1. Supply Chain Integrity in the Australian Food Industry Global drivers and Lessons from National Food Strategy Russel Rankin – Food Innovation Partners 1

2. Global food industry drivers Globalisation –Global consumers –Globalisation of Food Processing –Globalisation of Food Retailing Health and Nutrition –Aging population –Functional foods and substantiation of health claims –Designer food products 2

3. Global food industry drivers Sustainability –Global warming –Availability &efficient use of raw materials, energy and water –Environmentally sustainability –Food versus biofuels –Arable land –Workforce availability Food safety –Traceability – bioterrorism, country origin animal diseases, genetically engineered food –Contaminations and adulteration – microbial, chemical, –Nano technology 3

4. Global food industry drivers Consumers –Converging trends – health, convenience, premium, ethics –Functional foods –Environment, social and economic costs –Food miles Retailers –Global retailing –Driving down costs below production –Reduced competition –Need for product innovation 4

5. Global food industry drivers Science & Technology –Nano technology –Novel processing technologies –Genomics/bioinformatics –New packaging technologies Demographics –9 billion population in 2050 –Aging population Western world –Urbanisation –Population growth in arid regions 5

6. Megashock: Food Safety & Biosecurity Australian situation –5.4 million cases food poisoning per annum, –17,770 hospitalisations –125 deaths –$1.2 billion lost in productivity per year. –Food imports top $9bn 6 AIFST presentation 2009 – Dr Martin Cole

7. National Food Industry Strategy $100 million in new R&D investment through 71 FIG projects

8. National Food Industry Strategy

9. Responsibilities associated with stewardship of natural resources to sustain production of food. A sales/production mentality - a lack of strategy and leadership to focus limited resources on long-term profitable sectors R&D investment rates at about one-third of our international competitors Difficulty matching needs with R&D capability Issues Facing Firms

10. Fragmentation, duplication and lack of critical mass in R&D infrastructure Fragmentation in delivery of support services by Government agencies Overseas competition Food safety and traceability integrity Breaks in the supply chain used to service customers Issues Facing Firms

11. Supply Chain Lessons from the National Food Strategy Characteristics of successful supply chain –A new business opportunity (usually in an international market) that provides an incentive to improve the performance and integrity of the chain –A ‘Chain Captain’ who has the capability and means to stimulate changes along the chain –Committed partners who share the investment –Chain mapping discipline to ensure integrity and identify priority areas for improvement –Rigorous project management and reporting to chain participants –Culture that encourages capturing the lessons learnt for further improvement. 11

12. Drivers in Australia’s horticulture industry Competitiveness, labour shortages, Green technologies and sustainability, Industry location, Food safety and security (integrity), Consumer choice. 12 Rankin R. 2010. “Scoping study to review Mechanisation Automation Robotics and Remote Sensing in Australian horticulture”.

13. Conclusion Integrity in the supply chain is critical to, –Competitiveness, –Productivity, –Sustainability, –Efficiency, –Value, and –Consumer acceptance. 13