say about food security in Australia.

I found the report to be a well thought, well structured position paper. Just what you would expect from a Chief Scientist advising the Prime Minister.

Contrary to the opinions expressed by the Public Commission and to some extent Ross Gittins, in that we should decrease agriculture R&D funding and that we don’t really have to worry about food security in Australia, the PMSEIC report indicates the contrary. Emerging food security challenges mentioned in the report include:

a) Vulnerability to climate change and climate variability.
b) Slowing productivity growth in primary industries observed over the last decade.
c) Increasing land degradation and soil fertility decline coupled with loss of productive land in peri-urban regions due to urban encroachment.
d) Increasing reliance on imports of food and food production inputs (such as fertilisers) and the susceptibility of these supplies to pressures outside our control.
e) A finely tuned and ‘just in time’ food transport and distribution system that presents risks of rapid spread of contaminated food and is vulnerable to events such as pandemics.
f) Poor nutritional intake leading to an increasing burden of diet-related diseases in the population.
g) Conflict in our region and elsewhere.

What do you know? I have the same in my list, made in 2009.

In the report, it is said that Australia’s strengths are:

-Australian agriculture has maintained its leading position in despite of itself. That is, we produce food on the driest populated continent, on low quality soils and in the face of continual climate variability (and I would add, in despite of the lack of leadership in food policies and R&D funding).

-Australia has strong links and capabilities in delivering technological development to developing countries in our region.
-Australia has a strong R&D base and our agricultural R&D capability ranks among the best in the world. Note: we should not confuse “strong R&D base” with “strong R&D funding”. The same report indicates that global investment in agricultural R&D has decreased over the past 20 years and that similar trends are observed in Australia, where agri-food R&D investment has progressively fallen from
a peak of 5% of gross value of agricultural production in the 1970s to just above 3% in 2007. John McMullen, adjunct professor of Charles Sturt University, links decreases in agricultural R&D with losses in Australian agricultural productivity beautifully. Listen to his views here
-Australia has a strong capability in climate change research including impacts, adaptation and mitigation.
-We have expertise in human health and nutrition research.

The report also states that a national and coordinated approach to food is needed. This includes not only the supply chain partners (i.e. farmers, manufacturers, retailers and service providers). It also includes policy makers, regulatory agencies and research organisations. This is a position I argued in my submission to the Cutler innovation review. And inclusion is now the issue discussed by Franca Marine the PHAA and Prof. Lawrence.

Key recommendations out of the report:

a) The establishment of an Australian Food
Security Agency, which coordinates the development and implementation of
policies and programs targeted to improving Australia’s food security.

b) Australia should increase its investment in agricultural R&D, to harness national expertise and take a leading role in national and international programs targeted to improving low input farming systems (hear that, Productivity Commission??)

c) Development of incentives to recruit and nurture future generations of innovative and adaptive farmers, researchers and associated professionals for the Australian food production and processing sectors.

d) Improve engagement with the community and partner organisations to elevate the status of food in Australia and build cooperative commitment to an improved food value chain.

The report establishes a time frame of three years to achieve these recommendations.

This report provides an excellent review of the issues confronting Australia’s food system in the next years. This includes water availability, fertiliser and energy availability, climate change, competition for arable land, and the effect of international conflict on food security.

I also liked the assessment of food distribution as an issue: the report says: “In Australia, we have had an abundance of food. We can produce more food than we need and we
have the resources to import food if necessary. However, we have faced crises for specific foods, such as the banana shortage after Tropical Cyclone Larry in 2006. Further, our food transport, distribution and storage systems are vulnerable to disruption. For example, a major epidemic could restrict movement of people and materials resulting in food shortages in some urban centres”. These are examples that we use in two publications: 1) ” Food distribution systems in a climate-challenged future: fruit and vegetables as a case study.” 2) “Food Security in Pandemic Scenarios”.

You will be glad to know that there has been some research done in regards to the vulnerability of food transport, the carbon footprint of food transportation and distribution initiatives to decrease emissions from food transportation. Two reports just finished (to be available through VEIL) discuss a) the impact of food distribution systems; and b) the carbon footprint of food distribution of fruit and vegetables in Victoria. Stay tunned to this blog for further information about these two studies.

Overall, I highly commend the PMSEIC report and I look forward to the implementation of the recommendations.