Australian label change fears: Food industry warns against new Country of Origin rules as authorities mull digital approach

By Pearly Neo

- Last updated on GMT

Australia’s food industry has cautioned regulators not to impose new rules for Country of Origin Labelling (CoOL) for food products. ©Getty Images
Australia’s food industry has cautioned regulators not to impose new rules for Country of Origin Labelling (CoOL) for food products. ©Getty Images

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Australia’s food industry has cautioned regulators not to impose new rules for Country of Origin Labelling (CoOL) for food products, with the nation’s trade body citing cost and compliance concerns from its members.

The review is being headed by the Australian Department of Industry, Science, Energy and Resources (DISER)and has just concluded its public consultation process, although the evaluation process is expected to continue for another six months.

As part of the proposals, the authorities are considering advancing digital labelling technology.

“The 2016 CoOL reforms came into full effect in July 2018, [and]the Australian Government committed to evaluate these reforms two years after this date in 2020-21, hence the reason for this review,”​ the DISER media team told FoodNavigator-Asia ​via an email statement.

The evaluation commenced on 31 July 2020 and aims to conclude by June 2021, [where this] will examine the system’s effectiveness in meeting their objectives, including consideration of impacts and unintended consequences in implementation.

“[The department will also be considering] developments in digital labelling technologies explored in the Digitising Food Labelling Data report [in order to cover the] full breadth of issues raised by stakeholders - This would enable businesses to provide digital food product information to their consumers and share information with other businesses in their supply chains.”

According to the Digitising Food Labelling Data report, which FoodNavigator-Asia​ has viewed courtesy of DISER, this is because Australian food supply chains are expected to eventually transform from a traditional linear, step-by-step format to what it calls Digital Supply Networks (DSNs).

“Linear supply chains have a discrete progression of information – for the food industry, this means that data is passed linearly through the supply chain steps of production, processing / manufacturing, sales, and consumption,”​ said the report, which was commissioned by the Department of Industry, Innovation, and Science (DIIS) and authored by consultancy firm Deloitte.

“[This means that] end-consumers and businesses rely on information being passed through accurately at each step, [which could be wrong if] there are information gaps and inaccuracies in any earlier step. They have limited visibility into other processes or activities, which limits their ability to quickly respond to changes or issues.

“DSNs or digital supply chains are different – these are dynamic, interconnected and have a continuous flow of information, so in the food industry, food data would be dynamically and continuously shared between producers, manufacturers, retailers and end-consumers.

“End-consumers and businesses will not need to reply on information being passed accurately at each step and can connect to [any step in the network] to find out more information. Businesses especially can use internal and external data to see an end-to-end view of their supply network and can make more informed and real-time decisions.”

DISER declined to answer our queries as to whether this meant an eventual phasing out of physical CoOL labels by going digital, but added that such digitisation is expected to ‘inform the future development of digital food labelling’​.

Australian food industry response

The Australian Food and Grocery Council (AFGC)’s CoOL submission to DISER advocated for things to remain status quo due to both costs and the impacts of COVID-19.

“[We] consider that the current CoOL regulations should remain essentially unchanged - These current CoOL requirements were introduced a relatively short time ago [and] their introduction resulted in a sizable regulatory impost on the packaged food industry and retail outlets as virtually all manufactured foods for sale in Australia required a label change,”​ the AFGC commented in its submission.

“In addition, as the basis for determining specific CoOL elements changed, substantial costs were incurred by industry to understand the precise labelling required on each product, and to ensure ongoing compliance.

“[There] is little indication from market feedback that CoOL is a major issue for consumers in terms of its value, or otherwise, and companies are still coping with the impacts of COVID-19 [as the industry] adjusts to changes in consumer demand for products and disruptions to usual sources of key inputs into food and grocery manufacture.

“The latter, in particular, has implications for the CoOL of products, [so the] overwhelming sentiment of AFGC members is for retention of the status quo.”

The Australian seafood industry agreed that the current status quo was already efficient for retail products, but called for CoOL to be made mandatory for the foodservice sector as well.

“In the retail sector CoOL provides consumers with clear information on where their food has come from and allows consumers to make informed purchasing decisions, we want to see this origin labelling extended to seafood sold in the foodservice sector,”​ said Seafood Industry Australia (SIA) Interim CEO Veronica Papacosta.

“70% of the seafood eaten in Australia is imported, the majority of this consumption is in the foodservice sector, and many people don’t realise this. Consumers assume their iconic seafood meals are made using iconic Australia seafood, however we know this is often not the case.

“We know people want to support our Australian seafood producers, but people cannot buy Australian seafood if they can’t tell where it’s from.”

According to DISER, consumers and businesses are likely to have another opportunity to consult on the CoOL review later this year, before any final decisions are made.

“The Australian government will be considering all findings from the evaluation with regards to the effectiveness of the reforms, [and DISER] has contracted Deloitte to carry out further consultation consultation with consumers and industry between November 2020 and January 2021,”​ it said.

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