However, in many cases food production and processing is done in areas far from port cities and without access to good highways. Long trips over poor quality roads can compromise the quality of finished goods and raw materials as they move to be processed or move to ports for shipping. If a country is going to create an economic development zone, it must ensure that the infrastructure which includes pre-existing roads built to withstand traffic needs of the present and the future, is in place.
Vertical integration of agri-business may be one of the greatest challenges. Food processors need a steady and ready supply of ingredients. In countries such as India, China, North Africa and elsewhere fruits, vegetables and grains are processed into a range of ingredients or other value-added products. The problem is getting the raw agricultural commodities from known sources that utilise Good Agricultural Practices (GAPs). There are thousands and thousands of small farmers in most developing nations who sell to processors usually do not understand issues like GAP and traceability. In addition, if fresh market prices rise, these growers may take their crops there instead of to the processor. Food processors wishing to participate in the global marketplace cannot operate effectively and economically without a steady supply of raw materials and must be able trace what they use back to the source or the field in which it was grown. This is not usually possible when small farmers are your source of raw materials. The 2006 outbreak of E. coli 0157:H7 in the United States underscores this point. Processors of the spinach were unable to source the product quickly enough to satisfy regulators once the spinach was established as the source of the outbreak.
To participate in the global economy the cost of entry are the quality, safety and sanitary requirements imposed by potential buyers in developing countries. These are not technical barriers to trade but requirements to protect their business and customers. Understanding the requirements, and building the infrastructure to meet the demands of the client, must be a joint effort of government, industry, academia, customers and global stakeholders whomsoever they may be.
Vertical integration of agri-business may be one of the greatest challenges. Food processors need a steady and ready supply of ingredients. In countries such as India, China, North Africa and elsewhere fruits, vegetables and grains are processed into a range of ingredients or other value-added products. The problem is getting the raw agricultural commodities from known sources that utilise Good Agricultural Practices (GAPs). There are thousands and thousands of small farmers in most developing nations who sell to processors usually do not understand issues like GAP and traceability. In addition, if fresh market prices rise, these growers may take their crops there instead of to the processor. Food processors wishing to participate in the global marketplace cannot operate effectively and economically without a steady supply of raw materials and must be able trace what they use back to the source or the field in which it was grown. This is not usually possible when small farmers are your source of raw materials. The 2006 outbreak of E. coli 0157:H7 in the United States underscores this point. Processors of the spinach were unable to source the product quickly enough to satisfy regulators once the spinach was established as the source of the outbreak.
To participate in the global economy the cost of entry are the quality, safety and sanitary requirements imposed by potential buyers in developing countries. These are not technical barriers to trade but requirements to protect their business and customers. Understanding the requirements, and building the infrastructure to meet the demands of the client, must be a joint effort of government, industry, academia, customers and global stakeholders whomsoever they may be.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
Prof. Rajita Chaudhuri's Website
domain-b.com : IIPM ranked ahead of IIMs
Arindam Chaudhuri's Portfolio - he is at his candid best by Society Magazine
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
IIPM B-School Detail
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
Prof. Rajita Chaudhuri's Website
domain-b.com : IIPM ranked ahead of IIMs
Arindam Chaudhuri's Portfolio - he is at his candid best by Society Magazine
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
IIPM B-School Detail
