An Analysis of the Fruits and Vegetables Supply Chain

Abstract

Fruits and vegetables provides your body with the essential vitamins and minerals that is needed to maintain your health.

Introduction

It is no surprise these days that people are trying to live a healthier life. In order to do so one has to alter their diet and add fruits and vegetables. It takes time but the effort is worth it. We are learning every day that having fruits and vegetables in your diet can help guard against diseases and some types of cancer. The Center for Disease Control and Prevention (CDC) is doing their part to inform everyone about the benefits of eating fruits and vegetables. Their website is chock full of information that every family can use to their benefit.

Fruits and vegetables also provides your body with fruits and minerals. When you eat a variety of fruits and vegetables it helps you control your blood pressure and even weight loss. The daily recommended intake of fruits and vegetables is 4.5 cups. In addition to eating healthy physical activities should also be included such as biking, walking, and swimming and exercising.

More and more workplaces are jumping on the band wagon to implement some form of wellness program with a variety of activities for employees to have an opportunity in having good health. Some have built gyms and allow employees time during the day to work out, others have workout hours where groups of employees can participate at a time.

There are definitely important benefits in incorporating healthy eating habits and exercise in our lives. Everyday lives are cut short because we fail to feed and treat our bodies’ right. But simple and small changes with diet and exercise implemented over time can add years to our lives.

Farms

Agriculture is one of the major industries in the US. Although most states have some form of agriculture such as oranges in Florida, peaches in Georgia and grapes in California the more concentrated area of agricultural can be found in the Great Plains. In 2010, $115 billion worth of agriculture was exported around the world. We import less than what we sell which gives the United States balance in the agriculture trade. Our farm and ranch families make up 2% of the US population. Approximately 31% of our farmers’ income come from the goods they export, one out of three of the farms in the US plants their crops for export. Farms employ roughly 21 million Americans which is around 15 % of the United States workforce. 97 % of the farms are owned and operated by families. Only 16 cents of the dollar is returned to the owners the rest is use to continue to support the farm for upkeep, wages, machinery, transportation, marketing and so forth. It is important for our farms to be successful because they are necessary to sustaining and nourishing our families.

Other important factors of farming are making sure the land is protected by rotating crops. The use of alternate energy such as wind power and renewable fuels such as biodiesel and ethanol are also beneficial to keeping the environment enriched. An important fact farmers plant hundreds of thousands of tree every year. The farmers are stewards of the land and with the help of the conservation programs they can help to preserve and keep the lands in planting condition for healthier crops. More than half of our farmers provide a wildlife habitat to animals such as deer’s, moose and birds. US farms are important to us all.

Fruits and Vegetables Supply Chain & Distribution

Every year 800 million tons of vegetables and 700 million tons of fruits are produced worldwide. Of these the leading fruits and vegetables bananas, oranges, apples, melons and grapes tops the chart and the leading vegetables are cucumbers, tomatoes and cabbage. Over 50% of the United States retail grocery industry is fresh produce. The top 10 major grocery retailer in the United States are Wal-Mart, SuperValu, Inc., Kroger, Target Corporation, Aldi, Delhaize Group, Safeway Inc., Kmart, Albertsons LLC and Trader Joe’s.

Major markets such as Wal-Mart is one of the main supplier of fruits and vegetables to consumers. They buy directly from the growers/farmers who are also the shippers and this tend to cut costs. Because fruits and vegetables are perishable the longevity of the produce depends greatly on refrigerated trucks, cheap fuel and the proper storage food containers in the stores for consumer purchase. To ensure the freshness of the produce after it is picked is the cool hours of the day and shaded from the sun, the produce is then placed in facilities designed for rapid refrigeration.

There is great demand for a steady supply of fruits and vegetables. On an average produce travel over 1500 miles to get to supplier for distribution to consumers. The only obstacle that comes in the way of this supply and demand is climate. Due to climate variation the United States and European Union import grapes and avocados during the winter while during

the summer the United States export grapes, apples and stone fruits to Central and South America. Only five states in the U.S. are responsible for the growing and distributing of fruits

and vegetables both local and internationally they are California, Florida, Arizona, Georgia and New York.

There are six different types of cooling systems that is used for produce. This depends on the types of produce. The first is hydro-cooling used on vegetables with a root or stem and melons etc. The second type is Package icing where crushed ice is used to store broccoli. The third type is Forced-air this is used to cool produce such as strawberries. The fourth type is vacuum-cooling this method is used for leafy vegetables. The fifth type of cooling is called Room cooling where a refrigerated room used to cool produce such as apples and citrus. The sixth type of cooling is the evaporating cooling which is inexpensive this is where the temperature is lowered and the produce is kept fresh by wetting or misting this works best and does not need consistent cooling.

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Total output worldwide – divided by countries

Worldwide there is more that 500 million family farms that grow and sell produce. These farms are responsible for the world’ sustainability for supplying food to everyone. There diversity of these farms makes it necessary to face unforeseen challenges. Agriculture plays a vital role the diets of the human race. Farms need to be innovative and productive in order to be successful, due to the fact that the farms are family based and run it can be difficult to find adequate funding to keep their farms running. This is where each country government should provide funding to subsidize farms to keep them running effectively.

Regulatory Challenges in the Fruits and Vegetables Supply Chain

The demand for fruits and vegetables have increased significantly over the years. In order to keep track of these produce where they were grown and who they are sold to the GS1 (General Specification) regulations requires that the produce gets an identification number called a GTIN (Global Trade Item Number). This is required of all farms no matter what size they are. It is used to identify a series of identical items. If there are different color in the produce being package this may require a different GTIN number. The growers, packers and shippers are responsible for understanding what this number means and why is it assigned. The number is unique and is assigned to the company. This means that no matter where the product is being shipped to whether locally or internationally it can be tracked to the exact farm it was distributed from.

The GTIN is important in identifying fruit packages prepared for sale to consumers. After the produce is delivered by the packers the retailer is who assigns the GTIN number to the produce. There is an agreement between the retailer and the packers who deliver the produce. The retailer has to label the produce in order to identify which farm it was purchased from. When a GTIN is assigned it is done in different levels of packaging from individual items, to cases and pallets. In order to distinguish GTIN assigned there are reference numbers used in the sequence of numbers.

The GTIN is carefully thought out and implemented to alleviate operational burdens that can arise in the fruit and vegetables import and export distribution from farms all over the United States and other countries. These guidelines are set in place so that streamlining and tracking can be done seamlessly.

Examples of GTIN

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Wholesale and Distribution and Imports

The need for the increased fruits and vegetables imports spiked during the 1990s. The United States import fresh fruits and vegetables every year. They are imported from Chile, South Africa, Peru, Argentina, Australia, New Zealand and Brazil. Bananas are imported to the United Stated from countries such as Panama, Colombia, Honduras, Guatemala, Costa Rica and Ecuador otherwise known as the Southern Hemisphere and the NAFTA regions. Geography plays a role in the trade pattern of fresh produce globally. Tropical fruits such as pineapples, mangos, papayas and Guavas are also imported because they grow in tropical atmospheres. Fresh vegetables are imported from North American Free Trade regions such as Canada and Mexico.

Phytosanitary measures are in place because of concerns with the spread of disease and pests. The Agriculture’s Animal & Plant Health Inspection serve otherwise known as the APHIS are responsible for the produce being imported into the United States. This process begins with who the United States chose to import fresh fruits and vegetables from. The United States trade with a diverse set of countries for its import bringing awareness to the choices we make.

Wholesale and Distribution and Exports

The Hudson Corporation exports and distributes fruits and vegetables wholesale. They ship produce by ocean, air and cargo road service. The main markets of export are countries such as Mexico, United Kingdom, South America, Russia, India, The Netherlands, Germany and

many Caribbean countries. The Hudson Corporation distributes a wide variety of fruits and vegetables they have warehouses in Southern California, Los Angeles, New Jersey and New York. To name a few of the produce they distributes are Washington Gala apples, Washington,

Golden apples, Washington Honey crisp apples, Washington Fuji apples etc. they also offer competitive prices. The Hudson Corporation pride themselves in quality produce and developing long term partnership with the countries they distribute to. On their website you can find a table with the fruits they distribute and it tell when during the year that particular fruit is available. They also provide customer recommended storage temperatures for they fruits they distribute.

Example of Vegetable Availability and Storage Temperatures Table

|Products |Recommended Storage Temperature |Produces Ethylene |Sensitive to Ethylene |
| |Degrees F/C | | |
|BANANAS-Green |62-70 / 17-21 |Yes-Low |Yes |
|BANANAS-Ripe |56-60 / 13-16 |Yes-Medium |No |
|COCONUTS |55-60 / 13-16 |No |No |
|EGGPLANT |50-55 / 10-13 |No |Yes |
|GINGER ROOT |60-65 / 16-18 |No |No |
|GRAPEFRUIT |55-60 / 13-16 |Yes-Very Low |No |
|LEMONS |52-55 / 11-13 |Yes-Very Low |No |

End-Consumer Distribution

The end-consumer is the person who will use the product but not necessarily the person who will purchase it. Fruits and vegetables are purchased worldwide and distributed to markets, super-markets, stores for sale to the end-consumer. Families both nationally and internationally are the end-consumer in the distribution of fruits and vegetables.

Managing the distribution of produce in the United States takes organization. Farms are responsible for the supply of fruits and vegetables. The warehouses handles the inventory and shipments of the produce. It is important to manage the accuracy of fulfilling orders. The logistics of packaging, shipping and distributing all work to gather to reach the end-consumer. It is important to have an effective supply of produce. Suppliers has to make sure their product is cost effective and affordable especially when selling and buying in bulk.

Distribution and fulfilment are based on key factors such as financing, automatic replenishment, order processing, inventory and receiving while the suppliers are responsible for planting, disaster preparedness, packaging/labeling, inventory, transporting/shipping.

Example of End-Consumer Distribution

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Incentives in the Supply Chain of Fruits and Vegetables

Whether you are a farmer, packer, processor, supplier or vender of fruits and vegetables you have must have the knowledge of the supply chain. In the handling of produce there must be stringent hygiene and safety measures in place. Customers must be reassured of the produce they are purchasing for consumption. There must be concrete agreement for the delivery of produce being bought, traded and sold. The observation of fruits and vegetables comes with impeccable quality for the customer’s satisfaction.

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Areas of Concern in the Supply Chain (Fruits)

Fruits and vegetables are becoming more and more diverse. High consumption on vegetables such as potatoes, lettuce and carrots shows a great decline in current supplies. The farm level of supply is tracked by the USDA and this information is compared to the country’s population. Although the consumption rate of fruits and vegetables is high it is still suggested by the public health experts that we should eat even more. When we look at the risk factors related to health such as obesity, cancer and so forth. The fact that the supply of fruits and vegetables is getting smaller and requires more imports, is a little worry-some. Fruit options are becoming more diverse when it comes to weight loss strawberries, avocados and pineapples are in the lead. Other fruits that show a great decline are apples, bananas, oranges and grape fruits

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Areas of Concern in the Supply Chain (Vegetables)

Based on the graph below there has been a decrease of approximately 25 pounds of canned and frozen vegetables per person and decrease of 10 pounds of fresh vegetables per person. Due to these declines there is an increase in imports on vegetables such as tomatoes, garlic, cucumbers, eggplants, asparagus etc.

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Opportunities of Improvement in the Supply Chain

In order to improve the supply chain of fruits and vegetables we can begin with smaller farms by first acquiring the financing necessary to improve the farm. There would defiantly be an increase in productivity and quality by implementing the proper technology, training, storage and packaging process necessary to do so. Another step to take would be increase clientele of who the produce will be sold and distributed to. In turn jobs will be created for more hiring to take place in running the farm.

Research development in agriculture is needed to enhance farms/farmers. There should be sufficient time and effort invested in training of farmers, updating equipment, appropriate education through technical support, workshops, studies, and projects on what is expected from famers and the produce they offer. Farmers are extremely under-sourced as they face many challenges such as climate, not being informed of policy changes, update technology to name a few. Building on relationships for export and import is key to a farms survival. Being able to grow produce and prepare them for sale on a national and international scale need the support and strength of the community.

Farm Policies

“Farm policies could help with some of those—for example, by making it easier for farmers to grow more produce and helping consumers access these nutritious foods. But currently they do just the opposite.”

Farm policies are created to help families make healthier choices. Once the intake of fruits and vegetables increases the planting of fruits and vegetables would also increase. Farm policies also focus on how to improve farm practices. It is important to keep the soil healthy the results of a healthy soil reduces pollution in the water and air making the end results of planted fruits and vegetables fresher and healthier. Farmers are encouraged to plant a variety of fruits and vegetables. With the increase of planting more fruits and vegetables comes the creation of jobs. Everyone gets to benefit from the success of farms all over the United States.

Problems with outdated Policies

Some of the outdated policies restrict farms to monocultures of commodity cropping. Where they focus on planting just corn and soybeans and the heavy use of fertilizers and pesticides it a must. They also encourage the raising of livestock that can result in polluted water and polluted air. The soil deteriorating and manure excess that is costly to use and get rid of.

Also in realty the federal subsidies restrict farmers from planting fruits and vegetables. Since farmers are not planting enough fruits and vegetables then this means enough is not supplied to cover what is suggested by the FDA that we should be eating.

New farm Bill 2014

President Obama has signed a $956 billion dollar farm bill. This bill is intended to help communities and give opportunities. It will provide $200 million for job training and $100 million to increase the purchase of fruits and vegetables though the Supplemental Nutrition Assistance Program (SNAP) for low income families. The bill will also provide $250 million additional funding to The Emergency Food Assistance Program (TEFAP). It will also authorize $125 million for financing food initiatives that will make nutritious foods accessible.

Another part of the bill called the “Next Generation Farmers and Ranchers” will be provided with $100 million dollars for that program. Access to capital that supports reducing crop insurance and management tools over the next five years. The local and regional food systems includes aid to “Farmers market and Local Food Promotion” (FMPP) in the amount of $30 million annually. The continuation of funds reserved to the Business & Industry and Loan Program for businesses all over the US.

$72.5 million dollars annually will be provided to Specialty Crop Block Program (SCBG). This will increase new resources for organic farmer, the Organic Cost Share program will also be funded with $11.5 million dollars annually. The funding for pest and disease prevention and management will receive $62.5 million dollars. With this new farm bill signed into law the supply of fruits and vegetables should increase for domestic use and international export.

Conclusion

Farming is important in providing the right types of food for our diet.

References

http://www.cdc.gov/nutrition/everyone/index.html, retrieved April 16, 2015

http://www.health.gov/dietaryguidelines/dga2005/document/html/chapter3.htm#table4, Retrieved April 16, 2015

http://www.foodsafetynews.com/2011/11/fairness-why-fruits-vegetables-are-excluded-from-farm-subsidies/#.VTLmT5MYF_A, Retrieved April 18, 2015

http://www.fb.org/index.php?action=newsroom.home, Retrieved April 19, 2015

http://www.igd.com/our-expertise/Supply-chain/Sustainable-supply-chains/4671/Preventing-fruit-and-vegetable-waste-in-the-supply-chain/, Retrieved April 19, 2015

http://www.angelfire.com/ia2/ingenieriaagricola/postharvest_methods.htm#Forced-air%20cooling, Retrieved April 19, 2015

http://fdrrecipes.com/magazine/new-deal/566-top-10-best-and-biggest-supermarket-chains-in-us-2014.html, Retrieved April 19, 2015

http://www.foodsafetynews.com/2011/11/fairness-why-fruits-vegetables-are-excluded-from-farm-subsidies/#.VTLmT5MYF_A, Retrieved April 20, 2015

http://www.gs1.eu/jscripts/tiny_mce/spirit_docs/upload_0_1014/part_3_gtin_-_integrated_guideline_final_v1.pdf, Retrieved April 20, 2015

http://www.producenews.com/markets-and-trends/9248-u-s-fruit-and-vegetable-imports-growing-larger-by-the-year, Retrieved April 20, 2015

http://hudsonproduce.com/, Retrieved April 21, 2015

http://www.unitedfresh.org/nutrition/fruit-vegetable-incentives-snap-program/, Retrieved April 22, 2015

http://sustainablog.org/2012/01/us-fruit-vegetable-supply/, Retrieved April 22, 2015

http://www.bureauveritas.com/wps/wcm/connect/bv_com/group/services+sheet/inspections-audits-throughout-the-fruit-vegetable-supply-chain_13567, Retrieved April 22, 2015

http://www.fao.org/publications/sofa/en/, Retrieved April 23, 2015

http://www.ag.senate.gov/issues/farm-bill, Retrieved April 24, 2015

http://www.ucsusa.org/news/press_release/less-corn-more-fruits-and-vegetables-0378.html#.VTr6pZMYF_A, Retrieved April 24, 2015

http://farmpolicy.com/2014/02/08/weekend-update-president-obama-signs-2014-farm-bill-into-law/, Retrieved April 24, 2015

http://www.usda.gov/documents/usda-2014-farm-bill-highlights.pdf, Retrieved April 26, 2015

http://www.fns.usda.gov/snap/supplemental-nutrition-assistance-program-snap, Retrieved April 26, 2015

http://www.fns.usda.gov/tefap/emergency-food-assistance-program-tefap, Retrieved April 26, 2015