Food fraud is fast becoming one of the most heinous crimes committed against humanity. It is a much bigger problem than assumed and, unfortunately, one of the most widespread crimes worldwide. As such, food fraud always concerns the quality of food. It includes adulteration, tampering, mislabelling, theft, under reporting of production, diversion, simulation, counterfeit, refilling and diversion of government supplies etc.
Global Impact
As per estimates, the food industry lost EUR 30 billion every year due to food fraud (European Commission, 2018). According to The Consumer Brands Association approximately 10 of commercially produced food and beverage products are affected by fraud. To give a hint, in the latest Operation APSON, coordinated by Europol’s Intellectual Property Crime Coordinated Coalition and INTERPOL, more than €100 million worth of potentially dangerous food and drinks were seized. The problem is much bigger than economical losses. While the seizure data is anecdotal and may only reflect crime prevention tactics, an increasing number of incidents indicate that food fraud is growing worldwide.
The impact of food fraud is beyond economic losses as there are health costs to consumers poisoned by spurious and adulterated food. Approximately $100 billion is lost each year in productivity and medical expenses from unsafe food in low-and middle-income countries. Almost 600 million (60 crore) people fall ill after eating contaminated food, and 420,000 die every year. Children under five years of age carry 40 per cent of the foodborne disease burden, with 125,000 deaths every year.
Scenario in India
In the Indian scenario, the situation is not different. As per the Food Safety and Standards Authority of India (FSSAI) findings, during 2018-19, 1,06,459 samples were analysed. 3.7 per cent of these were unsafe, 15.8 per cent substandard, and 9 per cent samples had labelling defects. This is the first time the data has been compiled separately for unsafe, substandard, and labelling defects. This would help food safety authorities take specific corrective and preventive action.
Food most impacted by fraud
Every household item is impacted by food fraud, including Olive oil, seafood, milk-based products, honey, natural sweeteners, fruit juices, coffee and tea, spices, organic products, jaggery, etc. Last year, during April 2021, more than 400+ people were hospitalised, suspected of eating adulterated buckwheat (Kuttu Atta). In another shocking incident, in December 2020, police officials seized a factory in Hathras, Uttar Pradesh, making fake spices from donkey dungs, bhusa, and acids. These incidents raised questions over several increasing incidents of food adulteration cases in India and how far the food we eat is safe?
Brand reputation takes hit
Food fraud is impacting both brand and legitimate industries directly and indirectly. Food frauds impact individual brands and the entire industry’s goodwill and reputation. Apart from societal there are economical risks, including loss of business, wastage of food stocks, maintaining safety and cost of food recalls hitting profitability etc. According to Food Safety magazine, recall costs are estimated at an average of $10 million per annum. Food recalls are the biggest threat to the food industry profitability.
Another classic example is the Maggi Noodle crisis in 2015, which came under fire after laboratory tests found the famous two-minute instant noodles unsafe for human consumption. Nestle was bound to recall nearly 38,000 tonnes of Maggi Noodles from retail stores across the country and destroy them. It took almost another year for Maggi to return to shops across all states in the country.
Another example is from Karnataka & Tamil Nadu. In September 2020, The Tamil Nadu Food Grains Merchants Association had alleged that 90 per cent of the jaggery and jaggery powder produced in the state is adulterated and impacting legitimate businesses. Due to the increasing incidence of jaggery adulteration in Tamil Nadu State, Sabarimala and other significant temples have started procuring jaggery from Maharashtra. According to estimates alone, the Sabarimala temple consumed 1,000 tonnes (10 lakh kg) of jaggery annually.
In similar incidents during March 2021, where traders in Gujarat decided against buying jaggery manufactured in Karnataka’s Mandya district, has cast a shadow over the decades-old jaggery business. After the Gujarati traders, traders from Rajasthan, Assam, and Madhya Pradesh have also been mulling over a similar move. The development has exposed the widespread practice of jaggery adulteration in Mandya, the biggest producer of jaggery in Karnataka.
Consumer trust
Trust is essential in products mainly related to food, beverages and health items. It has a direct impact on sales. Many consumers question everything about a product—from ingredients and place of origin to working conditions—and for good reasons. Food scandals diminish consumer confidence. The 2008 China milk contamination scandals resulted in the death of six innocent babies and made 300,000 ill. According to surveys, even after almost ten years, parents in China won’t trust their babies to local formula. The famous Zomato food incident was known to everyone. Zomato quickly confirmed the incident and introduced “tamper-proof packaging” to prevent such cases from happening again.
Innovative technologies
Many food and supplements organisations lack end-to-end supply chain traceability. Without a clear understanding, managing risk becomes more challenging resulting in businesses facing food quality and safety issues that could permanently damage the brand reputation or, worse, harm consumers. The industry and policymakers in the food industry can take references and benefit from tested solutions adopted by other sectors, including beverages, liquor, and the pharmaceutical industry.
To prevent packaging tampering, food manufacturers can apply deterrents to each of these packaging items. Physical solutions such as a tamper-evident hologram, holographic shrink sleeves, hidden text printed using security or magnetic ink solutions can be used, which act as first deterrents to the counterfeiter.
DNA barcoding, which has seen success when used to identify fish, is a promising and potentially very accurate method of identifying the species and detecting cases of food fraud by substitution. Using digital technologies over and above the physical solutions takes the anti-counterfeiting features one step further, addressing, and curbing supply chain issues. A unique serial number (URN) is a randomised number printed onto the product’s packaging. It is impressive and can be used to define precisely who manufactured the item, where it made its journey through the supply chain and the country or state of origin.
What’s the solution?
We recommend measures including:
- Include the topic of food fraud when discussing emerging issues regarding food safety
- Adopt a definition of food fraud at the national level
- Review national food safety and quality legislation
- Develop a framework to respond to challenges related to food fraud in e-commerce
- Make tamper-proof packaging mandatory for food items and online deliveries,
- Keep up to date with and invest in new technologies to counter food fraudsters
These steps are necessary for a better food security ecosystem in India. Eliminating food fraud activities from the whole ecosystem is a long long way. However, a solution-driven phased approach that prioritises immediate action and long-term steps can bring effective change.
Nakul Pasricha, President, Authentication Solution Providers’ Association (ASPA)