On 12.5.22, theAntitrust Authority stigmatized one of the many conflicts of interest warped by Coldiretti regarding the genetics of heavy pigs destined for PDO hams.
It is the (seasonal) icing on the cake of a dysfunctional supply chain where private interests have taken precedence over compliance with existing rules. #CleanSpades.
1) Antitrust, previous censure of conflicts of interest (2013)
The Italian Competition and Market Authority (AGCM, Antitrust)-with this report, addressed to the Ministry of Agriculture, Food and Forestry Policies (MiPAAF)-returns to a topic, animal reproduction, already addressed by it in 2013. (2)
In fact, Law 287/90 gives AGCM the power to report distortive situations derived from laws and administrative acts to Parliament and the president of the CoM-or to the latter and the relevant ministers (if appropriate, also to the local authorities concerned). (3)
1.1) Animal reproduction, distortion of competition
AGCM decision 28.3.13 had already challenged Law 30/1991, with specific reference to the pig sector. Because of the blatant conflicts of interest at the head of ANAS (National Pig Breeders Association). Which had assumed the dual role of:
– ‘controlling body’ delegated to establish and manage herd books,
– ‘controlled operator‘ through its own subsidiary company, GEN.I, which developed and marketed pig genetic lines in competition with other operators. (2)
1.2) ANAS, the double game
ANAS, in its dual public and private role:
– ‘accessed strategic information inherent in competitors’ business policies, which it could use to benefit its subsidiary.’
– ‘benefited from public funding with which it could subsidize GEN.I.’s activities, favoring it over its competitors.’
–‘coordinated, through its representatives who ‘had an important role within the Consortia,’ the supervision ‘of the correct application of the production specifications of PDO/PGI pork products.’ (2)
1.3) Pig genetics for PDO hams, the inciucio continues
The Consorzi di tutela dei prosciutti DOP,” the Antitrust concluded, “didnot appear to be characterized, as they should be, by the requirements of third-party status and independence. And the Ministry of Agriculture should have corrected this serious distortion by entrusting the public functions of maintaining and managing herd books to ‘independent entities, free of co-interest with the relevant market,’ to be chosen through a ‘public evidence procedure.
MiPAAF Coldiretto , however, instead of following up on the Antitrust decision 26.3.13, did the exact opposite. With the DM 5.12.19 that confirmed the role of ANAS and also assigned to CREA (Council for Research in Agriculture and Analysis of Agricultural Economics) the tasks of ‘judging’ the eligibility of pig genetics for use in PDO, PGI products. (4) Under the de facto control of the Coldiretti magic circle.
2) Unfair competition and market distortion
The MiPAAF Decree 5.12.19 thus renewed the basis for ANAS to exclude ‘in the public name‘ genetic types of pigs that compete with those it markets. Unfair competition is thus added to a serious market distortion that harms pig farmers, slaughterhouses, and the sausage industry. As well as the entire PDO and PGI system based on the use of pork. (5)
Among other things, the PDO pork products supply chain is experiencing a very critical period. The CUN (Single National Commission) of mysteries continues to work on the basis of deficient and inconsistent data regarding the numbers and classification of pigs slaughtered each week (6,7). Meanwhile, the Parma and San Daniele Consortia have imposed strict specifications and obtained exemptions to their application. (8)
3) Antitrust, the new censorship (2022)
Antitrust has returned to address conflicts of interest already addressed in 2013. Noting that the same have never been resolved. On the contrary, Leg. 52/2018 on the regulation of animal reproduction established that:
(1) ‘[…] the National Breeders’ Associations and Public Bodies maintaining herd books and registers, as well as entities holding already recognized Hybrid Pig Breeding Registers, shall adjust their technical and organizational requirements to the parameters required by Article 3, Paragraph 3,
2) the Specifications, under Law 30/1991 of Herd Books and Registries, as well as Hybrid Breeding Pig Registries, which have already been approved, are considered to be approved Genetic Programs in accordance with Regulation (EU) No. 2016/1012,
(3) subjects conducting checks on the productive aptitudes of animals on the basis of specifications already approved by the Ministry are recognized subjects under Article 4, Paragraph 2′.
3.1) New process for admission of genetic types into PDO, PGI circuits.
The DM MiPAAF 5.12.19 ‘has then revised the system for verifying the pig genetic types that it is possible to use in the PDO/PGI circuit ‘. The new procedure exacerbates the impact of the conflicts of interest already censured by Antitrust by introducing a new procedure for the admission of genetic types, which is structured as follows:
– genetic houses that are active in Italy, ‘although already part of the PDO/PGI production circuit for some time,’ must submit special applications and communicate a range of information to ANAS,
– ANAS then transmits the dossiers to CREA so that it can give its opinion on the conformity for PDO/PGI purposes of the various genetic types,
– MiPAAF, on the basis of the assessments made by CREA, shall take the measures of acceptance or rejection.
3.2) ANAS, monopoly. Hog-opoly
The only genetic house not subject to the aboveprocess is ANAS, since ‘the genetic types referred to in the Italian Herd Book of the Swine Species are considered suitable ‘a priori‘ by the PDO/PGI specifications.’ Instead, 25 out of 29 genetic types of pigs submitted for application by private genetic houses-which ‘constitute the entire commercial portfolio of several relevant players until now regularly operating in Italy‘-were excluded, between February and March 2022.
The genetic types ‘rejected’ by MiPAAF, it should be noted, ‘to date have accounted (in value/volume) for the vast majority of those used in the PDO/IGP circuit, which consequently will be fed almost exclusively by the genetic types produced in the context of the selection programs managed by ANAS (which could, in this way, significantly increase its share, to the point of achieving a near-monopoly position in the market).’ (1) Hog-opoly, the monopoly on pig genetics.
3.3) Conclusions of AGCM
‘The current industry regulations on the control and evaluation of genetic types of hybrid pigs for PDO/PGI purposes, contained in MIPAAF Decree No. 12390 under review, appears wholly inadequate to ensure that the exercise of such functions of a public nature takes place in accordance with the principles of competition and equal treatment among the different genetic houses operating in the market.’ (1)
Once again, an impermissible distortion of competition and the proper functioning of the market, which is not justified by the needs of the general interest, is taking place. The Antitrust Authority has therefore enjoined the MiPAAF ‘to communicate, within a period of 45 days from the receipt of this report, the determinations made with regard to the critical competition issues highlighted.’ (1)
4) Data and controls, absolute darkness
ICQRF-after pointing out ‘repeated violations of the Control Plan‘ of PDO Parma ham, with particular regard to the classification of pig carcasses-had suspended the certifying body in charge of this task from that task, by Ministerial Decree 20.1.22. (9)
However, the ministry has not yet initiated, through a public bidding process, the task of supervising the activity of grading pig carcasses. And slaughterhouses working on PDO Parma ham continue to operate in the dark, for 30 months now.
4.1) CUN pigs, the big crockery
The attached table highlights, in the red boxes, the critical issues arising from the comparison of public data on the basis of which the Single National Commission (CUN) pigs should negotiate their carcass prices every week.
Classification data (see table, columns C-M) have always exhibited illicit alterations because some slaughterhouses, as previously reported, conceal peak demand in their favor. With reporting delays sometimes reaching 20 consecutive days, as well. (10)
4.2) RIFT pierced, price lowered
RIFT data (see table, columns O-V), in 2022, are also distinguished by substantial shortcomings then ‘updated’ one week late. As was the case in weeks 15,16/2022 where there was a turnaround in the fatty pig market not surprisingly challenged by the agricultural side commissioners. (11)
Another aberration of the system is evident in column V. Classified pigs should always be several thousand higher than the RIFT figure for the same week, since all PDO pigs, as well as non-PDO pigs (Italian and foreign) slaughtered at slaughterhouses operating in the system, must be classified. Instead, their numbers are lower.
4.3) Interim Conclusions
ICQRF inspectors have already noted that ‘the data on slaughter yield was obtained from the portal enterprise.gov on which slaughter operations (including weight) are recorded.’ But ‘that data is unreliable‘ because ‘the file with which it is transmitted can be altered by the slaughterhouse before it is sent‘. Also,
‘comparing the slaughtering yields recorded on the enterprise.gov portal with those on the Csqa/Ifcq Rift portal would show significant differences, at least until December 2021.’
The only solution to this serious critical issue plaguing the weaker party in the contractual relationship, pig farmers, is to introduce a computer system where data can be collected in real time and entered into an unchangeable and incorruptible registry based on a public blockchain. (12) The writer, who has always been attentive to transparency in the market and the protection of primary production, will be happy to make the source code of Wiise Chain available to the ministry to facilitate this virtuous path with the guarantee of the Bitcoin protocol. (13)
Dario Dongo
Notes
(1) Competition and Market Authority (AGCM, Antitrust). AS1837 – Arrangements for the admission and control of pig genetic types specified in PDO and PGI specifications. 12.5.22. On Bulletin 20/2022, pages 52-57, https://www.agcm.it/dotcmsdoc/bollettini/2022/20-22.pdf
(2) Antitrust. AS 1036 – Regulation of animal production. Decision 20.3.13, in Bulletin of March 20, 2013, Pub. in Boll 13/2013, pages 20-22, https://bit.ly/3MOjaUN
(3) Law 10.10.90, no. 287. Rules for the protection of competition and the market. See art. 21. Text updated as of 12/14/21 on the AGCM website, https://bit.ly/3MHjbKj
(4) MiPAAF. DM 5.12.19 no. 12390. Compliance requirements of the genetic type used for breeding pigs used in the PDO circuit. https://bit.ly/3MHM8pl
(5) See Sec. 2.4 in the previous article. Parma and San Daniele PDO hams, high yield or superior quality? The great chaos. 28.8.21,
(6) Dario Dongo. CUN pigs, the price is not (yet) right. GIFT (Great Italian Food Trade). 24.2.21,
(7) Marta Strinati.
Pork market, mystery over PDO carcass classification.
. GIFT (Great Italian Food Trade). 11.3.21,
(8) Dario Dongo. Prosciutto di Parma and San Daniele PDO, temporary change to specifications and darkness on data. GIFT(Great Italian Food Trade). 6.1.22,
(9) ICQRF. Suspension of the authorization given to CSQA Certificazioni S.r.l. to perform the functions of controls provided for in Articles 36 and 37 of Reg. EU no. 1151/2012 for the production of ‘Prosciutto di Parma PDO’. 21.2.22, https://bit.ly/3QhxEzv
(10) Dario Dongo.
CUN pigs, the boycott of slaughterers united in Assica.
. GIFT (Great Italian Food Trade). 14.7.21,
(11) In some weeks unreal data are published on Tuesday on the Theseus website, only to be corrected at the last minute. In another week, data were presented in the wrong time sequence, so that a trend that was instead negative appeared positive
(12) Dario Dongo.
A telematic commodity exchange to promote transparency and fairness in the food supply chain.
. GIFT (Great Italian Food Trade). 8.3.21,
(12) Dario Dongo. Blockchain agribusiness, from Walmart to FDA in the US, Wiise Chain in Italy. Toward Web 3. GIFT (Great Italian Food Trade). 9.2.22.
Dario Dongo, lawyer and journalist, PhD in international food law, founder of WIISE (FARE - GIFT - Food Times) and Égalité.
