A huge spike in commodity prices creates the perfect set of conditions for criminal activity in the food supply chain, says Nick Hughes.
Next year will mark the tenth anniversary of the ‘horsegate’ scandal in which horsemeat was illegally substituted for beef in a range of retail and foodservice products.
The scandal was front page news for days and was estimated to cost the UK industry £850m. It also spawned a government-commissioned independent review, led by Professor Chris Elliott of Queen’s University Belfast, which made recommendations for how a similar scandal could be prevented from happening again.
I worked as part of the secretariat to the Elliott Review and one of its key findings keeps running through my mind every time I listen to fresh reports of rampant food price inflation: if you want to predict where the next risk of food crime will occur look no further than commodity prices.
In 2012-2013 the price of imported beef was trading at a significant premium to horsemeat. Substitution of one species for the other allowed certain rogue elements within the supply chain to make a handsome profit.
It’s not hard to imagine there’s another substitution or food crime scandal just around the corner. The coronavirus pandemic had already caused a severe fracturing of global food supply chains before the war in Ukraine further imbalanced supply and demand. Reports of stocks of sunflower oil drying up and surging wheat, maize and chicken prices – to name but a handful of affected commodities – should put food buyers across the supply chain on high alert to the risk of foods being substituted or products being adulterated with cheaper ingredients.
Speaking on the latest Footprint40 podcast, Food Standards Agency (FSA) chair Professor Susan Jebb acknowledged the potential for food crime to increase. “We haven’t seen that yet but we’re conscious that might happen because food has become an increasingly valuable commodity,” Jebb said.
Some ingredient substitutions will be necessary and legitimate. The FSA recently agreed that rapeseed, palm, coconut and soybean oils can be used as substitutes for sunflower oil without changes to the label being made in order to maintain supplies.
But other switches will be illegal and potentially dangerous to consumers. A Guardian analysis from last year found that of more than 9,000 seafood samples taken from restaurants, fishmongers and supermarkets in more than 30 countries 36% were mislabelled, including due to species substitution. Now that issues with the supply of white fish, linked to the Ukraine conflict, have emerged it seems grimly inevitable that unscrupulous suppliers will look to exploit the situation. And remember – when high value species like cod and haddock are replaced by lower value species like pangasius or tilapia it’s not only the customer’s wallet that suffers but their health can be put at risk when certain foods cause allergic reactions.
Businesses might also be tempted to break labelling rules around use-by dates. In March, food hygiene inspectors found boxes of meat being sold at a shop in Crewe had been re-labelled to show them as two months in date, when in fact they were two months past their use-by date.
Supply chain risk
Despite the cost pressures facing food operators the vast majority of reputable businesses will not cut corners; but good intentions alone may not be enough to prevent exposure to criminality perpetrated further up the supply chain as many buyers learned to their cost during the horsemeat scandal.
Nine years on and in some respects the UK is better placed to manage the risks from food fraud and crime. The FSA now hosts a national food crime unit (NFCU) – a key Elliott recommendation – that works to prevent, detect and investigate food crime across the UK.
Businesses too have their own dedicated food industry intelligence network (FIIN) which shares insight on potential food crime issues. Consisting of companies from the retail, manufacturing, ingredient and foodservice sectors, FIIN now has 51 members from an initial 21 at the time of its inception in 2015.
Yet in other ways the UK is more exposed to the risk of fraudulent food than ever. The Chartered Institute of Environmental Health (CIEH) recently raised concerns that ongoing delays to checks on imports at the UK border risk heightening the danger of food fraud and crime – with potentially severe public health consequences.
Following Brexit, the UK has also lost access to EU intelligence systems, including the Alert and Cooperation Network which allowed for sharing of information regarding food fraud with EU member states. Full access has also been lost to the EU’s rapid alert system for food and feed (RASFF), through which member states share information about potential food safety risks.
The FSA notes that alternative communication mechanisms have been put in place, including via Europol, while the use of a variety of surveillance dashboards helps it identify and evaluate emerging food risks
It’s the job of regulators like the FSA to be the eyes and ears of the consumer through these kind of horizon scanning activities. But it’s also the responbility of businesses to ensure the integrity of their own supply chains – whatever the cost and challenges.
History tells us the price of failing to do so will be greater still.
Nick Hughes is associate editor at Footprint.