Ingredient Supplies and Ethical Knots

Looking into supplier options is turning into a fascinating chapter for me in the preparation to open a food business. I was mindful of the factors of cost, quality and ethics in choosing where to get raw ingredients, but until I really started thinking about it I hadn't realised how interesting, how important and political a choice this is.

My simple recipe cost calculator inputs cost and amount of ingredients and tells me the cost of each item per cake, and the total cost of the cake/batch/slice etc. It showed me that eggs and butter are the most costly ingredients for most recipes. It’s clear that flour will also be an important bulk ingredient for my business, and so I started looking into my sourcing options with these ingredients.

Eggs

Starting with eggs, I had in mind to find a small local producer of quality free-range eggs, I like the idea that I might be able to visit some farms (hatcheries?) and see for myself and for my customers that the animals are kept humanely. Also being local, the environmental cost of transportation would be lower. Finding such a place I would hopefully form a relationship with the producer, be able to ask questions and learn more while supporting local business. Maybe also sell some of the eggs in my store. From food hygiene and safety research I'm aware that supply chain traceability is a legal responsibility of food business owners in many countries (in the EU, you are required to be able to "identify at least the businesses to and from which the food product has been supplied" General Principles and Requirements of Food Law EC 178/2002), to be able to assist with containing any food safety problems, and while not required, knowing the farmer would be the ultimate in traceability.

Wanting to learn a little more about egg production in Japan, I found this article by an American farmer describing that due to a shortage of suitable land, poultry farming in Japan is generally more densely managed than in other countries, with the average yard-room per bird 3.6 m² compared to the 10 m² recommended by the RSPCA in the UK (which is about 1,000 birds/hectare compared with Japan's 3,494 birds/hectare). It's interesting to note that despite the more densely populated conditions of poultry farms in Japan, prevalence of salmonella is low (this study found no salmonella in the contents of the egg and only 0.25% of the sample with traces on the shell). Salmonella outbreaks do occur in Japan - in 2000 there were more cases per 100,000 people here than in the US, but this is probably because there is more of a culture of eating raw egg in various dishes here. It's possible that additional safety measures are required in Japanese egg production so that they can be sold for raw consumption - I don't have any data on that yet however. I have read comments on regular egg cartons in the supermarket along the lines of the eggs needing to be kept chilled and used before the expiry date if they are to be used raw - quite different to the American FDA warning "Safe Handling Instructions: To prevent illness from bacteria: keep eggs refrigerated, cook eggs until yolks are firm, and cook foods containing eggs thoroughly."

The poultry industry site states that Japan is the largest consumer of egg products in Asia, and that with demand greater than domestic supply, Japan needs to import large quantities (5,500 tones of frozen yolks in 2008). The article went on to say: "Again, Japan is the exception, as elsewhere most eggs are produced on small farms of less than a few thousand layers … it is estimated that just 6-7% of output is handled automatically."

Flour

It seems that there is a similar story of international dependency and domestic troubles with wheat and flour processing.

The Tokyo Foundation describes that 90% of flour used in Japanese udon is imported from Australia, saying that the reason Japan relies so heavily on imported wheat is down to the American surplus wheat that Japan was forced to import following World War II. The article reports on the Kagawa-based Tenno Farming Group who have been jump-starting local wheat farming by developing a domestic wheat called Sanuki no Yume.

Nissin (not to be confused with Nissin supermarket), with a 40% domestic market share is the company whose flour brand you're most likely to see in supermarkets and convenience stores in Tokyo, and has just bought the US' 12th largest flour producer Miller Milling Co., adding to its existing operations in Canada and Thailand. I'm still unclear whether wheat for Nissin flour is grown domestically or at these international locations. It's possible that it's mixed, as most Japanese wheat is classified as moderate soft wheat, producing low protein flour.

Import duties on grains were 63% (in 2001, rice was 1000%!), in Japan's Disappearing Small Farms, Japan's ambassador to the WTO is quoted as saying that he "realizes Japan's agriculture is less than efficient: other countries have natural advantages in production that could, if unrestrained by tariffs and domestic support, put Japan's farmers out of business. But the Japanese want to maintain their farms almost regardless because they cherish their own agriculture, they are prepared to pay for it." The article goes on to argue that "instead of serving to protect them, Japan's domestic agricultural supports are feeding the rich, large industrial farms at the expense of Japanese consumers and their cherished small farms."

I wanted to know more about farming subsidies in Japan. In "The Puzzle of Small Farming in Japan" Godo writes: "MAFF estimates that optimal farm size is 15 hectares or more. However, currently nearly 3/4 of farmland is operated by farmers whose farm size is less than 3 hectares. Being too small is the most critical reason for the high cost of Japanese farm products. Why, then, does inefficient small farming persist?" This was a shocking paper alleging that it persists due to the selfishness of current generations of Japanese farmers, policy makers and the broader society regarding the inefficient and non-use of farmland.

Ethical knots

So far we have the situation of shortage of agricultural land, production methods with lower yields than other countries, a declining workforce, alleged corruption and counterproductive farming subsidies, and huge domestic demand. The methods used by the type of egg farm I said I wanted to support would be less efficient still than the larger egg processing businesses discussed above. So in buying local am I helping or not? The Ministry of Health, Labour and Welfare site reports that "Japan can no longer support its people's diet without imported food." currently producing only about 40% of the food it produces. Would I then be perpetuating a middle class feel-good myth of the value of the small farm while ignoring the bigger picture that is Japan’s need to further reduce taxes on imports, embrace foreign influx of labor, and be able to expand their own food businesses abroad in order to import etc., in order to feed future generations? How to weigh all of that against the environmental, animal welfare and traceability issues from the top of the post?

Wow, see, it's huge! I'm clearly still at the discovery stage, working out my thoughts and tying myself in ethical knots, but the learning process is really quite interesting. I'd love to hear your thoughts especially if you've sourced produce for your own business. It's making me readdress how I feel as a consumer too. I think ultimately the decisions will need to balance the positive and negative impacts based on the knowledge I have at the time, and then evolve over time the more I learn. I haven't even got into the relative merits or lack thereof of the label "organic" :)

"Real respect for consumer choice means meeting people’s expectations about the high standards of your products and supply chains, and bringing your customers with you on the journey towards a food system where it is easy to eat a sustainable, fair and healthy diet."
- UK Food Ethics Council.

Here are some more interesting resources on food ethics:

A nicely written, simple resource on ethics for food business owners:
http://www.foodethicscouncil.org/system/files/Toolkit%20Final%20Web_0.pdf

A good BBC radio 4 food programme podcast "Japan's Food Dilemma":
http://www.bbc.co.uk/programmes/b00z2sj8.html

An article from the Guardian newspaper "Sustaining an Ethical Food Chain":
http://www.guardian.co.uk/commentisfree/2010/jul/14/sustaining-ethical-food-chain