Supply chain efficiencies in a global food industry

By Rory Harrington

- Last updated on GMT

Related tags: Fast food

The globalisation of the supply chain means transporting food across the world to be processed and back again to the country of origin to be sold can make environmental and commercial sense.

This is the conclusion of the UK Food and Drink Federation (FDF) which said economies of scale realised through transport and processing efficiencies in third countries may not only cuts costs for food companies but also reduce the carbon footprint of the product.

Sustainable

The body made the observations after it was revealed that cod caught in Scottish waters was being sent on a 10,000-mile round trip to China for processing before being shipped back to the UK for sale in supermarkets and fast food outlets. Fish producers, fisherman and environmentalist condemned the move and questioned the green credentials of food companies and supermarkets.

But Andrew Kuyk, FDF Director of Sustainability and Competitiveness, told FoodProductionDaily.com that the move could not only be justified commercially but also environmentally.

“It may seem counter-intuitive but there is a good body of evidence that backs it up​,” he said.

Taking the example of Scottish cod, he said the EU fish quota regime had put catch volumes under pressure. This means there may not be the throughput of fish to maintain year-round fish processing in some European plants.

Capacity

European fish processing facilities therefore would either have to run below capacity for some if not the whole time and/or shut down and restart according to ebbs and flows in supply. This is not only commercially unviable but also environmentally unsound as the amount of energy used to process a smaller amount of fish would be disproportionately high, said Kuyk.

He added: “On the other hand, China will have year-round processing facilities, which not only cuts unit costs but also reduces environmental emissions as the facilities are already running. Large-scale factories running at full capacity have, pro-rata, less emissions that smaller ones operating under capacity.”

The vast size of container ships, carrying multiple cargoes also means that transporting produce across the globe can be efficient and green, he said. Energy expended on shipping is more than offset from processing and packing savings at ultra-efficient plants across the world, he explained.

What it can mean is using scarce resources in an efficient way; one that is commercially and environmentally viable. Efficiencies keep company costs down - which can result in savings being passed on to consumers.

“Sometimes efficiencies in global food industry are realised through a wider international supply chain rather than a national one.”

Defra report

The FDF view is one echoed in a recent Defra-funded report that said New Zealand lamb and Spanish strawberries could have less impact on the environment than identical UK produce. The Comparative Life Cycle and Assessment of Food Commodities report compared factors such as energy use, pesticide and land requirements as well as global warming potential.

It found that British-grown strawberries and tomatoes could be less green than Spanish counterparts because the higher energy needed to heat greenhouses in the UK was greater than that expended by shipping them from Spain.

Related topics: Processing & Packaging

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