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Market-based Quality Schemes, Certification, Organic Labels Helga Josupeit Fishery Industry Officer FAO Rome, May 2007 Outline • General Considerations • Certification: Supply versus Demand – quality schemes and geographical schemes – eco-labels – organic labels • Stakeholder Concerns • Conclusions Labelling: Demand driven? Customer Value Triangle Quality Price Service Certification schemes – Production side Certification Wild eco labeling Aquaculture other cert. organic Fair Trade other cert. Certification schemes –Demand (Supermarkets Side) Logo/trade mark Fear: bad publicity Loyalty Brand value Social aspects animal welfare health organic sustainability ILO laws Fair Trade quality Certification schemes –Demand (Customer Side) Logo/trade mark Ethics Social aspects Service/ Convenience Health Price animal welfare nutrition organic sustainability quality safety ILO laws Fair Trade Organic Consumers ORGANIC CONSUMERS ‘HEAVY USERS’ YOUNG FAMILIES WITH SMALL CHILDREN and OLDER PEOPLE OCCASIONAL CONSUMERS Motivation Motivation Motivation Environment concern Health concern Ethic aspects Health concern Environment concern ‘ Consumer-friendly’ Life Style aspects Gourmet/Quality considerations Health concern Purchase Location Purchase Location Purchase Location Traditional Health Food Stores Local markets Conventional supermarkets Organic supermarkets Traditional Health Food Stores Conventional supermarkets Organic supermarkets Local markets Certification schemes – Production and Demand Certification Wild Aquaculture other cert. eco labeling other cert. organic Fair Trade Logo/trade mark Loyalty Brand value Social aspects sustainability ILO laws animal welfare health organic Fair Trade quality Geographical labels Quality labels FAO Guidelines • The FAO guidelines are aimed at providing guidance to governments and organizations that already maintain, or are considering establishing, labelling schemes for certifying and promoting labels for fish and fishery products from well managed marine capture fisheries. Reliable, independent auditing, Third party certification, Transparency of standard-setting and accountability, Standards to be based on good science. FAO Guidelines • • • • • • • • • PRINCIPLES 2. The following principles should apply to ecolabelling schemes for marine capture fisheries: 2.1 Be consistent with UNCLOS, Straddling Stocks Agreement, CCRF and WTO rules 2.2 Recognize the sovereign rights of States and comply with all relevant laws and regulations. 2.3 Be of a voluntary nature and market-driven. 2.4 Be transparent, including balanced and fair participation by all interested parties. 2.5 Be non-discriminatory, do not create unnecessary obstacles to trade and allow for fair trade and competition FAO Guidelines (cont.) • PRINCIPLES • 2.6 Provide the opportunity to enter international markets • 2.7 Establish clear accountability for the owners of schemes and the certification bodies in conformity with international standards. • 2.8 Incorporate reliable, independent auditing and verification procedures. • 2.9 Be considered equivalent if consistent with these guidelines. • 2.10 Be based on the best scientific evidence available • 2.11 Be practical, viable and verifiable. • 2.12 Ensure that labels communicate truthful information. • 2.13 Provide for clarity. • 2.14 Be based, at a minimum, on the minimum substantive requirements, criteria and procedures outlined in these guidelines. Eco labelling schemes • NGOs – Marine Stewardship Council (MSC) – Earth Island ‘Dolphin-safe’ labelling – International Dolphin Conservation Program – Friends of the Sea – Krav (Sweden) – Ecofish (USA) – Naturland • Governments – Iceland – Ireland – EU Processors adopting eco-labelling schemes • Unilever and Permira (new owner of most of Unilever seafood business) • CapVest (owver of Young’s Seafood and Findus in France and Nordic countries) • Pescanova • Lyons seafood • Caterers, importers and wholesalers catching up very slowly • Fortune Fish Company – a wholesale seafood distribution in Chicago starts “sustainability initiative” • Seafood Choices Alliance Supermarkets adopting eco-labelling schemes • Carrefour – own eco-label • Other retailers*: – ban of certain endangered species – ban of fishing gears – minimum commercial size above legal size *) Marks & Spencer, Waitrose, Sainsbury, ASDA, Auchan Supermarkets adopting eco-labelling schemes Countries Number of products Switzerland 69 MSC Sweden 44 MSC + 2 KRAV* France 13 MSC UK 87 MSC USA 93 MSC + 7 Ecofish* Japan 14 MSC Germany 63 MSC Spain 2 MSC Italy 25 FOS, 3 MSC Supermarkets adopting sustainability-labelling schemes Supermarket Policy Wal-Mart MSC for wild, GAA for organic Sainsbury working closely with the Marine Stewardship Council (MSC) Coop Swiss Naturland for organic shrimp Tesco Partnering with MSC Metro EII, MSC Carrefour Own scheme for “responsible fishing” Ahold USA Eco-Sound: sustainable fisheries ICA Sweden MSC Lidl MSC Eco-labelling schemes • Processors – Young’s – Fishmongers: Fishes, Netherlands The International Principles for Responsible Shrimp Farming (2006) • The International Principles for Responsible Shrimp Farming have been developed by the Consortium on Shrimp farming and the Environment, which consists of FAO, NACA, UNEP/GPA, the World Bank and WWF. • The principles address issues including: * Farm site. * Farm design. * Water use. * Broodstock and postlarvae. * Feed management. * Health management. * Food safety. * Social responsibility. Organic Aquaculture principles – sites regularly replenished with pollution free water – fish of natural origin and selection (absolutely no GMO and hormonal treatment) – feed based on controlled meals, oils and so on (no GMO) – limited and monitored treatment with medicines (preference for natural remedies) – low breeding/stocking density – longer rearing periods – continuous monitoring of environmental impacts good practices labelling schemes • GAA Global Aquaculture Alliance set up Aquaculture Certification Council Inc. this scheme is adopted by WALMART for its aquaculture products • Thai GAP certification • Italian API certification good practices labelling schemes • Crianza del Mar (España) – control of culturing methods – feed control – sanitary control – animal welfare – no chemicals or additives – 24 h marketing – environmental control – enterprise management Organic labelling schemes • NGOs – Naturland – Krav, – Soil Association, UK – Bioland – Biogro, New Zealand • Governments – French Ministry of Agriculture (AB public scheme) Organic labelling schemes Certification body Species Naturland, Germany Shrimp, carp, trout, blue mussel, salmon salmon, rainbow trout, brown trout, arctic char, fish from the perch family, blue mussel Shrimp, salmon, trout, cod Trout, salmon, seabass, seabream Krav,Sweden Soil Association, UK French Ministry of Agriculture (AB public scheme) Biogro, New Zealand, Salmon, crayfish, oysters, seaweed TILAPIA Organic labelling schemes • Processors – Deutsche See Organic in the USA When it pays to buy organic? (From Consumer Report, USA, 2006) • Don’t bother buying these items organic: seafood – Whether caught in the wild or farmed, fish can be labelled organic, despite the presence of contaminants such as mercury and PCBs. – The USDA has not yet developed organic certification standards for seafood. – In the meantime, producers are allowed to make their own organic claims as long as they don’t use “USDA” or “certified organic” logos. California, however, recently passed a law that prohibits the use of any organic labelling on fish and other seafood until either state or federal certification standards are established. Critics by stakeholders • Eco/bio-labelling scope and definition are not clear enough, • Eco/bio labelling is not practical to implement, especially for multi-species fisheries, • Being certified is costly, when the price premium is not guaranteed, • Going through the full process for certification requires much effort, time and competence that may be lacking, • The lack of criteria related to the quality of the fish are considered as a weakness of eco/bio label, • At last but not least, fish folks expressed to have some doubts about the legitimacy and credibility of the standards holder, Critics by stakeholders (cont.) • Environmentalists and/ or non fishermen are not welcome to tell us what we should do, • Reluctance to give power to other than fishermen to set the criteria, and verify the fishing activity, • Entering into a controlled scheme will prevent us to sell on the black market and reduce our revenues, • Some would prefer to consider joining a public programme, • Some would prefer to consider joining a national programme, • Reducing fishing efforts on some species, some areas, juveniles, may create new opportunities to competing fishermen, • Fisheries and aquaculture regulation is stringent enough; no desire for a new layer of constraints, Critics by stakeholders (cont.) • there are to many certifiers around, each certifier has his own interpretation of the rulebook, so the same certificate is certified to different standards • there are also to many labels, and the consumer is confused, what the differences are and whom to trust • most of the organic labels are weak on social and labour law issues or are not really looking at them, • for certifiers or label owners the most important thing is to make money to survive, so they are weak on their own standards • for many farmers producers the certification is a marketing tool, so they build a screen for the certifiers Conclusions • Various NGOs involved in eco/bio-labelling • More countries involved in quality labels for national aquaculture products • supermarkets: – will continue to have sustainability as a buying policy for seafood – very worried about bad publicity – interested in maximizing profits and expanding market shares Conclusions • importers/processors and catering – rather slow in considering eco/biolabels • Consumers: – are already confused and will become even more confused with more and more labels – willing to pay more for organic products, – but not for eco-labelled products Conclusions • developing countries – non tariff barriers? – problems with product quality – already some (Thailand) trying to promote good aquaculture practices with all producers – huge risk of leaving small scale producers out from the labelling process Thank you for your attention