Industry Responds with Advanced Quality and Traceability World Pork Congress April 29, 2004

1. Industry Responds with Advanced Quality and TraceabilityWorld Pork Congress April 29, 2004 Paul Clayton U.S. Meat Export Federation

2. What is the function of Animal ID, Traceability, Source Verification and/or Process Verification? • Control animal and zoonotic diseases • Only need live animals procedures • FMD, BSE, Scapies, PRRS, PMWS • Food Safety • Chemical • Antibiotics, Hormones, Pesticides • GMO • Sanitary • Microbiology • GMP • Physical Risks: Needles • Only need plant procedures • Recall procedures • Commercial purposes • Branded Programs • Source Verification • Identity Preservation • Information Exchange • Genetics • Production Practices

3. Traceability System • Traceability alone does not contribute to higher levels of safety or quality, it only transfers information along a supply chain. • In order for traceability to affect quality it must be associated with some type of quality assurance mechanism that imposes a set of standards and procedures and specifies data to be recorded so that quality can be assured. • It is the sharing of information recorded by firms, or by other institutions to which it is passed, which constitutes the bulk of any traceability system Souza-Monteiro and Caswell, Economics of Implementing Traceability in Beef Supply Chains: Trends in Major Producing and Trading Countries, June 2004

4. Definitions • Identification: Identify animals and record their movement over their lifespan • Traceability (Trace back): The ability to trace the history application or location of an entity by means of recorded identifications. (ISO 8402:1994) • Product Tracing: The ability to identify by means of paper or electronic records a food product and it’s producer, from where and when it came, and to where and when it was sent. (CCFICS) • Identity Preservation: Maintaining product integrity throughout production and processing cycles of a food system

5. World Standards • World Trade Organization • Scientifically Based on Risk Assessment • Not Trade Restrictive • Importing country cannot enforce more rigorous standards for imported meat than those applied to the domestic industry or use these standards as trade barriers. • Office International des Epizooties (OIE) • Agree to international codes and standards that will provide better guarantees and facilitate trade in animals and animal products. Traceability is a key element. • Codex Committee on Food Import and Export Inspection and Certification Systems (Draft) • TRACEABILITY: The ability to trace the history application or location of an entity by means of recorded identifications. (ISO 8402:1994) • Origin of food products and ingredients • Product processing history • Distribution and location of the product after delivery • TRACEABILITY/PRODUCT TRACING: The ability of a food business to identify for any food product under their control, where it came from, how it was changed by the producer (if appropriate) and where it was sent to. This is achieved by means of paper or electronic records, and implies a forwards and backwards tracing of the all relevant information regarding a food product. Records should be kept in a format allowing ready linkage and access by the appropriate authorities. (CCFICS)

6. Components of a Traceability System • Breadth: Amount of information needed by the system (Safety, Quality, Animal Disease) • Depth: How far forward and backward traceability is maintained. (Production, Processing, Market) • Precision: Ability of the system to pinpoint the source of the problem (individual, Group) • Verification: Third Party Audit, DNA, Laboratory Analysis Golan et. al. Traceability in the U.S. Food Supply: Dead End or Superhighway, 2003

7. Types of Traceability Breeding/Farrow Weaning Grower Should Animal Disease Identification be connected with Food Safety Recall? Is there an application for Source Verification, Process Verification of Commercial Traceability? Finisher Plant (FSIS Inspection) Carcass Fabrication Packaging Distribution Retail / Food Service/Consumer

8. Traceability Supply Current Traceability Concerns • Cost • Animal ID • Record Keeping • Third Party Audit • ROI • Liability • Infringement on Personal Financial Information • Animal Disease Control • Bio-security • Fraud Prevention • Production Improvement • Branded Product

9. Traceability Demand • Trade and consumer pressure to show that livestock and meat has been produced and processed in a safe and hygienic manner. • The trade and consumers want to be assured that: • Judicious use of compounds with responsible application have been exercised in the production of meat products. • Good Production Practices (GPP) and Good Manufacturing Practices (GMP) have been applied throughout the production and processing of the animal and meat. • Proof of these practices and procedures can only be accomplished through traceability systems, source or process verification.

10. The New Era of Better Informed Consumers • Consumers, both domestic and international are demanding assurances of food safety • In addition to safety, consumers want to know where the product was produced, who produced it and is it fresh Dickson and Bailey, Meat Traceability: Are US consumers willing to pay for it? 2002

11. Japan Consumer • Consumer study in Japan indicated that having a “traceability kiosk” in the retail store engenders consumer trust; • Consumers occasionally use the kiosk, but consumers just want to be reassured of the safety of the product. • Specifically, this study indicated the consumers want to know about the following attributes of meat products • Antibiotics • GMOs • Hormones • Agrichemicals • Consumers want more information on brands and traceability: • They are familiar with domestic brands and the key message of the brand • They need to know about the intrinsic attributes of a brand to understand and trust it.

12. Commercial Traceability Animal Disease Traceability Breeding/Farrow Weaning Grower Finisher Plant (FSIS Inspection) Food Safety Traceability Carcass Fabrication Packaging Distribution Source Verified Value Attributes Retail / Food Service/Consumer

13. Modern Animal Agriculture Value Attributes • Production • Genetics • Feed • Production Practices • Animal Health • Feed • Animal Welfare • Processing • Food Safety Enhancements • Quality Enhancements • Uniform Inputs • Genetics • Feed • Production Practices • Animal Health • Feed • Animal Welfare • Variable Inputs • Carcass Sorting (Premium Programs) • Carcass Fabrication

14. Branding will grow because a brand represents a promise of quality A tremendous amount of marketing and dollars will be placed behind a brand A brand can build customer loyalty & repeat buyers Brands Becoming the Norm

15. “Story Meat” • Voluntary • Marketing Tool • Shows Producer,Farm and Livestock • Let’s ConsumersKnow SomeoneStands BehindProducts

16. USDA Processed Verified Programs • Cargill Meat Solutions • Value Pork • Verified Pork • Farmland America’s Best Pork • Murphy Brown LLC • American Berkshire Association • Premium Standard Farms • Seaboard Farms

17. USDA AMS Certified Brands Certified Pork Programs Certified Beef Programs Montbello Premium Pork

18. Pork for the European Union • Swift and Company • Dutch Creek Custom, Inc • Schwartz Farms, Inc • Wakefield Pork

19. Connections!!!

22. Canada

23. Europe

24. South America

25. China

26. Summary • Regulatory Traceability • Animal Disease Control • Product Recall • Commercial Traceability • Value Attributes • Source / Process Verification