DESIGN 2003 H-M-K HAMBURG

1. DESIGN 2003 H-M-K HAMBURG THE WORLD OF TEA UNDER ONE ROOF

2. Colombo August 2007 Multi Origin Sourcing and Traceability Hälssen & Lyon ,Hamburg Germany Mr.Kalle Grieger

3. Hälssen & Lyon founded in 1879 Dealing with 105 different countries More than 20.000 articles are regularly used More than 11.000 articles are multi component and or processed.

4. OUR FUNCTION IN THE TEA TRADE • middleman between the source and the consuming nations • Innovator---trend setter-------trend enhancer • producer or manufacturer • trader • consultant and service center around the tea DESIGN 2003 H-M-K HAMBURG

5. PRODUCT RANGE Products handled by H&L • Black , Green ,White ,Oolong, Red Tea • Fruit and Herbal infusions • Tea extracts and Instant tea • Specialities and organic teas DESIGN 2003 H-M-K HAMBURG • Decaffeinated Tea (CO2, M/C, E/A) • Flavoured Tea

6. OUR CUSTOMERS Our clients • Tea Industry and Packers • Wholesalers • Speciality Shops • Beverage Industry DESIGN 2003 H-M-K HAMBURG

7. PURCHASING STRONG POSITION IN COUNTRIES OF ORIGIN • Worldwide sourcing. Imports from more than 105 countries. • Sourcing based on ethical principles • Advance purchase of crops DESIGN 2003 H-M-K HAMBURG • Regular inspections and education of key suppliers at origin.

8. PRODUCT SAFETY Inhouse How to achieve and maintain Product Safety • Organoleptic evaluation • Physical/Quality control External analyses • Partner laboratories DESIGN 2003 H-M-K HAMBURG • Pesticides, Microbiology, Heavy Metals etc. • EDP driven Quality Control System

9. contract PURCHASE OF RAW MATERIAL offer samples Sensorial and analytical tests Internal analysisidentification: macroscopical and microscopicalinsoluble ashesloss during drying processsieving analysisbulk densityforeign matters External analysispesticidesheavy metal Microbioligytotal number of germsyeassts and mouldsenterobacteria ceaeescherichia colisalmonellaaflatoxine (B1 + B2 +Gr + G2) Sensorial analysissmellcolourtaste Release/order DESIGN 2003 H-M-K HAMBURG rejection negotiation storage of purchase sample

10. GOODS RECEIVED AT WAREHOUSE Incoming Checkl- packaging- marks- contamination/parasites- quantity control- overall impression- perceivable damages etc. Sampling- according to GMP (good manufacturing practice)(root of colli + 1) (100 bags = 11 samples) Sensorial and analytical tests Internal analysisidentification: macroscopical and microscopicalinsoluble ashesloss during drying processsieving analysisbulk densityforeign matters Sensorial analysissmellcolourtaste External analysispesticidesheavy metal Microbioligytotal number of germsyeassts and mouldsenterobacteria ceaeescherichia colisalmonellaaflatoxine (B1 + B2 +Gr + G2) DESIGN 2003 H-M-K HAMBURG yes no Release/blocking claim storage rejection handling

11. Certification IFS higher level HACCP ISO 9001 DESIGN 2003 H-M-K HAMBURG Kosher BIO / Organic Organic NOP

12. Wh How did it all start------- the demand for traceability? • UK in the early 1980 ----it was claimed that more Darj. was sold than grown. • Tea and pesticides became an issue in Germany in the late 1980. • Food scandals in various countries concerning artificial colourings etc. • Super markets and the food industry want to avoid new scandals but have their • suppliers pay for it. • I.S.O. and I.F.S. created demands on the subject of traceability. • New laws and regulations came into being and require traceability • (18 different regulations concerning tea are in play in the EU alone). • Recently: food safety related scandals in China,India,Japan

13. What are the consequences of traceability issues?---A • Rising cost(analytical cost,additional staff,equipment,etc.) • Limited availability of teas to choose from. • More time is needed to source the teas in line with regulations. • The process of buying is selling has become more structured • (companies had the chance to question and improve their execution • routines). • More communication is required and more paper generated in the • process( 1 customer 8pos of TEA-----32 pages of certificates).

14. What are the consequences of traceability issues?---B • Companies are being driven out of business. • The trustworthyness of the supplier has become a key issue. • Additional cost for storage of samples occurs. • The quality of a given tea has been re-defined.1st comes • product safety. • Audits take place with every player in the chain and his • suppliers. • Three times the amount of paper per transaction and growing

15. What are the issues which require traceability? -----A • Origin of the tea. • Analytical data on Pesticides,Heavy Metals, Microbiology, • caffeine,catechine,polyphenol,moisture etc. • Allergic potential. • GMO free • Organic, Fairtrade, N.O.P., Kosher, Halal • Ingredient declarations • Compliance with I.S.O., I.F.S., H.A.C.C.P. • Biodegradability, Recycleability • Company standards • Legislation • F.D.A. registration

16. What are the issues which require traceability? -----B • Pallets in line with ISPM15 (F.A.O.guideline) • Firing material used on the estate. • Makeup and analysis of packaging material. • Free of B.S.E. prone material Radioactivity • Nutritional information • Sustainabilty issues • .

17. What will be requested in future? • Impact on the CO2 balance. • Energy used to have a product produced. • RFTD -chips to be used to collect information. • Countries of origin will wake up to the challenge because of their consumers. • Further legislation to be enacted. • More paper and time per transaction.

18. How to master the challenge? • Independent Quality Management to be installed . • Additional manpower and know-how has to be aquired • EDP-based tools have to be employed. • Closer communication at all levels internal & external. • Staying informed on the changes in legislation. • Free and fast flow of information. • Education------------------also of key suppliers.

19. The world of tea under one roof DESIGN 2003 H-M-K HAMBURG