Challenging Issues for

Transcription

1 International Seminar Food Safety and Quality: The Challenging Jigsaw Puzzle of Logistics in the Agri Food Supply Chain Challenging Issues for Food Logistics Assoc. Prof. Dr. Somyot Chirnaksorn Assistance to the President of Director of the 20 th January 2012 Rama Gardens Hotel, Bangkok, Thailand 1

2 Presentation Topics Characteristics of agriculture and food chain Limitation of food logistics Thailand strategy for agro logistics 2

3 Characteristics of agriculture and Supply chain stage Growers / Producers Food processing industry Wholesalers / Retailers food chain Characteristics Impact on logistics Modified from: Van der Vorst et al.,

4 Characteristics of agriculture and Supply chain stage food chain Characteristics Impact on logistics Growers / Producers Long production times Seasonality in production Variability of quality and quantity of supply Responsiveness Flexibility in process and planning Modified from: Van der Vorst et al.,

5 Characteristics of agriculture and Supply chain stage food chain Characteristics Impact on logistics Food processing industry High volume, low variety production systems Highly sophisticated capital-intensive machinery Variable process yield in quantity and quality Importance of production planning and scheduling focusing on high h capacity utilization flexibility of recipes Modified from: Van der Vorst et al.,

6 Characteristics of agriculture and Supply chain stage Food processing industry Modified from: Van der Vorst et al., 2005 food chain Characteristics A possible necessity to wait for the results of quality tests Alternative installations, alternative recipes, product-dependent cleaning and processing times, carry over of raw materials between successive product lots, etc. Impact on logistics Timing constraints, t ICT-possibility to confine products 6

7 Characteristics of agriculture and Supply chain stage food chain Characteristics Impact on logistics Food processing industry Storage buffer capacity is restricted, when material, intermediates, or finished products can only be kept in special tanks or containers Necessity to value all parts because of the complementary nature of agricultural inputs Flexible production planning that can handle this complexity Modified from: Van der Vorst et al.,

8 Characteristics of agriculture and Supply chain stage food chain Characteristics Impact on logistics Food processing industry Necessity for lot traceability of work in process (due to quality and environmental requirements and product responsibility) Need for configurations that facilitate tracking and tracing Modified from: Van der Vorst et al.,

9 Characteristics of agriculture and Supply chain stage food chain Characteristics Impact on logistics Wholesalers / Retailers Variability of quality and quantity of supply of farm-based inputs Seasonal supply of products requires global (year-round) sourcing Requirements for conditioned transportation and storage means Pricing issues Timing constraints Need for conditioning i Pre-information on quality status of products Modified from: Van der Vorst et al.,

10 Characteristics of agriculture and Supply chain stage O V E R A L L food chain Characteristics Shelf-life constraints Recycling of materials required Impact on logistics Timing constraints Information requirements Return flows Modified from: Van der Vorst et al.,

11 Presentation Topics Characteristics of agriculture and food chain Limitation of food logistics Thailand strategy for agro logistics 11

12 Limitation of food logistics High transportation cost High costs of distribution Major Problems Limited number of airlines Limited cargo space Closed rather than open sky Empty cargo on the way back Modified from: Wageningen UR Food & Biobased Research 12

13 Limitation of food logistics Farm based cooling systems Minor Problems but High Cost Facilities at packing houses Deficient i logistics and quality infrastructure Appropriate technology transfer Modified from: Wageningen UR Food & Biobased Research 13

14 Limitation of food logistics Policy on residue / chemical control Also Problems with High Cost Certification and standards assurance Thai GAP is not accepted Dual standards Modified from: Wageningen UR Food & Biobased Research 14

15 Limitation of food logistics Co- ordination Problems with High Cost Business environment for exporting perishable goods A choice of suppliers Consistency between national standards and international certification requirements Modified from: Wageningen UR Food & Biobased Research 15

16 Presentation Topics Characteristics of agriculture and food chain Limitation of food logistics Thailand strategy for agro logistics 16

17 Thailand strategy for agro logistics 2 Key Drivers To be Political a Global Agri-Food environment Super Power 1 Optimal Agro climatic conditions Strong credible coordinating & Promotion agency 3 Strong Demand 5 Strong Consumer base Strong Corporate leadership 4 Modified from: Pankaj Kapoor (2009) 17

18 Thailand strategy for agro logistics Logistics Development Master Plan ( ) endorsed by the Cabinet on Feb 2007 Vision Having World-class l National Logistics Environments to become a Trade Hub for Indochina Objectives 1.Reducing logistics cost (Cost Efficiency), increase business Responsiveness, Reliability and Security 2.Create Value-Added on logistics industry and related business Strategic Agenda Improve Logistics efficiency i in industry 1 Improve efficiency in transport and logistics 2 Build Logistics Service Providers Business 3 Enhance Trade Facilitation ti 4 Build Human Resources in Logistics To reduce the trade logistics cost from 19% (2007) to 16% (2011) (comparing to GDP) 5 18

19 Thailand strategy for agro logistics Goods Transportation and Services Management System Development Board (Office of the Prime Minister) Agricultural Logistics Systems Sub-Board (Ministry of Agricultural and Cooperatives) Working Committee on Action Plan for Agricultural Logistics (Office of Agricultural Economics) 19

20 Thailand strategy for agro logistics Ministry of Agricultural and Cooperatives Logistics management in agriculture and agroindustry to be effective and can be traced throughout the supply chain. Encourage farmers and entrepreneurs, both in agriculture and agro-industry with the application of modern logistics management techniques. Support the development of logistics management systems that are linked to each other along the supply chain to maximize efficiency (Supply Chain Optmization) and can monitor the movement of goods. 20

21 Thailand strategy for agro logistics Ministry of Industry Roadmap for Food Industry Logistics To reduce the Inventory Capital Cost by 15% (2016) )(comparing to Gross Output) The operation resulting in cost reduction. (Quick win) Measures to encourage incentives for the industry. (Enforcers) Measures to enhance the performance of the organization. (Enabler) Measures to support business operations and associated supply chain. (Enhancer) 21

22 Thailand strategy for agro logistics Ministry of Commerce Thai Trade Strategy Strategy 2. Development of fair competition and create an effective market mechanism to stabilize commodity prices. Food (people / animals), Livestock, Fisheries, Organic farming Energy crops (sugar cane, palm oil) Rubber 22

23 Thailand strategy for agro logistics Ministry of Commerce Farmers Stabilize agricultural prices Promote agricultural futures markets Consumers Business Operators Produc ers Exporters Traders Take care of products and services to be fair Make a choice / protect the interests of consumers. Organize and manage the import and export Promote business development and facilitate t trade Supervision and establish a fair trade 23

24 Thailand strategy for agro logistics Logistics and Supply Chain National Research Strategy Book 1 ( ) 2011) Strategy 3. Develop integrated knowledge into action to improve the agricultural l logistics and supply chain Increase productivity. Create value chains. Quality assurance and traceability. Enhance the well-being of the members. 24

25 Thailand strategy for agro logistics Problems that need attention Non-tariff barrier measures Food crops or Energy crops Environment Political issues Competitors or Partnerships Nature or global warming 25

26 Assoc. Prof. Dr. Somyot Chirnaksorn Assistance to the President Director of the 26