Know Your Nuts !!
The world is going nuts for every kind of nut out there because of health and sustainable diet trends. In the last decade or so, the demand for tree nuts and nut-based products has increased dramatically, leading to overdrive in production, price hike and the need for regulations in this industry.
Bringing in food traceability solutions in this industry could ensure that these sustainable diet options overtaking the world can be traced back to sustainable and ethical practices, in reality as well.
Before we deep dive into understanding the food traceability conundrum in the nut food chain, here is an overview of the worldwide nut production, consumption and trading market.
Worldwide, the nut industry has been seeing tremendous growth. For the year 2019-2020, Almond topped the list of tree nuts in production with almost 1.3 million metric tons produced, followed by walnuts, cashews, pistachios, and hazelnuts.
Overall in the nut and dried fruit market, peanuts are one of the most produced and traded varieties with almost 48.76 million metric tonnes in production.
The Global consumption of nuts is at an all-time high, with peanuts being extensively used across verticals such as the production of oil, peanut butter, and other cooking-related ingredients. Almond and Cashew are being used in the plant-based milk industry. Pistachios are widely popular in Middle Eastern and Asian cuisines, and Hazelnut has been accepted as a household favorite in popular chocolate varieties and also for coffee liquors.
Nuts have made a stamp in the market as a safer, healthier and more sustainable source of protein, essential fats, amino acids, vitamins, etc. Most nut products are also gaining mainstream recognition as viable dairy alternatives.
What this essentially implies is that as the market spreads wider and the supply chain becomes longer and complex, the need for traceability also increases. The nut market has become a hugely traded commodity and is slowly adapting traceability measures. Let us look at the most popular and traded nuts and nut-based products.
Almond surpassed peanut to become America’s most popular nut in 2014 and has seen steady growth ever since.
Almonds are tricky to grow and need just the right climate for the process to be successful over the year. Since California accounts for more than 80% of the global almond supply, the Almond Board of California has established Good Agricultural Practices (GAP) for growers that enable them to maintain quality and tackle productivity issues.
Why is the brand – California Almonds becoming such a rage? Well, the almond producers follow strict compliance in cultivation from the initial sowing stage until the final distribution stage. California Almonds maintain orchard-level records to trace every Almond back to the source. This precision in farm management and monitoring is why California Almonds are preferred by customers and other food manufacturers across the world.
The majority of the Cashew production is confined to Africa and some parts of Asia. Cashew manufacturing follows a series of complex processes right from sourcing from small to middle-scale farmers to processing the cashew in the right manner to make it edible, to exporting it to the distributors. Sometimes the raw cashews are exported to different countries with processing capacities before being added to the distribution supply chain. This makes traceability an imperative requirement for safety and transparency.
With increasing customer demand for transparency and government regulations on food safety, traceability measures such as lot tracing and other technological innovations to trace every crop from farm to factory, monitor yield, quality, labor and ethic metrics and processing cycles slowly into implementation.
Alphonsa Cashew, a leading manufacturer and exporter of Cashews from India, follows a farm-to-home model in tracking every crop right from procurement to distribution across 10-key processes in the supply chain. They have a farmer management system for the cashew value chain that enables transparent sourcing, processing and full case-level traceability to the raw cashew source. The primary metrics, including Food Safety, Social, Environment, Labour, Human Rights and Economic indicators, are being traced towards the ‘Safe Cashew’ Program they run within India and East Africa.
Hazelnut may not be one of the most traded premium nuts across the world, but it is slowly gaining market share with the popularity of Nutella. Hazelnuts are one of the prime ingredients in Nutella and are a crowd favorite in many cuisines, including hazelnut liquor in frappes, milkshakes and ice-creams.
Do you know Ferrero is the largest hazelnut consumer on the planet consuming about 30% of the global hazelnut production.
Ferrero quotes that they have already achieved 50% of their road map objectives for sustainable hazelnuts and 75% for cocoa. The company also added that since 2014, 100% palm oil used in all its products has been certified as sustainable.
The production of hazelnuts is a delicate cycle and as reported recently by BBC’s investigation in 2019 citing that most of the hazelnut pickers in Turkey are poverty-stricken seasonal migrants and these laborers earn less than their minimum net wage because of commissions to be paid to labour contractors, including their travel and lodging is deducted for the net earning. These unethical or forced labor instances from the nuts sourced from Turkey have been under scrutiny by Ferrero’s Farming Programme attempts to combat unethical working practices have been minimized. The program aims to make hazelnut farming sustainable, transparent and cruelty-free. The program is offering free training to hazelnut growers, including workers’ rights.
However, the supply chain for hazelnuts in Turkey is complicated – the orchard owners pay workers to pick the hazelnuts, they then sell the nuts to manavs (an independent nut trader of which there are thousands), the manavs then sell to brokers, which then sell it to big companies such a Ferrero.
The brokers have commented that it becomes impossible for the tons of hazelnuts to be monitored by farmers and their cultivation practices, we only buy and sell. Hence the need for supply chain traceability.
Further, there is the issue of duplicate products from Italy cited by the chocolate company Ferrero. Ferrero has now pledged to improve traceability measures from farm to the factory for all hazelnut sourcing to steer clear of such issues. The company is working with the local farmers and governments to digitize records and establish tracking systems that monitor not just the product but the climate-change effects, ethical behavior, labor laws and sustainable practices.
Nestle’s bulk of hazelnut supply comes from the western and eastern Black Sea region of Turkey, Spain and Italy. They are not sourcing directly from farms, instead they have designated and approved suppliers that obtain hazelnuts through a chain of intermediaries. Nestle’s Harvesting the Future is a multi-partner project designed to improve recruitment and employment practices for seasonal migrant workers in Turkey’s agriculture sector.
Definitely many global food companies are opting for regulating and monitoring their farm -to-product value chain either through company owned farms or approved suppliers who follow strict traceability guidelines where their efforts are to make their farming operations fair trade and sustainable by following transparent digitally tracked data of the food production systems.
Commercially, the peanut is one of the most traded nuts in the world even though it is not a nut as per the strictest of definition. The product is processed and exported in different forms – raw, salted, deshelled, and roasted, most of the time in the same facility itself. This leaves it prone to contamination and quality issues. Peanut products also figure in some of the top products involved in food recall incidents in the USA.
The traceability system for Groundnut products is being implemented across the groundnut producing major states of India and, at present, are introducing traceability systems from field to exporter.
The Agricultural and Processed Food Products Export Development Authority in India has set up separate export regulations from the peanut products meant for the EU and other countries to follow the traceability regulations. Such programs also make it easier for the manufacturers and distributors to ensure that the products get accepted in the market faster.
The primary source of pesticide contamination is putting the health and safety of the consumers of the nut supply chain at risk. To ensure the prevention of usage of harmful pesticides leading to contamination, the traceability and transparency in the supply chain from origination to procurement stage should be made visible.
Peanut allergy is common, and the food manufacturers are required to mention the details on their packaging whether their production facility was near a peanut or nut processing unit. This indeed involves food producers using detailed software at the PLM level with container-to-container traceability.
This “one-forward, one-back” traceability is mandated by federal law and USFDA. These production solutions provide every single receipt, production step, movement, inspection, rejection/sorting and shipment – even identifying the workers who operated the machinery at every step of processing and its history sheets. Using blockchain and traceability in this supply chain is rendered fool-proof and the ability to respond in case of any contamination or recall is swift and accurate to the batch or lot of ingredients.
It is accepted that Agritech is making the gradual change as comprehensive farm-to-fork platforms such as DATAGREEN SourceTrace will allow growers and food companies to collect key data on both GAP (Good Agricultural Practices) and social practices to validate the value chain using data science.
Olam Nuts, a part of Olam Food Ingredients (OFI), has taken the initiative of driving transparency in production and adopted a revolutionary data-based insights platform for its nuts, seeds and superfoods business and integrated processing and distribution capabilities. For customers of Olam willing to buy sustainable nuts including cashews, almonds, hazelnuts, peanuts and chia seeds are certain that the product is certified, 100% sustainable and labor-free.
Traceability is a metric by which both the countries and companies benefit immensely. Food traceability solutions bring in :
1. Easy recall ability so that companies do not end up recalling quantities more than needed and can trace the exact lot to the right processing center.
2. Saves costs and optimizes resources in the Supply Chain.
3. Improves brand transparency for the customers making them distinguish between an ethical brand and an imposter.
The cost of not implementing traceability in the nut industry is too high as a Peanut firm found out in 2008 after a salmonella outbreak was linked back to a peanut processing plant in Georgia. The company ended up recalling 3200 products and suffered a loss of a billion dollars since it lacked the knowledge to recall the right lot alone.
Peter Pan also suffered a similar setback in 2007 when their Peanut Butter product had to be recalled because of a broken sprinkler mishap in one manufacturing plant that contaminated the entire product line. With food monitoring and traceability systems, that batch could have been isolated and the crisis averted.
The nut industry is expanding at a rapid pace today. The demand is pushing growers to their limits, and the market has become quite vulnerable to exploitation and non-sustainable agricultural practices.
If you are a chocolate manufacturer or source nuts or bi-products of nuts in your products, you are probably looking to add safe sustainable practices and incorporate traceability. Make sure your food business is ethical, safe and sustainable with the right traceability solution.
Large Contract farms or Smallholder farming, contact SourceTrace today to devise a solution unique to your business.
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