Food safety: Challenges in Dairy Industry

Illustration: Ratna Sagar Shrestha/THT

Food safety is, inevitably, a vital component of food security. However, the compliance with food safety measures (FSM) along the value chain remains elusive in most of the developing countries. The emergence of new modern market chains and increasing integration with the global economy has been putting pressure on the governments for better compliance with FSM along the food value chain. In fact, governments in these countries are now seriously looking for ways and means to improve the status of food safety in these countries.

The status of compliance with FSM in South Asia, in general, is not satisfactory and particularly in Nepal it is precarious and even worse. Nepal often has to incur heavy losses when consignments for exports are rejected due to lack of compliance with FSM. It appeared that the efforts taken by the governments in the past have been largely inadequate. The government’s control and command approach to ensure food safety has not worked satisfactorily due to lack of physical, human and institutional capital for monitoring the compliance with FSM across the entire value chain. Globally, the demand-pull systems have worked well in improving the quality and food safety attributes of the product. Nepal too needs a paradigm shift from relying solely on supply-side food safety and develop demand-pull systems for it.

To understand the status of adoption of FSM and its implications, International Food Policy Research Institute (IFPRI), undertook a comprehensive study on compliance with FSM in Nepal’s milk production. We chose milk as it is one of the most important food item — for rich and poor, young (most importantly children) and old. It is also found to be highly sensitive and carries vector of all possible microbes and extraneous particles in it. We focussed our attention at farm level, as better compliance at production level goes a long way to minimise the chances of contamination at successive levels. The issues such as animal welfare, prevalence of drug residues and antibiotics resistance can be effectively addressed at the farm level.

We investigated the status, estimated the cost, identified the drivers and assessed the impact of compliance with FSM in milk production in Nepal. The study was comprehensive and data were collected from geographically and institutionally diverse regions of Nepal. Our results show that the status of farm level compliance is not very encouraging. On an average only 64% of the recommended measures are adopted by the dairy farmers, though the Government of Nepal released the “code of practices for dairy industry” way back in 2002, in which good dairy practices were developed for safety. The intensity of adoption of FSM exhibits significant variations. The dominance of informal channels in Nepal’s milk market further complicates the compliance and consumers, processors and cooperatives often complain about unhygienic milk production at the farm level.

In comparison to the international standards, Nepal’s mean total bacterial count (TBC) was seen to be nine times higher on farm and 104 times higher in plant, directing an urgent need of improving quality of milk production. It seems farmers are not very enthusiastic to fully comply with FSM since it involves incremental costs and the markets in Nepal often do not reward for food safety. On an average, a dairy farmer in Nepal has to incur an additional expenditure of Rs 2 per litre of milk production. The moot question remains to be answered whether the consumers are willing to compensate the producers for enhanced cost of food safety? Several studies elsewhere in the world illustrate that consumers are willing to pay a premium for safer food products.

Several policy actions are recommended based on comprehensive empirical analysis undertaken by IFPRI. Massive awareness needs to be created among the producers especially related to animal health and hygienic maintenance of the surrounding environment. Farmers should especially be sensitized to discard milk from seriously diseased and infected animals, or even from animals receiving medication.

Periodic monitoring and inspection is critical to ensure adherence to “dairy code practices”. The access to information and frequency of inspection for conformity with safety and quality standards are playing critical role in enhancing the compliance with FSM in Nepal. Farms having information about FSM have shown an 11 percent higher adoption. Similarly, the farms which have been inspected for conformity with safety and quality standards have increased their adoption of FSM by 11 percent.

These findings suggest strengthening of extension delivery and monitoring mechanisms in the country. The government should invest adequately to build physical, institutional and human infrastructure on priority in order to build a robust system to ensure compliance with FSM along the food value chain. Further, the integration with formal channels enhances the adoption of FSM by 8 percent. We need to promote and expand the inclusive formal milk markets to ensure better compliance with FSM. Finally, a pricing strategy based on the quality of milk production should be vigorously pursued to incentivise the famers for higher adoption of FSM. Government of Nepal should develop and prioritize short, medium and long-term action plans for improving compliance with food safety measures to access the global markets and reaping the benefits of expanding trade opportunities in agro-products.

Anjani Kumar is research fellow with the International Food Policy Research Institute. This article was originally published in The Himalayan Times

How PDS can be made Effective through Better Governance

India’s public distribution system (PDS) is the largest food security programme in the world, which covers nearly 60% of the population and costs Rs 1.45 trillion—close to 1.4% of the national income. PDS has often been criticised for its structure, incessant corruption and leakages, and inclusion and exclusion errors in identifying the beneficiaries. The rolling out of the National Food Security Act (NFSA), 2013, and the overhauling of PDS in some states has created an aspiration that the system can be made effectual in making the households not only food secure, but also nutrition secure.

Among the states, Odisha, Tamil Nadu, Rajasthan, Chhattisgarh, Madhya Pradesh, Telangana and Gujarat have intensified reforms in PDS using latest technology and ensuring community participation—they have taken steps such as computerisation of offtake of grains, recording of procurement, storage and distribution, installation of electronic point of sale machines in fair price shops, and regular monitoring at every stage. The digitisation of beneficiaries’ database and verification of their identities through Aadhaar have resulted in scraping of over 23 million fake ration cards and savings of Rs 14,000 crore of annual food subsidy.

Amid serious discussions on replacing the in-kind transfers with cash transfers, with pilots carried out in Chandigarh, Pondicherry, and Dadra and Nagar Haveli, it appears difficult to let go of PDS, at least in the short run. The political sensitivities, complexity in dismantling the massive system built over time, and inadequate infrastructure to transfer money to beneficiaries may act as barriers. Whether a revamped PDS, undoubtedly backed by strong political will and good governance, would pay off across the country is yet to be seen. We gauge its possibility by looking at the stellar performance of PDS in Odisha—a state marred with high incidence of poverty, hunger and malnutrition.

 

Odisha began with a state-of-the-art e-PDS from 2004 onwards to cover the entire network for greater transparency and accountability. PDS coverage in terms of population was expanded, grain prices were lowered, and entitlements were simplified and rationalised. The outlets were largely brought under the ambit of community, presently managed by gram panchayats, self-help groups (SHGs), cooperatives and non-governmental organisations, which ensured participatory management and transparency in administration. The entire distribution system was computerised and vans were mobilised to reach distant places that were otherwise disconnected from the mainstream distribution network. The movement of food grains from the warehouses to fair prices shops was monitored and tracked with GPS systems. The weighing scales were digitised, transport agencies were separated from distribution agencies and fixed distribution schedules were introduced. In fact, the overall system was strengthened with provisions for a grievance redressal mechanism.

A remarkable turnaround was visible in due course in terms of better coverage of eligible beneficiaries from 6.4% in 1993-94 to more than 58% in 2011-12, along with minimal targeting errors and plugging grain leakages. Some more statistics from the NSS showed an increase in the contribution of PDS grains in calorie intake from less than 2.4% to over 19.5% during this period, with larger benefits accruing to the rural households (21.3%). The consumption of cereals among weaker sections increased at a much faster rate than that for other privileged social groups. The estimates reveal that PDS contributed 34%, 32% and 26% of cereal consumption of SC, ST and OBC households, respectively, compared to 19% of general caste households. An increased access to subsidised cereals led to a decline in the share of cereal expenditure in total expenditure, which could be used for purchase of other commodities.

The incidence of calorie deficiencies in 2011-12 would have been 48.9% in a business-as-usual scenario, but the turnaround has been able to contain it to 17.2%. In absolute terms, nearly 14 million people could escape the curse of hunger due to revamped PDS. This translates to 31.7% reduction in calorie-deficient population in the state.

Perhaps an increasing divergence between market price and PDS price of grains made the latter more lucrative. The growing price advantage pushed the households to claim their eligibility which created demand-side pressures on the system to function better. The estimated grain leakages were capped to 11.4 % in 2011-12 from a staggering 85.8% in 1993-94 and 73.4% in 2004-05.

The functioning of PDS can be improved further. Firstly, nearly 16% of the below poverty line households were non-beneficiaries as they did not possess ration cards. Such unintended omissions could be minimised by strengthening the identification mechanism. Second, the density of fair price shops is still lower compared to many other states and efforts are needed to widen the distribution network to remote corners to enhance access.

Thirdly, there is still room for minimising wastage and losses resulting from poor handling and storage of grains. Continued research and improvements in logistics throughout the distribution chain is imperative. Lastly, appropriate choice of food including biofortified food, if distributed, can help in addressing recalcitrant micronutrient deficiencies such as vitamin A and anaemia.

The Cabinet has approved the setting up of the National Nutrition Mission (NNM) with a budgetary allocation of `9,046.17 crore for the next three years. NNM will cover all the districts in three years beginning with 315 high-burden districts. The aim is to reduce stunting by 2% annually, anaemia in young children, women and adolescent girls by 3%, and undernutrition and low birth weight among 100 million people.

Since each state has invested heavily in PDS and revamping is already under way, it would be cost-effective to make it as a platform to achieve some of the proposed goals under NNM. The respective states can provide necessary nutrients such as pulses and millets to women along with grains and possibly promote dietary diversification as per the culture, tastes and preferences of people. The ministry of women and child development has advocated bringing convergence with other ministries for the success of this mission. Clearly, PDS can play a pivotal role in bringing convergence and making India’s two important missions—food and nutrition security—successful in a short time.

Anjani Kumar and Seema Bathla are agricultural economists with the International Food Policy Research Institute and Jawaharlal Nehru University, New Delhi. This article was originally published in Financial Express

Book Release: Pulses for Nutrition in India: Changing Pattern from Farm to Fork

Book released by H.E. President Ram Nath Kovind & Shri E.S.L. Narsimhan Garu #Governor of AP & Telangana at 100th Annual Conference of Indian Economic Association

A good monsoon led to a rise in sowing and production of pulses in 2017, resulting in prices falling almost by half. Earlier, in 2015, rising prices causing declining consumption of pulses had been a cause of concern for both nutrition and food inflation in policy corridors. For a long time, India’s pulse production had been nearly stagnant, but volatility in prices and production in recent years make the continuing growth in pulses a big challenge for researchers, extension agencies, and policymakers.

Pulses are mainly produced by small farmers on marginal lands and face abiotic stresses like moisture, drought, and elevated temperature as well as biotic stresses like pests. This often leads to huge losses, reducing production by up to 20 per cent. The green revolution pushed pulses away from irrigated areas, with nearly 87 percent now being grown in rainfed areas. Despite their importance to diet and nutrition in India, yield improvement and technology development has been far more extensive in cereals vis-à-vis pulses.

In light of these challenges, the International Food Policy Research Institute (IFPRI), supported by the CGIAR Research Program on Agriculture for Nutrition and Health (A4NH),  is releasing a comprehensive book - Pulses for Nutrition in India: Changing Pattern from Farm to Fork authored by Devesh Roy, P K Joshi and Raj Chandra – by H.E. the President of India, Hon. Shri Ram Nath Kovind and Shri E.S.L. Narsimhan Garu, Governor of Andhra Pradesh and Telangana in the inaugural session at 100th Annual Conference of the Indian Economic Association on December 27, 2017 at Acharya Nagarjuna University, Nagarjuna Nagar, Guntur, Andhra Pradesh.

The eight chapters in the book cover the journey of pulses across the value chain, from understanding final demand and supply, production, consumption, prices to trade, technology, processing, markets and government interventions.

Pulses, often considered as poor man’s meat as the ‘only’ significant source of protein, are particularly important for vegetarians. Yet, production of pulses has been insufficient to meet the rising demand, resulting in persistent increases in imports as well as prices. Price support is effective in cereals in some areas, but without procurement, in pulses their role is limited to benchmarking traders’ offer price. Dr. Devesh Roy, senior research fellow, A4NH and former research fellow, IFPRI, said, “Direct firm farm linkages with farmer organizations in pulses need to be promoted. The most crucial step needed in pulses is ensuring better transmission of consumer prices to producer prices.”

Dr. P K Joshi, Director South Asia, IFPRI, added, “The private sector has been missing from pulse research and development, and they need to be a partner to strengthen the seed sector for promoting high-yielding pulse varieties, and to develop better market linkages so that farmers get competitive prices. If pulse production increases by only area expansion, that will lead to a fall in prices but will not benefit farmers. Productivity increase through improved varieties and technologies is necessary to increase profitability of pulse production.”

The book explains the major policy take away for increasing pulses production and consumption. Few of the policy highlights are as follows: -

  1. Technology delivery systems need strengthening by linking formal and informal seed sectors and motivating seed companies to engage in pulse seed programs.
  2. Utilization of rice-fallow lands for pulses can be important. Up to 3-4 million hectares of rice-fallow lands are spread across Bihar, Chhattisgarh, Jharkhand, Odisha, and Madhya Pradesh. During the winter (rabi) season, farmers can grow pulses using residual moisture – lentils in upland and chickpeas in medium and lowlands.
  3. Pulse processing is characterized by with low efficiency, irregular operation and inadequate capacity utilization. If processing were to become the engine of growth for pulses, there must be a structural shift toward larger mills with regular supply of good quality pulses.
  4. To develop infrastructure such as irrigation, transport, and communications in developing and deepening pulse markets.
  5. Explore incentives to the farmer producer organization (FPOs) that are growing pulses in large clusters.
  6. The participation of the private sector in research and seed value chain needs to be expanded.
  7. Incentives need to be put in place for private enterprises to engage in nutrition-sensitive food innovations; these may come in the form of research, tax, credits, challenge grants, or other strategies.

For more on the book, click here: https://www.ifpri.org/publication/pulses-nutrition-india-changing-patterns-farm-fork

Pulses Video

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The International Food Policy Research Institute (IFPRI) seeks sustainable solutions for ending hunger and poverty. IFPRI was established in 1975 to identify and analyze alternative national and international strategies and policies for meeting the food needs of the developing world, with particular emphasis on low-income countries and on the poorer groups in those countries. www.ifpri.org.

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The CGIAR Research Program on Agriculture for Nutrition and Health (A4NH) helps realize the potential of agricultural development to deliver gender-equitable health and nutritional benefits to the poor. The program is led by the International Food Policy Research Institute (IFPRI). www.a4nh.cgiar.org

 

 

Five Ways to Reduce Farm Distress

Indian agriculture is confronted with high price volatility, climate risks and indebtedness. Since majority of farmers (86%) are small and marginal with declining and fragmenting landholdings, they are more vulnerable

 

and risk prone to any of the uncertainty. The last two budgets of the government were pro-agriculture. More resources were allocated to agriculture and number of programs were initiated to increase irrigated area, improve soil health, promote agro-processing, cover production risk, among many others. Despite of this fact, it appears that agrarian distress is silently spreading across all the states. It seems that all these programs and schemes are disjointed and function independent of each other. Therefore, it is time to have a five-point program which addresses the agrarian challenges and converge various on-going programs under one umbrella.  These are suggested as below:

Increasing incomes: Agricultural transformation is very slow in India. Therefore, the process of generating higher income from agriculture is also slow. Production increase was the main objective than raising incomes. It is welcoming that the Prime Minister has given target to double the income of farmers by 2020. This paradigm shift is expected to raise framers’ incomes. Within agriculture, it will require (i) aggressive push to improved technologies by strengthening seed sector and knowledge dissemination system; (ii) agricultural diversification in favour of high value commodities and develop value chains by linking production and marketing centres; and (iii) develop mechanisms to ensure minimum support prices in the event of crash in farm harvest prices. The condition for success will rely on how the farmers are aggregated for production and marketing through promotion of contract farming, cluster farming, farmer producer organizations and self-help groups.

Generating employment opportunities: The Situation Assessment of India reported that more than 40 percent of the farmers would like to quit agriculture if alternative opportunities are available. Agriculture is becoming crowded and does not provide regular employment opportunities. In the absence of regular employment in rural areas, the rural population, especially the youth, is migrating to urban areas to explore better avenues and income. There will be around 34 percent youth (15-34 age group) of total population in India by 2020. More than 70 percent of youth lives in rural areas. Their energy and enthusiasm need to be tapped for meeting their aspirations and transforming agriculture and rural economies. Agriculture per se would not be able to absorb the growing number of youth in rural areas.  Incentives need to be given for (i) aggregating raw and processed products (good example is of Lizzat papad that employs more than 43 thousand women). (ii) self-employment in agro-processing, agro-advisory, agriculture and rural transport, etc., (iii) private sector engagement in custom-hire services, secondary and tertiary processing, (iv) location specific non-farm employment in micro, small and medium enterprises and link them with large manufacturing sector, and (v) engagement in government programs, schools, agriculture extension, etc.

Reducing risks in agriculture: Risk in agriculture is increasing over the years. Both production and price risks are leading to agrarian distress. On production risks, the incidences of droughts, floods, rising or falling temperature and unseasonal rains and hailstorms are increasing and adversely affecting agricultural production. However, during the normal years, farm harvest prices are steeply falling and badly affecting farmers’ incomes. Already Prime Minister’s Agriculture Insurance Scheme is in place to cover some production losses.  Though the scheme is good but compensation is not enough and does not cover the risk of falling prices. Therefore, the government may consider launching ‘Prime Minister’s Climate Resilient Scheme’ that covers both production and price risks. The scheme may bundle promotion of climate smart agriculture, provide value added weather advisory services, effective implementation of agricultural insurance and ensure minimum support prices.

Developing agri-infrastructure: Agri-infrastructure, including agricultural markets, cold storage, warehouses, and agro-processing, have not developed in corresponding speed of increasing agricultural production. The pace of agri-infrastructure is far behind than it is needed to improve overall agri-food system. More focus in the past was given to production of agricultural commodities. In the absence of adequate agri-infrastructure, the supply chains of agri-food commodities are in the hands of unorganized sector which is fragmented and inefficient.  Organized private sector is slowly coming up due to less commercial viability to develop agri-infrastructure. Role of public-private partnership (PPP) is immense in developing agri-infrastructure for high economic and social gains. Government may constitute a commission to develop modalities and proposals for public-private partnership in agri-infrastructure sector. Lessons may be learnt from excellent track record of PPP in constructing of national highways, building and functioning of airports, distribution of power, etc for developing agri-infrastructure (such as rural agri-markets, cold storage, agro-processing, surface irrigation and agricultural extension). Central government may contribute to states for viable projects in PPP mode to develop agri-infrastructure.

Improving quality of rural life: Rural India is still missing basic amenities (like sanitation, hygiene, drinking water, drainage, schooling and health centres). Three years ago, the Prime Minister encouraged each member of parliament and state assemblies to adopt one village to transform it into a model village. The main objective was to provide all basic facilities in rural areas to improve the quality of life. Former President late Dr APJ Abdul Kalam also gave a concept, namely “Provision of Urban Amenities to Rural Areas” (PURA), with the aim of providing urban infrastructure and services in rural hubs to create economic opportunities in rural areas. The scheme may be revived to improve the quality of life in rural areas. Though there are several programs and schemes to create social and economic infrastructure, these need to be converged for larger impact.

It is high time to revive agriculture sector and improve the purchasing power of the bottom of the pyramid to accelerate overall economic growth. It can only be done by focussing on key areas and implementing under one umbrella.

P K Joshi is director South Asia, International Food Policy Research Institute. This piece was originally published in The Business Standard 

Workshop on “Green Revolution in Eastern India: Constraints, Opportunities and Way Forward”

Workshop in New Delhi

Eastern region of India, comprising Bihar, Chhattisgarh, Eastern Uttar Pradesh, Jharkhand, Odisha and West Bengal, accounts for more than 50 percent of nation’s food insecure and poor population. These states could not reap the benefits of Green Revolution which was exceedingly successful in accelerating agricultural production and productivity and reducing rural poverty levels. While the nation takes pride in achieving food self-sufficiency with a record production of 273 million tons and reducing the incidence of poverty from 53 percent in 1977/78 to 21.4 percent in 2011/12, the reality is that the eastern states are quite a distance away from reaching the average national agriculture productivity levels and in mitigating poverty and hunger.

As these states were largely bypassed from the High Yielding Varieties (HYV) seeds and other such technologies and continue to have poor agriculture productivity levels, the Government has embarked upon a major mission, popularly known as BGREI-Bringing Green Revolution to Eastern India. The main focus of this bold initiative has been to augment land productivity as agriculture is the main source of livelihood and employment for majority of rural population in the region.

To understand how this important initiative of the government can be taken forward, the Indian Council for Agricultural Research (ICAR), International Food Policy Research Institute (IFPRI) and the Tata Cornell Institute for Agriculture and Nutrition (TCI) jointly organised a national conference during October 9-10, 2017. The conference was attended 150 delegates. Eminent economists, agricultural scientists and policy makers shared their views on macro as well as micro issues that have been holding back agricultural growth in the Eastern states. The participants deliberated upon several aspects viz. technological, land use, institutional, climate change and risk, investments, food security and migration to find appropriate strategies that would help the Eastern states in unleashing their potential.

Dr Harsh Kumar Bhanwala, Chairman, National Bank for Agriculture and Rural Development (NABARD), attributed low agricultural productivity in the eastern region to small size of land holdings and inadequate rural infrastructure. He laid emphasis on diversification of agriculture by the small farmers to harness the opportunities in horticulture and fisheries activities and income gains. He suggested formation of Farmer Producer Organizations (FPOs) or Aggregators who can provide easy market access to farmers for their produce.

Dr Trilochan Mohapatra, Secretary, Department of Agricultural Research Education (DARE) and Director General, ICAR, highlighted a strong need to bring convergence in policies and efforts from planning to implementation which can help in bringing green revolution in the eastern region. An increased spending on agriculture Research and Development (R&D) and improving extension services can go a long way in increasing crop productivity.

Dr P K Joshi, Director IFPRI-South Asia, IFPRI reiterated that India’s eastern region suffers from natural calamities and is largely rainfed. However, it offers numerous opportunities like utilization of rice fallows, cultivation of non-food crops including fruits-vegetables, and their value addition in processing industry. To harness these opportunities, it is important that these states bridge the yield gaps and have climate smart agriculture. He also emphasised to treat agriculture as an agri-business profession whereby entrepreneurship should be promoted among the farmers. In doing so, business models that are best suited for this region should be explored with adequate financial support by the lending agencies and banks.

The conference concluded with some key recommendations-

  • Technological development is critical for accelerated and sustainable agricultural development in the region. Special focus need to be given on adoption of improved seed varieties, System of Rice Intensification (SRI), farm mechanization and conservation agriculture.
  • Reforms are needed in inputs delivery chain (seed, fertilizer etc) and promotion of rental markets (farm machinery, irrigation, land) to ensure optimal land and water use.
  • Institutional reforms are required in improving agricultural marketing, financing, insurance and formation of FPOs/cooperatives.
  • Increase in infrastructural investment by the government in areas such as irrigation, cold chain, reefer vans and other logistics, roads and other transport mechanisms for high value perishable commodities is the need of the hour.

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