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Subsidies for Food Safety Tracing Technologies

May 23, 2011

Derek Singleton a Market Analyst for Software Advice has recently published an article calling for the government to subsidize technology purchasing and maintenance for food producers falling under new regulations put forth in the Food Safety Modernization Actsigned into law at the start of this year. According to the Huffington Post “The $1.4 billion bill mainly expands the reach and regulatory powers of the Food and Drug Administration. The FDA oversees production of all food products with the exception of meat, poultry and dairy, which fall under the jurisdiction of the U.S. Department of Agriculture.” Singelton argues “Installing a traceability system is downright expensive – in the neighborhood of $200,000. Companies have to purchase an expensive software system, scanners, and register unique ID numbers to trace food throughout the supply chain. Then there is maintenance and support that comes along with it.” He continues “Providing government incentives for traceability systems is not without precedent. Our Canadian neighbors recently implemented the Food Safety and Traceability Initiative. The government set aside $1.3 billion dollars over the next five years and has gotten hundreds of companies to apply for the incentive. This initiative can be used as a template for the success that can be realized when an incentive program is put into place.” Thanks to Singelton for his well researched blog post. My only critique is that many food companies have been scaling up for years from the fields to the processing plants and the dramatic increase in food related illness is their fault. They have been externalizing the costs of unsanitary working and processing conditions for too long and many of those main perpetrators need to pay for all of the costs associated with their mistakes, including the tracing technology. That said, for smaller businesses with no track record of recalls some government help could go a long way if they are going to fall under these new regulations.

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