US Food and Drug Administration’s new food safety act will come into effect this September. The new law is not just a few tweaks to the existing laws. The formidable regulatory agency has labelled the new Food Safety Modernization Act (FSMA) as the most sweeping reform of food laws in more than 70 years. The new safety system is focused heavily on prevention and will require imported foods to match the quality of domestic foods.
With the all new FSMA, FDA is empowered with crucial new inspection and compliance tools. One such is the directive that 600 foreign facilities should be inspected. The directive also mandates that the frequency of these inspections be doubled every year over the next five years. Industry food safety plans and other records will need to be accessible to FDA. FDA’s new law also requires firms to store documents regarding the implementation of their plans and have the necessary tests done by accredited laboratories.
With the new law, the burden of compliance is now that of US importers. Importers will now have to make sure that foreign suppliers comply with FDA’s law by inspecting production facilities on their own or by engaging accredited by the FDA agencies to conduct third-party audits.
The change is much required for the US as it imports account for 15% of the nation’s food supply.
Indian exporters will clearly have to gear up to tackle increased scrutiny as the US is a major export market. Food commodities worth Rs 9,000 crore was exported to the US in FY 16. Spices accounted for about a third of the earnings with a total of Rs.2,783 crore. Other top items exported to the US include guar gum, basmati rice and natural honey at Rs.1,668 crore, Rs.862 crore and Rs.619 crore respectively.
India holds the enviable position of being the leading exporter of spices to the US. Spices constitute about a third of US imports.
As per a spice exporter based out of Virudhunagar, Tamil Nadu, the new FSMA is going to be a tough challenge for most exporters as they are ill-prepared.
“With FSMA taking effect, the suppliers need to have a safety plan – outlining risks of hazards such as contamination in every stage of the supply chain and listing mitigation measures,” said K.V. Satyanarayana, senior manager at life sciences advisory group at Sathguru Management Consultants, a Hyderabad-based consulting firm.
“This means exporters have to invest and upgrade their safety systems to ensure compliance, and thereby margins of exporters will be under pressure,” Satyanarayana said.