As 2015 begins, several forthcoming regulatory actions will affect produce supply chain members of all sizes.
Pending changes in inspections and Customs and Border Protection rules, plus the sanitary transportation portion of the coming food safety rules, can present challenges to the businesses that provide fresh produce to the public. A panel of produce leaders, moderated by Dan Vaché, United Fresh vice president, supply chain management, presented an educational session on the topic during The Washington Conference, which is held each fall by the United Fresh Produce Association.
These regulatory actions reinforce the mutual goal of government and industry to provide healthy, safe produce.
The Agricultural Quarantine Inspection (AQI) program, administered jointly by the U.S. Department of Agriculture’s (USDA) Animal and Plant Health Inspection Service (APHIS) and the Department of Homeland Security’s (DHS) Customs and Border Protection (CBP), announced proposed fee changes on April 25, 2014. The AQI program is designed to keep foreign agricultural pests out of the U.S. Except for minor changes, the user fees had not been adjusted for a decade and were insufficient to cover costs. The fees are essentially paid by operators of commercial aircraft, maritime vessels, trucks and railroad cars.
The proposed fees for commercial aircraft inspections would mean an increase from $70.75 to $225; commercial maritime cargo vessels will go up from $496 to $825; commercial trucks with a transponder would increase from $105 to $320 per year, and commercial trucks without a transponder would be bumped up from $5.25 to $8 per crossing. To align the fees with actual costs, lower railroad car fees were proposed, which would reduce them from $7.75 to $2 per car.
The United Fresh panel noted that the impact of the fee changes would result in higher import costs. Ken Mobley, general manager, Earth Source Trading Inc., pointed out that the flat fee structure of container versus vessel shipment could be highly variable. That complicates cost management and grower returns. The panel agreed with a proposed fee adjustment for APHIS employees’ overtime, particularly when shipping produce late on Fridays. APHIS proposed raising those after-hours fees commensurate with the anticipated cost of the AQI service through 2018.
“We don’t mind fees,” Vaché said, adding, “We would like to be at the table when they are being developed so we can explain the supply chain process and provide solid information. Fees affect the importers, distributors and consumers, and could be imposed on a sliding scale to be less of a burden.”
The comment period for the AQI user fee proposed new rule, originally set to end June 24, 2014, was extended to July 24, 2014. The final rule is expected to be released by early 2015.
The AQI service monitors pest data worldwide to uncover new pest pathways; analyzes pest risks; inspects and certifies maritime vessels departing Asian gypsy moth-infested countries; harmonizes quarantines and other strategy initiatives with Mexico, Canada and the Caribbean to guard against high-risk pests; monitors U.S. markets for smuggled products; trains canines to detect pests; inspects live plants and propagative plant material to intercept pests; and develops import policies to prevent the introduction of plant pests and diseases.
CBP inspects and clears passengers of vehicles, airlines, cruise lines, rail cars and cargo, commercial buses, military aircraft and vessels, international mail including expedited couriers, land and border pedestrians, as well as any other cargo, conveyances or passengers.
United Fresh pointed to the need for more Customs and Border Protection officers at the Southwest border for effective and efficient crossing. Lance Jungmeyer, president, Fresh Produce Association of the Americas, noted that produce imports from Mexico to the U.S. have almost doubled since 2002, reaching almost 15.5 billion pounds in 2013. Close to 387,000 truckloads entered. Of the ports of entry, Nogales, Arizona, receives more than a third. Tomatoes were the largest percentage of imports, followed by cucumbers, watermelons and avocados. Underscoring the need for Customs officers, Jungmeyer said that legitimate trade should be defended, but, he urged, “Keep out bugs, drugs and thugs.”
On the Mexico side, Jungmeyer said more food safety and quality inspectors are needed, and that Mexico and the U.S. should develop a memorandum of understanding in which Mexican authorities are recognized. He also noted that the proposed truck fee is a 45 percent increase. In addition, the U.S. Food and Drug Administration (FDA) continues to consider the concept of an imported food safety fee. Jungmeyer said, “Taken together, these trends roll back the benefits of NAFTA [North American Free Trade Agreement].” Plus, each new fee may invite retaliatory measures and can harm U.S. exports.
Inspection change at New York/Newark
In January 2012, CBP consolidated the container examination process from 12 marine terminal sites to the Port of New York and New Jersey Centralized Examination Station (CES). Previously the import process was two to three days. Now the ocean containers are transferred to four CES warehouses. Importers report that the processing time for containers can now be five to 12 days, which results in reduced shelf life and higher shrink. The change also involved increased drayage fees for motor carrier pickup and delivery service, plus higher warehouse fees and potential steamship detention charges.
At the industry’s suggestion in 2014, DHS allowed for overtime for inspections, and CES expanded operating hours to include evenings and weekends. United Fresh has been maintaining dialogue aimed at making improvements in the inspection process time.
Part of the group of rules proposed in the Food Safety and Modernization Act (FSMA), the Sanitary Transportation of Human and Animal Food rule was proposed January 31, 2014. The comment period closed May 31, 2014. The final rule has not yet been issued.
The rule will establish measures to ensure that food will not become contaminated. The proposal covers vehicles and transportation equipment, plus transportation operations, training and record keeping. The proposed rule exempts transportation for raw agricultural commodities performed by a farm, transshipped food through the U.S. to another country, imported food for future export, shelf-stable food enclosed in a container, live animals, and compressed food gases. It’s important to note that shippers, receivers or carriers with less than $500,000 total annual sales are exempt.
The rule will set standards for sanitation of transport vehicles, proper cleaning between loads, refrigeration, and protection from allergens, spoilage and contaminants during transport. The criteria for time/temperature control of foods like leafy greens and fresh-cut produce and foods demanding prevention of microbial spoilage, such as meat, pasteurized juice and frozen foods, will be established.
Preventive controls for shippers, carriers and receivers include requirements for adequacy and maintenance of vehicles and equipment to protect food. Controls include hand washing facilities, precool compartments, and protection from nonfood items in the same load. Written specifications for procedures such as visual inspection of produce packed in open containers, cleaning and sanitizing, and temperature control monitoring is required. Personnel must be trained in sanitary practices. In addition, records must be maintained.
United Fresh, as well as other organizations and individuals in the produce industry, provided comments and suggestions to FDA on the proposed rule. United Fresh pointed out that temperature control should be commodity-specific. For instance, tomatoes and avocados should be maintained at temperatures above 40 degrees Fahrenheit.
The comments by United Fresh noted that a large majority of independent carriers used by the fresh produce industry would be covered by the rule to exempt businesses with less than $500,000 in annual sales. Further, United Fresh said that if a shipper is not exempt it could lead to confusion of whether the supplier or receiver is required to perform the unassigned tasks. Therefore, United Fresh suggested that carriers not be exempted on the basis of size.
Drawing attention to a number of specifics in the proposal, United Fresh suggested allowing the shippers’ procedures to include temperature measuring/recording devices instead of requiring carriers to install such devices. Also, because produce companies may ship produce in small cooler boxes with ice packs, relying on such for temperature control and not the carrier, the rule should allow the shipper to employ such options.
United Fresh also indicated that partial load shippers not present for subsequent loads cannot be held responsible to visually inspect the vehicle for subsequent loads. Also, that FDA should consider the potential for condensate formation during loading, and that precooling is not always appropriate. Regarding the hand washing requirement, United Fresh pointed out that most handling is by forklift or other equipment. United Fresh also noted the need for clarification in several specific instances.
To view the United Fresh suggestions on all FSMA produce proposals, go online to http://www.unitedfresh.org.
COVER PHOTO BY CHRISBOSWELL/ISTOCKPHOTO.COM