New Level of Regulatory Scrutiny in the Food Supply Chain

New Level of Regulatory Scrutiny in the Food Supply Chain

By Carl Vause, CEO, Soft Robotics

Carl Vause, CEO, Soft Robotics

One aspect of life that we all share is a daily reliance on the food supply chain. Whether this includes shopping at your local grocery store, dining at a restaurant, or preparing a mail-order meal kit. According to the USDA, food represented 13 percent of American household expenditures, ranking third behind housing and transportation. In 2013, food expenditures totaled $1.4 trillion dollars, almost evenly split between in-home and out of home dining.

"Robotic systems are capable of being washed down and sanitized, reducing the number of human touch points and potentially lowering the chance of contamination"

Given the wide availability of grocery stores, home delivery services, and the size of the restaurant industry, we may not consider the significant forces that are converging to fundamentally reshape the food supply chain. This ecosystem is undergoing dramatic change due to labor scarcity, production costs, and new regulations. As producers and suppliers are grappling with these changes, one thing has become clear and that is that process automation is critical to both commercial success and regulatory compliance.

In addition to accounting for a significant of GDP expenditure the food industry is a major employer in the United States. In 2014, 17.3 million jobs, or 9.3 percent of US employment, was related to agriculture. Under the tremendous burden, labor is becoming scarce in agriculture. This scarcity is resulting in productivity loss and increasing labor and consumer product costs. A recent Wall Street Journal article noted that “about a quarter of Biringer Farm’s strawberries and raspberries rotted in the field because it couldn’t find enough workers.” The Washington based farm is raising wages to try and address the labor shortage. A recent report by Partnership for a New American Economy estimates that the labor shortage results in $3.1 billion of lost production annually. This trend accelerates every year due to the aging of the workforce. Unlike other industries, productivity enhancements are not for the straight benefit of margin, but are a requirement to meet market demands.

A significant mega-trend in the food supply chain is the new level of regulatory scrutiny for each playing in the industry. Unfortunately, every year more than 48 million people, 1 in 6 people in the United States, contracts an illness due to food borne pathogens. The CDC has estimated the cost of foodborne illness at $15.6 billion dollars in 2014. The recent outbreak of E. coli at Chipotle in six states resulted in the closing or more than 40 retail locations while the company tried to determine the cause and location of the contamination.

As a response to the long history of food borne illness and the broad impact on the economy, President Obama singed the Food Safety Modernization Action (FSMA) into law in 2011. A key aspect of this law is that it now applies the standards once held for meat and dairy in to all aspects of food. Overall, this law gives the USDA authority to regulate the entirety of the food supply chain.

How can automation help address these key trends of labor scarcity, costs, and regulation? The goal of any automation project, whether robotics welding or data analytics, must be a measurable improvement in productivity. The two obvious areas of focus should be labor productivity and loss prevention. In the category of loss prevention, I will focus on reducing the incidence of food borne illness given the immense costs of product contamination, sickness, and recalls.

Labor productivity must address the full supply chain. The Biringer Farm example highlights the shortage of harvesting labor. This shortage exists across the supply chain. Produce is mostly manually harvested and transported to processing plants. In these processing plants, the product is washed, dried, prepped, and packaged for shipment to retail locations. Processing and packaging are mostly done by manual labor today.

Just as robotics automated the “Hot, Heavy, and Hazardous” jobs of the automotive industry, robotics should be viewed as a transformative technology in food packaging. New developments in robotic technology have enabled systems that are able to interact with delicate items like strawberries and lettuce heads without damage. These systems can replicate the manual packaging process in place today, freeing scarce labor to address other tasks such as harvesting.

In addition to being able to address the packing tasks, robotic systems are being developed to meet the sanitary requirements of the food handling industry. The introduction of many food borne pathogens is through human contact. Robotic systems with a protection rating of IP 67 are capable of being washed down and sanitized, reducing the number of human touch points and potentially lowering the chance of contamination.

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