Visible Solutions

New technology and practices in the food industry, along with a push from U.S. food safety regulators, are bringing better visibility to theincreasingly complex global food supply chain.

With an iPhone app, for instance, anyone can now scan a code on a traceable food product and learn exactly where the product has been. "That kind of immediacy and transparency has never existed before," says Elliott Grant, founder and chief marketing officer at Redwood City, Calif.-based YottaMark Inc., which markets the HarvestMark fresh food traceability solution.

While traceability technology will help companies comply with the Food Safety Modernization Act, which was signed into law on Jan. 4, 2011, it also will provide information to consumers who increasingly want to know where their food is coming from, Grant says.

"They can pick up a bag of salad in a Kroger store and see where it was grown. And if there was ever a recall, we could alert consumers immediately," he says.

HarvestMark's technology taps into a labeling system from GS1, a Brussels, Belgium-based nonprofit with 200,000 U.S. members that's a primary developer of common labeling standards throughout supply chains. "GS1 allows everyone to speak the same language," Grant says, so that in the event of a recall, the U.S. Food and Drug Administration could quickly determine where a product has been.

"Adopting GS1 standards is essential for traceability, especially as global sourcing becomes more common."

—Tim Pyne,

Tompkins Associates

While businesses generally remain cool to government regulation, most of the food industry is behind the Food Safety Modernization Act, says Tim Pyne, a food industry consultant with Tompkins Associates, supply chain and logistics experts in Raleigh, N.C. "Adopting GS1 standards is essential for traceability, especially as global sourcing becomes more common," Pyne says. "We need to know where foods come from in growing markets like Asia and South America."

Tracking produce

While all eyes are on the Food Safety Modernization Act, the produce industry is ahead of the government with its 4-year-old Produce Traceability Initiative, a joint project of the Produce Marketing Association, United Fresh Produce Association, and the Canadian Produce Marketing Association.

To help prevent situations like the widespread 2008 salmonella outbreak—initially blamed on domestic tomatoes but ultimately linked to contaminated Mexican peppers—the Produce Traceability Initiative has set a goal to have electronic tracking in place by 2012 that will provide traceability up and down the supply chain.

Many companies already have adopted new technology. Edinburg, Texas-based Frontera Produce, which grows two high-risk products, cilantro and cantaloupes, in Mexico, has been using case-level radio frequency identification tags for traceability. When it was notified of a cilantro recall, the company was able to trace its cilantro cases to grocery stores within 36 hours. In addition, Frontera limited the recall to 12 percent of its total cilantro in stores; without traceability, it would have been forced to pull all of its product, the company says.

HarvestMark's two-dimensional bar code for produce cases and clamshells, on the other hand, can be scanned anywhere along the supply chain so users can tell where a product was grown and where it has been.

By taking a proactive stance toward traceability, the produce industry has the potential to improve its reputation, says Grant. "Historically the produce industry has been a late adopter of technology, but that's turned on its head. It's now the guiding light," he says.

The industry still has a ways to go, however. While HarvestMark codes can be found on more than 2.8 billion food packages, less than half of produce growers currently are compliant with PTI, Grant estimates. Still, demand for HarvestMark has been increasing, and he anticipates a last-minute rush of HarvestMark orders this year.

In the future, Grant expects the system to gain adoption by food companies outside the produce industry seeking compliance with the Food Safety Modernization Act, which will require food companies to produce all their records when foods are suspected of contamination.

Global concerns

The number of FDA-regulated imports has quadrupled since 2000, according to the agency, with nearly 80 percent of the seafood and 60 percent of produce consumed in the United States imported from other countries. As more imported food products originate in emerging markets like China with less sophisticated food safety systems, concerns about traceability have intensified.

"Global sourcing of food has added measurably to the complexity of the industry."

— Rick Shanks,

Aon Corp.

"Global sourcing of food has added measur ably to the complexity of the industry," says Rick Shanks, national managing director of risk solutions for insurance giant Aon Corp.'s food system, agribusiness and beverage unit, which helps global clients prevent and minimize damage from recalls. As the industry grows, Shanks says, "It's only going to get worse."

GS1 has developed a Global Traceability Standard now used mainly in Europe, including information sharing between trading partners in China and France. For example, French retailer Groupe Casino worked with Chinese food supplier SynBroad Ltd., a producer of canned vegetables and fruits, to adopt GS1 labeling to track merchandise from factories in China to stores in France and other countries, GS1 reports. The pilot program for electronic tracking has made it easier for the companies to comply with European food laws and to make product recalls run more smoothly, GS1 says.

In the United States, the FDA is expected to launch pilot traceability projects by September 2011 as it works to define what a traceability system should look like and to determine specific compliance rules by 2013.

Meaty matters

The new attention on food safety is also spurring meat producers, which aren't covered by FSMA, to invest in traceability technology as well. In July, Aurora Packing Co., an Aurora, Ill.-based producer of Angus beef, announced a partnership with IdentiGen North America to provide its customers with DNA-traceable beef. The system identifies the animal's DNA, allowing for traceability throughout the supply chain.

IdentiGen has samples of every animal harvested at the Aurora facility that provide information on the animals' origins, says Ronan Loftus, chief executive of IdentiGen North America. "We're effectively reading nature's bar code," he says, noting that DNA-based traceability systems are inherently more accurate than others. Besides keeping track of where the products have been, DNA information can be useful in determining overall palatability of particular meats, he says.

While the Dublin, Ireland-based company has been selling the technology to food companies in Europe for a decade, it recently reconfigured the application for the U.S. market as interest has heated up, Loftus says. More consumers are willing to pay a few pennies a pound extra for the comfort of knowing where their meat comes from, and those pennies generally cover the cost of the IdentiGen system, he says.

Compared with the cost of a recall, traceability applications are a bargain, experts say. "Recalls are extremely expensive," says Chris Jones, director of consulting services at Denver-based Junction Solutions, which offers an application called CLEARthru that tracks products from farm to fork. "Anything you can do to improve traceability of products and streamline and speed up that process" will amount to dollars saved in the long run, he says.

Freelance business writer Ann Keeton worked at Dow Jones News Service for more than a decade. She covered the U.S. airline, aerospace and defense industries for Dow Jones and The Wall Street Journal and has written about retailing and manufacturing.