NIOP Tackles Food Fraud

NIOP TACKLES FOOD FRAUD

Food fraud has been an insidious and growing problem in our industry for many years. We’ve listened to the frustration of several of our members who have been negatively impacted by the practice of adulterating oils or short-weighting products along the supply chain. You’ve all heard the phrase, “You get what you pay for,” but when it comes to food fraud, you don’t.

The FDA refers to food fraud as “Economically Motivated Adulteration” and it is estimated that the global good industry loses $10-15 billion per year by this practice, though other experts report the number is closer to $40 billion. As a trusted organization dedicated to supporting companies engaged in the buying, selling, processing, shipping, storage, and use of vegetable oils and raw materials, NIOP has chosen to actively stand against food fraud.

NIOP'S PRODUCT INTEGRITY COMMITTEE

In 2022, NIOP formed a Product Integrity Committee to take a deeper look at this problem, collect data from our member companies, and educate our local, state and federal leaders responsible for overseeing the health, safety, and labeling of packaged products on why this critical issue must be addressed.  We have also begun quality testing oils shipments at many of our members’ facilities.  The results will give us additional data on how food fraud affects our members.

HELP US STOP THE SPREAD OF FOOD FRAUD

Food fraud is the act of purposely altering, misrepresenting, mislabeling, substituting, or tampering with any food product at any point along the supply chain.

  • Lower cost oils blended into a product at the expense of customers
  • Increases fraudsters’ profit margin
  • Compromises the product’s integrity
  • Lack of enforcement or regulation allows practice to continue
  • Finished goods containing less product than the stated weight on the label
  • Profits increased at the expense of customers
  • End users’ not having time or proper equipment to check, enables fraud to continue
  • Compromises the product’s integrity
  • Legal action / lawsuits
  • Company reputation tarnished
  • Grocery Manufacturers Association estimates food fraud costs the global food industry $10-15 billion per year, though other estimates state $40 billion
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NIOP AS A THOUGHT LEADER AGAINST FOOD FRAUD

For more than 80 years, NIOP has been a trusted leader for those engaged in the buying, selling, processing, shipping, storage and use of vegetable oils and raw materials. Today, over 165 members in 15 countries trust NIOP to be their voice. NIOP is committed to being a catalyst for positive change in the oilseed product industry and uniting its international members under the shared goal of supporting the fair, safe, and efficient production of oilseed products from seed to shelf.
We are extremely concerned about the growing problem that food fraud poses for our industry. It impacts consumers, restaurants and distributors and costs our members millions of dollars a year in sales. Unfortunately, this issue has not received significant attention from governing bodies with the power to enforce existing regulations or implement new policies.
In response, we have elected to become a one-stop resource offering the latest news and information on food fraud, and to help our members advocate for meaningful policy changes regarding protecting the integrity of weight and ingredients in our packaged products nationwide. NIOP is taking a firm stance against food fraud and is committed to using the full array of tools and talent at our disposal to ensure that a resolution is reached. We know a problem this insidious will take significant time and effort to address sufficiently, and, as always, we will continue to support the financial and ethical health of our members along the way. If we let food fraud win, everyone in our industry ends up losing.

FREQUENTLY ASKED QUESTIONS

What is Food Fraud and why should we care about it?

What is Food Fraud and why should we care about it?

Food fraud is the act of purposely altering, misrepresenting, mislabeling, substituting, or tampering with any food product at any point along the supply chain. It can occur at any point from raw materials to final products to packaging. The U.S. Food and Drug Administration (FDA) refers to food fraud as “Economically Motivated Adulteration.” According to industry experts, including the Consumer Brands Association (CBA), food fraud affects 1% of the global food industry at the cost of about $10-$15 billion/year, though other experts predict it’s closer to $40 billion/year.

How does this impact our membership?

How does this impact our membership?

Member companies have been impacted by food fraud in 2 key ways: 1) Inferior Oils (not on the ingredient list) are often blended into a product to increase the profit at the expense of customers. 2) Short Weights and Measurements – this is a practice where finished goods contain less product than the stated weight on the label to increase profit at the expense of customers. Although food fraud is slightly better today than it was 15-20 years ago, dishonest practices continue, especially in food service, where there is less regulatory oversight on product labeling and standards of identity.

Aside from the companies themselves, who else is impacted by Food Fraud?

Aside from the companies themselves, who else is impacted by Food Fraud?

1) End Consumers -- Consumers, both those cooking at home and those eating outside the house, have no idea that they are not getting what they are paying for. 2) Restaurants -- Restaurants unknowingly buy inferior products and/or short weights and measured products that go undetectable by most restaurant owners/managers. Unfortunately, some of the smaller operations do not normally have the resources to verify the product and in uncertain economic conditions, price is one of the most important considerations for these small businesses. 3) Distributors -- Food Distributors and other resellers are unknowingly buying and reselling inferior products and/or short weighted and measured products, as a result they could be subjected to penalties and fines.

Why is this important to us?

Why is this important to us?

Food Fraud is a growing concern, one that has recently been elevated by NIOP. Aside from negatively impacting companies, end users, restaurants, and distributors, food fraud can result in a negative perception for the entire oil industry. In late summer 2022, NIOP established a Product Integrity Committee (PIC), comprised of member companies that are upstanding competitors and suppliers, who offer fair market pricing for their quality products and have been negatively impacted by deceptive practices. These companies do not engage in deceptive practices, yet are losing business due to the poor reputation of fraudsters who claim they are selling the same product as NIOP members, but are not.

Why do we need to stop the cycle of Food Fraud?

Why do we need to stop the cycle of Food Fraud?

We must encourage regulators to prioritize improving state and federal government oversight on labeling at all stages of the supply chain. This includes, stronger penalties/fines for non-compliance until state and federal governments have the bandwidth to regulate in this area. The biggest and most frustrating challenge when an incident is uncovered, is ensuring action is taken against the fraudulent company. Currently, the FDA is not prioritizing food fraud because it is not a food safety issue. NIOP is looking to challenge the status quo and do things better, safer, and more efficiently until the agencies are able to assist.

NEWS ARTICLES RELATING TO FOOD FRAUD

Controversial UC Davis Report

This widely referenced report likely published false information about the percentage of fraudulent olive oils -the FDA found that 98% of EVOOs on market were not fraudulent. Click here to

Read More »

Food Fraud Prevention Think Tank

“Dedicated to reducing fraud opportunity by educating about food fraud (includes questions consumers can ask to mitigate chance of purchasing fraudulent goods)” Click here to read more.

Read More »

QUESTIONS? WANT TO KNOW MORE?

NIOP Headquarters:
PO Box 11035 / Columbia, SC / 29211
803-252-7128
leigh@niop.org
janamarie@niop.org
Goodwin Consulting (Media Contacts):
508-846-5307
heidi@goodwin-consulting.com
978-995-1552
hannah@goodwin-consulting.com
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