SPC Ardmona’s bailout is crucial given China’s food safety record

By Christopher G. Baker, University of Sydney

SPC Ardmona’s $22 million lifeline from the Victorian government seems to have saved Australia’s largest food packaging company.

Yet the firm’s recent tribulations are a reminder of why I regularly choose to buy products at the supermarket that are more expensive than the alternative.

Local produce: Victorian workers and politicians have rallied behind the SPC brand. AAP

One reason is that Australian food standards are generally world-class when it comes to the amount of contamination allowed from metals such as lead and cadmium. Although it is not always possible to police this perfectly, these standards allow a high degree of confidence that Australian food is free from contamination.

Contamination issues

The story is different elsewhere. In China, for example, the past decade has seen a host of food-contamination issues. Besides the notorious melamine baby formula scandal, there were also rice products with toxic levels of cadmium, and vegetables tainted with other industrial heavy metals such as lead, chromium, zinc and nickel.

In March last year, up to 16,000 diseased pig carcasses were found rotting in Shanghai’s Huangpu River, after a crackdown on black-market sales of substandard meat prompted the animals’ owners to dump them.

There have also been fears over soy sauce made using human hair, and slaughtered sheep injected with filthy pondwater to boost the weight of the meat.

Rapid growth, but at what cost?

Last year, my colleagues and I released a report on the state of food security in Asia. It highlighted serious environmental issues related to China’s food supply, stemming in part from the chronic pollution of China’s water and farmland.

Among other things, it showed that China’s rampant economic growth has come at a severe cost to its environment, effectively turning its rivers and lakes into industrial dumping grounds. As a result, 90% of groundwater in China is polluted, 65% severely so, with contaminants such as pesticides, fertilisers, and petrochemicals.

According to China’s Vice-Minister for Land and Resources, 3.3 million hectares of agricultural land are moderately or severely polluted, an area roughly the size of The Netherlands. This results in the contamination with heavy metals of 12 million tonnes of grain per year; an amount greater than the entire cereal production of Japan.

Along China’s vast coastline, 68,000 square kilometres of coastal waters are now classified as severely polluted. Figures from China’s National Marine Environmental Monitoring Centre show that in 2012, some 17 million tonnes of pollutants flowed through 72 of China’s rivers, including 93,000 tonnes of oil and a staggering 46,000 tonnes of heavy metals such as lead and cadmium.

A woman collecting water from the Yangtze River, China. Lu Guang/Greenpeace

The deadly combination of food, water and air pollution in China has led to a dramatic increase in the number of “cancer villages”, where high rates of cancer have risen in line with water and soil contamination.

Poor track record

This is not to say that all Chinese canned food is necessarily contaminated. Nor does it suggest that it is only China facing these issues. India, Bangladesh and Vietnam, to name a few, are also facing serious challenges to clean up pollution and contamination.

But for importers of Chinese food, China’s track record on food safety, and its systemic problem with severe and chronic pollution, should raise serious concerns.

Several reports have shown how deadly chemicals have infiltrated the Chinese food system, such as through the use of waste water to irrigate crops, and the presence of pesticides in market food. A 2012 review of the extent of lead contamination in China concluded that “the problem of lead pollution in China is a global problem”.

Of greatest concern to Australian consumers of canned fruit should be a recent study in Zhejiang province, showing that oranges, grapes, pears and plums were contaminated with levels of chromium, copper, cadmium, mercury and lead well in excess of Chinese safety standards. It is worth noting that Chinese safety standards allow twice the level of lead permitted in Australian fruit.

Although a recent article in The Conversation suggested that the label of “cheap, dumped and frequently contaminated” attached to Chinese food is a shortsighted view, I would argue exactly the opposite.

China is attempting to make changes to the amount of pollution in its food chain, and clean up its environment. Yet the reality is that as the pressure for food and water continues to ramp up, food contamination is also likely to increase.

China’s environmental problems border on insurmountable, and when combined with systemic corruption in environmental monitoring and the greater profits to be gained from industrial output over agriculture, it makes for a bleak long-term outlook.

What does this mean for Australia?

China is already Australia’s largest supplier of prepared fruit. According to data from the UN Food and Agriculture Organisation, Australia imported just 3,000 tonnes of packaged Chinese fruit in 2001, rising to 27,000 tonnes a decade later. As a comparison, statistics prepared for the Australian Productivity Commission show that SPC Ardmona sold just over 36,000 tonnes of packaged fruit in 2012.

Employees at SPC Ardmona’s factory in Shepparton, Victoria. AAP Image/Daryl Pinder

Australia’s last fresh fruit cannery is safe for now. But its demise would have caused a shortfall in packaged fruit that would need to be sourced from overseas. Given that China is Australia and the world’s largest supplier of prepared fruit, it’s likely that much of the shortfall would be sourced from China.

The challenges facing SPC Ardmona highlight the risks confronting both Australian food producers and consumers. The steady increase in cheap food imports means that Australian producers of food face an increasingly uneven playing field: one in which it is harder every day to stay profitable.

For Australian consumers, the increase of food imports from countries facing severe contamination issues – such as China – creates a difficult choice between the superior and more expensive Australian product and the often much cheaper import. Unfortunately, there are far too many consumers who are unaware of the potentially serious risks to their health of buying the import.

In denying federal assistance to SPC Ardmona, Prime Minister Tony Abbott has said he wants to signal the end of the corporate “free ride”. But he should bear in mind that the consequences of leaving Australian food manufacturing by the roadside are far greater than any short-term economic agenda.

Christopher G. Baker does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

The Conversation

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Hemp: next big cooking oil crop?

A new breed of hemp crop has been developed that has a similar oil yield to olive oil, has a longer shelf life and is more heat resistant.

Researchers say the high-oleic acid variety of hemp could be a major step towards developing hemp as a commercially attractive break crop for cereal farmers.

The changes to the crop makes the oil more valuable as a cooking oil and also increases its usefulness for high temperature industrial processes.

With oilseed rape crops declining in yield and being increasingly affected by pests and diseases, researchers believe hemp could help ensure the sustainability of the UK’s cereal industry.

University of York

Big Food lobbying: tip of the iceberg exposed

By Gary Sacks, Deakin University

The influence of the food lobby has come into the public spotlight over the past week, with revelations that Assistant Health Minister Fiona Nash’s chief-of-staff, Alastair Furnival, has strong links to the food industry. Furnival previously worked as a lobbyist for several food companies and is the co-owner of a firm that has represented the food industry.

The controversy came as Nash personally intervened to have health department staff withdraw a website launching a new government-approved health star rating food labelling system for Australia. Nash has since been accused of breaching ministerial standards for failing to declare Furnival’s conflict. And Furnival resigned from his chief-of-staff position on Friday.

This incident has exposed one of the many ways in which powerful food companies exert their influence over government policy. From a public health perspective, the major concern is that this is just the tip of the iceberg.

Big Food tactics

Big Food lobbying to avoid government regulations for improved food labelling is not new.

In Europe, the food industry reportedly spent a staggering €1 billion successfully lobbying the European parliament to reject a traffic-light food labelling scheme. The scheme, heavily favoured by public health advocates internationally, uses colours to indicate the relative healthiness of foods. The fear for the food industry is that by putting red labels on their products, sales would decline.

Big Food also lobbied extensively to oppose a proposed tax on soft drinks in Mexico. However, in that case, their lobbying could not prevent the implementation of the tax.

Direct lobbying is just one of several tactics that food companies use to shape the regulatory environment and public perception in their favour.

In the media, food companies typically place the responsibility for obesity on individual choices, rather than environmental or corporate influences. They also portray government actions to regulate food environments as interference in personal liberties and free choice.

Food companies frequently publicise their contributions to worthy causes, such as children’s charities. This seeks to cast members of the food industry as respectable corporate citizens in the eyes of politicians and the public. However, some of these charities have been heavily criticised as being predominantly marketing ploys that distract attention from harmful business practices.

The food industry also funds research that serves to confuse the evidence and keeps the public in doubt. They also set up front groups to lobby on their behalf. And they promise self-regulation in efforts to avoid government regulation, despite the demonstrated failure of self-regulation for improving food environments.

These Big Food tactics closely mirror those used by tobacco companies.

Flow of unhealthy food

The corporate sector has been very successful in shaping a regulatory environment that favours market liberalisation and free trade.

For food companies, this enables them to supply and heavily promote a high volume and enormous range of products, many of which are unhealthy. This increased supply of cheap, tasty, energy-dense food has been the main driver of population weight gain over the last three decades.

Despite strong evidence that many very affordable and cost-effective government interventions – such as improvements to food labelling, restrictions on the marketing of unhealthy food and drinks to children, and taxes on unhealthy foods (such as soft drinks) – are likely to be highly effective in improving population health outcomes, very few of these policies have been implemented globally.

The goal of food labelling is to help consumers make informed decisions. Franzj/Flickr

A major reason for this lack of action is that governments have faced strong pressure from food companies to maintain the status quo.

Corporate efforts to influence policy are a serious worry for public health. There’s a clear conflict of interest between big food companies seeking to profit from sales of their products (many of which are unhealthy) and public-interest efforts to improve population nutrition.

Indeed, the Director General of the World Health Organisation, Dr Margaret Chan, recently referred to the lobby forces of Big Food as one of the biggest challenge that countries face as they try to reduce obesity and diet-related diseases.

Towards informed choices

In the case of current efforts to improve food labelling in Australia, the
goal of the new labelling scheme is to assist consumers to make informed dietary choices and, in so doing, help improve the health of the population.

The government has engaged heavily with public health experts, consumer groups and the food industry throughout the policy development process. And Australia’s food and health ministers have all agreed to support the new labelling system.

However, it appears the food industry’s recent efforts to undermine the scheme are having some effect.

Hopefully, the enormous media attention that has accompanied the government’s decision to take down the new food labelling website will enourage the government to follow through on their previous commitments to support the scheme.

But more broadly, we need tighter rules around government engagement with the private sector, and closer monitoring of the tactics used by Big Food to influence policy. This can generate evidence that can be used to hold food companies and governments to account for their roles in obesity prevention.

Gary Sacks receives funding from the Australian National Health and Medical Research Council (NHMRC).

The Conversation

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-Asset Invest

Should the food industry resign from the health department too

By Christopher Mayes, University of Sydney

Furore over links between Assistant Minister for Health Fiona Nash’s office and industry continues today with revelations that her former chief of staff is connected to the alcohol, as well as the food industry.

Alastair Furnival resigned last Friday over his role in shutting down a website about the health star rating food labelling system and it’s now been revealed that he played a key role in cancelling the funding of the Alcohol and other Drugs Council of Australia.

Furnival is co-owner of a lobbying firm that has represented major food companies opposed to the new front-of-pack labelling system. According to Fairfax, he and his wife also co-own a company, which, in turn, owns another that lobbied for the alcohol industry in 2012.

Such conflicts of interest place question marks over an individual’s capacity to judge a situation, perform a duty or make a decision in a fair and impartial manner. But what if a public institution, such as the Department of Health and Ageing (DoHA) itself, has conflicted interests?

Furnival’s conflict of interest is worrying and should be thoroughly scrutinised. But the influence of the food and alcohol industries at the institutional-level precedes Furnival and will continue despite his resignation.

A growing closeness

The Australian Food and Grocery Council (AFGC) and the health department have developed close ties in recent years. Senior executives of the Council sat on the Dietary Guidelines Working Committee and the National Preventive Health Taskforce.

It co-funded a major nutritional health research survey with the health department in 2007, and is a prominent member of the Food and Health Dialogue.

At the 2009 AFGC annual dinner, Nicola Roxon, then-minister for health said these relationships weren’t cause for concern. Roxon welcomed the industry’s partnership with health prevention strategies and research projects, adding that she “saw no reason for people to fear industry engagement – quite the opposite”.

Perhaps. But when the aim of the food and grocery council is to “influence federal and state policies to ensure our members’ views are represented at the highest level”, legitimate questions arise about whether these partnerships conflict with the work of the health department.

Lawrence Lessig, professor of law and director of the Edmond J. Safra Center for Ethics at Harvard University, warns that such partnerships can corrupt an institution by creating:

an economy of influence that illegitimately weakens the effectiveness of an institution especially by weakening the public trust of the institution.

So does the health department’s relationship with the food and grocery council weaken its effectiveness and public trust of the institution? For many, the answer is yes.

Keeping everyone happy?

In 2011, DoHA responded to the Blewett Review of food labelling law and policy by rejecting the major recommendation of a traffic-light front-of-pack labelling system. Journalists, public health researchers and consumer groups all believed the decision was due to the food and grocery council’s influence.

Catherine King, then-parliamentary secretary for health, defended the decision in an interview with the ABC. King explained the traffic-light scheme would “be a fairly big change for industry” and decided that “we need to get public health and industry together to try and…look at another system”.

This led to the Forum on Food Regulation, a collaborative process involving the AFGC, public health researchers and health department officials. The Forum’s objective was to develop a front-of-pack food labelling system that “must strike a balance between seeking to ensure good public health outcomes and ensuring a strong and profitable food industry”.

But are these objectives compatible? If a profitable industry undermines public health, is a balance feasible? And does the attempt to reach a balance weaken the effectiveness of the health department, the institution that arbitrates this relationship?

A profitable food industry is certainly in the nation’s economic interest. But the idea that it should be a primary concern for DoHA rubs against its more obvious objective of ensuring public health.

Individual conflicts of interest can cause significant damage – Furnival and those responsible for his appointment need to be fully investigated. But whether the increasing acceptance of public-private partnerships is the best way to ensure public goods needs critical attention. These partnerships have the potential to undermine public trust and weaken the effectiveness of vital public institutions.

The public needs to be confident that public officials and public institutions are acting in their interest. Recent events at the individual and institutional level imply that such confidence is misplaced.

The author would like to thank Associate Professor Jonathan H. Marks and Emeritus Professor Donald B. Thompson. This analysis partly draws on research undertaken as Postdoctoral Fellow on their collaborative project (http://rockethics.psu.edu/bioethics/food-ethics/research) jointly funded by the Rock Ethics Institute at the Pennsylvania State University and the Edmond J. Safra Center for Ethics at Harvard University.

The Conversation

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-Asset Invest

SPC Sunday sees sales a boost for SPC Ardmona

The federal government may have denied SPC Ardmona a $25 million assistance package but shoppers came out in full force on the weekend rallying behind a social media campaign, SPC Sunday.

The campaign had simple instructions: “Get involved with SPC Sunday by buying any SPC product & sharing a photo of you enjoying it on Facebook, Twitter or Instagram with the hashtag #SPCSunday”

According to SPC Ardmona Managing director Peter Kelly, sales over the past week had increased by more than 50 per cent, encouraged by the campaign that asked Australians to buy the company’s products and share pictures of them online.

The campaign was started by Linda Drummond on Twitter where she asked people to buy and share pictures of their meals using SPC products. Even The Wiggles got in on the act. The campaign was tagged with #SPCsunday.

According to a statement put out by the company (via Twitter) the campaign saw 7000 tweets over three days.

Apparently, #SPCsunday is one again this weekend. Here are some highlights from last Sunday: