Journey to the Marketplace Series: TATRIG Webinars -Oklan Best Foods
Overview of Export Challenges and Rejections
Exporting products internationally comes with many potential hurdles and risks. Goods can face rejection for various reasons, ranging from quality control issues to problems with packaging, labelling, pricing, etc. When products are rejected, it can be costly and damaging for exporters.
Understanding the key challenges and reasons for rejection is crucial for anyone looking to succeed in international trade. Export rejection occurs when customs authorities in the destination country do not accept or allow imported goods into their country. This can happen during clearance if products do not meet set standards or requirements.
Rejection can lead to enormous losses for exporters. The shipment has to be re-exported or eradicated. There are also additional costs involved with storage fees while resolving these issues. That’s why having proper knowledge and preparation is vital before exporting any items overseas.
Some of the main factors that can result in an export rejection include:
- Quality control failures – Issues with unsafe materials, contamination, improper processing, etc.
- Labelling problems – Incorrect language, missing information, non-compliant labelling.
- Packaging faults – Damage, improper packing/sealing, non-food grade materials.
- Documentation errors – Mistakes or omissions on certificates, invoices, and permits.
- Regulatory non-compliance – Not meeting international standards or destination import rules.
- Pricing issues – Under-invoicing to avoid duties or taxes.
- Counterfeit goods – Trademark or copyright infringements.
Avoiding rejections requires attention to detail in all aspects of the export process – from production to documentation and shipping. Understanding why goods get rejected, and the strict requirements of foreign markets is critical to developing robust strategies to overcome these export hurdles.
Interview Background
Mrs E Nwankwo is the CEO and Director of Oklan Best Foods, a Nigerian company specializing in the processing and exporting agricultural goods. She has extensive experience navigating the complexities of international trade. She has made Oklan Best a leading exporter of products like cocoa, cashew nuts and sesame seeds to global markets.
Oklan Best Limited has been operating as an exporter since its inception. To ensure both quality and quantity in our trading endeavours, Oklan Foods implemented backward integration, with a primary focus on globalizing international food safety standards, particularly in the realm of organic agricultural produce such as shea butter, yam tubers and products, plantains and products, beans, cassava products, and more.
In collaboration with agribusiness stakeholders, including farmers and producers, Oklan Best provides training and planting materials while leveraging various media channels to underscore and educate farmers on the significance of adhering to standards, ensuring safety, and maintaining traceability in their day-to-day agricultural activities. Additionally, Oklan Best collaborates with the government to facilitate financing options for farmers.
Concerning beans, Oklan Best Limited engages in off-taking immediately after harvest. The process involves threshing and drying, and PICS bags are utilized for transportation, transferring the produce from the farm to our silos. This approach enables extended storage without synthetic pesticides, resulting in pesticide-free beans.
Under Mrs Nwankwo’s leadership, Oklan Best has grown and has its own farms and collection centres. The company is focused on maintaining stringent quality standards and prides itself on its strong reputation amongst international buyers.
As a respected voice in the agricultural export business, Mrs Nwankwo was invited to share her insights on the Talking Trade webinar hosted by renowned trade expert Olufemi Boyede, CITP. Her deep knowledge of product requirements, export procedures, and mitigating risks makes Mrs Nwankwo uniquely positioned to guide fellow exporters.
The Multifaceted Risks of Export Rejection
Exporting products internationally comes with inherent risks that can lead to rejected shipments. As outlined by the hosts of Talking Trade (TATRIG), numerous factors can result in products being turned away at the destination port.
At the most fundamental level, quality issues with the actual products remain one of the most significant risks for rejection. If the quality does not meet the standards and specifications agreed upon in the contract, buyers have the right to refuse the shipment. This underscores the need for stringent quality control on the exporter’s part before goods leave the factory or farm.
Pricing discrepancies also pose a significant risk if the final pricing does not match the invoice. Exporters must ensure transparency and accuracy in invoicing to avoid rejecting goods due to pricing conflicts or mismatched information.
Meeting agreed timelines also plays a pivotal role. Failure to deliver goods on time per the contractual delivery schedule can lead to penalties, cargo holds, and even outright rejection. Exporters must account for potential delays and build sufficient buffer time into delivery plans.
Additionally, packaging and labelling issues can contribute to rejected shipments if branding guidelines, labelling requirements, or packaging specifications are not adequately followed. Overlooking small details on packaging and labelling compliance can have outsized consequences.
Finally, providing inadequate product information remains an avoidable but frequent factor in export rejections. To avoid information gaps, exporters must furnish detailed product specifications, ingredient lists, nutritional information, and other mandated disclosure requirements.
Overall, while product quality remains paramount, exporters must holistically examine all aspects of the export process to mitigate the multifaceted risks of rejection. Rigorous quality control, accurate pricing and invoicing, timely delivery scheduling, packaging and labelling compliance, and comprehensive product information provision are all critical elements in navigating the risks of the international export arena.
Understanding Product Requirements
Mrs Nwankwo emphasized the importance of understanding the specific requirements of each exported product. She explained how the standards and specifications vary greatly depending on the product.
For example, when exporting beans, there are precise limits on allowed pesticide residue levels. The percentage of permitted pesticides can differ based on the destination country. Exceeding the threshold percentage, even slightly, can lead to outright rejection of the shipment.
Other product-specific requirements she mentioned included:
- Packaging format and weight regulations based on container shipping requirements
- Labelling standards of international bodies and import countries
- Adhering to codes of hygienic practice from organizations like Codex Alimentarius
- Following ISO quality standards for factors like bean size and uniformity
- Understanding moisture content and its impact on shelf-life
Proper education on the exact product specifications is critical. This allows exporters to implement quality control and processing measures to meet international standards. Failure to comply with the precise requirements leads to avoidable rejections.
Pesticide Residue and Post-Harvest Challenges
The discussion delved into the challenges posed by pesticide residue and post-harvest issues in agricultural products. Mrs Nwankwo explained how pesticide levels in beans were meticulously monitored and how addressing the issue involved collaboration with overseas laboratories. She emphasized the importance of working with international partners to ensure pesticide residues meet the strict export standards.
Furthermore, the prevalence of aflatoxin in products like maize, sesame seeds, cocoa, and cashews was discussed, underscoring the need for proper drying techniques to prevent contamination. Adequate drying, storage and handling methods are critical to minimize mould growth and aflatoxin production. Mrs Nwankwo highlighted the techniques used by her company, such as promptly drying crops to a safe moisture level, cleaning storage areas, and testing for aflatoxin. Good manufacturing practices and HACCP principles were emphasized as key to mitigating this post-harvest issue.
The insights provided underscored how closely monitoring pesticide use and implementing proper post-harvest techniques are essential to overcoming two significant causes of export rejection. Mrs Nwankwo stressed the importance of addressing these potential risks before exporting agricultural commodities.
Safeguarding Product Quality
Mrs Nwankwo stressed the importance of addressing potential risks before commencing an export venture to mitigate the rejection risks. She likened this to a bank evaluating risks before granting a loan, emphasizing the necessity of risk mitigation in every aspect of the export business. This includes processes such as:
Deshelling – Properly deshelling products like cocoa beans is crucial to prevent contamination and ensure quality. The deshelling process must be monitored and controlled to remove shells while keeping the beans intact.
Fermentation and drying – Proper fermentation and drying techniques are vital for products like cocoa to develop the desired flavour profile and prevent moisture issues. Careful monitoring of time, temperature and humidity allows for optimal results.
Grading and sorting – Grading cashews by size and sorting out any defective nuts is crucial in achieving uniformity and quality. Proper grading ensures only the best cashews are exported.
Risk analysis – Conducting a detailed risk analysis of the entire supply chain can identify potential trouble spots that require mitigation strategies. This allows exporters to address risks proactively.
Quality control – Implementing rigorous quality control with sampling and testing at multiple touchpoints ensures export products consistently meet specifications. This prevents quality issues that lead to rejection.
By proactively addressing risks with processes like grading, sorting, deshelling, drying, and comprehensive quality control, exporters can safeguard product quality and avoid the major pitfall of rejection. Mrs Nwankwo emphasized proper risk mitigation as a prerequisite for export success.
Please use the arrows to navigate the flipbook containing the presentation slides below. You can view the book in full-screen mode. You can also download the pdf version.
Industry-Specific Challenges
The conversation further shed light on industry-specific challenges, such as in the production of palm oil. Maintaining the appropriate fatty acid content is vital, as any deviations can lead to rejection. The common practice of bleaching to achieve the desired color of palm oil was discussed. Bleaching makes the oil look good visually but adversely affects the quality. Educating producers on avoiding harmful bleaching and adhering to international standards is crucial.
Additionally, the potential hazards of hydrocarbon smoke in processed fish products were highlighted. Smoking fish with improper fuels can introduce harmful contaminants. Ensuring product safety and remaining vigilant about conformity to import regulations is paramount. Rejection can occur if hydrocarbon levels are above thresholds. Proper smoking techniques and fuel choices are essential.
Each industry faces unique challenges that require specialized knowledge and preventive measures. Meticulous quality control and risk mitigation strategies tailored to the specific product can help navigate these obstacles. Maintaining dialogue with buyers and authorities can further help anticipate and address potential issues proactively. With the right expertise and systems, the risks can be managed effectively.
Addressing Industry-Specific Challenges
The conversation further shed light on industry-specific challenges, such as the production of palm oil. Mrs. Nwankwo addressed the issue of fatty acid content and the adverse impact of bleaching on product quality.
She emphasized the vital role of educating primary producers to ensure adherence to international standards. Additionally, the potential hazards of hydrocarbon smoke in fish products were highlighted, emphasizing that product safety and conformity are paramount.
Collaboration with international laboratories and overseas partners was noted as an important step in addressing challenges related to pesticide residue testing and establishing acceptable thresholds for exports.
Educating producers on proper techniques, for example drying methods to prevent aflatoxin contamination in agricultural commodities, was also highlighted. Proper techniques for processing commodities like cocoa beans to prevent mould growth requires training producers on international best practices.
Building capacity of local producers and manufacturers is key to meeting global export market requirements consistently. Partnerships with international organizations can facilitate knowledge transfer and technical assistance to improve processes and capabilities.
Ultimately, a proactive approach involving collaboration, education and building capacity is essential to address industry-specific challenges in the export business. Leveraging global expertise and transferring knowledge empowers local producers to meet international standards.
Key Takeaways
Mrs. Nwankwo’s insights illuminated several key factors to consider in avoiding export rejection:
Rigorously understand product specifications – Each item has unique requirements for pesticide levels, packaging, labeling etc. that must be strictly followed.
Assess and mitigate risks before exporting – Evaluate potential rejection factors across the supply chain and take preventive measures, just as a bank would before issuing a loan.
Implement stringent quality control – Ingredients, processing, storage and transport must uphold the highest standards through practices like proper drying techniques, sorting, grading etc.
Ensure food safety from farm to market – Be aware of risks like aflatoxin contamination and educate farmers on techniques to avoid it.
Adapt to each industry’s challenges – Issues like fatty acid levels in palm oil or hydrocarbon smoke in seafood require tailored solutions.
Continuously educate exporters and producers – All involved must be informed on the latest protocols, standards and regulations in international trade.
Meticulous attention to detail is key – Successful exporting requires rigorous adherence to product specifications and international quality norms across the board.
The overarching theme is that avoiding rejection requires proactive quality control, risk mitigation and deep knowledge of each product’s unique export requirements. Mrs. Nwankwo’s experiences provide invaluable advice for exporters seeking to navigate these hurdles.
Conclusion: Key Insights on Quality Control for Export Success
Mrs. Nwankwo’s extensive experience provides critical insights on overcoming export rejection through comprehensive quality control and risk assessment. Her emphasis on understanding exact product specifications, stringent monitoring of metrics like pesticide residues, and meticulous attention to industry-specific requirements is invaluable.
The knowledge shared reinforces the need for exporters to thoroughly evaluate potential risks and implement robust mitigation strategies. As Mrs. Nwankwo explained, this level of diligence is crucial, just as banks assess risks before approving loans.
By outlining key factors behind export rejection, from product quality to packaging and labelling, the conversation highlighted what exporters must get right. Mrs. Nwankwo stressed that in-depth product knowledge, stringent quality checks, and preventing issues like aflatoxin contamination are paramount.
In conclusion, these insights underscore the importance of stringent quality control and comprehensive risk management in successful export ventures. Meticulous attention to product specifications, international regulations, safety protocols, and packaging is key. Following Mrs. Nwankwo’s advice will enable exporters to navigate hurdles and achieve global market access.
