The Report examines the evidence and provides essential insights under these headings:

• Global sourcing and sustainability
• Meeting the challenge in Europe
• Supply chain issues
• Conclusions and recommendations

This is a key report for food industry and supply chain professionals alike and may be purchased from Campden BRI and CILT(UK).

Make an informed business decision. This Supply Chain Europe Global Sourcing Report is essential reading for senior managers and other professionals involved in developing and managing supply chain strategies linking Brazil and Europe.

The Report provides insights and practical advice for procurement professionals in the European food retail, wholesale, and manufacturing sectors, as well as for international logistics service providers.

It will also be of value to government representatives, lawyers, bankers and financiers, consultants, educators, and members of all organisations seeking to understand and develop global trade and investment links between Brazil and Europe.

Key topics covered include:

• The critical issues surrounding global sourcing
• Assessment of Brazil as a sourcing option
• Logistical network alternatives in Brazil and Europe
• Advice on creating the responsive supply chain
• Recommendations for European buyers

In fact Brazil leads the world in the production and export of sugar, coffee, orange juice, soya, beef, chicken, pork and other agricultural products. Its potential is illustrated by the fact that it has 25% of the world’s available agricultural land – all without encroaching on the Amazon.

However, globalisation of food supply brings risks. For example, last year headlines focused on melamine contamination of Chinese milk and dairy products sold across world markets from Russia to Cameroon. So food safety and traceability are key elements of food security. This article looks at some of the principal issues affecting stakeholders in the food chain.

In its broadest sense, food security is about sustainability. World population is forecast to hit 9bn by 2050 (up from 2.5bn in 1950) with continuing upward pressure for more complex food products as world poverty is alleviated. Governments are therefore seeking to secure their food supply.

In a narrower sense food security (or food safety), involves protecting the food chain from (malicious) contamination by organisations or individuals, or as a result of terrorist attack. Under the revised WHO International Health Regulations (2005), certain incidents potentially involving deliberate contamination of food may be considered of international significance and subject to the Regulations.

Market access requires food safety assurance from ‘farm to fork’ whatever the geographies involved. Suppliers to Europe must comply with national food safety laws – as required by the General Food Law Regulation (EC) 178/2002 – and industry codes of practice. Application of the principle of equivalence is intended to ensure that food safety standards are common in different countries.

Producers and processors will also employ HACCP (Hazard Analysis & Critical Control Points) principles as a basic methodology for safe food production. Traceability legislation further requires that each operator provide a ‘one-up/internal/one down’ view of the processes under their control although it does not give a single source of whole chain traceability.

The goal of supply chain management is to link procurement, manufacturing, distribution activity, and the marketplace so that consumers are served better but at a lower total cost. In order to assess potential food security and safety risks within international supply chains, stakeholders can use a variety of mapping techniques relating to both geography and process.

For example, a ‘learningto-see’ map describes the product and information flows. Pipeline and time-based process maps take into account the time element at each node and link in the network to suggest vulnerable areas.

It is important to develop a holistic end-to-end view while capturing enough detail including product/pack information at consumer unit, traded unit, or logistics unit (i.e. pallet or ISO container) levels. Key aspects include product identification, labelling, and document specification.


From the diagram it can be seen that supply chains are complex and that product flowing through a network will have multiple hand offs Entities include factories, warehouses, ports, and distribution centres often with a variety of languages, cultures, and ways of working. Stakeholders also include customs and health regulatory authorities.

Each supply chain is different – there is no “one size that fits all”. However, a logical approach is essential to identify and assess the risk of product contamination, substitution or counterfeiting on an individual chain by chain basis. A useful approach involves a review of:

• Network infrastructure
• Organisation
• Process
• Information

One challenge can be that no single entity controls the chain. Others relate to the ability or willingness to collaborate and communicate, both internally and externally. There may be commercial or even political sensitivities about sharing data, information and understanding.

In May 2008 the WHO revised guidance document “Terrorist Threats to Food” looked at the issues surrounding food security and safety. It outlined a series of measures for consideration by the food industry under the following headings:

• Risk awareness
• General security
• Emergency procedures
• Management of hazardous materials
• Employees
• Access to facilities
• Suppliers
• Raw and packaging materials
• Storage areas and warehouses
• Processing areas
• Transport of ingredients and processed products

While the advice is focused on combating terrorist threats its advice is equally sound for preventing and responding to all forms of malicious attack. Some examples from the Brazil – Europe food supply chain show the necessity of actually ‘walking the process’ to find disconnects in information or product flows. This facilitates risk awareness based on a vulnerability assessment and identification of the point(s) where a contaminant would achieve the greatest spread. A point to note is that this is best done by an independent auditor.

In one example, a factory ERP system logged a certain date and time for when a truck was despatched. Further enquiry reveals that this was in fact when the administrator completed the transaction on the ERP system and that reliable despatch data was held only in the plant weighbridge system which showed an up to 24-hour variance.

As regards material flow, product may leave the factory on identifiable pallets but when ISO containers are loaded at a warehouse batches are mixed.

General security covers a wide range of aspects, not least assigning responsibility for security to a suitable person. This can be difficult with multiple entities involved in supply chain operation located in different countries with a variety of languages and business cultures. On one occasion attempts by a food processor in Germany to get its supplier in Brazil to admit that there was a food safety problem were met by the response “that’s impossible, we have a quality system”.

Vulnerabilities often relate to weaknesses in people. Screening of job applicants and employees has to be done in a consistent way and the same routines applied to all, including seasonal, temporary and contract workers. Culture is also a factor here – for example, a situation where a container of tropical fruit will be shipped on time only if the right person in the port receives an incentive, says little for appropriate levels of integrity and security.

While accreditation of suppliers under regimes such as Authorised Economic Operator (AEO) in Europe is seen as a defence against terrorism it is fundamentally an effort to facilitate world trade through improved customs processes. It does not provide the depth of supplier knowledge required for adequate food security. Adequate knowledge of suppliers – including contractors supplying transport, warehousing, and other logistics services – is vital.

In conclusion, the main points are as follows:

• Global sourcing and supply is here to stay but globalisation of food supply brings risks
• In view of Brazil’s role as a leader in world food supply its experience is relevant
• Effective supply chain management maintains food security and safety
• Visualisation of the entire supply chain and walking the process by means of an independent audit helps identify and mitigate the risks.

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A Chartered Member of CILT (UK), Andrew Morgan is managing director of Supply Chain Europe Limited and has over twenty five years’ experience in logistics and supply chain management. He works on supply chain improvement with European and Brazilian companies particularly in agribusiness, food and drink, and retail.

Reproduced with the permission of CM as published in the Latin American supplement November 2009