IMPACT OF UNHARMONIZED AFLATOXIN REGULATIONS AND STANDARDS ON TRADE. James Gathumbi (PhD) Faculty of Veterinary Medicine University of Nairobi KENYA

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1 IMPACT OF UNHARMONIZED AFLATOXIN REGULATIONS AND STANDARDS ON TRADE James Gathumbi (PhD) Faculty of Veterinary Medicine University of Nairobi KENYA

2 INTRODUCTION OUTLINE OF PRESENTATION Aflatoxins And Mycotoxin Standard Aflatoxins Regulations And Standards How Aflatoxin Standards are Set? Aflatoxin Regulations And Standards In Some Coutries Aflatoxin Limits Are Low. Justifiable? Aflatoxin Standards: Pros & Cons Aflatoxin Limit And Trade Conclusion

3 AFLATOXINS AND MYCOTOXINS STANDARDS Since discovery of aflatoxins in early 1960s, many countries have established regulations to safeguard health of man and animals. The first standards were set in the late 1960s. USA in Today, over 100 countries have established standards on aflatoxins.

4 AFLATOXINS AND MYCOTOXINS STANDARDS Some countries have simple standards. Others have detailed standards that have MRL for various commodities and uses, and also specify sampling plans. Standards have been set by individual countries, regional trading blocks eg. European Union, USDA and by international bodies eg. WHO/FAO Codex STANDARDS AND REGULATIONS ARE NOT HARMONISED

5 AFLATOXINS REGULATIONS AND STANDARDS In general, more stringent aflatoxin standards are in wealthy developed countries such as the European Union. Less stringent standards are by CODEX, in developing counties and in the USA. As is the case with all food safety regulations, aflatoxin standards are difficult to set and are often contentious within countries and internationally. Standards are potentially important barrier to trade for many exporters in low-income countries.

6 AFLATOXINS REGULATIONS AND STANDARDS There is general agreement that aflatoxins should be excluded from food and feed as much as possible. However, aflatoxins occur naturally, are estimated to contaminate over 25% of all food produce worldwide and cannot be completely excluded. A certain level of aflatoxin MUST be tolerated.

7 HOW ARE AFLATOXIN STANDARDS SET? According to World Trade Organization (WTO), countries can set their own Sanitary and Phyto Sanitary Standards (SPS) to protect human, animal, and plant health. Set SPS should be nondiscriminatory and justifiable by science. SPS regulations sometimes serve as a significant barrier to trade and result in trade disputes within the WTO.

8 HOW ARE AFLATOXIN STANDARDS SET? A number of scientific factors, political and economic considerations influence establishment of MRL (FAO, 2004). These are: Availability of toxicological data (hazard identification, characterization, etc) Availability of data on aflatoxin occurrence in various commodities. Availability of analytical methods. Domestic food supply situation. Domestic trade interest and foreign trade regulations.

9 MYCOTOXIN REGULATIONS AFRICA 2003 (FAO)

10 AFLATOXIN TOTAL LIMITS IN 2003

11 AFLATOXIN LIMITS IN EU (2010)

12 USA FDA AFLATOXIN STANDARDS ppb Product Description 20 Corn, peanut products, cottonseed meal, and other animal feeds and feed ingredients intended for dairy animals, for animal species or uses not specified above, or when the intended use is not known 20 Corn, peanut products, and other animal feeds and feed ingredients, but excluding cottonseed meal, intended for immature animals 100 Corn and peanut products intended for breeding beef cattle, breeding swine, or mature poultry 200 Corn or peanut products intended for finishing swine of 100 pounds or greater 300 Corn and peanut products intended for finishing (i.e., feedlot) beef cattle

13 SOME COUNTRY STANDARDS COUNTRY Egypt 10 Kenya 10 Malawi 5 South Africa Tanzania Zambia 10 Zimbabwe 5 Australia 5 China 20 India 30 USA 20 Guatemala 20 Codex STANDARD (ppb) 10 (Total) 5 (aflatoxin B1) 15 total (Peanut) 0.5 (aflatoxin M1 in milk)

14 AFLATOXIN LIMITS ARE VERY LOW. JUSTIFIABLE? 10ppb is same as 10g aflatoxin in 1000 tonnes of food! Less than a tablespoon in 1000 tonnes of food! Standards set through science esp. genotoxic effects. Aflatoxin affects staple foods (maize) and so high dietary exposure. Africa has a high disease burden (hepatitis B, AIDS) synergism with aflatoxins.

15 AFLATOXIN LIMITS ARE LOW. JUSTIFIABLE? PROBLEM Most adopted from WHO FAO CODEX No detailed risk assessment was done to evaluate public health benefits. Many Countries - One standard has been set for all commodities with disregard for further processing, inclusion rates and various uses eg. Fattening livestock. Low capacity of most countries to implement regulations and standards.

16 AFLATOXIN STANDARDS: PROS & CONS Benefits Improved health & safety Improved food quality Greater information exchange, More technology transfer, Disadvantages Non-transparent rules May target import - specific testing, certification rules Domestic science drives rules May be used as protection

17 AFLATOXIN LIMIT AND TRADE A World Bank study has calculated that the European Union regulation on aflatoxins costs Africa $670 million each year in exports of cereals, dried fruit and nuts. And what does it achieve? It may possibly save the life of one citizen of the European Union every two years Surely a more reasonable balance can be found. -- Kofi Annan, former UN Secretary General At the Third United Nations Conference on the Least Developed Countries in Brussels on May 14, 2001,

18 AFLATOXIN LIMITS AND TRADE LOSSES According to IITA (2009), aflatoxins as nontariff barriers to international trade are estimated to cause losses of $1.2b to the global economy and about about $450m loss to African economies.

19 AFLATOXIN LIMITS AND TRADE LOSSES Aflatoxins are huge potential barriers to trade. Inadmissibility or rejection of products by local and higher-value international market. Rejection of shipments (loss of value of goods, shipping cost, insurance etc). Aflatoxin regulations may result in trade losses by increased cost of meeting the standards including cost of testing, loss of time, demurrage costs

20 AFLATOXIN LIMITS AND TRADE LOSSES Producers of the affected crop may also earn less because of product rejection, reduced market value. In some international market, products that do not meet the aflatoxin standards may be assigned a reduced price, or diverted to non-human or even non-fee uses, sometimes destroyed at owners costs Destruction of contaminated commodities

21 AFLATOXIN LIMITS AND TRADE LOSSES Case studies E.U Peanut Meals Imports In 1982 the EU mycotoxin regulations were tightened. The total peanut meal imports by the European Union (EU) member countries fell from more than one million tons in the mid-1970s to just 200, ,000 tons annually in mid 1980s. The losses to African trade was estimated to be greater than US$750 million dollars annually.

22 AFLATOXIN LIMITS AND TRADE LOSSES Case studies Maize and Peanut Trade in East Asia In the 1980s, Thailand was one of the top five maize exporters in the world. Due to aflatoxin contamination, maize from Thailand if frequently sold at lower discounted prices. This is estimated to cost Thailand about $50 million annually in lost export value. According to FAO), the combined costs of mycotoxin contamination in maize and peanuts in Southeast Asia (Thailand, Indonesia and the Philippines) is estimated to be several hundred million dollars annually (Roy, 2013)

23 AFLATOXIN LIMITS AND TRADE LOSSES Case studies - Aflatoxin in Kenyan Maize Contamination of 2.3 million bags (90 kg per bag) of maize resulted in a loss of Kenya Shilling billion revenues for farmers, as well as high prices of maize flour meal for consumers in CONTAMINATED FOOD IS POISONOUS

24 AFLATOXIN LIMIT AND TRADE LOSSES For both maize and pistachios, nations with identical or near-identical aflatoxin standards (not different by more than 5 ng/g) tend to conduct significantly more trade with each other than nations with very different aflatoxin standards. Thus, countries are aligning themselves in food trade, so as to minimise economic losses due to rejected consignments due to aflatoxin contamination (Wu and Guclu, 2012)

25 HARMONIZED AFLATOXIN STANDARDS World Bank study by Wilson and Otsuki, (2001) If 15 importing countries and 31 exporting countries (including 21 developing) could have harmonized aflatoxin at 9ppb, there would have been a 51% ($6.1 billion) increase in trade of cereals and nuts.

26 AFLATOXIN LIMIT AND TRADE LOSSES According to research results by Munasib and Roy (2011), a 10 percent increase in the gap between standards of importers and exporters is associated with as much as a 4.4 percent decline in maize exports from lowincome countries.

27 AFLATOXIN LIMIT AND TRADE LOSSES Bui-Klimke, (2013) observed that over a past period of15 years, the US increasingly exported pistachios to countries with stricter aflatoxin standards, while Iran exported to countries with more lenient or without regulations. The US pistachio crop has had consistently lower levels of aflatoxin than the Iranian crop over this same time period.

28 FELICIA WU, 2009

29 FELICIA WU, 2009

30 CONCLUSION Philippus Aureolus Theophrastus Bombastus von Hohenheim Paracelsus, stated All substances are poisons; there is none which is not a poison. The right dose differentiates a poison from a remedy AFLATOXINS ARE NOT DIFFERENT: HARMONISE STANDARDS AND REGULATIONS FOR BETTER TRADE.

31 THANK YOU