Exceeding Standards, Capturing Markets

Spice Exporters Face Scrutiny: Ethylene Oxide Concerns Spark Recall in Asian Markets

Last April was a month when Indian spices exporters gained the limelight in Indian media for some unpleasant reasons. Countries like Hong Kong and Singapore have raised concerns over the safety of popular Indian spice products, leading to a recall of certain items. For example, the Centre for Food Safety (CFS) in Hong Kong conducted routine food surveillance and found that four products from renowned Indian brands MDH and Everest contained ethylene oxide, a pesticide deemed unsuitable for human consumption and classified as a Group 1 carcinogen by the International Agency for Research on Cancer.

As a result, the CFS in Hong Kong on 18 April 2024 recalled Everest Fish Curry Masala from India alleging the presence of a pesticide called ethylene oxide at levels exceeding permissible limit. Singapore, on the other, recalled Everest Fish Curry Masala over alleged pesticide content.

In a statement released, the Singapore Food Agency (SFA) said “Ethylene oxide is a pesticide that is not authorised for use in food. It can be used to fumigate agricultural products to prevent microbial contamination. Under Singapore’s Food Regulations, ethylene oxide is allowed to be used in the sterilisation of spices.” It also said “Consumers who have purchased the implicated products are advised not to consume it.

Those who have consumed the implicated products and have concerns about their health should seek medical advice. Consumers may contact their point of purchase for enquiries.” The affected products include MDH’s curry powder (spice blend for Madras curry), mixed masala powder, and sambhar masala, along with Everest’s fish curry masala. Following this, both regulatory authorities have instructed vendors to halt the sale and remove these products from shelves.

Safeguarding Health and Market Trust: Compliance with Pesticide Residue Regulations

According to the Pesticide Residues in Food Regulation (Cap. 132CM), food for human consumption containing pesticide residue may only be sold if it is not dangerous or prejudicial to health. Failure to comply with these regulations can result in fines and imprisonment. While there is no immediate risk from consuming food with low levels of ethylene oxide, long-term exposure to this substance may lead to health issues, including an increased risk of cancer.

This is not the first time Indian spice products have faced scrutiny in the international market. The European Union (EU) raised concerns over cancer-causing chemicals. In a startling revelation, the European Union’s food safety authorities have flagged the presence of cancer-causing chemicals in several food products originating from India.

The United States customs authorities refused 31 per cent of all spice-related shipments exported by MDH over salmonella contamination in the last six months, and the refusal rate since October 2023 has doubled from 15 per cent for all shipments sent in the year prior. Appendix 1 presents Indian herbs and spices rejected by the US FDA in 2023.

The European Food Safety Authority (EFSA) has banned the use of ETO and earlier flagged ETO contamination in Indian spices. On 8th April 2024, India has also rejected a total of 184 products/ingredients under the Food Safety and Standards (Approval for Non-Specified Food and Food Ingredients) Regulations, 2017. What follows is that trade involves inherent risks, including import rejection, fraud, counterfeiting, and illicit activities. Failing to comply with the trade-related standards may cause the rejection by importing countries as happened recently in case of India’s export of chicken and fish curry masala powder.

Box. 1 Ethylene Oxide (ETO)
Ethylene Oxide (ETO) is a colourless, flammable, and in many ways, a remarkable gas that was originally intended for sterilising medical devices. It is used as a chemical in industrial settings, agriculture, and as a sterilising agent in food products, including spices, dried vegetables and other commodities. The chemical lends life to the spice industry: it reduces microbial contamination, and in turn, extends products’ shelf life and makes their storage safe. The improper and excessive use of ETO may leave behind residues, causing toxic and even carcinogenic compounds to form, thus contaminating the product. One such compound is ethylene glycol. Long-term exposure to ethylene oxide is associated with cancers including lymphoma and leukaemia, some evidence shows.
2022-23 (US$ million)2023-24 (US$ million)Annual Growth (%)Top Three Markets for India
Chicken curry masala (HS 9109100)89.16108.3221.49UAE, USA, Saudi Arab
Turmeric (curcuma) powder (HS 09103030)78.16101.2629.55USA, Nederland, Germany
Fish curry masala (HS 09109990)21.6525.1516.17Canada, UAE, Nepal
Ginger and turmeric powder and paste (HS 09101210)11.4212.7811.91USA, UK, Australia
Ginger powder (HS 09109929)8.899.355.17USA, Australia, Canada
Other spices (HS 09101290)6.688.5828.44Morocco, USA, Bangladesh
Total215.96265.4422.91
Table 1: India’s Exports of Selected Masala Curry and Other Products

India is the world’s largest producer and export of spices. The Spices Board, the sole regulatory authority in India, is tasked with developing, promoting, and regulating the export of spices and spice products. The Food Safety and Standards Authority of India (FSSAI) is a statutory body under the administration of the Ministry of Health and Family Welfare, Government of India, which regulates the manufacture, storage, distribution, sale, and import of food articles, while also establishing standards to ensure food safety.

Exports of masala curry powder have been witnessing a rising trend in India (Table 1). In 2023-24, India’s export of chicken curry masala (HS 9109100) was US$ 108.32 million, having a share of 40 per cent in India’s total exports of masala curry and other powders falling under the Customs Code 09 (Coffee, Tea, Mate and Spices). Turmeric (Curcuma) powder (HS 09103030) comes next to it. There has been a lot of demand for Indian turmeric and ginger powders across the world. Major buyers of India’s masala curry and herbal powders are the UAE, USA, Canada, Nepal, the UK, Australia, Morocco, and Bangladesh.

With rising trends, India’s export of curry and herbal powders is likely to grow. Trade-related employment creation is also linked with exports of spices and related products. Therefore, while trade is important, so is meeting the standard for food safety and hygiene.

The trade rejections have prompted increased sampling, quality checks, and corrective actions. The Spices Board of India, for example, has initiated mandatory testing of products shipped abroad and is reportedly working with exporters to identify the root cause of contamination. The international scrutiny has also stirred a demand for the FASSAI to ensure stringent quality checks on spices and curry powders sold in domestic markets6.

In a recent statement, the FSSAI has added that the number of samples analysed during the past few years has grown from 1,07,829 in 2020-21 to more than 4,51,000 in 2023-24, registering an increase of more than three times. It also noted that from 2020-21 to 2022-23 each year over 22 per cent of samples were found non-conforming. Highlighting the challenges, the FASSAI has also said that 90 per cent of the food business operators fall under the jurisdiction of the State Governments, and therefore, the enforcement of the provisions of the Act usually rests with the State Governments. India presently has 239 primary food testing laboratories, 22 referral laboratories, and 12 reference laboratories operating in the country.

Most of the comprehensive regional and bilateral trade agreements (e.g. RCEP Agreement) keep specific provisions covering sanitary and phytosanitary measures; standards, technical regulations and conformity assessment procedures; and trade remedies. The RCEP Agreement, for example, has Chapter 5 (Sanitary and Phytosanitary Measures (SPS)) and Chapter 6 (Standards, Technical Regulations, and Conformity Assessment Procedures (STRACAP)). On the other, India-UAE CEPA has several provisions on the standards and conformity assessment (Chapter 4 (SPS measures) and Chapter 5 (TBT)).

There are global agreements on trade standards (e.g. WTO SPS and TBT Agreements) but no uniform international standards on the use of maximum residue limits (MRLs) in food products including spices. Regional Trade Agreements (RTAs) also do not provide any direction on the MRLs. India has made a strong pitch at the World Trade Organization (WTO) for the formulation of guidelines to determine default MRL in the absence of international standards. The traces pesticides leave in treated products are called residues and MRL is the highest level of pesticide residue that is legally tolerated in food or feed.

In a recent submission to the WTO, India said that stringent MRLs can be trade-restrictive and act as non-tariff barriers to international trade, disproportionately affecting exporters from developing countries. However, the FSSAI emphasised that India upholds some of the most stringent MRLs in the world and stressed that MRLs are continually adjusted based on new scientific evidence, ensuring that these revisions align with international standards and reflect the latest research and global practices.

The FASSAI has expanded standards for food additives that now have over 9000 provisions covering 350 additives and food processing aids by harmonising the standards of food additives with CODEX standards10. Codex Alimentarius, or “Food Code” is a collection of international food standards, guidelines, and codes of practice that define many aspects of food quality and safety for foods moving in international trade.

Compliance with trade-related standards and harminisationFood safety controls and survillence
Suporting Policy Choices
Digitalisation to standards managementTraining and capcity buiding
Figure 1: Towards a Trade Standard Compliance

Way Forward

International standards play in harmonising technical regulations, conformity assessment procedures, and national standards, and in reducing unnecessary barriers to trade. Besides, strong vigilance and cooperation between standard-setting authorities will pave the way to avoid import rejections and revenue losses. To facilitate such a ‘quality’ trade, complying with higher standards, surveillance, and connectivity is essential. Meeting the standards would lead to winning markets and it also is contingent on several factors such as local capacity to ensure, assess, and prove conformity; and level of surveillance; to mention a few. When needed, countries must undertake effective and necessary corrective measures to ensure adherence with regulatory standards. Figure 1 illustrates some of the key supporting policy choices.

Execute the MRAs with trade partners, particularly with the countries where India has high GVC potential. While doing so, trade partners shall cooperate to ensure that international standards, guides, and recommendations that are likely to become a basis for technical regulations and conformity assessment procedures do not create unnecessary obstacles to international trade.

Equally important is cooperation among the regulatory and/or standardizing bodies for (i) the exchange of information on standards; (ii) the exchange of information relating to standard-setting procedures; and (iii) cooperation in the work of international standardising bodies in areas of mutual interest.

Digital technology has an important role in harmonising technical regulations, conformity assessment procedures, and in reducing unnecessary barriers to trade. Application of AI technologies may help in mitigating risks by enhancing risk assessment and fraud detection capabilities. AI algorithms can analyze transaction data, financial records, and shipping information to identify suspicious patterns or anomalies that may indicate fraudulent activities. This enables customs authorities and businesses to take proactive measures to prevent illicit trade and protect intellectual property rights.

India may consider maintaining a Trade Standards Compliance Report (TSCR) for trade partners. To start with, India may conduct a TSCR with some of the trade partners in BIMSTEC and ASEAN. While the ASEAN-India Trade in Goods Agreement (AITIGA) is under review at present, it is a good opportunity to include futuristic provisions for standards, technical regulations, and conformity assessment procedures in the AITIGA 2.0.

References

https://www.sfa.gov.sg/docs/default-source/accredited-overseas-attachments/180424-media-release—recall-of-everest%27s-masala-fish-curry.pdf?sfvrsn=e0a4f694_1

Refer media news of https://www.deccanherald.com/india/toxic-tale-eu-flagged-over-400-indian-products-3008954

https://indianexpress.com/article/business/us-rejects-1-3rd-of-mdh-masala-exports-since-oct-over-salmonella-9295982/

https://www.fssai.gov.in/upload/uploadfiles/files/Status%20of%20applications%20under%20FSS%20NSF%2008042024.pdf

As reported in most of the prominent newspapers in India during April 2024.

Refer, for example, “Troubled Spice Route”, Business Standard, 7 May 2024.

Refer, https://www.fssai.gov.in/recent-whatnew.php

Refer, https://www.mofa.go.jp/mofaj/files/100114908.pdf

Refer, https://commerce.gov.in/international-trade/trade-agreements/comprehensive-economic-partnership-agreement-between-the-government-of-the-republic-of-india-and-the-government-of-the-united-arab-emirates-uae/

Refer, https://fssai.gov.in/cms/codex.php

In the past, UNIDO carried out an extensive survey of TSCR, results of which are still relevant in today’s uncertain world.

Prabdir De is Professor, Research and Information System for Developing Countries (RIS), New Delhi.

Disclaimer: All views expressed in the article belong solely to the author and not necessarily to the organization. 

This article was posted by Mansi Garg, a researcher at IMPRI.

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