Discovering that labor is easily the biggest component of measurable food safety costs, the U.S. Department of Agriculture’s Economic Research Service  has issued a report called “Food Safety Practices and Costs Under the California Leafy Greens Marketing Agreement.”
 
Authored by Linda Calvin, Helen Jensen, Karen Klonsky and Roberta Cook, the 64-page report looks at food safety costs under the Leafy Greens Marketing Agreement, with a look towards how those costs might compare to complying with the produce safety rule under the Food Safety Modernization Act. 
 
“The main point is that labor is a really big (cost) under LGMA and will probably be really big under FSMA too,” Calvin said June 7. 
 
The case study, according to the executive summary, focused on interviews with seven California leafy greens firms in 2012 and follow-up questions after that.
 
While the LGMA and the produce safety rule cover the same major categories of risk and many of the requirements are similar, LGMA is generally more demanding with respect to practices, the summary said.
 
The authors said that the interviews revealed that food safety costs are very tough to measure and not every company provided comprehensive responses.
 
Costs that could be measured included spending for food safety staff, harvest foremen, third-party audits, product lost due to animal intrusion and water testing.
 
Counting costs
 
The study found the largest share of food safety costs were for workers implementing the food safety plan: 38% for the food safety staff (including the clerical staff) and 32% for time that harvest foremen spent on food safety tasks. Harvest foremen spent almost one-fourth of their time on food safety tasks, according to the study.
 
In the 10-year history of the LGMA, Calvin said some growers have evolved how they use labor on food safety over that time period, shifting some of the food safety tasks to foremen.
 
“The way they do food safety has really changed that way,” she said.
 
Third-party audits were a big expense for the firms in the study, accounting for 17% of the costs the authors could measure (LGMA audits making up 11% and other commercial audits 6%). Calvin said several growers said they believed there were fewer audits demanded by buyers now than in 2007, perhaps due to benchmarked Global Food Safety Initiative audits.
 
The study authors conclude the share of costs for audits under the produce safety rule could be similar to commercial audits faced by LGMA members.
 
While the study notes that both the LGMA and the produce rule emphasize the importance of field inspections to look for animal intrusion, only the LGMA specifies exactly how much area should be marked off around evidence of animal intrusion and not harvested. The authors said that total lost-product costs were 11% of measured costs for the surveyed LGMA growers. For the firms that were interviewed, Calvin said no one had buffer zones bigger than LGMA required, and half didn’t have any buffer zone because they didn’t have an adjacent risk factor. Some growers — not interviewed in the study — are thought to have bigger buffer zones than LGMA requires, Calvin said.
 
Under the produce rule, the cost share for buffer zone may be smaller, the study said.
 
Water testing made up 2% of measured costs for the seven LGMA growers. The authors noted that LGMA requires monthly water testing for all water used in the fields unless a firm qualifies for an exemption. Under the LGMA, firms test all water used in the fields for evidence of generic Escherichia coli (E. coli).
 
Calvin noted that some growers are doing more water testing than LGMA requires for their own risk management purposes. For example, she said growers have put in place water testing for other commodities not covered by the LGMA. 
 
“It was just easier to have the same rules for training, for water, and also they did more because buyers demanded more,” she said. The authors said that the produce safety rule requires water testing only for field water sources that are likely to touch the plant. The authors concluded that although the produce rule water requirements should cost less than those of the LGMA, buyers may require more testing than the minimum required under the rule. 
 
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