THE DAIRY INDUSTRY’S APPROACH TO SUPPLY CHAIN MANAGEMENT

 Dairy farmers and dairy companies produce a range of products for a variety of markets, both nationally and internationally.  The dairy industry is a regionally based employer contributing approximately $9 billion to the national economy and has grown 40% in the past 10 years.  Drought over the past few years has reduced production from the peak of 2002/2003.Dairy products are the major output but dairy farmers also produce 20% of Australia’s beef; exports of breeding cattle are also of growing importance.Food safety has always been a priority for the dairy industry. 

 All dairy companies require their dairy farmer suppliers to implement on farm HACCP based Quality Assurance Programs.  The dairy industry in implementing on farm QA programs has integrated the management of food safety risks across the whole supply chain.This approach is now being adopted internationally by Codex (Code of Hygienic Practice for Milk and Milk Products); nationally by Food Standards Australia New Zealand (FSANZ – Primary Production and Processing Standards) and State-wide through the Dairy Food Safety Authorities (eg Dairy Food Safety Victoria’s Code of Practice).

Key elements to this approach are:

• Consideration of the food chain in its entirety for food safety purposes.
• A science based assessment of the risk at critical points in the food chain and the development of appropriate strategies to manage the risk to protect public health and safety with minimum effective regulation.
• An emphasis on preventative rather than reactive measures.
• A recognition of the shared responsibility for food safety between all parts of the food supply chain.

All on farm QA programs in the dairy industry, as a minimum, cover the same essential elements. These were agreed by industry in the mid 1990s. These elements now form the basis of food safety programs. Regulatory agencies have recognised the need for a whole chain approach to food safety and a better understanding of where in the dairy chain the dairy food safety risks occur.  All States have introduced a mandatory requirement for on farm food safety programs except WA where voluntary programs are in place.

While the dairy regulatory authorities have agreed to ensure consistent implementation, the FSANZ Primary Production and Processing Standard now provides a national legislative framework for a whole chain approach to dairy food safety.  This comes into force in October 2008.  AQIS have also agreed to adopt relevant sections of the Dairy Primary Production and Processing Standard in export legislation.  Industry facilitated this whole chain national and international approach to reduce the regulatory burden.

 On-farm Dairy Food Safety Programs

All on farm dairy food safety programs are HACCP based and were initially designed to improve farm management with respect to; food safety, animal husbandry, chemical contamination control, and environmental responsibilities.  They all cover the following core areas:

• Physical, chemical and microbiological contaminants, as related to inputs (feed, water and agricultural & veterinary chemicals) animal health and outputs (milk and meat).
• Dairy milking premises
• Hygienic milking
• Water supply and quality
• Cleaning and sanitising
• Traceability and records
• Personnel competency 
• Verification of the systems is also an important element. 

The State Dairy Food Safety Authorities licence farm businesses and these licences allow the farms to operate. Contingent upon the licence is the mandatory requirement in most States for dairy farmers to have and implement a validated food safety program. The State Dairy Food Safety Authorities approve and accredit these on farm food safety programs. The implementation of the systems must be verified by audits undertaken by auditors approved by the State Authorities. This on going verification process has a flow on effect.  Dairy farmers need to assess the food safety risks associated with farm inputs and ensure appropriate management strategies are in place to manage these risks. This includes full traceability up and down the input chain.