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Manzhi Zheng, senior casualty underwriter discusses how food and beverage businesses are vulnerable to foreign body contamination and how they can protect against the product recall costs involved with these contamination events.

In 2018, more than 50,000 bottles of Stella Artois beer in Hong Kong were recalled, with fears that they were tainted with particles of glass during manufacturing. More recently, a batch of haw flakes was recalled in Singapore in February this year, after a consumer said she bit into a shard of glass while eating the candy.


Recall reasons by type: US

There have been recently a number of high profile food and beverage recalls resulting from foreign body contamination which can fall under three categories:

Biological contamination

Bacteria or toxins that contaminate food and can cause food poisoning and food spoilage. These include pathogens such as salmonella, e coli, staphylococcus and listeria and could result for example, from food being stored at the wrong temperature, food handlers sneezing into food, raw food coming in contact with food etc. In recent years, listeria found in soft cheeses, frozen vegetables, cantaloupes and more have all caused large recalls in the US.

Chemical contamination

Any unintended chemicals in food which can enter the food production during various stages of the food value chain:

  • Growth stage ex. contamination from antibiotics & pesticides which may be used in the agricultural production of food but not safe for human consumption. In August 2017, insecticide found in Dutch eggs triggered a massive recall of egg products across Europe all the way to China where farmers suffered losses of almost USD40m in that month alone.
  • Processing stage ex. contamination from oils and lubricants or cleaning agents which may be used to clean up possible physical and biological contaminants but when consumed, can be poisonous.
  • Transport stage ex. contamination as a result of spillage or leaks
  • Sale stage ex. contamination from cleaning chemicals at point of sale

Physical contamination

Any unintended physical objects in food and can include items like hair, glass, rodent droppings or flaking paint. Some physical contaminants such as hair may not pose food safety concerns (though still result in a nasty surprise) however others such as glass do. Physical contamination can be malicious, such as the case of the 2018 strawberry needle tampering incident in Australia or not malicious.   

Lastly, cross contamination can occur from the accidental transfer of contaminants from one surface/substance to another which can be biological, chemical or physical. We see this often occurring on the production line for example from maintenance tools, conveyer belts and could be a result of equipment or machinery not being cleaned or sanitized properly.

What's the cost and why do such events happen?


 
These events are not only costly – on average we see F&B recalls costing close to USD10m and can reach up to USD100m – but also result in priceless reputational brand damage.

Avoiding a pathogen-triggered recall often comes down to:

Hygienic manufacturing plant design and education of staff.

  • Adherence to key sanitary design practices such as zones of control separating uncooked (raw) products from cooked, ready to eat (RTE) products as well as separate wash stations for personnel handling raw products.
  • Temperature and moisture control is vital to reducing mold and bacteria and proper mechanical systems, ventilation and refrigeration can minimize condensation in work spaces.
  • Maintaining the ability to clean and maintain the facility means careful selection of materials that are durable and cleanable. 
  • Ensuring employees comply with hygiene and cleanliness standards. Bacteria grows quickly so regularly washing down equipment and ensuring proper hygiene among staff is important.

Maintenance of manufacturing plants and facilities also plays a vital role, which includes the premises. Common sources of contamination we see are due to issues such as lack of air filtration system, poorly located vents, ledges, drains. Rusty equipment can indirectly contaminate products as can peeling paint or light bulbs from premises falling into the food production line. Regular equipment checks are necessary as are preventative measures such as closing factory windows. We've seen numerous cases of contamination due to flying debris for example, from a bird flying in and defecating into the food production or a piece of plastic being blown in unintentionally. Various safeguards can also be built into plant processing design to screen for physical contaminants such X Ray scanning, metal detection, filtration mechanisms, sieving processes, optical processes and more.

While helpful, these additional safeguards have cost considerations and are not always fool proof. Systems need to be accurately calibrated in order to pick up contaminants and account for the size, density and location of the contaminant and speed of production line.

Knowing your suppliers is key as is inspecting raw materials as they enter your facility – each component should be tested to prevent contamination and to provide proof of the material's authenticity. Many major food and ingredient buyers require suppliers to have metal detection systems in place to ensure the safety of their products.

Physical contamination can often be pinpointed to a breakdown in the production process, and more often than not, human error, for example, someone accidentally dropping something into a vessel or forgetting to perform a critical sanitation process.

What can you do as a risk manager?

Foreign object detection should be a critical aspect of a food facility's food safety plan in order to eliminate any contamination before the finished product leaves the factory. But which part of the production process? Incorporating control points throughout the production line is key – from the beginning to end.

Implementing, updating and testing your Food Defence and Hazard Analysis and Critical Control Points (HACCP) plan is important to control and monitor your food supply chain rather than just a finished product inspection. Designed to provide increased control and monitoring during critical stages of the food processing chain, it's a preventative quality assurance programme that prioritizes and controls potential biological, chemical, and physical hazards from raw material production, procurement and handling, to manufacturing, distribution and consumption of the finished product.

Running through Food Safety Training for staff at all levels is essential to cultivate a good food safety culture and minimize human error. Whether a grower, processor, manufacturer, distributor or retailer, it is essential to train your staff as a key part of your food safety policy to ensure the production of safe, quality food.

At Swiss Re Corporate Solutions we partner with crisis management experts RQA as part of our product recall insurance offering who are able to work with our clients on their HACCP and Food Defence plans as well as customize recall plans for individual clients.

Having a tried, tested and robust system in place is crucial and contaminated products can strongly affect your bottom line, destroy trust built with your customers and result in costly recalls. Showcasing good quality risk management in place can also result in more favourable insurance terms due to preferred risk quality.

"A lot of what happens in the F&B industry relates to ingredients that can be sourced from around the world, exposing food manufacturers to a great deal of risk" Says Manzhi Zheng, Product Recall Expert, Swiss Re Corporate Solutions "How a food company tracks its supply chain and manages risk is not just a matter of complying to local food safety regulations but also a critical aspect of a company's insurability. A supply chain analysis should not only focus on food safety but be a full quality assurance system. This means not only focusing on your facility but assessing and managing the potential risk of those with whom you do business with."

Further reading

Food safety in a globalized world

Manzhi Zheng
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