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For the food industry, fraud is the elephant in the room

Sylvain Charlebois is professor at the Food Institute, University of Guelph

If asked about sustainable food systems, most people think about the environment, climate and social responsibility. These pillars are key to sustainability, but so is the economics of food.

For any organization to be sustainable, it needs to be profitable for everyone across the supply chain: farmers, processors and retailers. What's currently threatening the delicate balance between these key drivers is counterfeiting.

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Food fraud isn't new to the food industry. During the Middle Ages, staple foods such as bread, meat and wine were often adulterated, leading to the implementation of legal regulations to ensure quality and quantity.

Because of modern advanced technologies, however, most consumers believe that today's food-supply chains are protected and that counterfeit products are the exception. Yet in recent years, evidence of widespread fraudulent behaviour has increased.

A recent U.S. study revealed a high substitution rate of 57 per cent in meat products. Consequently, there have been discrepancies between the contents of meat products and the information found on their labels. Similar results in parts of Europe were found in a study involving sausages. In Britain, two-thirds of takeout ham-and-cheese pizzas recently tested contained neither ham or cheese.

If you think Canadian food is immune to fraudulent labelling, think again. Recent studies have discovered that 25 to 70 per cent of all seafood products sold here are mislabelled due to counterfeiting somewhere along the supply chain. Recently, several inspections at one well-known Toronto restaurant revealed menu misrepresentations.

Chances are you have already unknowingly purchased a counterfeit food product at a restaurant, a retailer or even at a high-end specialty store. What's more concerning is that retailers, restaurateurs serving and selling counterfeited items may not even know it.

National brands have registered deep concerns about food fraud. Many consumers purchasing products purported to be coming from faraway parts of the world were actually purchasing local products. For example, it has been estimated that Canadians buy $3.6-billion in counterfeit Italian food products annually. The way some suppliers package, repackage, present and market food products can make local products seem imported from Italy, known for its good food.

The same thing is likely happening to our own "local" food products. Counterfeiting causes products to go down in price, which makes it more challenging for ethical, honest local food producers and processers to make a decent living. Counterfeiting takes away the opportunity for a localized food economy to flourish, which makes it unsustainable in the end.

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With all this in mind, we could be just one major scandal away from a collapse of consumer trust. Food retailing and service in Canada is a $200-billion business – efforts to curtail food fraud need to be taken.

The government could step in, but more inspections and regulations can only go so far. It would be impractical, and even undesirable, to expect regulators to effectively monitor everything, every single day. Additional monitoring would likely result in more bureaucracy and higher food prices.

More can be done by industry. In order to validate food authenticity, modern food traceability systems will need to track food content and ingredients, not just packages. The application of anti-counterfeiting packaging in the food industry is a real option. With the rise of food prices in recent years, the business case for better, more sophisticated packaging is getting stronger. In fact, the global market for anti-counterfeiting packaging technologies in food is expected to increase by almost 15 per cent yearly over the next decade or so.

In the not-so-distant future, food could also be randomly checked for authenticity. One recently developed test can rapidly differentiate products using nuclear magnetic resonance, a new frontier in foodomics.

Some tests using that technology in Germany allowed researchers to differentiate between organic and non-organic tomatoes in more than 300 cases. It could potentially detect geographical origin, genuineness, substantial equivalence, shelf life, even freshness. The technology does need refining, though, as it is not ready to be used commercially.

DNA analysis could be another option, although getting test results can be slow and very costly. The Canadian Food Inspection Agency recently partnered with the University of Guelph to explore the use of this technology.

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The most potent option will eventually come in the form of portable technologies that consumers can use to protect themselves – not an app, but an actual device the size of a smartphone. Many universities and research centres are currently attempting to develop tools that consumers can use safely at home or in stores in real time to authenticate labels and food content.

Through such technological empowerment, consumers could actually police the industry themselves. And when that day comes, possibly in the next decade or so, the entire supply chain will need to discipline itself.

For food supply-chain sustainability, counterfeiting is the proverbial elephant in the room. Most of the industry knows it exists, but rarely speaks out against it. Eliminating it will help everyone become more sustainable.

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