1
Pangasius
quality standards
and
smallholders
The search for an organic quality
standard for smallholders to comply
with the quality standards of the
European market
Sijtze Niels Sietsma
University of Groningen
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Rijksuniversiteit Groningen
Date: 05-oct- 2007
Specialization: Technology Management
Organization: Faculty of Management and Organization
Supervisors Rug: Prof. Dr J. Wijngaard Dr. C.H.M. Lutz PhD Researcher: Le Nguyen Doan Khoi
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Preface
This document results out of the research that I have done for my master thesis Technology Management. I am sure that no one thought I would come this far when I left the secondary school (Mavo). After the MTS in Ede I continued to the HTS mechanical engineering in Groningen. When I made this step I was sure I would never go to the University, since it was only theory and who cares about that? However, over time people can learn and opinions can change, mine did. Now, 10 years after the secondary school and 2 finalized studies later, I finish my educational career with this master research. For my research I spend two months in Vietnam. It has been a great experience to stay in a country that is developing so fast.
I firstly want I want to thank Jacob and Clemens for giving me the opportunity to go to Vietnam and participate in the research. I want to thank them for the guidance and conversations through which I was able to finish this thesis with success. I thank mr. Khoi for his help in Vietnam. Without him I would not have been able to do my research in Vietnam.
A bunch of people really made my life in Vietnam more then pleasant. So I want to thank: Laury, Binh, Nang, Claire, Johny and Andy for the fun at the beer hoi, the tennis and the pool, the travels and off course the great times at XO.
Last but not least I want to thank miss Van and Flavio. Miss. Van has offered me opportunities to participate in workshops and conferences which were not only very helpful for my project but also gave me great insight in different aspects of field I was working in. I want to thank Flavio for being Italian.
Niels Sietsma
Nielss@gmail.com
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Executive summary
The Vietnamese pangasius aquaculture has increased rapidly the last decade. Vietnam is importing fillets into the EU and America. The economic conditions for the pangasius export look promising. However, Europe and America have and are erecting stricter quality standards for fish products. The major processing factories in Vietnam are complying with those quality demands. The processors are demanding better quality pangasius from their farmers. At the moment many smallholders can not comply with the standards that the processing factories demand from the smallholders.
In the above outlined context the objective of this report is to analyze if the position of the pangasius smallholders in the Mekong Delta can be improved, by implementing an organic quality standard or label.
The problem situation is viewed from a value chain perspective, in which the quality system is managed trough a distinction of technological and managerial functions. With this perspective the conventional and organic chain are analyzed regarding their quality system and the most important chain performance drivers (quality, cost and reliability).
The research is initiated in the Netherlands where a desk research is performed regarding the minimal EU demands on one side and different organic labels on the other side. There is a tremendous amount of different labels available. SQF, Eurergap and Naturland are active in the pangasius industry in Vietnam. The organic label Naturland is chosen, this because there is a clear price premium, there is an established supply chain and farmers could increase their income by 15%.
The performed study revealed that the smallholders in the conventional chain had almost no quality system. They use (sometimes forbidden) antibiotics and, depending on the farmer, there is some documentation. In relation to bigger farms, smallholders produce lesser quality in terms of size and color of meat, this due to less technical and managerial capacities. The costs are higher due to increased input costs and their reliability is less since they use oral contracts and can behave opportunistic. Bigger farms have contacts with processors. This clearly leads to the conclusion that smallholders have a lower performance level then bigger farms.
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A market research revealed that the German market is almost saturated; it is however growing vastly. Besides the German market other countries or new markets (e.g. fast food) can be explored.
The comparison between smallholders and the organic farming efforts of Binca show a big gap. It is unlikely that the smallholders can establish the organic quality system. Firstly the investment for the adoption of the technical functions is high. Secondly a location near the river close to a processor is preferred for stress-free distribution of the fish within 10 hours. Smallholders are mostly positioned further inland.
On managerial level there is a big gap as well. Most smallholders lack the education and the managerial skills needed to set up and maintain an organic quality system on their farm. The smallholders also lack connections in the chain, especially international, to find a market for their product. A cluster of smallholders is required to benefit from economies of scale to reduce the high licensing costs for smallholders.
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Index
: PREFACE...4 EXECUTIVE SUMMARY ...5 CHAPTER 1: INTRODUCTION ...11 1.1 AQUACULTURE IN VIETNAM...11 1.2 RESEARCH JUSTIFICATION...121.3 PROBLEM DEFINITION AND RESEARCH QUESTION...12
CHAPTER 2: THEORETICAL BACKGROUND...15
2.1 THE VALUE CHAIN...15
2.1.1 Performance...16
2.2 QUALITY MANAGEMENT...18
2.2.1 Technical functions...18
2.2.2 Managerial functions ...18
2.2.3 Decision making for product quality ...19
2.3 CONCEPTUAL FRAMEWORK...20
2.4 THE TRANSLATION FROM THEORY TO A RESEARCH APPROACH...22
2.4.1 Research approach ...22
2.4.2 The data collection ...23
2.4.3 The time frame and Limitation...24
CHAPTER 3: LEGAL QUALITY DEMANDS ...27
3.1 LEGAL QUALITY STANDARD...27
3.2 THE BASICS HACCP ...28
3.3 NAFIQAVED ...30
CHAPTER 4: CURRENT PANGASIUS SUPPLY CHAIN ...31
4.1 SEASONS OF DEMAND...31 4.2 THE HATCHERIES...32 4.2.1 Technical functions...32 4.2.2 Quality management ...32 4.3 THE PANGASIUS SMALLHOLDERS...33 4.3.1 Technical functions...33 4.3.2 Quality management ...35 4.3.3 Chain performance ...37
4.4 FINGERLING AND PANGASIUS TRADERS...37
4.4.1 Technical functions...37
4.4.2 Quality management ...38
4.5 PROCESSORS & EXPORT...38
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4.5.2 Quality management ...39
4.5.3 Chain performance ...40
4.6 AFA...41
4.7 CONCLUSION...41
CHAPTER 5: QUALITY STANDARDS...47
5.1 THE WORLD OF THE SCHEMES AND INITIATIVES...47
5.1.1 General initiatives ...48
5.1.2 Non-organic fishery schemes...50
5.1.3 Organic schemes...51
5.2 SUITABLE LABELS FOR SMALLHOLDERS...52
5.3 THE NATURLAND REQUIREMENTS...54
CHAPTER 6: CURRENT ORGANIC SUPPLY CHAIN...59
6.1 STATUS OF THE ORGANIC PROJECT...59
6.2 BINCA SEAFOODS...60
6.2.1 The technological functions ...61
6.2.2 Managerial functions ...64
6.3 NTACO ...65
6.4 DEUTSCHESEE...66
6.5 EXTERNAL QUALITY ASSURANCE...66
6.6 CONCLUSION...67
CHAPTER 7: ORGANIC OPPORTUNITIES ...71
7.1 MARKET DEMAND FOR ORGANIC PANGASIUS...71
7.2 ADAPTING THE TECHNICAL AND MANAGERIAL FUNCTIONS. ...73
7.2.1 Technical processes...74
7.2.2 Managerial functions...74
7.2.3 Performance of the chain...75
7.3 COST CALCULATIONS AND SUPPLY CHAIN PROFIT...76
CHAPTER 8: CONCLUSION AND RECOMMENDATIONS...81
8.1 CONCLUSION...81
8.2 RESEARCH DISCUSSION...84
8.3 RECOMMENDATIONS...86
BIBLIOGRAPHY:...87 APPENDIXES ...ERROR! BOOKMARK NOT DEFINED.
APPENDIX 1:RESEARCH REPORT ON THE FIELDWORK... ERROR!BOOKMARK NOT DEFINED.
APPENDIX 2:NATURLAND IMPLEMENTATION STEPS... ERROR!BOOKMARK NOT DEFINED.
APPENDIX 3:FARMING DOCUMENTATION OF BINCA (1ST POND,2ND PEN)ERROR! BOOKMARK NOT DEFINED.
APPENDIX 4:FCR CALCULATION BINCA... ERROR!BOOKMARK NOT DEFINED.
APPENDIX 5:FCR REGULAR PONDS AND GROW CYCLE... ERROR!BOOKMARK NOT DEFINED.
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APPENDIX 7:COST CALCULATIONS... ERROR!BOOKMARK NOT DEFINED.
List of abbreviations:
BMP Better management practices
B-T-B Business To Business
B-T-C Business To Customer
CCP Critical Control Point
Danida Danish International Development Assistance
EU European Union
FAO Food & Agriculture Organization
FCR Feed Conversion Ratio
FVO Food and Veterinary Office GAP Good aquaculture practices GDP
GHP Good Health Practice
GMP Good manufacturing practices
GoV Government of Vietnam
GTZ deutsche Gesellschaft für Technische Zusammenarbeit HACCP Hazard Analysis and Critical Control Points
IMO Institute for Marketecology
IFOAM International Federation of Organic Agriculture Movements
MKD Mekong Delta
MOFI Ministry of Fisheries
NAFIQAVED National Fisheries Quality Assurance and Veterinary Directorate
NGO Non-Governmental Organization
OCIA Organic Crop Improvement Association QACCP Quality Analysis and Critical Control Points
SH Smallholder(s)
SGS Société Générale de Surveillance
SQF Safe Quality Food
VASEP Vietnamese Association of Seafood Exporters & Producers VINAFIS Vietnamese Fisheries Association
WTO World Trade Organization
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Chapter 1: Introduction
This research will focus on the pangasius fish farmer in the in Vietnam and the possibilities for an labeled supply chain. In this chapter a description will be given about the aquaculture in Vietnam, the problem situation, the problem definition and the research questions.
1.1 Aquaculture in Vietnam
The amount of captured fish world wide stagnated since the 1980’s. Due to expected increases in demand for fishery products; aquaculture will gain further importance in the future. The fish demand is expected to grow 1.5% annually in developed and 2% annually in developing countries. With traditional aquatic resources such as inland or marine capture fisheries being already exploited to the maximum, other sources have to be developed. Thus a further increase of fish production from aquaculture can be expected (Delgado et al, 2003: 137-140).
The Mekong Delta is located in the southern Vietnam and consists of 13 provinces. It accounts for 70% of the total aquaculture production in Vietnam. The fish production in this area is extremely important for three reasons: the trade, employment and for the high nutrition value of fish. The trends in the fishery sector identified at the global level are reflected by the current situation in Vietnam. The sector is growing and so is its economic significance. Vietnam is expected to export over US$ 1 billion worth of pangasius in 2007, this was US$ 700 million in 2006, Between 2005 and 2006 exports of pangasius fillets doubled to reach 286 600 tons. The value of these exports expanded even further (www.globefish.org). Seafood exports are now the third biggest source of export revenue in Vietnam. The General Statistical Office of Vietnam (2005) calculated that aquatic products have a 9.1% share in total export revenues of 26,504.2 million US$ (Schutz, 2006). This makes Vietnam the number four in the top ten producers of value. The top ten producers by value are Japan, India, Chile, Vietnam, Thailand, Indonesia, Norway, Bangladesh, South Korea and Brazil (Asche and Khatun, 2006). Due to the rapid growth and the lack of documentation no one is sure what the total production in Vietnam is or how many farms there are. An estimation of the total production of Vietnam can be seen in figure 1 (page 10).
12 0 200 400 600 800 1000 1200 1400 1600 1999 2000 2001 2002 2003 2004 2005 Area (1 000 ha) Production (1 000 MT)
Figure 1. Estimated pangasius production area and tons in Vietnam (Bakker, 2007)
1.2 Research justification
The faculty of management and organization of the University of Groningen has close contacts with Can Tho University. At the moment the Vietnamese Ph.D. student Khoi researches how the export requirements for quality in the Vietnamese Pangasius industry can be met by smallholder fish farmers. He examines the importance of the coordination of the activities in a supply chain in order to improve the quality of production. The Rug gives the possibility to write a master thesis about the pangasius supply chain and execute an empirical research in Vietnam. This research partly overlaps his research; however it will focus on one organic label from which the smallholder could benefit.
1.3 Problem definition and research question
Although the economic conditions for the pangasius look promising, there are problems in the pangasius sector in Vietnam. Europe and America have and are erecting stricter quality standards for fish products. The major processing factories in Vietnam are complying with those quality demands. However, at the moment most smallholders can not comply with the standards that the processing factories demand from the smallholders (Macfadyen, 2004, Schutz, 2006). To ensure a stable income for the smallholders, the current and future quality demands need to be met.
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margin with the organic product. They earn 15% more than in the conventional market. Additionally, their outputs are secured by the buyers in this buyer-driven value chain. More and more farmers and processors in the neighboring areas come to learn from the organic niche market success“. An established organic label (Naturland) is used and the supply chain exists. In this existing chain the Naturland standard and label is used. In order to improve the profitability for the smallholders, organic labels and standards will be examined. The objective of this research is: To analyze if the position of the pangasius smallholders in the Mekong Delta can be improved, by implementing an organic quality standard or label.
The main research question derived from the research objective is: Is it feasible for the Vietnamese pangasius smallholders to comply with the Naturland standard?
This question can not be answered directly and is divided into seven sub questions. Firstly a definition of supply chains is needed with an elaboration on the performance of the chain and the quality management itself. This will lead to a structure and criteria to judge the supply chain and quality management system. Thus: 1. What is the importance of quality management in a supply chain? (Chapter 2)
At the moment the Vietnamese pangasius is available in the stores in the Netherlands. This means that it is possible to comply with the minimum quality demands set by the EU. It should become clear which quality criteria are obligatory for the import into the EU. Therefore: 2. What are the obligatory quality criteria for import into the EU? (Chapter 3)
However, it is not clear if the pangasius comes from small, medium or large-holders. To create a clear perception what the position of the smallholders is, the supply chain will be studied by answering the following question: 3. What is the current position of the smallholders in the conventional supply chain in Vietnam? (Chapter 4)
The smallholder can differentiate their product trough a higher quality and label. First a preliminary research of the different labels is needed to give an understanding what the status of the labeling initiatives. This enables the choice of one suitable label for Vietnam. The label will supply the demands the smallholders need to practice. Hence: 4. What are the most important labels for the European supply chain and their demands which are feasible for the smallholders in Vietnam? (Chapter 5)
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located in Vietnam. Thus: 5. How do the organic supply chain and the quality management system in Vietnam function? (Chapter 6)
It may be possible to improve the performance of the smallholders in the supply chain by implementing a label. The feasibility depends on: the current state of the smallholders, the needed investment, the price premium and other enabling factors as business and government relations. To determine the positive or negative effects of these factors the current labeled and conventional chain are compared. This results in opportunities and pitfalls, thus: 6. What are the labeling opportunities and pitfalls for the smallholders? (Chapter 7)
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Chapter 2: Theoretical background
The literature is used to provide the right structure which enables an ordered description and analysis of the pangasius supply chain. The literature is used to explain and elaborate the research questions. The value chain terminology of Porter (1995) is discussed to get a better understanding of the value creating process in the pangasius chain. Subsequently I will go through the performance dimensions of the chain, e.g. cost and quality. This is followed by a discussion about food quality management. This elaborates on product quality, quality management and the functions of which this consists. This all leads to a conceptual model which includes the performance of the supply chain and the quality functions to control it. The chapter is finalized with the methodology for the research.
2.1 The value chain
Companies create value for their customer trough a set of activities. This can be seen as a value chain. The value chain creates value when the goods move along the chain of value activities. According to Porter (1995) the value activities can be divided into primary and support activities. The terminology of Porter will now be used to get an impression of the activities in the pangasius chain.
Primary activities are those activities concerned with the creation and sale, the transport to the customer and after sale assistance of the product. There is a classification of 5 different primary activities which include:
• Inbound Logistics are activities associated with receiving and storing the fish, material handling, inventory control, inventory control and vehicle scheduling;
• Operations are activities related to transferring the input to the value added product such as, fish culturing, processing, packaging and facility operations;
• Outbound logistics are activities related with the distribution of fish to the customer such as collecting, storing, delivery vehicle operation and scheduling;
• Marketing and Sales are activities related with providing the means by which customers can purchase fish. They are temped with advertisement, promotion, sales force, channel choice and pricing;
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Support activities fortify the primary activities and each other by exchanging inputs. According to Porter (1995) support activities can be divided into four categories namely procurement, technology development, human resource management and firm infrastructure.
• Procurement are activities related with purchasing inputs used in the firm‘s value chain i.e: pond or cage, fishing nets, incubating machine, circulation tanks, water pump, land, fuel, machinery, office equipment, and buildings.
• Technology development is related to activities that can be broadly grouped into efforts to improve fish culture and processing facilities such as fishing methods, technology embodied in process equipment.
• Human resource management are activities related with recruiting, hiring, training, developing, and compensating personnel.
• Firm infrastructure are activities related with general management, planning made to get access to fish, financial activities, accounting, contractual agreements, and very important fish quality management.
Porter (1995) states that the linkages that create value do not only exist within a firm’s value chain but also between the firms’s value chains. In the supply chain there are fingerling producers (baby pangasius), pangasius farmers, traders, processors, ex- and importers, distributers and retailers. There is a linkage between the outbound logistics of the pangasius farm and the processor. Both can benefit from a performance improvement trough better configuration of the farmers value chain and the coordination of the activities between the firms. If the smallholders can increase the chain performance they will strengthen their position. The performance can be divided into different dimensions. I will define which performance objectives are most important for the smallholders.
2.1.1 Performance
Slack and Lewis (2002, p41) define five performance objectives as the dimensions of an operation’s performance. Every stage of the supply chain can be analyzed using these performance objectives. These five performance objectives are: quality, speed, reliability, flexibility and costs. Noori and Radford (1995) focus on the total quality perspective and identified six very similar dimensions for quality: product quality, cost, time, flexibility, dependability, and service. Time/speed and reliability/dependability are defined the same way in both theories. The only extra dimension Radford state is service.
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costs. For a higher product quality one often needs to make more costs. If the quality of the fish is good and consistent it can lead to a reliable supply chain. The quality rejection of the batches has major impacts on the reliability and costs, thus the performance of the chain. These most important performance dimensions and can be defined as followed.
Cost: The cost of the product is cumulative throughout the chain. The chain can only be
sustainable when the cumulative costs of the members are lower than the price paid by the customer. This also has to be the case between every connection within the chain. The customer value is the basis for the quality/price perception. Often the costs are related to the other performance dimensions as well. Cutting cost will often mean that another performance dimension will decrease.
Reliability/dependability: This performance objective refers to the certainty of the delivery. It
should be on the right time on the right place. One can define reliability on the long and on the short term. Reliability on the long term includes e.g. the sustainability of the sector. This is something the smallholders have almost no influence on. A high reliability on the short term implies that de dates of delivery are met but also that the quality demands are met.
Quality: Quality can refer to intrinsic and extrinsic quality attributes of a product. The intrinsic
attributes are connected with the physical product and can be measured in an objective manner or with sensory evaluation. A further distinction in intrinsic attributes can be made into sensory and health attributes. Sensory attributes refer to the aspects of food quality such as flavor, taste, appearance, texture and smell. These are experienced during the consumption. The health attributes concern about nutritional value and health aspects of the product. Due to obesity or overweight of populations, the some health attributes are getting more relevant (Verkerk et al, 2007, Luning and Marcelis, 2007).
Extrinsic attributes relate to the way it is produced (e.g. organic or social responsibility). These can be divided into production and convenience attributes. Production attributes relate to consumer interests in production systems. European consumers are prepared to pay premiums for organic products or likewise considerations. Convenience attributes are the aspects of products that save time of energy for the consumer. For this there is a growing appreciation in Europe (Verkerk et al, 2007).
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2.2 Quality management
The quality performance of the end product is determined throughout the total value chain, and starts at the beginning of the chain. If the farmer starts with weak fingerlings that are receptive to disease and treats them with forbidden antibiotics, this can have consequences for the whole supply chain. The same goes for the process temperature; if this is too high, the amount of bacteria can multiply too fast. Thus, quality needs to be managed. Luning and Marcelis (2007) propose a techno-managerial research approach to manage the quality system. They do not define the primary and secondary activities of Porter (1995), but define different technology dependant and decision-making activities. The model provides functions that determine the food quality. I find these more suitable for quality management than Porter’s activities. Luning and Marcelis (2007) divide the activities into technical and managerial functions.
2.2.1 Technical functions
The technological functions are described as technology dependant activities necessary to achieve a product with certain physical properties. These are tools, equipment or methods used to produce goods and production and measuring activities to provide information about the status of the product. Luning and Marcelis (2007) state that you can distinguish three technological functions that are very comparable with Porter’s (1995) first three primary activities of Porter (1995), namely:
1. Physical supply and storage of incoming food materials (inbound activities). 2. Transformation of food materials into processed food products (transformation). 3. Physical storage and distribution of processed food products (outbound activities).
These technical functions have consequences for both the intrinsic and extrinsic quality attributes for the product. A bad freezer or a dirty cutting knife will have consequences for health issues, as dirty farming water has for the color of the meat. With a conventional farm it is impossible to comply with the extrinsic quality demands of organic farming.
2.2.2 Managerial functions
Managerial functions are defined as the necessary decision-making activities to activate the food production system as well as the management system. Luning and Marcelis (2007) define five managerial functions that contribute to the realization of quality: design, control, improvement, assurance and policy & strategy of quality. These will be discussed below.
Quality policy and strategy is a function that relates to the quality objectives and strategy of the
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strategies: the low cost producer and the differentiation strategies. Every label can be seen as a differentiation strategy.
Quality design discusses the importance of the implementation of quality in the product and
process design. It starts with the identification of the customer requirements. Previously products had to comply with the customer requirements dealing with price, taste and composition (e.g. fat content). Nowadays the requirements include a more specific composition (e.g. fat composition) which is intrinsic, and the way the product is produced (e.g. organic production and fair trade), which is extrinsic (Verkerk et al, 2007). These requirements are translated through the chain in consideration of the processes and equipment used. This includes decisions regarding quality standards and tolerances of product properties.
Quality control is the basic process that regulates the quality of the product and keeps the
product properties, production and human processes within certain limits. It has to evaluate the primary process, both technical and human, and take corrective actions when necessary. It is focused on the productions process, e.g. farming or processing of the fish. A system used to control the quality is HACCP.
Quality improvement discusses a systematic approach that takes quality to a higher level. This
is an ongoing process that changes people, processes and resources. Quality improvements can be made obligatory by governments or demanded by customers.
Quality assurance deals with the design and setting of policies, plans, procedures, tasks and
responsibilities for the quality system. It has a description of the technological and administrative conditions. The objective is to ensure that the quality of the product is met for customers and consumers.
2.2.3 Decision making for product quality
The product quality in the technical function is dependent on the product or food dynamics on the one hand, such as variability in properties due to variable compositions, enzyme activities and on the other hand the technological conditions like the process, equipment and building circumstances (Luning and Marcelis, 2007).
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influence and activate the food production system. That is why Luning and Marcelis (2007) characterize decisions on food/human dynamics and technological/administrative conditioning, for each managerial function. This is shown in the table below.
Table 1. Functions of Luning and Marcelis (2007)
When the situation of the smallholders and the quality management is analyzed, these functions and decisions can offer structure for the criteria that have to be met. For a decision on a technical condition (e.g. process requirement) there has to be a quality control and assurance measure to guarantee the quality policy and strategy.
2.3 Conceptual framework
The model of Luning and Marcelis can be combined with the value chain of Porter (1995) which gives the conceptual model that can be found in figure 2 (page 19). This model shows the relations between the quality functions within the chain. It distinguishes the technical and managerial functions.
The mutual arrow between the managerial and the technical functions emphasizes the mutual dependency between the functions. Decisions in the managerial function can have consequences for the technical functions and vice versa. The technical functions in the chain should prohibit the quality demanded by management functions and the other way around.
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been added since it is desirable for a stable business relation. The value chain in the model stops at the export and import of the product but can be extended to the final customer.
Fig. 2 Food quality model in the total supply chain (modified from Luning&Marcelis, 2007).
The quality design and the quality control are both defined as managerial quality functions. However, they are also incorporated in the technical functions. In an established supply chain with an established label, the quality design should be implemented in the process and product of each member. To guarantee quality, these activities can be controlled at critical control points. This can be seen on the level of the individual member, or through a value chain perspective. I will use the value chain perspective to create an overview of the activities of the chain with the critical control points where quality is controlled. The way quality is controlled will have consequences for the performance of the chain (quality, costs and reliability).
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All managerial functions are connected with a mutual arrow which emphasizes the mutual activities between the functions. The quality control is dependant on the quality design. A certain design needs a certain control, and the other way around. The functions quality control, design and improvement form the quality system that needs to be assured by the quality assurance. Quality assurance activities deal with setting requirements on the quality system, evaluating its performance and organizing necessary changes. The objective is to control the quality system, which includes all activities and decisions to realize quality, and to provide confidence to customers and consumers that quality requirements will be met (Luning and Marcelis, 2007). The quality assurance decides what critical properties need to be checked, but it is also dependent on the quality system.
Finally there is the environment which can not be influenced by the smallholders. The environment influences the whole chain. It refers to social, political, economical, and technological circumstances in the environment that affect decision-making on food quality by the organization, via interests and power (Luning and Marcelis 2007). The government of Vietnam has a lot of power in the industry. They govern along two lines; by rules and procedures and by inspection. Diseases, or worse, epidemics are another example of the environment.
2.4 The translation from theory to a research approach
The current chapter provides the reader with the theory and the conceptual model for the analysis of the situation. This will now be translated into a research approach and data collection. I will end this chapter with the timeframe and limitations regarding this research.2.4.1 Research approach
Vietnam is a fast developing country; this is also the case when it comes to research development. There is not much literature about the first steps in the pangasius supply chain. The fact that it is unknown what the total production of pangasius is within Vietnam, highlights the lack of documentation and regulation in Vietnam. Therefore a case study will be done which is descriptive and explorative in nature, which contains an amount of fieldwork to consult experts.
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The study uses the quality model to investigate the two supply chains. All functions within the quality model will be covered. The first step consists of determining the minimal import demands set by the EU or the organic label. For the organic label this part will be more extensive than for the EU regulation. I will examine the labels before one is choosen.. This is the quality standard that needs to be managed, which will be seen as the quality policy & strategy for the chain. This results in the ‘theoretical’ quality design of the chain which the EU or organic label subscribes. The next step is an overview of each member of the chain with reference to their technical functions, quality design and quality control. For each member the performance criteria quality, costs and reliability will be discussed, as well as the quality assurance in ‘practice’. The individual members can be combined to form a supply chain model in which the quality management of the chain is summarized. The technical function of the supply chain will be presented which contains the points where quality is controlled or assured. I will elaborate on the positive and negative aspects of the technical and managerial functions in comparison to the chain performance. The conclusion for both chains focuses on the position of the smallholder.
With this knowledge it is possible to answer the last sub-question in chapter seven; what are the possibilities for the smallholders concerning the chosen label? First the organic market possibilities will be determined trough a short market desktop research. This is followed by an evaluation of the conventional and the organic supply chain. This will result in necessary activities which the smallholders have to change or add. A cost calculation is made to judge the feasibility. The wrap up will consist of the conclusion of my research where I will answer the research question. I will finish this report with suggestions for further research.
2.4.2 The data collection
The research initially started as a desk research to investigate the quality demands set by the EU and labels. Reports and internet sites were used to gather information about the demands and the status of labels. In some cases extra information was obtained trough telephonic interviews or email correspondence with the labels or authorities. The first goal was to find out what the minimal EU standard was. The second goal, to inquire how suitable a strategy of each label is for the smallholders, and what their current status is regarding aquaculture in Vietnam. This resulted in the EU and the Naturland demands.
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enabled me to obtain information about the current quality assurance or control of different members in the chain.
Most of the interviews were conducted semi-structuredly with predefined open questions to make sure all topics were covered, meanwhile allowing enough space to elaborate on important issues. Some interviews were on the spot during conferences. A list of the consulted experts can be found in the bibliography. Examples of questions that where asked for both chains are:
• What quality design is demanded by the EU/Naturland? • Which members focus on quality control?
• How, where and when are products or processes monitored for quality control? • How and by whom is the quality assured?
• What is the role for the smallholders in this?
To date, no research has been done concerning the organic supply chain and its quality management system. There are only a few documents available on the internet. This is why an explorative approach will be used. The organic farm will be visited and an in depth interview will be given by the general manager of Binca in Vietnam. The processor has not been visited, but a quality assurance report from IMO was obtained, which discusses the activities from harvest to processer.
2.4.3 The time frame and Limitation
In March 2007 the research started with a part-time set-up of the research project. The main focus in this initial state was to set up the research and to collect general information regarding the conventional supply chain and the labels. On the 19th of May the field research in Vietnam started with the participation in a workshop about sustainable development of the pangasius sector. The time in Vietnam was used to get a clear impression of the current situation of the pangasius industry and the organic farming practice. During this period I visited conferences to create a network and to interviewed important stakeholders, until the flight back the 24th of July 2007. The finishing period until October has been used for the interpretation of the data and the finalization of the report.
A significant limitation relates to the language barrier and the cultural differences between the researcher and the interviewees. Most interviews were conducted in English, and since this is no one’s native language, communication was sometimes limited. Some Vietnamese are well educated in the English language but most Vietnamese speak poorly to no English. Fortunately Khoi offered to translate from Vietnamese to English, so some interviews could be conducted.
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criticize the current business situation. The language and culture differences made it hard to have a critical dialogue. I noticed that I consulted a lot of European experts for a critical dialogue. Most of them are stationed in Vietnam for a longer period.
Another limitation is the fact that the sector is changing very rapidly. There are many reports that are used over and over. This makes triangulation hard. Some information is inconsistent. An example of this feeding costs for pond farmers. Some reports state this cost is 60% of the total, others state it is 90%. Due to my limited time in Vietnam, only a limited amount of observations and interviews could be performed. Some facts are simply unknown, like the total production of pangasius. This makes this report sensitive to induction.
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Chapter 3: Legal quality demands
In the past there have been importers of pangasius with bad experiences due to rejections of containers because of a high amount of antibiotics or bacteria in the products. is necessary for the supply chain, thus the smallholders, to comply with the minimum quality standard defined by the EU. First the legal demands are discussed followed by a description of HACCP. This provides the reader with the quality strategy for the conventional chain.
3.1 Legal quality standard
The legal quality standards for food import deal with the assurance of food safety. The assurance is based on the traceability of the products and control of hazard in the supply chain that may cause damage to humans.
The EU introduced a new legislation on traceability of food stuffs including fish and fishery products from 1 January 2002. This legislation for traceability requires that all fishery products traded in the EU are labeled with information on the type of the product and the country of origin or catch area (Asche and Khatum, 2006). Traceability can be defined as documents that link the productions to the customer or as administrative conditions for quality assurance. Traceability means control of the production process and associate record keeping.
The new EU rules on food hygiene confirm that all food businesses after primary production must put in place, implement and maintain a procedure based on the HACCP (Hazard Analysis and Critical Control Point) principles. (FVO, 2006). So all food processors in the EU are legally bound to have a HACCP plan or they must be working on a HACCP system.
If an EU importer buys raw food for further processing, the importer becomes responsible from the moment the products are offered to customs. (www.CBI.nl). Within the aquaculture sector, additional legislation covers items such as approved veterinary products and maximum residue levels (e.g. for therapeutic agents), issues that also have to be included within the concept of quality (www. Feap.com). All these standards are compulsorily for the import into the EU and according to the directive 91/492 en 91/493 of the EU.
There are 3 grades of lists for import in the EU. The third level list of countries can’t import. If a country is on the second list, each country in the EU can decide if it allows import. At the moment Vietnam is on list one for the harmonized countries and can export into every country in the EU. The harmonization implies that Vietnamese processors are obliged to have a HACCP plan as well.
28 0 50 100 150 200 250 1999 2000 2001 2002 2003 2004 2005 2006 N o . o f E U E x p o rt a p p ro v e d E n te rp r.
a third party, e.g. SGS, to check the quality within the chain. NAFIQAVED determines which chains of companies can import to Europe (www.pvis.nl and C. ter Kuile).
When a country has reached list one it is no total assurance for a stable trade relation. When the test facilities of the component authorities are not adequate and 100% check up can be demanded. Cost per container has to be paid by the importer (C. ter Kuile).
In Vietnam there has been an increase of number of organizations that were approved by the EU for export to the EU market. The growth can be seen in the next figure.
Figure 3. Number of organizations approved by the E.U. (source: Fisheries Informatic Centre of Vietnam ministry of fisheries)
Having a HACCP plan is obligatory for the processors and forms a base for many standards. HACCP gives a clear introduction of a how quality in a food supply chain can be managed. This is why HACCP will be discussed.
3.2 The basics HACCP
The traditional approach to food safety assurance was based on applying codes of Good Hygiene Practices (GHP) and Good Manufacturing Practices (GMP) in food processing. Confirmation of safety and identification of potential problems were obtained by end-product testing. Inspectors checked for compliance with the codes and sampled the foods for laboratory analysis. Although these actions are still essential parts of any foods control program, they have clear limitations and shortcomings (Figure 4, page 26).
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food supply chain (Huss 2004). The UHCP (1994) has estimated that HACCP averted 20-60% of the seafood-born illnesses. The introductions of HACCP will generate extra costs for the fish producers. The cost however of not implementing HACCP and dealing with reputation damage due to seafood-born illness can be significantly higher (Reilly and Kaferstein, 1997). When HACCP is used the cost of end product testing can be reduced and a more cost effective use of recourses will be established (Huss et al, 2004). HACCP contains the following concepts:
Hazard: This can be defined as every possible danger or risk that could reasonably be present in
food, and which could threat the health of the consumer. This concerns all kinds of dangers, micro-biological (bacteria, viruses, fungi), chemical (e.g. pesticides) or physical risks (e.g. small stones, wood, glass), which could be present in the raw material, or which could occur during processing, preservation, handling, packaging or transport of the food.
Analysis: This stands for the analyzing of the identified risks (hazards). Estimates are made
about the consequences for the health of the consumer, if the risk would indeed occur in the end product. It is important to take into account the frequency and the seriousness.
Critical Control Point (CCP): After the systematic analysis there should be insight in the real
dangers, which could provide risks for the health of the consumer. These risks should be eliminated or decreased in such a way that there is no real danger for the consumer. This can be achieved by controlling and watching certain points in the production process. These points in the production process are absolutely necessary for the control of the risks, and these are called ‘Critical Control Points’ (www.cbi.nl).
Fig. 4 Food Safety and quality, an integrated approach (from Jouve, 1998)
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It is said that operating a system such as HACCP will increasingly become a market requirement. It is important for developing country exporters to be able to demonstrate to their European buyers that they have taken all the possible precautions to deliver the product safely. (www.cbi.nl). Thus, food safety represents a major challenge faced by Vietnamese fisheries in relation to market access, especially to markets in the EU, the United States and Japan. This raises significant challenges for the aquaculture sector in Vietnam, but perhaps most to the many thousands of small-scale producers involved, connected to markets only by fragmented market chains. While bigger companies can overcome the implementation cost of HACCP and remain competitive on international markets, the implications for poorer farmers could be significant. (Ministry of fisheries and the world bank, 2005).
3.3 NAFIQAVED
The National Fisheries Quality Assurance and Veterinary Directorate is the national expert authority for fisheries food safety assurance and quality control and is a part of the ministry of fishery. They are responsible for the quality assurance to the customer. There is a total of 6 offices trough out the country. They are responsible for the disease control of fish and shrimp. The seafood products are randomly checked by NAFIQAVED. There have been cases of rejected containers from Vietnam by the EU or America. The seafood products did not met the standards for export in term of safety, hygiene, chemical or antibiotic residues. When using random checks it is of course always possible to let pass contaminated containers. According to Khoi (2006) this is also due to the lack of modern tools for inspection which are not complying with the high EU requirements.
Apart from the function to assure the quality they are working on an own quality design in Vietnam. There are three different stages namely: BMP, GAP and CoC. At the moment NAFIQAVED is working on GAP, which is namely applicable to bigger well organized farms. During the interview and presentations it was mentioned that there was a plan to develop BMP and make this the minimal obligatory standard for farmers. But since it are only plans without a schema this will most likely not happen in the coming year(s). CoC is the environmental quality design is also still under development and should address organic issues.
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Chapter 4: Current pangasius supply chain
In this chapter the customary pangasius supply chain is presented, which can be seen in figure 5 below. I will focus on the chain that is located in Vietnam, from hatchery until export. For each step the technical and managerial function will be discussed. I will start with the seasons of demand.Fig. 5 Total pangasius supply chain
4.1 Seasons of demand
There are two main harvestings seasons for Pangasius in Vietnam. Pangasius needs a natural 6 month growing cycle to reach market size. It is hard to shift these two cycles because the seasons are more or less fixed by Mother Nature (e.g. temperature). There are two main seasons with a temperature difference of 20 degrees. The farms are stocked after harvesting in November and again after the main harvest in March. So always after the change of the seasons the new fish comes into the farm.
The Pangasius is robust but sensitive for temperature changes. So the water temperature when the seasons are at their end will drop significantly and this can make the fish sick. So the farmers try to sell as much fish out of their farms and empty the premises. The second season is the flood season. It causes a lot of freshwater swelling and a mix with the saltwater from the seas as the River Mekong changes its direction during flood season and presses salt water from the sea inland. This mixture is not healthy for the freshwater fish. So due to the seasons the prices are low at harvesting times from March and from October.
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demand stays strong from January to Easter business, more Pangasius is needed. This is the time it becomes hard to deliver pangasius from Vietnam. After Christmas most of the farmers have sold the fish (http://www.worldofpangasius.com.vn).
4.2 The hatcheries
The first step in the chain is the actual breeding of the pangasius. This is where the eggs hatch and the young pangasius, the fingerlings, are produced.
4.2.1 Technical functions
Before 1997 the young pangasius could be caught in the wild in the MKD near Cambodia. But since the authorities forbid the catching of wild fries all young fries should come from hatcheries. The eggs and sperm are obtained from the broodstock. It is most important that the broodstock are good and strong pangasius since this has huge consequences for the development of the offspring. The development of pangasius larvae is a fast process; eggs and sperm are stripped and 20-30 hours after fertilization, the eggs start to hatch. After one more day the larvae develop into fry and can be transferred to nursing ponds or tanks. The nursing takes about 90 days. The mortality rates the highest during the first month (up to 80%). This is firstly due to the cannibalistic behavior and secondly because the young fry have a low resistance to poor water quality. Disinfectants and antibiotics are largely applied to treat eggs, fry and the rearing water. High application of chemicals/drugs will result in poor quality fry and fingerlings (Bakker, 2007).
Another problem is that pangasius only lay eggs once a year. This can be influenced by the use of chemicals and supplying extra food to the female. This technique is now applied and controlled by most hatcheries.
4.2.2 Quality management
The treatment of the fingerlings with chemical or other antibiotics to achieve a lower mortality rate can cause a lower quality of fingerlings. For the pangasius farmers the quality of the fingerlings is essential. The question that rises is if the higher fingerling survival rate, thus higher quantity sold, ways up to the loss of quality further down the chain.
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reputation and conditions of sale of the supplier that are the key to quality assessment by the producer. (www.foad.org)
There are two reasons why it is hard to control the quality of the delivered fingerlings to the farmer. This is firstly the lack of adequate measures of testing the quality of the fingerlings. Secondly it is the fact that the fingerlings are sold to fingerling traders. Because he can combine batches of fingerling all traceability is lost. NAFIQAVED is working on a better quality management.
4.3 The pangasius smallholders
The second step in the supply chain is the actual pangasius farming. This is where the fingerlings mature until they are ready for the next step.
4.3.1 Technical functions
There are three ways to farm pangasius. One can use a wooden cage on the river, a pond with water supply or use nets to fence of a part of the river (enclosure or pen). For pond culture system one needs less technology, many farmers use of homemade feeds. These practices tend to give the meat a muddy flavor and yellowish color, not favored by the export market (FAO, 2006). Cage farming gives whiter meat. This is why in the beginning cage farming was preferred. However, it is more expensive and after the price drop in 2001 it became harder to make profit with a cage. During the visit to the cage farms it became clear that the farmers mix the pangasius in the cage together with red tilapia. This is a general trend in cage farming (Nguyen, catfish 2007). Ponds are mostly used at the moment and generate the best results if one has a good water supply (FAO, 2006).
Figure 6 Change in different farming systems in the Mekong river delta of Viet Nam (FAO, 2006)
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I could not find his master thesis, so the amount of ponds visited stays unknown. His finding can found in table 2.
Size of pond
Size [m2]
% of total ponds
large
> 3000
30
medium
1000-3000
53,3
small
300-1000
16,7
Table 2 Different pond sizes found by Nhi (2005)
An investigation from Minh, presented in the same MoFi report, states an average pond area of 4,441 m2, with different sizes of 300 – 12,600 m2. The depths of the ponds are between the 2.5 and 3 meters. I have seen tremendous difference between ponds: ten ponds of more then 10.000 m2 each which are located next or near to the processor and smallholder ponds located inland with a small size of 1000 m2, but there are even smaller farms. It is unknown how many large, medium and small farmers there are. I will maintain the sizes of the ponds of Nhi, thus a smallholder is smaller then 1000m2. The cycle for the farming is for everyone the same.
The cycle begins with the preparation of the pond. After draining the water from the pond chemical (derris root and quick lime) are used to clean the soil in the pond. After 3 days of drying the pond is refilled. Early in the morning or late in the evening, when it is cool, the fingerlings are transported in plastic bags to the pond. The fish in the pond can be stocked up to 30fish/m3. The fish are fed twice a day. Depending on the age of the fishes home-made or industrial feed is used. It is generally mentioned that home made feed has a lower growth rate compared to the kg needed but is the overall cheapest solution. The industrial feed is more expensive but it gives a better quality of meet and causes less pollution (Khoi, 2006).
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4.3.2 Quality management
Because of the growth of the sector there is a big difference in the experience farmers have with aquaculture. Some have years of experience, others just started. Most of the farmers do not have an education on aquaculture and most of the staff a low training and competence. Some of the bigger farms hire competent technical managers but most learned through experience. Therefore, most smallholders are poorly managed and lack basic knowledge on planning, monitoring and selection, purchasing and application of inputs (Bakker, 2007). Depending on the farmer there is some documentation. According to the HACCP of Jouve (1998) the following CCP must be monitored: site selection, water supply, production and the feed supply. The status of these CCPs will now be discussed.
The quality of the water is controlled by looking at the color of the water and the number of fishes that die. If the water is to green it is refreshed using a gasoline driven pump. The water in the ponds comes directly from a river. The quality of the water is not monitored. Generally, the incoming water is not treated before it is used for farming. Some farmers have basic equipment for checking water quality. However, water quality is seldom monitored in catfish culture.
Another risk is that ponds can become contaminated by rain water from the paddies or fields where chemicals (e.g. fertilizers or pesticides) have been used. The sites are mostly not monitored (Bakker, 2007).
The waste water of most culture systems is discharged directly into the surrounding environment. The heavily fed pangasius production systems in areas with high farm density lead to high amount of nutrients being discharged in the river. Waste from feeds, especially farm-made feed, and chemicals/drugs may cause environmental issues and this self-pollution of the sector often leads to disease outbreaks and economic losses. In the Mekong delta, the water might as well be polluted by activities other than aquaculture, especially in heavily populated areas and near factories, processing and agricultural activities. Even though the carrying and self-cleaning capacity of the river is high, discharging effluents into the river contributes to water contamination and pangasius culture in this area might also receive sub-optimum quality water (Bakker, 2007).
This stated there are other studies that do not subscribe this. A study by the Can Tho University showed that there was no significant change in the water of the Mekong River composition before Chau Doc and after Can Tho, despite the presence of more than 5000 cages; which is most of the cage production of catfish in Vietnam (Mofi, 2006). The pangasius is a fish that can survive in highly polluted water. Nevertheless there is often no quality control point before it is used for farming.
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used to cure the fish. It is not unheard of that farmers use antibiotics as a preventative measure or to stimulate the growth. Apart from that they use old sometimes forbidden antibiotics that cause problems further down the chain, e.g. containers that are send back. In order to ensure aquatic products safety and quality, MoFI issued the list of chemicals/drugs that are permitted, limited and prohibited for aquaculture in 2002. Ten antibiotics were banned and Malachite Green was also added in the prohibited list in 2003. In 2005, the prohibited list consisted of 17 antibiotics and 34 of limited chemicals/drugs (MoFI, 2006). The government is working on controlling the sales of antibiotics at the chemical manufacturers. But there are a lot of old and illegally imported antibiotics available on the market that the farmers use. The illegal antibiotic and chemical network exists because of ignorance and the fact that the chemicals or antibiotics work better, these chemicals are so strong they just do the trick.
The farmers do not apply the rule that the fish can not use antibiotics 500 Celsius days before slaughter. This means that if the average temperature is 25 degrees the fish can be slaughtered 20 days after the last antibiotics are given. After this period most of the antibiotics should be gone. According to H. Nguyen (presentation Catfish 2007) 46% of the farmers use Dipterex, a forbidden antibiotic. It does not give huge problems because the concentration in the meat decreases very rapidly. N. Campet who treats diseases in the field confirmed that there is a tremendous use of forbidden antibiotics.
Fig. 7 Farm manager that lives next to the food (l), the house and his pond with irrigation.
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considering possible negative consequences. Home made feed is far cheaper then industrial feed and thus more used by smallholders. The FCR of this feed is around 3.0 (Nguyen, Catfish 2007) or even 4 (FOA, 2006). This has the consequence that ponds get much dirtier when home made feed is used. Farmers who produce according to BMP, SQF standard or an AFA member should document the amount of feed fed.
4.3.3 Chain performance
According to Bakker (2007) and Khoi (2006) the relationship between fish farmers and processors in An Giang has been more commonly characterized by informal agreements than by enforceable contracts. They have not included a guarantee that the processor will purchase the fish from the farmer. Fish farmers normally coordinate the amount of fish they will produce with the processor at the beginning of the farming season through a registration process. Prices will be negotiated at the time of harvest and depend on the market situation, fish quality and quantity. At that time the processor will check the fish quality by taking samples. If content, color or size does not match the requirements of the processor the price will be lower or the fish might even be rejected completely. Thus the quality gives problems in the reliability of the relation between the farmer and processor.
One of the problems dealing with processors is to find customers and obtain details about their demands in advance. Mostly the processors have already determined where to buy their fish. The processors have more power in the chain then the individual farmers. Besides antibiotic free fish, the processors want fish of 1 kg with white meet. Under certain bad water conditions the meet becomes yellow or pink (Schutz, 2006).
The problems the literature (Bakker, 2007, Schutz, 2004) mentions during production of the pangasius are the high production costs, insufficient quality of the fish, the outbreak of diseases and the low and fluctuating price. In the period from May 2007 to June 2007 the price dropped from an average price of 17.000 dong/kg to 11.000 dong/kg. The actual price drop occurred in no more then a few weeks. Reasons given for the price drop where seasonable price changes and price agreements between all the pangasius processors.
4.4 Fingerling and pangasius traders
Both the fingerling traders as the pangasius traders fulfill the same intermediate function.
4.4.1 Technical functions
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the chain. When they buy different stocks at different hatcheries or farms they sort the fish on desired quality and size. In some cases poly-cultures are bread. In this case the species of fish are also sorted.
The traders arrive with their boats when the fish are driven together with nets (the netting). When the fish have an extremely high density big bamboo baskets are pushed in to capture the fish. The bamboo bucket filled with fish is weighed and registered. After this the fish are carried to the traders who sort the fish on the spot. The species and qualities are weighed and registered. When the harvest is completed the total amount and the sorted amount is compared and the price for the quality is paid. The traders sell the big fish with the right quality to the processors for the international market. The lower quality is sold to processors that produce for the local market.
4.4.2 Quality management
The traders do not alter the product they buy. They fulfill the function of intermediary and sort on quality. The traders sort on the quality aspects such as size and physical appearance, but they do not sort on the use of antibiotics. The traders can stock and combine the harvests. It could be registered which harvests are combined. Documents can be easily ‘adapted’ and the traceability of the fish is lost. Furthermore, a batch of fish can be created that were and were not treated with forbidden antibiotics. When the batches are statistically tested for antibiotics this can cause batches to firstly be accepted and when imported rejected.
Nowadays most pangasius traders have become employees of the processors. They collect the fish at contracted farms and when the contracted farms can’t supply they buy from independent farms. The transporter gets paid per transport and not for the amount and quality. This is the responsibility of the farm.
4.5 Processors & export
The final step export is the creation of the fillet in the processing plant.4.5.1 Technical functions
The factories producing fillets are big. They have capacities to slaughter around 100 tons of fish every day. This is generally handled in shifts of 10 - 12 hours, where certain personnel start early while other finishes late. The design of the factories is generally good and takes well care of demands for hygiene zones, dividing operations in clean and unclean areas (Sorensen, 2005).
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The fish are then transported by assembly line to the fillets section where the fillets are cut from the fish. The trash (dead, tail, etc) is separated and sometimes used for side products as fish oil or cosmetic products. The fillets continue to the second fillet section where the fillets are skinned, e.g. the fat is removed. After this they are inspected, washed, sorted and transported to a huge freezer that fast deepfreezes the fillets individually. At this stage they are glazed as well. This is a small layer of water to protect the fillet for further handling. Finally the fillets are weighed, packed and stocked in a freezer where they are ready for further transport.
At the moment the filets are sold for 2.50 Euro per kilogram at the harbor of Rotterdam. The filets are packaged in their final form, thus per 2 filets with the right label on the box. Vietnam exports a huge amount of 1 million ton but does not capture a high margin on the product (P. Redmayne, Catfish 2007). China and Vietnam export a lot of bulk but only capture a low margin on the product.
Figure 8. Cutting the fillets (l) and checking the fillets for parasites (R)
When the fillets enter the harbor from Rotterdam they are distributed to e.g. Anova. They are the supplier for Ahold. Anova supplies directly to the supermarkets around Holland. What the distributers from pangasius mentioned is that there is not a steady supply of pangasius from the producers. The pangasius has to be bought from different importers in time to fulfill the demand of the market. The fillet is offered at the harbor in Rotterdam for approximately 2,50 euro in the shop the customer pays at least 12 euro per kilogram.
4.5.2 Quality management
Because of the harmonization with the E.U. regulation NAFIQAVED demands the same rules for the processors as the E.U. This means an HACCP plan should be implemented.
