Climate Change and Food Supply
Climate change threatens intense weather resulting in food shortages WMO annual report highlights continuous advance of climate change. The State of the Global Climate 2022 State of the Global Climate in 2022 | World Meteorological Organization (wmo.int) shows the planetary scale changes. For global temperature, the years 2015-2022 were the eight warmest on record. This week reports of early heat waves particularly in Spain were highlighted.
In other reports certain food supply chains are showing restricted availability. EU wholesale prices of onions rose by almost 500% in a year following a significant tightening of supply with the UK heavily reliant on imported onions from the EU this will impact throughout the supply chain. There is a shortage of one million tonnes of onions in the EU this year due to “robust” domestic demand and poor harvests hit by bad weather, according to Mintec, leading to a 483% increase in wholesale prices in the bloc over the past year and as reported by the Grocer.
Global sugar prices also hit a six-year high in March, according to the FAO’s food index, and there is little sign of them easing after supplies tightened due to poor crops in Thailand and India, and unexpected weather patterns in Brazil.
Corporate Sustainability Reporting Directive CSRD
On 5 January 2023, the Corporate Sustainability Reporting Directive (CSRD)EN••• entered into force.
Scope
The main change is that this increases the scope for reporting obligations from the Non-Financial Reporting Directive (NFRD) (that applied to some 11,000 “public interest entities”, meaning listed companies, banks, and insurance companies with more than 500 employees.) This will increase the number of companies affected under CSRD to some 50,000 companies.
CSRD will apply to all large EU companies, that is, EU companies (including EU subsidiaries of non-EU parent companies) exceeding at least two of the following criteria:
- more than 250 employees;
- a turnover of more than €40 million; or
- total assets of €20 million.
CSRD will also apply to companies with securities listed on an EU-regulated market, irrespective of whether the issuer is established in the EU or a non-EU country. This includes listed small and medium-size enterprises (SMEs), except for certain listed micro-enterprises.
For financial years starting on or after 1 January 2024, CSRD will apply to companies that are already subject to NFRD, with the first report expected to be produced in 2025. Large companies that are not presently subject to NFRD will have to apply CSRD from financial years starting on or after 1 January 2025 and therefore report in 2026 on 2025 data. For financial years starting on or after 1 January 2026, CSRD will be rolled out to listed SMEs, albeit subject to an opt-out until 2028, with the report in 2027 being based on 2026 data.
Additionally, CSRD will have an impact on non-EU undertakings with annual EU-generated revenues in excess of €150 million and which also have either a large or listed EU subsidiary or a significant EU branch (generating €40 million in revenues). The respective subsidiary or branch will be responsible for publishing CSRD-style sustainability reports for these non-EU undertakings at a consolidated level from 2028.
Objectives
In short the objectives of CSRD is to require financial, social and environmental information is given equal weighting in companies’ annual performance reports.
The exact reporting standard (EU Sustainability Reporting Standards or ESRS) are to be confirmed by the European Financial Reporting Advisory Group (EFRAG) by June 2023.
Companies subject to the CSRD will have to report according to European Sustainability Reporting Standards (ESRS). Essentially companies will need to report on information necessary to ‘understand the company’s impacts on sustainability matters and how they affect the company’s development, performance and position’. This includes aspects of business strategy, governance of ESG issues, reporting on material environmental and social factors, including those within the business supply chain. Sustainability-related data will be disclosed within the company’s annual report alongside financial performance. Third-party assurance of sustainability reporting will be mandatory. Limited assurance will be mandatory from 2024, but this will move to Reasonable Assurance over time, which demands more transparency and auditing to demonstrate authenticity of the information captured.
Carbon Border Adjustment Mechanism legislation
The European Parliament voted to adopt a regulation on a Carbon Border Adjustment Mechanism (CBAM) this month. Negotiators for the Parliament and the Council of the European Union (EU) had reached a provisional political agreement on the text of the regulation in mid-December, and this vote reflects that agreement without amendment.
The CBAM will start as a reporting obligation during a transitional period starting on 1st October 2023. Beginning in 2026, financial adjustments on imports of iron, steel, cement, aluminum, fertilizers, electricity and hydrogen will be phased in over a nine-year period.
The next step in the legislative process is formal adoption of the regulation by the EU member states in the Council. The Council is expected to vote in favor of the regulation in the coming days or weeks. Once adopted by the Council, the regulation will be published in the Official Journal of the EU and will come into force 20 days after publication. The CBAM regulation will become law.
Deforestation-Free Products Regulation
Parliament also approved a proposal for a regulation Proposal for a regulation on deforestation-free products (europa.eu) on deforestation-free supply chains this month. Like CBAM, the deforestation regulation is expected to become law following adoption by the Council in the coming days or weeks. The regulation will require companies to conduct strict due diligence if they export from or import to the EU market certain goods considered to contribute to deforestation.
The adopted text currently covers seven household products, including wood, cattle, palm oil, soy, cocoa, coffee and rubber and derivatives like chocolate, furniture and certain cosmetics.
The new law obliges companies to ensure products sold in the EU have not led to deforestation and forest degradation.
While no country or commodity will be banned, companies will only be allowed to sell products in the EU if the supplier of the product has issued a so-called “due diligence” statement confirming that the product does not come from deforested land or has led to forest degradation, including of irreplaceable primary forests, after 31 December 2020.
As requested by Parliament, companies will also have to verify that these products comply with relevant legislation of the country of production, including on human rights, and that the rights of affected indigenous people have been respected.
Once in force, large companies would have 18 months to comply, and smaller firms 24 months.
Products covered
The products covered by the new legislation are: cattle, cocoa, coffee, palm-oil, soya and wood, including products that contain, have been fed with or have been made using these commodities (such as leather, chocolate and furniture), as in the original Commission proposal. During the negotiations, MEPs successfully added rubber, charcoal, printed paper products and a number of palm oil derivatives.
Parliament also secured a wider definition of forest degradation that includes the conversion of primary forests or naturally regenerating forests into plantation forests or into other wooded land.
Risk-based controls
The Commission will classify countries, or parts thereof, as low-, standard- or high-risk based through an objective and transparent assessment within 18 months of this regulation entering into force. Products from low-risk countries will be subject to a simplified due diligence procedure. The proportion of checks is performed on operators according to the country’s risk level: 9% for high-risk countries, 3% for standard-risk and 1% for low-risk.
The competent EU authorities will have access to relevant information provided by the companies, such as geolocation coordinates, and conduct checks with the help of satellite monitoring tools and DNA analysis to check where products come from.
Penalties for non-compliance shall be proportionate and dissuasive and the maximum fine must be at least 4% of the total annual turnover in the EU of the non-compliant operator or trader. Parliament adopts new law to fight global deforestation | News | European Parliament (europa.eu)
EU pesticides monitoring regulation - ethylene oxide (EtO) added
The European Commission has added ethylene oxide to a list of pesticides that should be tested for following the substance being behind thousands of recalls in recent years.
New legislation means European countries must take and test certain food samples for ethylene oxide from 2023 until 2026.
The new EU regulation 2023/731 Publications Office (europa.eu) of 3 April 2023 concerns a coordinated multiannual control programme of the Union for 2024, 2025 and 2026 to ensure compliance with maximum residue levels of pesticides and to assess the consumer exposure to pesticide residues in and on food of plant and animal origin.
Ethylene Oxide is stated to be analyzed in the EU on dried beans, rye, and rice in 2023, wheat in 2024; barley and oats in 2025; and dried beans, rye, and brown rice again in 2026. The lot to be sampled is chosen randomly.
The aim is to ensure compliance with maximum residue levels of pesticides and to assess consumer exposure to pesticide residues in food of plant and animal origin.
Member states should submit by the end of August in each year the information concerning the previous calendar year.
The scale of ethylene oxide incident
In September 2020, ethylene oxide was detected in sesame seeds from India. The substance was later found in other raw materials such as herbs, spices, and locust bean gum, a type of thickening agent used in ice cream and other foods. The use of ethylene oxide to disinfect foodstuffs is not permitted in Europe.
There were at least six meetings at the European level with some countries unhappy with how the issue was handled. It prompted the biggest food recall operation in EU history, according to the 2021 Alert and Cooperation Network (ACN) report.
In response, the EU Commission tightened official controls on certain foods imported into Europe. The latest rules cover different products and countries including vanilla extract from the United States, locust bean products from Morocco and Malaysia, tomato ketchup and other tomato sauces from Mexico, and calcium carbonate from India.
In the summer of 2021, EU countries moved from zero tolerance to a fine-tuned approach for products containing the substance. When ethylene oxide is found in a raw material, companies have to check whether it will also be in the final product. Only final products containing ethylene oxide above the limit are recalled from consumers. This led to a sharp decline in the number of recalls but a few still occurred in 2023.
Other pesticides and products
The Regulation 2023/731 covers more than 100 pesticides to be analyzed in products of plant origin from 2024 to 2026. It mentions substances like chlorpyrifos, glyphosate, and folpet in foods such as bananas, melons, tomatoes, onions, and carrots.
About 30 pesticides are listed to be screened for in products of animal origin. They include DDT, fipronil, and Lindane in items such as chicken eggs, cow’s milk, and poultry fat.
Also, in 2024 each member state shall take and analyze 10 samples of processed cereal-based baby food. In 2025, the focus is 10 samples of foods for infants and young children other than infant formula, follow-on formula, and processed cereal-based baby food, and in 2026 five samples of infant formula and follow-on formula should be tested.
Food Safety News: EU adds ethylene oxide to the list of pesticides that need monitoring | Food Safety News
Windsor Framework – ‘Not for EU’ labelling
The Windsor Framework (WF) will create a “Green Lane” (for agri foods being traded only into NI) and a “Red Lane” (for agri food products ‘at risk’ of leaving the UK’s Single Market and being traded into the EU’s Single Market). Green Lane goods will be required to carry new labelling stating ‘not for sale in the EU’ or ‘Not for EU’ and will be subject to reduced customs checks and procedures.
Since the WF is only a “Framework” agreement, both the UK and EU will need to pass implementing legislation and guidance for companies operating in NI, GB and the EU on how the “Not for EU” labelling proposals will work in practice. The ‘Not for EU’ labelling looks like it will be unlikely to hit individual shelf stable products; however this may change.
The EU has published a Proposal for a Regulation on NI Sanitary and Phytosanitary Measures (2023/0062(COG) (“EU Agri‑Food Proposal”). This EU Agri‑Food Proposal only covers goods which move from GB to NI. It proposes this labelling on meat and dairy and will move towards processed goods. .
UK Guidance has not introduced any proposed legislation however in guidance documentation there has been the indication this would move to “These products from the United Kingdom may not be sold outside Northern Ireland”. Further Guidance indicates this will follow the products indicated by EU; but may also be extended UK wide for those products:
“The Windsor Framework: A new Way Forward” Paragraph 23 on pages 11 and 12 notes that: “A subset of high-risk products such as meat, dairy and other composite products will be labelled at a product-level on a phased basis through to 2025, in line with the proposals [the UK government set out in its] July 2021 Command Paper. Those labelling requirements will first be introduced on meat and fresh dairy from October 2023, with the Government providing transitional reimbursement funding during this first phase. From October 2024 these requirements will be extended to include all other dairy products, such as UHT milk and butter, and would be proposed to apply UK-wide from that point, in consultation with the Scottish and Welsh Governments. From July 2025, composite products, fruit, vegetables and fish will also be labelled on a UK-wide basis” (emphasis added).
Cases:-
Landowner fined for dredging river
There has been widespread coverage following the sentencing of a landowner for causing significant damage to the riverbed and habitats along the River Lugg in Herefordshire.
Mr Price was sentenced to 12 months in prison and ordered to pay costs of £600,000 for carrying out unconsented works along the riverbank which included dredging and bulldozing the riverbanks, removing trees and vegetation.
Natural England and the Environment Agency led a joint investigation into the environmental harm caused by the work which persisted despite a Stop Notice. Mr Price’s actions were in breach of several regulations, including the Reduction and Prevention of Agricultural Diffuse Pollution, and operations specified within a Site of Special Scientific Interest.
Bodmin dairy farm fined for worker fall
A Bodmin dairy farm has been fined more than £60,000 at Plymouth Magistrates Court this month after one of its workers sustained multiple injuries when he fell more than 20 feet through a roof on to a concrete floor.
Mike Rossiter fell more than 20 feet when the shed roof he was clearing gutters from gave way. Mr Rossiter has stated that despite being back in work and fully-supported by his employer, he still fears for his long-term future in the industry.
Plymouth Magistrates Court heard that employees of C.P. Button Limited were clearing the gutters on the grain and silage pit shed roofs on 13 July 2021. Although they were using crawling boards, Mr Rossiter had stood on a fragile rooflight, which failed under his weight causing him to fall.
An investigation by the Health and Safety Executive (HSE) found the company failed to control the risk of falls. They failed to adequately assess the risks and did not have a safe system of work. Wider failings were identified in respect of the information, instruction, training, and supervision provided for the employees involved.
C.P. Button Limited, of St Tudy, Bodmin, Cornwall, pleaded guilty to breaching section 2(1) of the Health and Safety at Work etc. Act 1974 after failing to ensure so far as reasonably practicable the health and safety and welfare at work of all its employees against the risk of falling when carrying out the planned maintenance task of clearing gutters.
HM Inspector of Health and Safety James Hole is reported as stating: “Roughly half the deaths and serious injuries caused by falls in agriculture involve work on fragile roofs…Any work on roofs should be adequately planned and suitable protection should be provided which will normally include a combination of coverings, guard rails, safety nets and safety harnesses.” Teenager fell more than 20 feet through roof of Bodmin dairy farm | HSE Media Centre
HSE guidance can be found at: Agriculture: Preventing falls (hse.gov.uk) Agriculture: Preventing falls (hse.gov.uk)
Co-op vote – Christine Tacon ex Grocery Code Adjudicator stands for election as director
Members of the Co-op are being encouraged to vote as part of Co-op’s 2023 AGM, where they are set to provide support towards raising £5 million for Barnardo’s.
Members who are eligible to vote – will vote on representatives within Co-op’s National Members’ Council, directors on the Co-op Board or on AGM motions.
Christine Tacon is standing to be elected as a Member Nominated Director for the Co-op Group. Christine worked for the Co-op for 11 years when she ran their farming business and also regulated them for a further 7 years when she was Groceries Code Adjudicator.
Co-op members have 4 candidates to vote for one position. Voting packs are already being issued to eligible members, via post and by email, with a voting deadline of 15 May. Members can also vote in person at the AGM event, to be held at the Manchester Central venue in the city centre on Saturday 20 May.
You can find out more about the candidates standing for election by selecting the summary candidate address, reading the long statement, or watching the video provided by each candidate via this link: Home (cesvotes.com)