Address: Parque Antonio Rabat 6165, Vitacura, Santiago Phone: (2) Fax: (2)

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1 WAGYU STANDARS VERIFICATION SYSTEM FOR EXPORT This document has been developed by Fundación Chile, at the request of the Agricola Mollendo S.A. Company, under contract to provide services for Research and Development covered by the Tax Benefit Law , certified by Innova Chile, CORFO. Author Address: Parque Antonio Rabat 6165, Vitacura, Santiago Phone: (2) Fax: (2)

2 INDEX SCOPE OF VERIFICATION. 2 WAGYU GENETICS QUALITY VERIFICATION SYSTEM.3 CHAPTER I: OF THE WAGYU ANIMALS....3 CHAPTER II: OF THE RECORDS.. 3 CHAPTER III: OF THE FILIATION...4 CHAPTER IV: OF THE DOCUMENTATION..4 WAGYU BEEF QUALITY VERIFICATION SYSTEM.6 CHAPTER V: CHARACTERISTICS OF THE CARCASSES.6 CHAPTER VI: CHEMICAL CHARACTERISTICS..9 CHAPTER VII: SANITARY CHARACTERISTICS..10 CHAPTER VIII: REQUISITS OF THE BEEF PROCESSING FACILITY (PFC). 10 CHAPTER IX: PROCESS IN THE SLAUGHTERHOUSE 11 CHAPTER X: SMALL PARTS, PACKAGING AND CONDITIONING

3 SCOPE OF VERIFICATION The carcass verification system is to evaluate the defined characteristics in the Quality Standard, from the genetic characteristics of the live Wagyu race up to the superior meat characteristics, resulting in the slaughter of Wagyu animals. To assure compliance a certification company should exist, accredited as certifier of the beef law, recognized by the Agricultural and Livestock Service (SAG), so it certifies the application of the Wagyu quality standard. For proper verification and certification of the conditions of the Standard it is required that the information is available in places where they arise, such as the land of calve suppliers, feedlot, slaughter plant and certification company. Fundación Chile is the developer of the Standard, and as such, in case it s required, it will perform a second level verification to assess the activities of the interested company and the certification company. For the correct certification process and to give the respective guarantee regarding compliance of the standard, the following list of information is requires: 1. The calf rearing farm must have and provide records of animals on the site, specifically records of insemination or mating, and gestation. 2. The feedlot must provide a complete list of the animals on the site, with a minimum frequency of once per semester. 3. DII0 of animals for slaughter: must be provided by Mollendo, minimum 3 days prior to loading the animals, to check the compliance of these animals in the Wagyu crossbreeding program. Fundación Chile will answer within two business days via N DII0 and N of resulting channel: will be shipped by the Beef Processing Facility (PFC) after each task. 2

4 5. It is required to send the results of the carcass evaluations by the certifying company, a day after the recorded event. 6. Deboning Program of the evaluated carcasses, provided by Mollendo. WAGYU GENETICS QUALITY VERIFICATION SYSTEM CHAPTER I: OF THE WAGYU ANIMALS The identity of the animals must be recorded in official databases, according to the official traceability rules (DII0) and PABCO property records. The use of DII0 should be subject to the provisions of the SAG and the official traceability program. In the case of animals that have no DII0, where their original identification must be changed, records must exist which associate the original identification to DUO. The original identification must be reported on export certificates, Artificial Insemination (AI) catalogs, invoices and catalogs of exhibitions and sales. CHAPTER II: OF THE RECORDS The wombs and bull or bulls used in the service must be present on the holding on the service day. Therefore official records of existence must be available, of movements and disposals of animals to ensure their presence at the time of service. The insemination records (artificial or natural mating) and / or Embryo Transfer (TE) must include the date, the DII0 of the inseminated female or exposed to a bull, if available the name of seeded womb, and the identity and name of the bull used. The sex and product identity must be registered on the day of birth. In the case of TE, the records must show the genetic mother and the receiving embryo mother, as well as the bull used in the service of the genetic mother. 3

5 CHAPTER III: THE FILIATION. The following controls should be completed before establishing genealogy compliance. The animals involved in the Wagyu breeding program must be identified according to the proposals of the Wagyu genetic standard. Cover- partum period: It is assumed that the cover- partum period average is of 288 days for the Wagyu race, with a margin of error of 17 days (6% of the total length of gestation of 288 days), so for calves born outside this range (<271 or>305 days) will be considered products non pertaining of the mating or IA recorded for them. The service of the bull must be established by the artificial insemination registry, mating and the evidence that the father was on the premises the day of service, or a veterinarian's statement (e.g. in the case of an embryo transfer). CHAPTER IV: THE DOCUMENTATION Germplasm: Up to date documentation must be available at the current site of purchase or receipt of Wagyu germplasm, as well as any changes in inventory of the property (Invoices, Waybill, etc) Additionally, if there are doubts and inconsistencies in the records of housing- delivery, the following paternity supervision controls for the verification of the Wagyu breeding program may be performed. a.) The visual inspection of the progeny. While it is not conclusive evidence by itself, it is imperative a visual inspection (phenotypic evaluation) is made to support the management of the Wagyu standard, and to rule out the animals that do not represent the race. The Wagyu breed is defined by the characteristics of the live animal, within which the most relevant are listed below. 4

6 Wagyu Standard Regimen Review N Racial Evaluation Wagyu Pattern of 1 Head Small respective to the size of the animal, long, narrow face with a straight 2 Neck Fine, thin and long 3 Cross Relatively thick 4 Lumbar back line Straight, without a prominence 5 Spine Broad 6 Thighs Wide, thick and fleshy 7 Tail Short and thin, finished in rich tassel of black hair and/or reddish. b.) Determination of blood group or any other known method for verification of genetic parentage. Paternity Test Paternity Testing: In the case of having to prove the paternity of the animals of the Wagyu crossing program with inconsistencies in their records (e.g. covered- partum period), but the product suggests phenotypically Wagyu origin, DNA samples must be taken for the laboratory analysis to establish the paternity of the offspring with respect to the Wagyu bulls used during that season. 5

7 WAGYU BEEF QUALITY VERIFICATION SYSTEM CHAPTER V: CHARACTERISTICS OF THE CARCASSES The animals ready for slaughter must comply with all requirements set forth in the Wagyu Breeding Program. Carcasses must be evaluated at the beginning of the process ; the parameter must be recorded in writing and must add a photograph of the loin eye, which will link the number of the corresponding side. The following attributes will be evaluated with particular characteristics for each of them: a.) Beef color, fat color, evaluated by comparing the beef and the fat, both in the cross section between the 11 th and 12 th vertebrae, with the Beef Color Standard table and Beef Fat Standard table, the evaluation will register as it complies or does not comply, as appropriate. In cases the evaluation does not comply, it shall indicate the cause. b.) The total area of the spine, is evaluated in a cross section between the 11 th and 12 th vertebrae, the surface will be measure with a semi- transparent template marked with a grid of 1 inch 2 (squares of 1inch x 1inch; 1inch=2,54 cm, 1 inch 2 =6.45 cm 2 ), 6

8 Each square occupied by the section of the Longissimus dorsi muscle will be counted for the evaluation of the loin eye area. To measure the total area of the loin, the Longissimus dorsi, Spinalis thoracis, Transversus Spinalis thoracis, Intertransversalis thoracis will be accounted. In both measurements, the squares that are partially filled with muscle are added until completing a whole square. The fat between the muscles mentioned above will also be considered, the criterion of this evaluation is to measure the commercial cut that will reach the consumers. The template should be disinfected before and after each evaluation to avoid contamination. 7

9 Marble or marbling: is evaluated at the "eye of the loin" between the 11 th and 12 th vertebrae and is visually compared with the Japanese scale (Beef Marbling Standards, BMS). - One must wait at least 30 minutes after the cutting of the quarters is finished due to the low melting melting point of fat, the marbling is not properly appreciated and it is necessary for it to re- condense. - Both left and right sides must be observed, it is common for marbling levels to be different for each sides, for which the evaluation criteria to be granted shall be the lowest score of the two. Procedure for the BMS Evaluation: i. First criterion of comparison is the similarity with the visual scale. 8

10 ii. iii. iv. Second criterion to consider is the level of marbling homogeneity, i.e., those carcasses that display a level of homogeneous distribution of fat infiltration will have the same qualification as the one observed in the first criterion. If there is a good level of marbling with bad distribution, i.e. areas with no infiltration in the muscle, the classification of evaluation will be lowered by one point according to the first criterion. The thickness of the veins of marbling, in those cases where the veins are of good thickness, they will have a better rating. v. The BMS score will be recorded in writing with the carcass identification. vi. vii. A photograph must be registered with the number of the corresponding carcass. Immediately after the previous photograph, a photograph will be recorded of the loin eye of the carcass, with the BMS visual scale with the given rating, ensuring that both the loin eye and the visual scale are centered in the picture. BMS 7 BMS 8 BMS 9 The visual scale must be disinfected before and after the evaluation, to avoid contamination. CHAPTER VI: CHEMICAL CHARACTERISTICS The ph of the beef is evaluated in the "Longissimus dorsi" muscle, the value must be less than six, the measured value with the number of the carcass must be recorded in writing. This assessment will be conducted in all Beef Slaughter Plants (PFC), for the verification the records must be reviewed by whom the PFC assigned responsible. The carcasses with a ph higher or equal to 6 will be rejected by the standard. 9

11 CHAPTER VII: SANITARY CHARACTERISTICS Food Health Regulations, regulated by the Health Ministry The carcass temperature is measured in the long dorsi muscle ("Longissimus dorsi") it must be at the 12th dorsal vertebra height, constantly at 5-7²C, 48 hours after the animal slaughter. The registered temperature must be recorded in writing, with the carcass identification where it was evaluated. For verification of temperature records one must review the available information in the PFC. CHAPTER VIII: REQUISITS OF THE BEEF PROCESSING FACILITY (PFC) The standards set forth in this section must be supplemented with the legal provisions contained in the 94th Decree of 2008, of the Agriculture Ministry. The constituents of the slaughter of Wagyu animals must ensure that those responsible for the PFC must agree contractually to comply with this regulation. Annex 1 Beef Slaughter Plants Commitment. The culling will take place in slaughter plants authorized for export, under the List of Livestock Exporters Establishments (LEEPP) of the Agricultural and Livestock Service (SAG), for the bovine raze, eligible for export to markets in the United States and the European Union, for the verification one may visit the SAG website which publishes the Livestock Exporters Establishments list of bovine beef products, they must verify the validity of its habilitation for export to markets in the United States and the European Union, both inclusive, the link is as follows: habilitados exportar/habilitados especie/especi es banderas/bovinos.htm For the verification of compliance with this standard, verification will be made by the Certification Company of all slaughterhouses, generating respective certification reports. Second level checks will be performed by Fundación Chile to ensure technical compliance of the Standard and its verification system. 10

12 The frequency of second- level checks defined for the first year of standard performance will be at least 50% of the tasks performed. This estimate was made with the scenario of a task per week, which will witness some of the production process, one will need access to the installations, documentation demonstrating the processes the carcasses have followed resulting from the slaughter of Wagyu animals, whether owned by the Beef Slaughter Plants, the Company Certifier of the Beef Act or the Wagyu Carcass Certification Company. The information will be evaluated in terms of quality, robustness and consistency of information with the observed. It will maintain information confidentiality. In case there are these will be presented in writing to the Mollendo Company, which corresponds to the counterpart of Fundación Chile. CHAPTER IX: PROCESS IN THE SLAUGHTERHOUSE The abattoir must provide a reliable method to maintain the individual animal s traceability, associating the DI10 with the carcass identification given by the slaughter plant. For verification, an auditable tracking system must be made to link each slaughtered animal s identification individually and the carcass number, identification to be assigned by the slaughtering plant, this information must be contained in a written record. The identification of the carcass must be held until the minor cutting, in the case of labels, the removal of the identification of the carcass will be verified until the office staffs, prior to entering the deboning room. In the case of stamping, it must be legible. It is recommended to use those labeled PFC, due to the level of thickening of Wagyu carcasses, the stamps become difficult to read. The sacrifice will be made so that the animal suffers the least possible stress. The minimum requirements to be respected during this phase are: Immobilization and quiet stunner. Bleeding wings as complete as possible. Applying electrical stimulation is authorized according to the current legislation. The dressing of the carcasses will be held under current legislation 11

13 The verification of these labor conditions will be done through questions to the officials or visually during slaughter, through the check list. The carcasses with apparent surface condensation will be out of standard; this condition will be checked visually at any time during the process, recorded only in cases where this situation is detected. Maturation will take place during a period of no less than 10 days, starting from to the time of slaughter, time may elapse for the carcasses in the slaughtering plant or as a vacuum- packed beef and frozen, for which it will be verified according to information provided by the Mollendo company, on the beef covered by the certification, on shipping time of the beef for export or distribution in the domestic market. Maturation units shall be grouped in specific areas within the refrigerators, avoiding physical contact with other pieces of beef. There will be a visual inspection. The slaughter plant will have a Quality Assurance system (SAC) based on the Hazard Analysis system and Critical Control Points (HACCP), ensuring in this way, the safety of food throughout its chain of production. For verification, one may conduct a department audit in a specific department of the Slaughter plant who is responsible for this area of work. CHAPTER X: SMALL PARTS, PACKAGING AND CONDITIONING The product s traceability is always guaranteed, at the sub lots level comprising the category defined by the beef law, within each of these sub lots, the carcasses will be grouped assessed by the BMS, which will be ordered by levels of marbling, and must enter entirely (forequarters and hindquarters), thus resulting with BMS classification cuts and will be grouped by BMS ranges: 12

14 BMS Silver Gold Platinum 3 to 5 6 to 7 8 to 12 Packages must ensure easy product identification and proper protection for it; materials must be clean, new, and odorless, not cause alterations to the product and comply with current legislation. To check on the sub- lots one can verify in the office staffs, where the labels of the carcasses are removed before entering deboning and are stored in an orderly manner. Operators of the deboning Inns must have the necessary instructions on how to maintain traceability at the sub lots and the labels to correctly identify the cuts. a.) Each export cut must be identified with labels giving information about the BMS classification of the carcass it comes from (Silver 4-5; Gold 6-7; Platinum 8) b.) If the label does not have the BMS classification, the Certification Company must remove the seal certifying that identifies your certification, should it be printed on the label, it must be changed for another without his trademark. c.) Each export cut must be indentified according to their classification on a label, which must be certified by a competent company in the field. The Certifier must ensure that the boxes indicate the cuts classification. In the case there are two or more levels of marbling in a box, this must be labeled with the lowest classification it contains. The classification must be indicated according to the BMS on the box of the final product. 13