Despite food being the biggest subsector of Australia’s manufacturing industry, it receives almost three times less in government support than car manufacturing, according to the latest Productivity Commission review.
In 2011-12, the rate of combined assistance, including government programs, tariffs and regulatory assistance, was 9.4 percent for car manufacturers and 7.3 percent for the textile, clothing and footwear industries, but just 3.3 percent for the food, beverage and tobacco industries.
The food and beverage manufacturing sector received $106m in government programs and tax concessions, while cars and parts manufacturers pocketed $621m, the review states.
Food did do better than cars in regards to tariff rates on output for 2011-12. Food and beverage manufacturers – mostly those in horticulture and fruit growing – received $1.7b worth of tariff assistance, while car manufacturers only received $0.8b.
According to the ABC, the review notes that assistance for both the food and automotive groups has declined significantly in recent decades because of big reductions in tariffs and the removal of import quotas.
However high labour costs, competition from cheap imports and the high Australian dollar have been enormous concerns for food manufacturers, with a number of very high profile brands falling victim to the tough times, including Rosella, Spring Gully, Darrell Lea, SPC and Cowra's Windsor Farm Food.
SPC had to let go of 170 fruit growers in May with the high exchange rate and a decline in export markets causing the brand to significantly reduce its fruit intake.
SPC issued an urgent request to the federal government asking for special protection measures, which could include an emergency tax on imports.
The Productivity Commission's review found the overall rate of assistance for the Australian primary industries was 3.3 percent in 2011-12 with sheep, beef cattle and grain farming industries receiving the biggest cut – $567.9 million out of a total $1.4b.
After sifting through a very impressive collection of nominations, we're thrilled to finally announce the 2013 Food magazine awards finalists!
It's almost here. The food and beverage manufacturing industry's night of nights is just around the corner.
On 26 July, the best of the best in food manufacturing will head to the Crystal Palace event space at Sydney's Luna Park to celebrate innovation in an industry which – let's be honest – has been put through the wringer lately.
You might also be pleased to know that the Food mag team has responded to the pleas of last year's party animals, organising the event to be held on a Friday night, so you can all let your hair down, enjoy the night (with a few vinos), and not have to explain your less-than-impresssive state at the office the next day.
We've had an extremely impressive response to this year's call out for nominations, trumping the past few years' efforts, with the Health and Wellness and Ready Meals categories proving particularly popular.
After a very difficult deliberation process, the Food mag team was able to narrow each of the 14 categories down to between four and six finalists each.
Their nomination kits are now in the hands of our new-look judging panel, comprising a number of fresh faces as well as some long-standing Food mag judges, all of whom have extensive experience in and knowledge of the food and beverage manufacturing industry in Australia.
The judges' decisions will be announced at the gala dinner, where each lucky finalist can not only bring a guest to help with the celebrating/commiserating, but also the opportunity to put their finalist product on display for the rest of the night's attendees to enjoy.
Our MC for the night will once again be The Chaser boys, most recently from the ABC's consumer affairs program, The Checkout.
Craig Reucassel and Julian Morrow had us in stitches in 2012 and will no doubt have the same effect this year with their satirical jibes and perhaps even some advice on how food brands can avoid The Checkout's critical eye?
I'd like to take this opportunity to thank our awards' sponsors: Heat and Control (Platinum Sponsor); Flavour Makers; Janbak; HACCP Australia; Kerry Ingredients; Newly Weds Foods; Tronics; APPMA; Matthews Australasia; Earlee Products; and Kurz.
Of course I'd also like to congratulate the finalists for 2013 and thank every manufacturer and food brand that took the time out to complete a nomination. Reading over your entries was a real eye opener – it showed me just how innovative and forward-thinking Australian manufacturers are, even during testing times. You should all be very proud of your efforts.
Good luck and I look forward to seeing you all in July!
FINALISTS FOR 2013
Sweet Mallows by Sweetness the Patisserie
Salted Butter Caramel by Caramelicious
Morlife Snakes by Morlife
Rocky Road Gluten Free Bakery Range by Springhill Farm
FOOD SAFETY AND INNOVATION IN NON-FOOD
Dissolved Air Flotation System by CST Wastewater Solutions
Dyson Airblade Tap by Dyson
Testo 104-IR by Testo
Torus Pak by CMActive
Dyson Airblade mk2 Hand Dryer by Dyson
The Wrightway Bin by Wrightway Products
Kez's Free Gluten Free Vienna Eclair by Kez's Kitchen
Springhill Farm Gluten Free Bakery Range by Springhill Farm
Byron Bay Cookies Gluten Free Range by Byron Bay Cookie Company
Garlo's Mushy Pea Pie by Garlo's Pies
Chia and Fruit Loaf by Bakers Delight
OmegaSmart – Omega Peanut Butter by Natures Blend
Organic Noodle Kitchen – Asian noodle range by The Right Food Group
Co Yo Coconut Milk Ice Cream Alternative by Co Yo Corporate
Bionade by Drinks Beverage Logistics
Cheeky Rascal Cider by Rebello
Koala Karma by Koala Karma
Passionfruit Cider by Rekorderlig
Old Time Premium Lager by Old Time Brewing
The Pale Ale by Australian Brewery
Bebi Infant Suitable Water by Bebi Australia
81x Label Printer Applicator by Matthews Australasia
Dyson Airblade Tap by Dyson
Dyson Airblade mk2 Hand Dryer by Dyson
Chok Chai Starch Raptor by CST Wastewater Solutions
8×6 APET MAPwrap Tray by Alto Packaging
Clever Cooks Moussaka by Australian Wholefoods
Made Easy Range by Coles
Emily's Kitchen Shanks and Spatchcock by Creative Food Solutions
Fresh Meal Kits by Lenard's
Tassal Quick and Healthy Easy Bake Frozen Salmon by Tassal Operations
Passage to India Pumpkin Curry by Passage Foods
Soma Bite by Soma Organics
Organic Noodle Kitchen – Asian noodle range by The Right Food Group
Torus Pak by CMActive
Fresh Meal Kits by Lenard's
SpiceVine marinades by SpiceVine
MEAT AND SMALLGOODS
Easy Chef – marinated cook in the pouch fresh meat by Tibaldi
Grab & Go Hot Country Roasts by Creative Food Solutions
Char-grill Split Chicken by Lenard's
Chicken Kebabs by M&J Chickens
Steggles Lean Chicken Mince by Baiada Poultry
Red wine and thyme slow cooked pork shank by Sunpork Fresh Foods
Organic Sultanas and Apricots by Whole Kids
Organic Noodle Kitchen – Asian noodle range by The Right Food Group
Five:am Organic Powerpak and Smoothy Range by Five:am Life
Soma Bite by Some Organics
Black Tahini and Agave Butter by Carwari International
Aribar by Artisse Organics
Organic Sultanas and Apricots by Whole Kids
IsoWhey low-carb, high protein snack bars by FIT BioCeuticals
Choc-coated Goldenberries by Morlife
100% Fruit Twisters and Rip'ems by Go Natural Australia
In light of recent announcements from Simplot and McCains regarding cutbacks to their produce supply, AUSBUY have come out to say that when it comes down to it, the only ones to blame are ourselves.
McCains Foods and Simplot have blamed the ever powerful Aussie dollar and the threat of cheap imports for their drop in profits leading to a reduction in renewed supplier contracts and the possible closure of two processing plants respectively.
But is the problem really the fact that we have sold the majority of our major food companies to the foreign entities who make production decisions in boardrooms around the globe?
AUSBUY poses a good argument… Below is a statement they released this morning:
Stop whinging – we have done this to ourselves!!! Simplot (USA) has been a relatively benign foreign investor since it bought many of the brands and factories formerly owned by the Australia Public Company in the mid 1990s (Edgells).
Likewise we thought McCains (Canada) was here to stay. Will they follow the Heinz example to set up in New Zealand and sell back to us? Decisions are now made overseas about the closure of factories.
We have been complicit in the decline of our food manufacturing in Australia. Over the past three decades we have allowed majority control beyond the farm gate of every major food commodity except rice.
The Australian Consumer and Competition Commission has overseen the loss of control to overseas interests and retailers in the name of competitiveness, while our farmers and our local manufacturers are expected to play to a different set of rules to their competitors.
While we claim food manufacturing is the largest manufacturing sector we have remaining, Australia has no major food companies. Decisions about our manufacturing are made in overseas board rooms, not here.
Other countries look after their own. New Zealand has the largest dairy company in the world, Fonterra. New Zealand obtained an amendment under the WTO rules to stop imports which impact their strategic industries. New Zealand stopped the sale of eight dairy farms to the Chinese last year because it did not meet the national interest test.
Its government cannot divest assets which are their for the long term interest of its citizens. Australians have no rights. Countries such as the USA strictly control manufactured goods through labelling law compliance. They decide what products will be sold in the USA.
Despite the warning signs, Australian decision makers turned a blind eye. Foreign investment at any cost has been the call cry! And our people are bearing the consequences! In recent years we have condoned the importation of packaged foods and fresh produce which does not meet our standards.
Dumping is rife! Our labelling laws are inadequate. We have under resourced our gate keepers AQIS, Bio Security Australia and Australian Standards. In recent years, aided by our high A$, our open door policy to imports, and our largess and benevolence to help developing countries, we have imported foods in direct competition with own farmers and their skills. Our borders are not secure. Imports are coming from countries with labels which do not meet our standards, are replacing local producers on the shelf.
The growth of private label among the retailers has also put addition burden on our manufacturers to compete on price with overseas manufacturers if they want to keep their factories operational.
In addition, in recent years we have been net importers of food. While retailers might espouse their support for fresh produce on the shelves, imported foods are being substituted for local produce in many manufactured goods. Made in Australia does not mean it is owned here or sourced here with the current rules of 51% substantial transformation.
The problem in Australia is further exacerbated by the closures in our regional areas where produce is “value added”, creating skilled manufacturing jobs while our farming skills are retained.
TheAustralian owned businesses who are competing in this environment deserve our support. AUSBUY was prescient in warning of the consequences of loss of control of our wealth creating assets when it formed during the recession we had to have in 1991.
Australia’s challenge in the coming years is to rebuild our nation, get our people working productively for Australia again, and reinvesting in our future. If we cannot find answers to the questions we are asking then ask other questions. The seeds of the future are in those Australian owned companies and our farmers, many of whom have the answers. Are we listening?
Simplot Australia has advised employees that two of its plants are under threat of closure, with the food manufacturer blaming a very competitive industry and unsustainably high costs.
The plants, located in Bathurst, NSW and Devonport, Tasmania are currently not competitive because of the rise of cheaper imported products, a Simplot statement reads, and this is only exacerbated by the high Australian dollar.
The announcement follows a six month review of Simplot’s supply chain operations in the vegetable category.
Simplot Australia managing director, Terry O’Brien, said the company’s most pressing challenge is to seek sustainable improvement opportunities with key stakeholders, to help the plants’ financial performance bounce back to the required level.
"The frozen and canned vegetable categories have been chronic profit under-performers for years, regardless of the value of the Australian dollar," O’Brien said.
Meetings are being scheduled with local, state and federal government representatives, employees, unions, suppliers and growers to discuss profit improvement opportunities.
"If insufficient opportunities are identified, we will be forced to close our Bathurst plant after the next corn season. Our Devonport plant will be required to produce a five year improvement plan with satisfactory outcomes or face the prospect of a longer term (three to five year) closure," he said.
The company told growers at meetings in April that their produce would not be accepted from 1 May, with the high exchange rate and a decline in export markets causing SPC to dramatically reduce its fruit intake.
SPC said the high exchange rate and a decline in export markets forced the decision.
The Australian Industry Group Performance of Manufacturing Index recorded a score of 43.8 for May, an improvement on the previous month but continuing the industry’s contraction for the 23rd straight month.
The PMI is a seasonally-adjusted national composite index based on survey results from more than 200 companies. A score of 50 is the line separating contraction and expansion.
The May PMI saw no sub-sectors and no states record growth.
"The Australian PMI recovered somewhat in May from the plunge in April, but the overall landscape across manufacturing is still one of contraction,” said Ai Group CEO Innes Willox in a statement.
“The welcome drop in the Australian dollar in recent weeks will provide breathing space for many exporters and will help lift confidence. However, the dollar remains well above its post-float average and there will need to be sustained falls if we are to see a real impact on import-competing manufacturers and exporters.”
Bright spots included an improvement on April’s score of 36.7 and increases in the new orders (by 9.9 points to 42.3) and production up 13 points to 46.1.
“Manufacturers are telling us that despite the latest cut to official interest rates, weak demand from businesses and consumers remains all too evident,” said Willox.
"This caution is to a degree being influenced by the prelude to the federal election which is generally a period when consumers and business keep their hands in the pockets.”
New Zealand’s Waikato Innovation Park is using a product development spray dryer known as FoodWaikato to dry avocado pulp into a high value powder for use in food products.
FoodWaikato is the only open access product development spray dryer in NZ and is part of the New Zealand Food Innovation Network which supports growth and development in the New Zealand food and beverage industry.
The dryer is currently helping company’s including Bay of Plenty and Avocado Oil New Zealand to develop the products for commercial use including rehydrated guacamole, smoothies and baby food.
Plant manager Dave Shute said that the dryer had previously been used for drying milk products and the switch to drying fruit, such as avocado presented a few challenges, including cleaning the plant to ensure the highest possible safety standards.
“Our plant has been up and running for one year now and we’ve primarily been drying milk products. So, drying avocados – in fact fruit of any kind – was new territory for us,” said Shute.
“We did our first trial run in January, which introduced us to the challenges of dealing with a fruit that is fibrous, highly viscous, and oxidises rapidly if exposed to air.”
Shulte said that Waikato Innovation Park is currently in discussions with around ten different companies who wish to do trials with several other fruit and vegetable products.
“We want to get the word out to food innovators within New Zealand and throughout Australasia that we’re here to help. If you have a great idea for a new dairy, fruit or vegetable product that requires drying, come talk to us,” he said.
Brian Richardson, Executive Director of Avocado Oil New Zealand said that the creation of Avopure, its new avocado powder would not have been possible without with access to FoodWaikato’s product development sprayer.
“The avocado powder we have developed has a unique point of difference on the international stage compared to our competitors. It will be the first premium avocado powder available which contains no added fillers or carriers and contains higher levels of potassium, fibre and energy,” said Richardson.
Richardson said that the development of the powder has now given them access to an entirely new export market.
Avopure will be sold initially in the US, Japan, China and Australia.
Entries are now open for the 2013 Australian HACCP Awards which recognise outstanding contributions of individuals and businesses in the food safety sector.
The awards ceremony will take place as part of the 20th Australian HACCP Conference and will be hosted by Advancing Food Safety, SAI Global.
The awards categories include:
Outstanding individual nominated by an agri-food industry
Outstanding individual working as a registered food safety auditor
Outstanding single site company and outstanding multi-site company
Speakers for the night include:
Major General John Hartley OA, CEO of Future Directions International who will be discussing Australia’s role in helping alleviate possible future world crises in the supply of safe and quality food.
Greg Warren, general manager of Foodbank Australia will discuss quality food supply in times of individual and community crisis.
Bill McBride, Managing Director of FoodLink Management Services will be discussing the Global Food Safety Initiative.
“We’re working to provide organisations around the world with information services and solutions for managing risk, achieving compliance and driving business improvement,” explained Damian James, General Manager – Assurance Services Australia.
“Hosting these awards as part of the annual conference will set the standard expected for food professionals in all three of these categories and will give brands the recognition deserved for their remarkable contribution to food safety.”
The 20th Australian HACCP Conference will take place at Pier Docklands, Melbourne VIC on 27-29 August, 2013.
The Australian Institute of Food Science and Technology (AIFST) has announced the winners of their merit and innovation awards ahead of the 46th Annual AIFST Convention.
Professor Ian Brown was awarded the Keith Farrer Award of Merit which acknowledges achievement in food science and technology.
Brown, CEO and managing director of Australian company, Clover Corporation, has been successful in commercialising key food and nutritional ingredients including the world’s first commercial source of resistant starch Hi-Maize®.
“It is unique in the food sector to see an individual that holds full-time senior industry positions with such an impressive scientific record of published papers, book chapters and keynote presentations,” said Jo Davey, President of the AIFST.
The Food Industry Innovation Award was received by Australian Functional Ingredients Pty Ltd for the development of a natural antimicrobial, Herbal-Active®.
Herbal-Active® is an innovative ingredient sanitiser comprising of essential oils and extracts from culinary herbs. The product has the ability to extend the shelf life of fresh produce, reduce the need for fungicides post-harvest, sanitise fruits and vegetables prior to juicing and replace chemical sanitisers in washes for hands, surfaces and equipments.
“We applaud Australian Functional Ingredients on this true innovation that has such wide-ranging food industry application. Herbal-Active® has the ability to also assist with many food security goals by reducing food waste, by extending the shelf life of fresh and manufactured products and increasing food safety – a great asset to our industry,” said Jo Davey.
The 46th annual AIFST Convention with take place in Brisbane from 14th -16th July 2013.
Released over the weekend by the Minister for Agriculture Joe Ludwig, the National Food Plan contains worthy goals for boosting food exports and production but lacks urgency, says the Australian Food and Grocery Council.
AFGC CEO Gary Dawson said the Council has long advocated for a National Food Plan which provides policy on ensuring that Australia has a safe, nutritious, sustainable and affordable food supply and can capitalise on export opportunities.
"The National Food Plan released today [Saturday, 25 May] takes a number of steps towards this by establishing the Australian Council on Food to bring the challenges of food production and manufacturing ‘front of mind’ to the nation's most senior policy makers, while the five yearly reviews of the National Food Plan will enable governments to track the progress of meeting long term sectoral objectives, critical to the success of the industry," he said.
Dawson also praised the $28.5m Asian Food Markets Research Fund which is expected to provide insights into Asian consumer buying preferences, build on Australian products' 'clean and green image' and maximise our competitive advantage.
Where the Plan falls short, according to Dawson, is that it lacks urgency in addressing the immediate challenges affecting the competitiveness of the food manufacturing sector, and will require much bolder policies in order to be effective.
"Given the scale and importance of food production and processing to the Australian economy the initiatives outlined today are very modest. There is little to build confidence to invest and no immediate action to tackle regulatory reform," said Dawson.
"While long term aspirations are important, industry needs the government to act urgently because without a competitive domestic industry these opportunities will never be realised."
The Greens have also come out criticising the National Food Plan, saying it fails to address issues surrounding the supermarket duopoly and lax food labelling laws, the Australian reports.
However, the National Farmers' Federation is happy with the Plan, with president Duncan Fraser saying it's a sign that the government has been listening to Australia's farmers.
"We asked the government to include collaboration between the agricultural sector and the Government on the creation of brands to promote Australian production. Today, the Minister has announced $2m as part of the Food Plan to develop a brand identity for Australian food and related technology," he said.
"We asked the government to ensure that work is done beyond the farm gate to improve opportunities for farmers to sell their produce, including a greater investment in understanding international markets. The Minister has today announced $28.5 million for research to tackle roadblocks to export, including a study into food needs and preferences, helping businesses increase their exports."
The NFF also praised the $5.6m allocated to building relationships with trading partners, including expanding the network of specialists that support agricultural trade in Asia, as well as the launch of a Productivity Commission review to identify priority areas of reform of food supply regulations.
"Finally, and perhaps most importantly, we asked the government to play a role in working with the agricultural sector to improve consumers’ understanding and perception of agriculture. We welcome the inclusion of $1.5 million to develop resources and provide professional development to support teaching about food and agriculture through the Australian curriculum – this is a starting point for what must be a greater long-term investment from government and industry," said Fraser.
Hedge fund investors and money managers across Wall Street are said to be favouring the food sector over the Treasury bond market.
According to Buzzfeed, as US Treasury yields are approaching historic lows, (fetching a mere two percent for a 10 year bond) food sector stocks are offering a far more attractive alternative with relatively low risk and better yields than government bonds.
Investors see attractive growth in the sector as it consists of inelastic products which seldom exhibit negative fluctuations in demand.
“The food sector offers everything that a big money manager needs,” said one hedge fund industry observer. “There are dividends, liquidity, upside possibility and downside protection. These managers are using it almost as a proxy for convertible bonds.”
Industry is saying that investors are seeking well known, safe names such as Kellogg’s, Heniz and General Mills, because if or when the market drops, people will still “have to eat.”
The Kellogg Company has gained almost 50 percent over the last year equating to $64 per share, and Heinz has attracted the interest of billionaire Warren Buffett, with a $23 b deal currently in the works to purchase the iconic ketchup company.
Industry sources are claiming that although the food sector demonstrates less risk and greater profit potential than bonds, the increased investment in the sector is largely a result of defensive posturing rather than a potential alternative to bonds.
Palm oil has received a great amount of attention in recent months. Heightened consumer awareness surrounding palm oil farming practices has resulted in protests and boycotts the world over, causing producers to re-think the ingredient composition of many of their processed offerings.
Social media outlets have been rampant in naming and shaming manufacturers who use palm oil in their products. Supermarket giant, Woolworths, suffered a massive belting for the inclusion of the controversial ingredient in its hot cross buns earlier this year and Arnott’s has also copped a lot of flack for including it their popular Shapes range.
But what exactly is palm oil? Where does it come from and why is it so controversial?
What’s with all the bad press?
According to Food Standards Australian and New Zealand (FSANZ), palm oil is vegetable fat which is obtained from the fruit of the African oil palm tree. Palm oil contains a significant amount of saturated fat, similar to coconut oil, and is a popular ingredient in many processed foods.
Current regulations state that palm oil doesn’t have to be labelled as palm oil, and may be used under the more generic guise of ‘vegetable oil.’
FSANZ previously rejected an application for the mandatory labelling of palm oil in July 2008. The application focused on environmental concerns rather than food and safety standards and as such, FSANZ had no legal capacity to hear the case.
Contrary to Australian regulations, The Food Information Regulation published by the EU will require all types of vegetable oil used in food, including palm oil to be stated by 2014. Canada and the US also require palm oil to be labelled.
Approximately 87 percent of palm oil is produced in Malaysia and Indonesia, with Australia importing around 130,000 tonnes of palm oil each year, according to WWF.
Palm oil is the world’s most widely used edible oil with an estimated 50 percent of products on Australian supermarket shelves comprising the ingredient. The widespread popularity of palm oil is due to its attractive price tag and the fact that it promotes a longer shelf life when compared to butter and other oil alternatives.
The controversy surrounding palm oil relates to mass deforestation which is taking place in Malaysia and Indonesia to make way for palm oil plantations, with obvious implications for native species, especially the endangered orangutan.
WWF has estimated that around 300 football fields’ worth of forest native to the orangutan is cleared every hour.
Why would food manufacturers use palm oil?
According to the Roundtable of Sustainable Palm Oil, the oil palm plant is entirely GMO-free and yields up to 10 times more oil per unit than soybean, sunflower or rapeseed oil.
The rise in demand for palm oil has also been largely attributed to the move away from trans-fats in the early 2000s. Palm oil offers a low trans-fat content for a cheap price, which is a welcome alternative for many food manufacturers.
Palm oil is typically used to produce an extensive range of processed foods including margarine, ice cream, biscuits, chocolate, chips as well as baked and fried foods.
Palm oil kernels, a by-product of palm oil production, are used for stockfeed because of its high fibre content, energy and protein as well as favourable levels of residual oil.
WWF-Australia and the Australian Food and Grocery Council (AFGC) recently developed a report providing an assessment of facts, myths, issues and challenges surrounding the palm oil debate. The report provides a springboard for action to increase the amount of palm oil derived from sustainable sources.
"It lays out a way forward, including the need for better understanding of supply chains, better alignment of supply-side and demand-side expectations, and work to overcome significant logistical challenges,” said Gary Dawson, CEO of AFGC.
WWF- Australia’s CEO, Dermot O’Gorman said that the switch to sustainable palm oil is critical to the preservation of the environment and many engendered species.
“Companies must ensure that unsustainable practices are phased out; governments must support corporate commitments with appropriate incentives and land use planning policies,” he said.
Many other vegetable oils including canola oil, have been adopted by fast food outlets as an alternative to palm oil, including KFC which recently announced the use of Australian-grown canola oil.
The report states that a major challenge lies in the move away from stearin, which is palm oil in its solid state. Stearin is a popular ingredient in baking applications due to its hard composition, low cost and lack of trans-fats. Traditional alternatives, butter and hydrogenated fats, are typically higher in cost and contain trans-fats.
Other, more cost effective alternatives include more stable versions of canola, soy and sunflower oils however these products still hold a heftier price tag when compared to stearin.
How would a change to sustainable practices affect producers?
The costs associated with switching to sustainable palm oil production are a major factor in determining buy-in from food manufacturers. Some of the big players in the Australian industry however, Woolies and Coles, have already committed to make the switch.
Woolworths has committed to only use Roundtable on Sustainable Palm Oil (RSPO) certified sustainable palm oil by 2015 in all private label products. The supermarket giant is now a member of the RSPO and has committed to using only certified sustainable palm in their hot cross buns for Easter 2014, following the consumer backlash earlier this year.
Coles, now also a member of RSPO, has made a similar move by committing to use only certified sustainable palm oil in all Coles-branded products by 2015. The retailer said that it has already removed palm oil from some of its bakery products.
The current global supply of certified palm oil is sitting at around 15 percent of the world’s total production, resulting in supplies of the sustainable alternative to be somewhat limited at this stage.
The reality of a sustainable switch
Palm oil production is vital to countries such as Malaysia where it accounts for approximately six to seven percent of GDP and employs a significant proportion of the country’s workforce.
The movement towards sustainable production needs to have buy-in from governments to ensure a smooth transition from current conventional practices, ensuring that farmers receive adequate income and incentives to make the switch. This will undoubtedly require a great deal of co-operation from parties on each side of the debate.
The push for sustainable palm oil is a true testament to the power of the consumer. Widespread campaigns reporting on the unfavourable production methods of palm oil has undeniably turned the industry on its head.
The consumer really does have more power than you think.
Choice has released a statement relating to unclear labelling of products containing palm oil.
The consumer watchdog says that ambiguous labelling techniques are not allowing consumers to make informed decisions at the checkout.
According to the statement, approximately 50 percent of packaged products from shampoo to chips and health food snacks all contain palm oil under the guise of vegetable oil. Under current regulations, palm oil is allowed to be labelled as vegetable oil.
Palm oil is the most consumed edible oil in the world accounting for 33 percent of total production in 2009. Over 130,000 tonnes of the controversial ingredient is imported into Australia annually and used in popular grocery items.
“Unfortunately only 14 percent of palm oil produced is sustainable, and deforestation is resulting in catastrophic environmental damage. Additionally, it has a saturated fat content of 51 percent, which fares poorly in comparison to other vegetable oils such as canola, sunflower and olive,” said Choice spokesperson Tom Godfrey.
“CHOICE believes that in order for consumers to make an informed decision to avoid palm oil should they wish to, access to accurate labelling is vital. For a product with such high levels of saturated fat, we think it is important to clearly and specifically label, rather than leave it up to the consumer to decipher fat levels on the nutritional panel.”
Unlike Australia, The Food Information Regulation published by the EU will require all types of vegetable oil to be labelled by 2014, and the US and Canada already require palm oil to be labelled.
Leading brands including Arnott’s, Coca Cola (SPC Ardmona), Goodman Fielder and Nestle all use palm oil and label it as vegetable oil.
The seven international speakers who formed part of the World Packaging Conference at the recent AUSPACK PLUS in Sydney, had some very valuable lessons to share with Australia's packaging community.
At AUSPACK PLUS 2013, the AIP conducted the National Technical Forum with the theme ‘Global Packaging Trends’. The seven international speakers were part of the World Packaging Conference organised by the AIP. These were leaders in their fields from USA, Austria, Indonesia, India, Brazil and South Africa.
The world cannot do without packaging was the core message from Tom Schneider (USA) – president of the World Packaging Organisation (WPO). The WPO does provide a global advantage under its motto of “Better quality of life through better packaging for more people” and Tom reminded the audience that we as packaging professionals are making a difference, but it starts with education.
Jin Zhe (Jack) from the World Packaging Centre (China) spoke on the scale of the changes and future of the Chinese packaging industry. The value of the Chinese packaging industry was $248 billion in 2012 or 50 percent of the world’s output and growing.
Dr. Johannes Bergmair of the Austrian Packaging Institute presented Packaging and Food Safety on a Global Level. This presentation was full of alerts to packaging and food technologists about the risks to food safety with the core message being “the problem is already out there.” There is relevant legislation in many parts of the world but there is little cohesion between them and they are not complimentary.
Global Trends in Packaging in Indonesia and Within the Region was the presentation from Ariana Susanti of the Indonesian Packaging Federation. Our nearest neighbour has geographical challenges of 17,500 islands and 250 million people, which affect the required packaging formats to serve its culturally diverse people with the limited supply chain resources. The radically changing retail environment provides another dimension.
Professor Narayan C. Saha represented the Indian Institute of Packaging and spoke on Economical, Social and Ecological Aspect of Packaging and Indian Market Potential. With a population 55 times that of Australia, diverse food habits, economic growth rates of 6.9 percent, an emerging middle class and booming retail market, India has addressed its ecological aspects across the country. Government controls on certain packaging formats are being applied. Rural India, where 74 percent of the people reside, is the “challenge of distribution – the market for the future.”
Luciana Pellegrino represented the Brazilian Packaging Association on the topic of Packaging as a Marketing Tool – Global Approach. The marketing strategy of a brand has to be materialised to consumers through its packages, Luciana insisted. For consumers, packaging and product are one single element that cannot be disassociated. Luciana’s last and most telling comment was the impact that an online presence can have on influencing consumers’ buying decisions. Be online; be connected with the real world.
Keith Pearson provided the closing presentation on Discovering the Missing Link – Sustainable Advances in the Packaging Supply Chain, which was directed at all parties in the packaging industry, encouraging them to change the way they think and act. Food waste is becoming an increasing concern for consumers and industry members, with the former buying more than is needed and the latter often not packaging their products appropriately.
Keith shed light on the implications of our growing waste, especially in regards to sustainability, with one-third of global food production lost or wasted annually. His messages were simple: good packaging saves food; and recycling is not about removing waste but extending a material’s value and usability. A fine end to a global review of packaging.
Ralph Moyle MAIP
Australian Institute of Packaging
What are your primary roles and responsibilities in your job? Give us a day in your working life.
From the foundation year of 1999 right through until today my primary role is to drive the vision of developing and manufacturing wonderful, delicious organic foods while all of us also have some fun.
As the company has grown, some wonderful people have come on board as members of "Team Organic" at The Right Food Group.
My day can start out with looking at new product ideas, then onto a management meeting, chat with a client, review of new machinery, discussions with new private label customers, review of marketing – and this may all be before lunch!
I've always seemed to have a lot of new ideas for great products and like to spend some time each day on these.
What training/education did you need for your job?
Interestingly – I had none. Just a good idea and dedication to clean, healthy, organic food.
If I had undertaken any formal business training, there would be a good chance that I would never had taken the risk to start such an innovative food company.
In 1999 when I founded The Right Food Group, organic food was considered "hippy food". I well remember turning up to sell my products to a grocery store and the buyer being very surprised I had on a good suit!
How did you get to where you are today? Give us a bullet point career path.
Hmm, career path?? Not something I have ever given any thought to. I have been self-employed since my early 20s – initially in natural health care.
When I work out what my career is, I'll let you know my career path. Not sure there is such a thing for an organic entrepreneur!
What tools and/or sofware do you use on a daily basis?
My MacBook Air, Blackberry, and various software programs. Oh, and the largest computer I own, my brain.
What is the one thing that you are most proud of in your professional life?
Still being in organic food manufacturing in Australia in 2013 and being profitable!
Surviving the GFC and creating full time jobs in a rural town.
Creating roles in my company where good people can grow their skills, improve their income and lift their level of professional training.
Giving those people the room to run with their own ideas.
Taking on the chair's role of the Tweed Business Advisory Board and using the position to push through some ideas to improve the regional economy.
Biggest daily challenge?
Keeping my many ideas for new products in some sort of order, then working out which ones are "real" and which ones go into the "later" file.
Plus – the internet. We are in a regional town and the net can be very slow. Roll on the NBN!
Biggest career challenge?
Attempting to keep my frustration with the organic certification industry in check. Some organic certification fees seem out of proportion with the service and add extra cost to the final product. Imported organic product do not pay these fees. The whole system disadvantages Australian organic food producers. I fail to understand why fees are not controlled by federal legislation.
What is your biggest frustration in your job?
There are a few items in my "biggest frustration" basket.
1. For a regional company, distribution can be a hassle. While we have product on shelf in every state in Australia, how it gets there is complicated and costly.
2. The "I am not interested" attitude to Australian food producers from the federal government! Honestly, why on earth is there no recognition of the following:
We need to eat as a nation (and I don't think locally made cars make a tasty meal no matter how much sauce you pour over them!)
The food industry is a massive employer! Many production plants are in regional towns which need the jobs to sustain the local economy.
We cannot compete with the dollar so high against imports – particularly those which are subsidised. Why is Australia the only sportsperson on the "level playing field?"
3. And of course I have a lot of new ideas for products and the development, certification, supply chain, manufacture, marketing and distribute process can be frustratingly long.
What is the biggest challenge facing your business?
High dollar, cheap imports, lack of federal government interest in sustaining a vibrant Australian food production industry.
Also, there's no domestic organic certification legislation which is enforceable under federal or state law. There are may products on Australian shelves claiming "organic". The only "organic" ingredient in some of these products is the name on the label. I have to compete with these cheats.
Is there anything else about your job you want Australia to know about?
I don't have a job – I have passion, drive and commitment. A passion for people, organic food, sustainable business and community.
My food which we create every day in our own factory is proof that the "career path" can be a journey. And all journeys start out with the desire to explore.
I continue to "explore" organic food (and have a heap of fun while doing it!)
If you would like to take part in Food mag's Industry Map, click here.
Scientists in Europe have been constructing what hopes to become a key source of sustainable protein for the future, vitro meat.
Dr Mark Post from the University of Maastricht, has painstaking created a vitro meathamburger which has been assembled from minute pieces of beef muscle tissue which has been grown in a laboratory as reported by the New York Times.
The vitro meat burger, is to be cooked and consumed at an event in London which aims to show the world the potential of this curious creation and convince investors that it will be a viable and potentially profitable venture in the long term.
The idea of creating laboratory meat seems to be a logical step in the face of a global strain of the food supply, not to mention the invaluable environmental and animal welfare benefits of a smaller livestock industry.
A study in the journal of Environmental Science and Technology, found that full-scale production of vitro meat, or cultured meat, would greatly reduce strain on global resources just as water, land and energy as well as deliver a significant decrease in methane emissions and greenhouse gases.
Post has become one of the world’s leading researchers in the development of cultured meat through the use of stem cells. The burger created by Post consists of 20,000 thin strips of cultured muscle tissue and he claims that the meat “tastes reasonably good.”
The meat which requires a significant amount of materials to produce, including fetal calf serum, has been created at a staggering US$325,000, making the competitiveness of large scale manufacturing somewhat far off compared to conventional methods.
“If it can be done more efficiently, there’s no reason why it can’t be cheaper,” said Post.
“It has to be done using the right materials, introducing recycling into the system, controlling labour through automation.”
Hanna Tuomisto from the University of Oxford in England agrees stating that cultured meat has the potential to offer significant cost advantages as expenses associated with feeding livestock would be eliminated.
“It’s really about the conversation of feed to meat,” she said.
“In cultured meat production it’s much more efficient; only the meat is produced, and not all the other parts.”
Another issue aside from cost is the safety of the lab made cultured meat.
Post claims that cultured meat should be just as, if not safer than conventional meat, and may possibly be a healthier option. The main hurdle is consumer acceptance which Post admits will be a challenge.
“I see the major hurdles, probably better than anybody else,” he said. “But you’ve got to have faith in technologies advances, that they will be solved.”
"The point is, we already have sufficient technology to make a product that we could call meat or cultured beef, and we can eat it and we survive,"
"I'm not by nature a very passionate guy," he added. "But I feel strongly that this could have a major impact on society in general. And that's a big motivator."
The use of advanced conveyor cooking systems is improving product quality and cooking efficiencies among food processors in Australia – and saving on costs.
In search of enhanced quality, safety and efficiencies food processors throughout the world are adopting more advanced, sophisticated cooking systems. In Australia there is more incentive to upgrade these systems – government grants to incorporate added energy efficiencies into plants via the use of innovative technologies and equipment.
“Emphasis on the quality of the foods is one of the more noticeable trends in this market, particularly on the retail side,” says Barry Hansell, sales manager at Sydney’s Reactive Engineering, a supplier of processing and packaging equipment for medium to large-size processors.
“Ready-to-eat meals sold by retailers are a good example. Ten years ago you’d be hard pressed to find really good quality in frozen meals. But now processors are focusing more on the fresh-prepared meals, which allow for a lot higher quality, and on much greater variety of dishes than we saw in the past.”
There is strong evidence that the move towards improved quality and greater variety is also being driven by the availability of more advanced and flexible cooking systems. Another influence is the Australian government’s grant programs that support the investigation and implementation of energy efficient projects. Such grants to food processors can help to reduce the payback period of projects, and offset the financial risk of investing in innovative technologies.
“Yield improvement remains important to Australian processors,” Hansell says, “but with newer cooking system designs, they no longer have to sacrifice quality to get a bit of extra yield. Today the opportunity exists for them to gain or at least maintain yield while improving on quality and cooking efficiencies.”
Hansell explains that, increasingly, his customers are switching over from sometimes unsystematic and more labor-intensive batch cooking to high-efficiency inline or conveyor processing that improves on quality, consistency, yield improvement, and throughput. Extended shelf life plus improved taste and appearance are significant among quality improvements, he adds.
Invigorating meat fillings & toppings
Sydney-based Prontier produces ready-to-eat protein sandwich fillings as well as meats for pizzas and salad toppings, and covers all aspects of manufacturing, distribution and retail operations.
“The majority of our business comes from sandwich meats that we cook, slice, and marinate for the lunch trade in the foodservice category,” explains Saxon Joye, Prontier founder and managing director.
Joye adds that his philosophy doesn’t follow a rulebook. “I grew up in a restaurant kitchen – if you dream it, I’ll find a way to make it,” is his trademark position on sandwich fillings.
This philosophy has led Prontier to a stream of innovations, such as the recent acquisition of two conveyor cooking systems, a flame grill and a spiral oven. This equipment enables Prontier to achieve added flavour and a more authentic appearance for its products, plus the improved efficiencies of inline cooking.
The flame grill individually quick-flames products and maximises the effects of flame-searing while minimising yield losses. The multiple independently controlled burners and touch screen recipe selection make this unit flexible and efficient.
“We use this equipment to wrap the outside of ready-to-eat items in flames and seal the meat,” Joye explains. “It also browns meat products such as chicken with a char-grilled stripe, which creates a fabulous presentation. The natural-looking flamed colour and authentic grilled flavour are important advancements for us. They are dramatic improvements in the quality.”
Prontier’s meats are fully cooked in a spiral oven, a highly flexible, small-footprint cooking system developed for processors who want the benefits of continuous conveyor-style cooking with reliable consistency and lower energy usage.
“Now, instead of batch processing we have a ‘production river,’ which provides huge labour saving advantages, and gives us real control over the way we finish every individual piece of food, making it a beautiful product,” says Joye.
Spiralling into control
The spiral oven is also a key cooking system at Sydney-based Primo Moraitis Fresh, which manufactures, processes and packages high quality ready-to-eat salads, soups and fresh cut processed vegetables. Primo Moraitis Fresh caters to retail, foodservice, industrial manufacturers and quick service restaurants.
“Before getting this equipment we used little combination ovens and other small cooking devices,” says Ben Watt, general manager. “When we first looked at the spiral oven, it seemed like a great piece of equipment that could have a lot of potential uses, which is exactly what it has. We’ve had ours for about 18 months, and we run a whole lot of items through it. We can steam, roast, bake, and super roast (roast and steam). The system is really versatile, so it’s in use almost all the time.”
Among Primo Moraitis Fresh’s principle products are wet salads, including items such as creamy pastas, potato salads and coleslaw.
“We use a lot of bacon, pancetta and meats like that,” Watt explains. “So we roast those items through the spiral oven. The continuous process gives us great volume with a very even cook and great consistency.”
Watt says that his spiral oven is also used for steaming potatoes, not only because of the systems versatility, but also because of its speed and the fact that the spiral oven does a better job than boiling the potatoes in water. Currently, Primo Moraitis Fresh produces approximately 400 kilos of steamed potatoes per hour using this conveyor cooking system.
Improving efficiency and output
Jewel of India is another Australian processor using a spiral oven in combination with a spiral chiller to meet its high quality standards while improving yields and other efficiencies.
Jewel of India is a ready-to-eat, chilled-meal manufacturer cooking a range of authentic Indian foods including chicken and meatballs dishes, ready-to-eat curries, simmer sauces, cocktail and finger foods and Naan breads.
Headquartered in Sydney, the company supplies to clubs, hospitals, airlines and stadiums as well as butchers and delis, supermarkets, and caterers that service the military and mining industries.
“A spiral oven is installed in our new high-risk production facility, which will provide us with food safety similar to the newest European and pharmaceutical standards,” says Jim Keating, Jewel of India general manager. “We will primarily cook chicken on this system. But the system will be able to cook other items that we may adopt in the future. We have done trials on meatballs, molded lamb balls, chicken balls and fish through the spiral system and it has proved to be very flexible. The system will allow us to adapt quickly to market changes, so we don’t run the risk of being left behind.”
Although the spiral oven is newly installed, Keating says he expects overall yield improvements to be between 15 and 20 percent. Other important efficiency features the new system is expected to provide include improved throughput, optimised product consistency and reduced labour.
“Improved cooking quality and efficiencies are very important,” says Keating. “Today, it’s really about output; it’s no longer all about input – the price of beef or lamb, the price of power, etc. But if you can improve the quality and efficiency within your operation, that is where your competitive advantage and profits lie.”
Adam Cowherd is the vice president of international sales at Unitherm Food Systems, in Bristow, Oklahoma.
According to theAustralian, Gary Dawson, chief executive at the Australian Food and Grocery Council (AFGC), said the dollar needs to fall closer to US76c.
"There's no doubt the high dollar has a significantly negative effect on the competitiveness of food manufacturing in Australia, so the recent falls are welcome. But it would need to move lower for longer to start having some impact," he said.
A spokesperson from Ferrier Hodgson, the administrators for Rosella, which collapsed late last year, said the high Aussie dollar had caused supermarkets to look towards imported private label products, but said even if the dollar had dropped by 10 percent it probably wouldn't have been enough to save the brand.
Coca-Cola Amatil also entered into the debate, claiming cheap imported tinned fruits contributed to the recent struggles of its SPC Ardmona brand, which has suffered a nine percent drop in first-half earnings.
However, managing director Terry Davis said the dollar's slide will make some imported goods more expensive.
"The softening of the Australian dollar against the euro is better news as this will help inflate the prices of the very cheap imported fruit and tomatoes coming in from European markets which have been flooding our domestic markets," he said.
The Food Magazine team is pleased to announce that the Chaser Boys will be returning again in 2013 to MC the 9th annual Food Magazine Awards.
The Chaser crew, most recently of ABC 1’s The Checkout fame, has reignited interest in consumer affairs by providing viewers with an insightful and sometimes satirical mix of information on certain products, retail industries or brands, aiming to encourage Australian shoppers to make smarter and more educated spending decisions.
Entries for the awards have been extended until 17 May with categories including Packaging Design, Sustainable Manufacturing, Snack Foods, Confectionery, Dairy and many more.
The event which will take place at Luna Park’s Crystal Palace on Friday 26 July, recognises and rewards best practice and innovation in food and beverage processing in Australia and New Zealand.
Sponsors for the night include Heat and Control, APPMA, Earlee Products, Flavour Makers, HACCP Australia, Janbak, Kerry, Kurz, Newly Weds Foods and Tronics. For more information on sponsorship opportunities contact Will Fernandes at firstname.lastname@example.org
Kraft Foods has surpassed Wall Street expectations for first quarter earnings following the company’s separation from global snack business, Mondelez.
The decision by Kraft to split from Mondelez, which holds brands such as Oreo and Cadbury, was driven by a strategy to focus on a narrower mix of products, drive sales and cut costs as reported by SMH.
Industry experts have suggested that Kraft will face numerous challenges in its core market of North America as the packaged food industry has already reached maturity in the region.
To combat this, Kraft executives will be continuing to focus on streamlining its portfolio by pruning out less profitable brand extensions and coming up with new innovations.
The company is also looking to refresh the image of older brands Kool-Aid and Grey Poupon.
Kraft Food Group reported quarterly earnings of $US456m with shares equating to 76 US cents per share, down from $US483m a year ago when the company paid less in interest and other expenses.
Revenue rose two percent to $US4.55b, surpassing analyst expectations of $US4.46b.
Kraft shares were up almost two percent at $US51.37 in after hours trading and the company believes it’s on track to achieve $US2.75 per share by year’s end.