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Nestle India ends 12-year contract with Maggi manufacturer

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Nestle India has decided to stop outsourcing the production of its Maggi instant noodles to a third party, in an apparent move to remain focused on improving the quality of noodles.

SAJ Food Products–the "lone third party producer" of Maggi noodles–will no longer be manufacturing the noodles that were banned by the country’s food regulator for containing higher levels of lead and presence of monosodium glutamate (MSG) in tested samples.

"As part of a standard process, where we review our overall capacity every two years on the basis of volume projections, we took the decision to bring the co-manufacturing with SAJ to an end," The Economic Times quoted a Nestle India spokeswoman as saying.

Analysts believe that Nestle’s move to cancel its 12-year contract with SAJ could be a part of its efforts to increase the quality of noodles.

"Generally, companies have their own production units for high gross margin product and contract manufacturing is given in the case of commoditised product. The move could be triggered by a need to bring higher quality focus within the company," said Nitin Mathur, research analyst, Societe Generale.

Earlier in August, the Bombay High Court had ruled in favour of the company and lifted a ban on the instant noodles imposed by the country’s food regulator. The court had asked the Food Safety & Standards Authority of India (FSSAI) to "justify its ban" and ordered for fresh tests of the noodles at laboratories opted by it.

Following a ban on its popular Maggi noodles, Nestle India has witnessed its first quarterly loss in 17 years. It posted a loss of Rs 64.4 crore in the June 2015 quarter compared to a profit of Rs 288 crore in the same period last year.

The company’s sales fell by over 19% to Rs 1,957 crore in the April-June quarter as against Rs 2,432 crore in the corresponding quarter a year ago. The company also saw a one-time loss of Rs 452 crore during the quarter.

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Maggi ban: Nestle claims it is being ‘singled out’

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Alleging bias, Nestle   India Limited today told the apex consumer commission that it was being "singled out" by the government in the Maggi noodles ban case as no action was being taken against other manufacturers of similar products. Citing Bombay High Court order which had set aside the countrywide ban on Maggi, the company also sought to recall an earlier order of the National Consumer Disputes Redressal Commission (NCDRC) by which it had admitted government’s Rs 640 crore suit against the noodles manufacturer for alleged unfair trade practices and other charges. A bench, headed by Justice V K Jain, issued notice to the government on the company’s plea and sought response by October 8. It also issued notice to Nestle on a separate plea filed by the government seeking further testing of Maggi noodles. The company opposed the government’s suit saying that due to the ban, around 9,000 vendors and 10,000 suppliers were rendered unemployed and it has suffered a loss of nearly Rs 250 crore. "It has caused a huge damage to our reputation… to the extent that my competitors are making fun of me (company). While my product has been banned, government is not taking any action against any manufacturer of similar products… I am being singled out," senior advocate Arvind Nigam said on behalf of the company. On August 17, NCDRC had issued notice to Nestle on the government’s suit to which the company had to reply today. However, the company failed to reply to the notice claiming that it has not received complete documents from the government to which it had to filed its reply.

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காரைக்காலில் அதிகாரிகள் அதிரடி 20ஆயிரம் புகையிலை பொருட்கள் பறிமுதல்

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காரைக் கால், அக்.1:

காரைக் கால் மாவட்டம் முழு வ தும் தடை செய் யப் பட்ட புகை யிலை பொருட் கள் அண் மைக் கா ல மாக தாரா ள மாக கிடைத்து வரு கி றது. பள்ளி, கல் லூரி மற் றும் வழிப் பாட்டுத் த லங் கள் உள்ள பகு தி களில் இது போன்ற பொருட் களின் விற் ப னையை தடை செய்ய வேண் டும் என சமூக ஆர் வ லர் கள் மாவட்ட நிர் வா கத்தை வலி யு றுத்தி வந் த னர்.

மாவட்ட கலெக் டர் வல் ல வன் மற் றும் உணவு பாது காப் புத் துறை அதி காரி ரவிச் சந் தி ரன் ஆகி யோர் இது கு றித்து பல முறை எச் ச ரிக்கை விடுத் தும், அதி ரடி சோத னை கள் நடத் தி யும் விற் பனை தொடர்ந்த வண் ணம் இருந் தது. இந் நி லை யில், காரைக் கால் நகர் பகு தி யில் அமைந் துள்ள ஓர் மொத்த வியா பாரி குடோ னில், தடை செய் யப் பட்ட பொருட் கள் பதுக்கி வைத் தி ருப் ப தாக, உணவு பாது காப் புத் து றைக்கு வந்த ரக சிய தக வ லை ய டுத்து, உணவு பாது காப்பு அதி காரி ரவிச் சந் தி ரன் மற் றும் ஊழி யர் கள் சம் பந் தப் பட்ட குடோ னில் திடீர் ஆய்வு நடத் தி னர். அப் போது ரூ.20 ஆயி ரம் மதிப் பி லான தடை செய் யப் பட்ட புகை யிலை பொருட் கள் இருப் பது தெரி ய வந் தது. அனைத் தை யும் பறி மு தல் செய்த அதி காரி, சம் பந் தப் பட்ட குடோன் யாரு டை ய து? அங் குள்ள தடை செய் யப் பட்ட புகை யிலை யாரு டை ய து? எங் கி ருந்து வந் த து? யார் உரி மை யா ளர்? என் பது குறித்து விசா ரணை நடத்தி வரு கின் ற னர்.

மேலும், இனி வ ரும் காலத் தில் இது போன்ற புகை யிலை பொருட் களை விற் பனை செய் யும் சிறு மற் றும் பெரும் வியா பா ரி கள் மீது கடும் நட வ டிக்கை எடுக் கப் ப டும் என அதி கா ரி கள் எச் ச ரிக்கை விடுத் த னர்.

Categories: NEWS

Food & beverage industry seeks early solution to labelling and claim issue

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Not only Product Approval but the regulations with regards to labelling and claim have also put the food & beverage industry in a tight spot. In this regard, FSSAI seems to be still using erstwhile PFA regulations to regulate the food industry’s labelling and claim issues largely along with issuing norms for different products separately, like in case of nutraceuticals. It lacks an overall comprehensive labelling and claim regulation feels many.

According to FSSAI officials, the regulation with this aspect of food industry was being deliberated upon and there were certain issues and language which was being finalised. However, the apex food regulator had come up with a draft regulation in 2012, and its fate was still hanging in balance.

No clarity

According to one industry insider who does not want to be named, there is no clarity on labelling and claim policy of FSSAI, as yet. The issues largely rest with proprietary food, wherein labelling and claim issue together with Product Approval denial is making the situation worse.

Without Product Approval there is no licence and if supposedly the licence is lapsed, the company has to get a newer licence and subsequently it has to change the whole packaging to accommodate the new licence number. There should be provisions for licence renewal, according to an industry insider.

Furthermore, sometimes FSSAI issues notices which are contrary in nature. For instance, in case of canola oil, which was asked to be labelled as ‘low erucic acid rapeseed oil.’ The notification in this regards was later quashed by the Bombay High Court.

Importers’ issue

Food importers were also at the receiving end due to labelling and claim issue, particularly the ones who import in lesser quantity. The problem was that the exporter refuses to acknowledge the labelling requirement of India. There should be a way out says another industry representative.

Currently, the labelling norms were defined for FSSAI logo, licence number, nutritional values and so on under new regulations while date of manufacture and best before date are being used according to the erstwhile PFA rules.

Labelling is largely related to the name of food, list of ingredients, declaration of food additives, net quantity or net weight, lot/code/batch identification, name and address of the manufacturer, date marking (best before, date of manufacture and/or packing & use by date/expiry date) for different product category like veg/ non-veg declaration and size of the vegetarian/ non-vegetarian logo.

Further display of declaration and labels, the height of numeral in the declaration and product specific labelling requirements also come under labelling.

Categories: NEWS

Maggi controversy fallout: Govt may exclude stuff like dietary supplements, which will be subject to tighter regulations

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NEW DELHI: After the recent controversies involving the Food Safety and Standards Authority of India, the central government proposes to change the definition of food to widen its scope and close loopholes.

The new definition will exclude nutraceuticals, health supplements, functional food and dietary supplements, which will be subject to tougher regulations, officials from the industry and the health ministry said. The definitions of traditional and proprietary foods will be broadened. "The earlier definition of food had certain loopholes of which some companies, especially pharma companies, were taking advantage," said a senior official in the ministry of health. "Since regulations are more stringent for pharma products, companies tried to pass off nutraceuticals and health supplements as food, where regulations are slightly relaxed." According to the Food Safety and Standards Act, 2006, food is defined as "any substance, whether processed, partially processed or unprocessed, which is intended for human consumption and includes primary food." It excludes "drugs and medicinal products, cosmetics, narcotic or psychotropic substances."

The proposed draft also intends to broaden the definitions of traditional food and proprietary food. The current definition of proprietary food is "food that has not been standardised under these regulations." The draft definition of proprietary foods includes "food with additives added with a view to preserve such food and provide it with a distinct aroma or flavour or taste and a shelf life…," according to the proposal sent by the ministry to the industry.

Traditional food, which is described as food that has been and is "traditionally being consumed in the country" will be broadened to "food which is prepared in accordance with the knowledge normally transmitted from one generation to another, conforms to the gastronomic heritage of the country, or local area, or region of the country, with little or no processing or manipulation through addition of preservatives or otherwise and retains the sensory property."

The ministry of health and family welfare said on its website on September 3 that the government plans to review and amend the Food Safety and Standards Rules, 2011. It sought suggestions and comments from stakeholders by September 24. While a ministry can change rules, an act can be amended only in parliament. Representatives of the food industry, citing procedural lapses in the proposed changes, have alleged that the government wants to "sharpen their teeth and extend their reach beyond the normal to target the industry."

"It is not understood as to how and why all of a sudden an unscientific and adhoc, restrictive definition has been flashed to food industry for comments," said Amit Dhanuka, president of the All India Food Processors’ Association. The industry bodies said the government is trying to avoid a discussion on the matter.

Categories: NEWS

Relief for Nestle as panel to hear testing issue

1,October, 2015 1 comment
 

Wednesday’s development is significant for the company since arguments in the Bombay High Court over testing and sampling went in Nestle’s favour, too

In what looks like another victory for Nestle India, the National Consumer Disputes Redressal Commission (NCDRC) has decided to hear the issue of alleged improper sampling and testing methodology undertaken by various state food regulators. Accepting an appeal by Nestle to not to conduct fresh tests on samples collected earlier by the authorities from the market, the commission on Wednesday asked the government and the company to appear before it on October 8.

Wednesday’s development is significant for the company since arguments in the high court in Bombay over testing and sampling went in Nestle’s favour, too. While, the Commission on Wednesday asked both the parties to explain their positions next week, hearing on the core issue of whether Nestle was liable to pay Rs 640 crore as damages has been postponed till October 30.

Test reports showing presence of lead at higher-than-permissible levels (2.5 parts per million) and monosodium glutamate (MSG) in Maggi noodles from various Food Safety and Standards Authority of India-approved laboratories led to a country-wide recall of the product on June 5, followed by Nestle approaching the Bombay High Court.

The Food Safety and Standards Authority of India (FSSAI) had, meanwhile, forwarded its claim of the product being hazardous for human consumption and said it was right to ban Maggi at the earliest.

Nestle India’s arguments over the procedure of sample collection and conditions of laboratories, eventually, proved to be helpful for the company. The court, questioning the tests conducted earlier, ordered fresh tests and struck down the ban on Maggi. In the meanwhile, the consumer affairs ministry took suo moto congnisance and filed a class-action suit against Nestle India in NCDRC, a first in the country, and claimed Rs 640 crore in damages.

"We have already done over 3,500 tests of Maggi in independent as well as in our own accredited laboratories. All results showed Maggi is safe to eat. Food regulators in the US, UK, Singapore, Canada, Australia and New Zealand, have also found Maggi manufactured by Nestle India to be safe. Nestle India is fully committed to working with all stakeholders to get Maggi back on the shelves," a Nestle India spokesperson said.

During Wednesday’s hearing, Nestle said the entire litigation in NCDRC should be set aside, since after the Bombay High Court order it did not have any more significance. "The company has been "singled out" and victimised by the authorities," it argued. The commission, however, has not accepted the plea for rejecting the case. "Nestle India, in response to the complaint filed with the NCDRC, has raised concerns over the maintainability of the complaint. This is based on the fact that the complaint makes allegations similar to those leading to the ban of the product on June 5, which was quashed by the Bombay High Court on August 13," the spokesperson said.

While in Bombay High Court, Nestle India ultimately brought the wind in its favour on the same line of arguments, lawyers indicate the strategy may become handy this time, too. However, pointing towards it counter side, Ashish Prashad, partner, Economic Law Practise, said, "The issue that has been opened in front of NCDRC has already been decided by the Bombay High Court. It may lead to a retrial."

Categories: NEWS