Agro-Based Industry : Sustainable Food

Production, Food Crisis

PROF. NOOR AZMAN BIN ALIGROUP 15

MOHAMAD KHAIRUL NIZAM 149100ANAS SYAZWAN BIN MOHD SAH

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147608

Is a industry based on activity agriculture, livestock, forestry

and fishing. Agriculture is the cultivation of animals, plants, fungi and

other life forms for food, fiber, and other products used to sustain life

Livestock refers to one or more domesticated animals raised in an agricultural setting to produce commodities such as food, fiber and labor.

Forestry is the art and science of tree resources including plantations and natural stands. The main goal of forestry is to create and implement systems that allow forests to continue a sustainable provision of environmental supplies and services.

Fishing is the activity of trying to catch fish. Fish are normally caught in the wild

Agro-Based Industry

Why is agriculture important?

• Though agriculture often plays a contributory role in the Gross Domestic Product (GDP).

• Before industrialization, they were able to face challenges of nature without having to starve.

• Agriculture still remains the biggest sector responsible for the employing and feeding a large percentage of the population.

• New concepts keep 'cropping up' to give the traditional activity a modern turn.

• 'Organic food' began as a small movement decades ago, with gardeners and farmers rejecting the use of conventional non-organic practices.

• It is practiced both for subsistence as well as commercial reasons

YEAR

AGRICULTURE, LIVESTOCK, FORESTRY

AND FISHING

Current Prices/RM

2005 43,854 (8.40%)

2006 50,436 (8.78%)

2007 65,032 (10.16%)

2008 75,657 (10.24%)

2009 64,651 (9.58%)

Gross Domestic Product Malaysia

Reference: Country Account, 2009.

Food Crisis

Food Crisis

Extreme and protracted shortage of food, resulting in widespread hunger and a substantial increase in the death rate.

Generally, affect all classes or groups in the region of food shortage of a country. Causes may be natural or human.

Natural causes include drought, flooding, unfavorable weather conditions, plant disease, and insect infestation.

The chief human cause is war, others include overpopulation, bad distribution systems, and high food prices.

Food Safety

Food safety is an increasingly important public health

issue. Governments all over the world are intensifying their efforts to improve food safety. These efforts are in response to an increasing number of food safety problems and rising consumer concerns.

ISO 22000:2005 specifies requirements for a food safety management system where an organization in the food chain needs to demonstrate its ability to control food safety hazards in order to ensure that food is safe at the time of human consumption.

Food Safety

• Outbreaks of food-borne illness. • Reportedly unsafe foods that have been imported to Malaysia and

alerted local authorities and consumers for example, BSE, dioxin, MCPD.

• Increased consumer awareness of food safety issues such as genetically modified and irradiated foods.

• Rejection of vegetables for exports and imported fruits to Malaysia due to pesticide residues.

• An increasing number of foreign workers who have different cultural practices in handling foods.

• Urbanization and rising economic interdependence, resulting in a longer food chain with greater risks of contamination.

• Emerging and reemerging disease due to resistant microorganisms.

• Changing consumer habits brought about by greater affluence. • Increased promotion of food safety awareness by authorities and

food industry.

Why Food Safety

Foodborne infection

Foodborne intoxication

Foodborne Toxinmediated

TYPE OF FOODBORNE ILLNESS

Some example food safety problem:-1. Salmonellosis: bacteria and symptoms are fever2. Campylobacteriosis: Acute health effects3. Enterohaemorrhagic : e-coli, listeriosis4. Naturally occurring toxins: such as aflatoxin and

ochratoxin A, are found at measurable levels in many staple foods; the health implications of long-term exposure of such toxins are poorly understood.

5. Unconventional agents: Dioxins are unwanted byproducts of some industrial processes and waste incineration.

6. Persistant Organic Pollutants (POPs) 7. Metals: such as lead and mercury, cause neurological

damage in infants and children

Food Safety Problem

• New methods and policies to assess such food need to be

developed and agreed upon internationally.• Crops modified to resist pests, foods with allergens removed or

food with an increase of essential nutrients.• Modern intensive agricultural practices contribute to

increasing the availability of affordable foodstuffs and the use of food additives.

• Adding low levels of antibiotics to animal feed in order to increase growth rate

• Globalization of trade in food, urbanization, changes in lifestyles, international travel, environmental pollution, deliberate contamination and natural and manmade disasters.

• Many outbreaks of food-borne diseases that were once contained within a small community may now take on global dimensions

Challenges And Developments

1. Government • The overall technical supervision of food safety activities including

the formulation of legislation, codes of practice, and guidelines.• Determination of food safety policies; adoption of food sampling

and food premises inspection strategies; and coordination of activities at the state and district levels

• To increase public awareness on food hygiene, posters and pamphlets are prepared and distributed, and health education programs are occasionally relayed through the mass media

• Government laboratories for food quality control services consist of the Food Quality Control Laboratory under the Ministry of Health, Chemistry Department, Department of Veterinary Services, and other research institutes and universities. Accredited private laboratories also provide food analysis services.

Food Safety Management and Administration

• Producing safe, high-quality food.• The Federation of Malaysian Consumers

Associations (FOMCA), act as pressure groups in ensuring safe food for consumers.

• Foods for export are monitored for the purpose of issuing health certificates for export items like frozen prawns, edible oils, fish, and fish products.

• Imported foods are randomly sampled by the Standards and Industrial Research Institute of Malaysia (SIRIM), which establishes standards for various food products.

2. Industry

Food Security

• The World Food Summit of 1996 defined food security

as existing “when all people at all times have access to sufficient, safe, nutritious food to maintain a healthy and active lifestyle”.

• Generally, the concept of food security is defined as including both physical and economic access to food that meets people's dietary needs as well as their food preferences.

• In many countries, health problems related to dietary excess are an ever increasing threat, In fact, malnutrion and food borne diarrhea are become double burden.

Food Security

To be food secure means that:

1. Food is available - The amount and quality of food available globally, nationally and locally can be affected temporarily or for long periods by many factors including climate, disasters, war, civil unrest, population size and growth, agricultural practices, environment, social status and trade.

2. Food is utilized - At the household level, sufficient and varied food needs to be prepared safely so that people can grow and develop normally, meet their energy needs and avoid disease.

•Food is Access – by households and individuals to adequate resources to acquire appropriate food for a nutritious diet.

• For the more than 800 million people who do not

get enough regular, healthy food, ill health and a shorter life expectancy are real risks.

• Children, and especially very young children, who suffer from food insecurity, will be less developed than children of the same age who have had sufficient food.

• They will most likely be shorter and weigh less, and be less able physically and intellectually, because of poor nutrition.

What happens when people do not have

food security?

• Increasing rice production

> Maintenance of drainage & irrigation infrastructure> Land leveling> Farm mechanization> Supplementing inputs> Research and development

• Increasing production and productivity> Permanent food production areas> Aquaculture industrial zones and hatcheries> Livestock breeding

Malaysia Food Security Policy (2008-2010)

• Reinforcing marketing and distributing network

>Assisting farmers to market their produce efficiently> New Farmers' Market> New and upgrading cold rooms> Upgrading distribution centers> Enhancing FAMA's trading fund

• Bumi Hijau Programme (Crops, aquaculture and livestock)

> Growing vegetable, breeding fish and rearing poultry within home or community boundaries to supplement consumption> Kitchen garden and edible landscape concept> Distribution of selected seeds, fertilizers, feed, cat fish fries and free-range chicks

Development of abandoned areas

> Rehabilitation of abandoned lands for vegetable, cash crops cultivation & cooperation with land owners, MOA Inc's agriculture department, land and district office, village development and security committee> Rehabilitation of abandoned ponds

Hunger in the worldLate Year 1990-1992

Number and percentage of undernourished persons 1990 -1992 is 843million (16%)

Number and percentage of undernourished persons 2005-2007 is 848million (13%)

Hunger in the worldLate Year 2005-2007

Case Study

ZIKAY GROUP OF COMPANIES

Zikay Group was incorporated in 1995 following the

establishment of Kembang Serantau Sdn Bhd which was set up in 1991.

Most business operations are centralized from the headquarters and channeled from Zikay Centre situated in the heart of Kuala Lumpur.

The Group has evolved into a strategically diversified organization with a cumulative paid-up capital of approximately RM53 million.

Zikay Group

Today, the Group has formed several

synergistic divisions ranging from property development, construction, information & communication technology, agriculture, security services, real estates, food and beverages, international ventures and education services.

Agro-based industries were firstly established

by Zikay Group in 2003. It began through its realization of the decline

for Malaysian self-sufficiency in ruminants with imports accounting for more than 80% of beef, mutton and milk.

Zikay Group – Agro-based Industries

Vertical integration describes a style

of management control. Vertically integrated companies in a supply chain are united through a common owner. Usually each member of the supply chain produces a different product or (market-specific) service, and the products combine to satisfy a common need.

Style Of Management Control

Vertical integration is the degree to which a firm owns

its downstream suppliers and its upstream buyers. Contrary to horizontal integration, which is a consolidation of many firms that handle the same part of the production process vertical integration is typified by one firm engaged in different parts of production (e.g. growing raw materials manufacturing, transporting, marketing, and/or retailing).

Backward vertical integration  Forward vertical integration  Balanced vertical integration 

Vertical Integration 

Backward vertical integration when it

controls subsidiaries that produce some of the inputs used in the production of its products.

Forward vertical integration when it controls distribution centers and retailers where its products are sold.

Balanced vertical integration means a firm controls all of these components, from raw materials to final delivery.

Vertical Integration 

The upstream has been established in 2003 Operated on few pieces of land approximately

350 acres in Kedah and Selangor for the production of beef and milk through the feedlot system.

To fill the deficiency of demands for ruminants by importing live stock of Brahman Cross to our 350-acres feedlots. With the commitment and obligation to provide HALAL meat to the consumers, we ensure appropriate methods and slaughtering processes are being adhered in Zikay abattoir.

Upstream

MRZ Base (M) Sdn Bhd has been supported by

the Government body through the security of permit for live stocks importation to ensure continuous and uninterrupted supply.

The Upstream are divided into 4 main business flow:

1. Importation of Livestock2. Feedlot Management3. Live Cattle Trading 4. Breeding & Diary

Rumpun Berkat Sdn Bhd is only importing

cattle of selected breed especially Brahman Cross from the origin country namely as Australia for local market.

These specific breed of cattle are taken from abroad for its superior beef quality, better meat yield for feedlot production and adaptable to extreme weather changes during the transportation as well as at farm of local climate.

Upstream - Sourcing & Importation of Livestock

Kuala Ketil, Kedah with the capacity of 1500

heads. Three (3) production cycles are being

maintained per annum for optimum revenue. In fact, the farm is certified as FMD free area

Upstream - Feedlot Management

Was first established in 1997 In 2005, the company has been taken over by

Zikay being the vehicle for retailing to market our fresh meats products.

Activity by forming an equal opportunity collaboration with hypermarket and supermarkets.

Rumpun Berkat Sdn Bhd is committed in delivering the assured halal meat under brand “Amal Beef".

Are aggressively penetrating the special cut meat market segment for fine dining restaurants.

Downstream

The Upstream are divided into 4 main

business flow:1. Carcass Retailing 2. Fresh Cut Meat 3. Prime Cut and Special Cut4. Process Meat

Sourcing

•From Breeding Farm•Import From Other Country•Breed From Brahman, Angus, Droughtmaster

Feedlot•Keep In The Farm For 50 Days •Adg At 800G Perday•Input Weight At 250Kg

Abattoir •Cattle At Weight Above 350Kg•Convert Into Hind-Quarter And Fore Quarter

Business Flow

Carcass Retailing

•Carcass Kept And Distribution From Subang•Special part segregated at this point before delivering to outlet

Prime Cut Retailing •Fresh Meat Sold Through The Outlet•Prime Cut Is Prepared Over The Counter For Freshness And Easy Selection By Customer

Manufacturing Of Processed Meat•To Develop Burger And Meat Ball•To Open Franchise Concept Of Cooked Food

Future Trend

The trade in food and related agricultural

products is enormous. A rising population, climate change and the lack of adequate water supplies in some parts of the world has put pressure on the agriculture industry to provide enough food without damage to the environment

Growth in agribusiness

The Animal Welfare Act and the Animal Health

and Welfare Act (Scotland) has meant a greater duty of care towards domestic and captive animals. Higher professional standards will be required for those in the animal care and equine industries.

Animal health and welfare

The sector has an ageing workforce, which

means that over 11,000 new entrants will be needed over the next decade. Efforts are also being made to attract more women and people from ethnic minority groups as they are currently under-represented (Lantra Skills Assessment Report, 2009). The ageing workforce and subsequent shortage of skilled workers is more pronounced in the devolved regions than in England.

Ageing workforce

The sustainability of fuel and energy sources

is vital to the industry as operating costs are affected by prices. The industry can also help find a solution to the problem by providing renewable energy through producing energy crops, conventional forest management and biodegradable waste (including food and farm waste).

Energy and fuel security

In summary, we are optimistic that world food

production will be sustainable for a gradually leveling population. If the world trend toward free markets continues, this food supply may be distributed in a way that tends to decrease the percentage of the global population living in hunger.

How we look at agriculture in the future will depend on how we deal with change. But regardless of personal interpretation of circumstances, one thing is certain. Agriculture will be different in the years to come, but it will always be important to us.

Conclusion

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