Close investigation reveals that not much has changed since the Spanish pepper issue broke last December, and that almost all the measures taken since - with the exception of the sanctions imposed immediately after - plus the closures and arrests, have been more for show than anything else.
Sources from the region where it all started, Almería, confirm that the problem still remains, and they cite a general lack of awareness and understanding of the problem’s impact amongst producers and the public administration in charge as the major cause of this.
Background
The crop protection industry claims that, through its national trade association Aepla, all stakeholders involved in Spanish agriculture, and especially in intensive undercover production, have been aware that certain growers have been using illegal crop protection products for many years.
Whilst Aepla representatives claim they repeatedly tried to highlight the problem, little has happened in the agricultural industry. The very complex and multi-layered Spanish public administration system and its officials knew of the illegal traffic of crop protection products in Spain. Producers and exporters were also well aware of the situation. But, with the exception of the Spanish environmental police, Seprona, which through those years kept quietly and efficiently doing its job, all who were aware helped to minimise the problem. They generally claimed this to be a highly sensitive issue that would cause a scandal of uncontrolled repercussions if made public.
The origins
It all came down to the fact that the pressure of an industrial growing system of fruit and vegetable production caused certain plagues and diseases to spread in major crops, especially peppers and tomatoes, which were resistant to commercially available treatments. These plagues consisted of white fly and trips, which not only attack the plant and its fruits, but act as vectors for other vegetable diseases.
Meanwhile, in the EU, the entire system of crop protection product authorisation was being overhauled, and many of the existing and traditional insecticide substances were revoked, while the introduction of new products that could have provided the controls farmers were seeking was delayed.
This radical reform of the crop protection product authorisation system and its slowness in granting new authorisations is at the root of the problem. Although this is in no way a pretext for non-compliance with the law, the situation caused immense frustration among growers searching for solutions to control pests and diseases. New, active substances are reviewed in Europe when it is the right time to authorise a new substance. Over a decade has been spent in reviewing existing authorised substances, with the subsequent loss of many products. Once a substance is finally approved, formulations based on authorised substances, whether old or new, are then reviewed in each member state.
In Spain, the authorisation system for formulations of crop protection products has never been noted for its efficiency. There were delays of many years, when even new formulations composed of substances approved by the EU were not approved, with paperwork piling up on the desks of the public servants. This was largely responsible for the deterioration of the situation. More crop protection problems were emerging, while available solutions were dropping in number; problems were bound to appear.
As a result, criminals soon identified opportunities in situations that crop protection companies could not resolve. There was money to be made from illegally importing, selling, transporting and distributing counterfeit products or using old, dis-used products in Europe. These products came from China, India and an array of other places, were not controlled and were hit and miss in their efficiency. Farmers were willing to try anything and, in fact, got used to doing so. Networks were established in Spain, and the criminals went about their business right under the nose of the inspectors, who were too busy controlling maximum residue levels (MRLs).
So how does a newly developed crop protection product compete with some of these substances that have been used in Almeria? It is practically impossible. There have been cases of new products authorised in other parts of the world being imported into Spain and used by farmers many years before the same product has gained European and national authorisation. The indiscriminate use of these products resulted in insects gaining resistance, so that when a product finally legally reached a market, its efficacy was reduced.
The crisis
The major importing countries were also aware of this problem. Let us not forget that they analyse the produce and have representatives in the production areas. German food distributors had been monitoring the situation for some time, and it was well known that they would not tolerate it. Towards the end of December 2006, Germany activated the rapid alert system on the grounds of pepper imports from Almería, Spain, which showed residues of a crop protection product not authorised in the EU: isofenphos methyl from China. The product had never been authorised in Europe for use, let alone on peppers.
In spite of the Spanish health ministry’s affirmations that the level of the substance found posed no risk to human health and that the situation in no way constituted a sanitary alert, the alarm bells quickly started ringing, and similar situations were reported throughout the following weeks in the UK, Holland, Finland, Russia and Hungary.
Volumes of the contaminated peppers were also detected within Spanish territory, in the Canary Islands, Madrid and Barcelona, in spite of the road controls that were immediately established around the Almería area.
It is important to point out that the rapid alert system for food and feed (RASFF) has as its main purpose a mechanism to provide the control authorities with an effective tool for exchange of information on measures taken to ensure food safety. There are two types of information: alert notifications and information notifications. The former are sent when the food presenting the risk is on the market and immediate action is required. Information notifications are sent when the food at risk has been identified but has not reached the market, so that other members do not need to take action.
Since December 2006, a total of 13 alerts have been reported to the system from Germany, the UK, Finland, Hungary and Spain. During the same period, a further 12 notifications have been issued from the UK, Spain, Germany and Portugal.
Then, in March, another non-authorised product, oxamyl, was also detected in beans, courgettes and aubergines by Swedish, German and Norwegian authorities. In fact, in one of the alerts made by Germany on February 1, peppers, again exported from Spain, were reported to show residues that contained both the presence of oxamyl and isofenphos methyl.
The media have also reported alerts by the Netherlands, and Russia, and the latter claimed to prohibit Almerían imports.
In January, the Andalusian government affirmed that the crisis was over and that no more contaminated peppers would be found in importing nations, but the alerts and notifications have been arriving as late as May of this year.
The consequences
The immediate results have been multiple and varied, including the closure of 37 greenhouses and the suspension of certain produce marketers. Tonnes of produce were destroyed, resulting in a reduction in sales and exports and price fluctuation for peppers.
The ramifications were substantial, and included the resignations of senior people in the production chain, and the detention of others. This was the case for the president of Almería’s major co-operative union, Coexphal, which was accused by some of its members of selling and recommending the chemical substance that prompted the crisis from his very office, reportedly using the same arguments traffickers do. According to those who reported him to the police, he claimed the product left no detectable residues and that there was no problem using it.
According to the regional government in charge, Junta de Andalucía, the sanctions applicable to the 13 greenhouses that were found with residues of the detected substance were to “reach up to €120,000” (£84,000), although to date neither the application of the sanctions nor the quantities applied have been publicly confirmed.
Fepex, the national representative of fresh produce growers and exporters, reports that during the period from January to May 2007, produce exports fell 6.7 per cent. Most significantly, pepper exports dropped by 19.16 per cent during the same period. In total, the quantity of peppers exported from Spain reaches 196,941 tonnes a year. Pepper prices per kilo have decreased from the €1 reached last year to the current rate of €0.40, a price similar to that of the 2005-2006 campaign.
Some of the major worker unions in the area announced the probable loss of more than 3,000 jobs directly involved with peppers in the area. This has never been confirmed, but it has certainly reduced new work contracts signed in Almería which, by July of this year, meant a 34.29 per cent negative inter-annual variation in the agriculture and fishery sector. New employment across the board has decreased by 4.12 per cent in Almería, according to the regional government’s public figures.
Lastly, some major food chains and produce importers reacted immediately to the crisis, announcing they would no longer purchase from Almería. Lidl was quite clear in February on this regard.
Almería in a nutshell
Almería combines a number of peculiar characteristics. It is historically a poor area only known for mining and fishing, with no agricultural tradition. It has a privileged climate, with a large amount of annual sunshine. Using the greenhouse, an imported production system, offered spectacular results, and the locals welcomed the technology. All of that has rendered yields and profits that attracted the investment of many, with the area becoming the major source of production of certain fruits and vegetables for a good part of Europe and Spain. In no other area could so much be produced at such competitive prices, almost non-stop.
Agricultural production is now the major source of income for the area, with nearly 20,000 greenhouses. Almería is Spain’s major province in agricultural production, with 44 per cent of the total land in Andalucía dedicated to this task. Almería exports 66 per cent of its total agricultural production, doubling the average national export ratio, which is around 30 per cent.
According to the regional government, the three major destinations for peppers produced in Almería are Germany, the UK and the Netherlands. For the entire region’s food products as a whole, the major export destinations, according to the official figures, are France, Germany, Italy and the UK, in that order.
But the hen with the golden eggs has been exhausted. The deficient installations of the older greenhouses, the proximity amongst them and the inadequate use of some chemical products have all taken their toll. This, together with a scarce disposition to apply integrated agriculture techniques, which not only require knowledge but also patience, as well as the dry and hot climate, have produced insect plagues resistant to chemical control and have threatened production capacity, just as society at large is becoming more demanding as to the quality of its food and the minimal use of chemicals. Economic interest won when farmers were faced with problems, and had to choose between long-term goals or shortcuts for immediate results, which in the end have been very dear for all.
Long before this situation arrived, many agricultural professionals and producers forecasted that such a problem would arise sooner or later.
The solutions
Applying the law effectively would have alleviated many of the problems. Those responsible for applying the law should have paid attention to the industry’s warning that the whole agricultural production process was under threat of collapse. The central co-ordination of the different administrations responsible for ensuring healthy and sustainable food production would have certainly been able to control this very serious problem.
Admittedly, changing the local money-driven culture is a tall order, but a collective and creative effort with the support and active participation of the government, farmers’ organisations, the business community and other social actors would have, and still could, contribute to a substantial change.
Raising awareness amongst producers as to their responsibility in safe food production and promoting sustainable methods from the beginning would help solve the problem. Encouraging the improvement of the installations (maintenance, modernisation and cleanliness), and investment would be part of the solution.
Stakeholders: their behaviour, crisis management and responsibility
The regional government in charge of the situation acted rapidly and clearly during the first stages of the crisis, and has managed the aftermath, but it seems unlikely they will solve the problem.
The regional government has now focused its strategy on conducting an image campaign and implementing a green code of agricultural practice in which biological methods (meaning using insect predators of the undesired plagues) are encouraged over traditional chemical control. Legally authorised crop protection products are now held suspect as a result of what has been uncovered.
It is quite interesting that many of those involved in the unsuitable, or downright illegal, behaviour are now campaigning for the urgent implantation of a pseudo-organic agriculture, using terms that in Spanish are associated with organic farming. This option is hardly credible for anyone familiar with the area, its conditions and its practices.
There have been no changes amongst the administrative teams who were responsible for the management of the area prior to, and after, the crisis. There have not been any reorganisations or resignations during this time.
The regional government head of agriculture in Andalucía, Isaías Pérez Saldaña, announced in April this year that by 2010 all greenhouses would be certified under the norm of integrated production, which defends a sustainable model. It is only fair to point out that this model already exists and has been implemented in the growing areas of Spain for more than a decade.
The central government’s reaction has been different. By avoiding its final responsibility in relation to the increasing illegal traffic and use of crop protection products through a constant denial, and claiming that control fell under the jurisdiction of the regional governments, it sought to deflect the issue. When urged to take measures, especially speeding up the process to allow new products in that were already on sale elsewhere the government, in fact, continued to block reviews.
In June, a large portion of the Spanish ministry of agriculture was remodelled, and some of the key positions were changed. It is probable that the pepper crisis led to some of the changes that were applied to the sub-directorate responsible for product authorisation.
This case also shows that an excess of well-intentioned precaution and distance from reality on the part of European bureaucrats, who were alarmed when they were informed of the situation occurring in Spain and other corners of the EU, combined with the comfortable attitude of a body of national bureaucrats inadequate for the demands of the new regulatory context, makes for a dangerous cocktail and has caused long-term damage that it will take time and effort to restore.
Likewise, the other protagonists of this story do not fare much better. Farming organisations first protected their members and later pointed to others as not doing things properly.
The food chain, with few exceptions, has also remained exceptionally quiet. There seems to be an unofficial attitude of non-satisfaction with Almería and its practices as a whole, but both the chains and their representatives, such as GlobalGAP, have taken a business-as-usual approach to the situation.
Under the circumstances, the extreme caution exercised by the crop protection industry is not surprising. Whilst wanting to bring the problem to light earlier in Spain by encouraging a debate in the public arena, given the gravity of the issue, which far surpassed mere intellectual property or patent issues, it had to address the ongoing issues of gaining new authorisations, using the same regulatory authorities that were denying the problem in the first place. The European industry, represented by its trade organisation, the European Crop Protection Association, took a proactive stance long ago and is fighting these problems from a number of angles.
So what comes next?
Agricultural production continues in the area - all is not lost. The community has been shaken up after recent events, but memory is short in these cases. There are many instruments in place throughout Europe to speed up crop protection product authorisation processes at a national level.
Regulators will have to come to terms with real production conditions and their peculiarities, rather than persist in theoretical scenarios that in practice simply do not work. The Spanish administration will have to accept its responsibility to control the market with an executive attitude, implementing the law, even if it is politically unpopular. Farmers and their advisors need to realise that markets are sovereign and able to change the rules of supply and demand faster than any protective measures will ever do. And the industry players should take note that no-one will defend their legitimate interests if they do not.
All of the above is still possible. What remains to be seen is if the stakeholders will be capable of doing so in a reasonable period of time, applying common sense and practicality. Spanish production for export has been hurt seriously, and many things will have to change in a bid to recoup credibility.
Considerable changes have taken place thanks to trade agreements which respond to regional strategic interests and therefore affect the trade.
In January, a more favourable treatment of Israel’s agricultural imports to the EU was established. Turkey has also been advancing in its negotiations for imports to the EU. In 2005, the country sent 32,794t of peppers into Europe. Since 2000, Turkish imports have grown in value by more than 19 per cent. It is no coincidence that Freshfel Europe held its annual congress in Istanbul last June - its first time outside of the EU.
Morocco has also spent the last few years exchanging the opening of its frontiers in return for market access for its own exports.
Israel, Turkey and Morocco are serious competitors to Almería’s privileged situation to date, and most important of all, 2010 is set as the horizon for a new Euro Mediterranean free trade area. None of these facts will remain ignored by Spanish import markets.
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