From ‘honey laundering’ to fake free-range: food fraud costs billions

After enjoying what seemed to be a lovely meal, what if you were told the prawns you’d just eaten were injected with an unknown gel to make them look plumper and weigh more? Or the expensive wine you drank with it was diluted with fruit juice?

For many of us, this seems unbelievable, especially in Australia, but it’s happening all over the world.

Our food supply chains are now longer, more complex and faster than ever before, with some blind spots that cannot be regulated.

This breach of trust – known as food fraud – happens when food producers or distributors intentionally deceive consumers, shops and restaurants about the quality and contents of the foods they are purchasing. Consumers face wasting money on lower-quality products, or more worryingly, eating food adulterated with toxic ingredients or undeclared allergens.

Food fraud can occur in the raw food itself, an ingredient, the final product or in the food’s packaging, sometimes with fatal results. There are some tips for consumers to avoid food fraud, but we also need better ways to prevent and detect it.

The Impact of Food Fraud

Because of the modern techniques now involved – like the injection of gels – food fraud may seem like a modern problem, but it’s actually very old.

In ancient Rome and Athens, laws existed regarding the adulteration of wines with flavours and colours, suggesting that food fraud began almost as soon as humans transitioned from subsistence farming to selling food products.

Today, the issue is more widespread and costs billions of dollars, usually when customers pay a premium price for a fraudulent product. Agrifutures Australia estimated the cost of global food fraud is $AU 40 to 50 billion annually, with $AU 2 to 3 billion in Australia alone.

But this is just the tip of the iceberg as many frauds go unreported or undetected, especially in developing countries. It is also very difficult to detect the true nature of food fraud, so more research into these techniques is needed.

The seven types of food fraud

  1. Adulteration – Occurs when a component of the finished product is diluted or replaced with non-food-grade or even toxic substances. In 2008 in China, melamine was added to dairy milk to artificially increase protein content. An estimated 300,000 babies became unwell from the contaminated products, and six deaths occurred due to kidney damage.

    Common adulteration practices include the addition of water to milk, or diluting premium wine and fruit juices with lower-quality juice, thereby increasing profits. Adding substances like cane sugar to honey to produce ‘fake honey’ is also known as ‘honey laundering’ which depresses the costs of real honey, impacting the livelihoods of beekeepers and deceiving consumers.

  2. Tampering and mislabelling – Includes changing expiry information like the deliberate extension of use-by or expiry dates. This practice poses health risks and has included an incident in China in 2015 where 40-year-old frozen meat was smuggled into the country. Mislabelling includes the fraudulent description of a production method or origin, like fraudulently marketing produce as organic or free-range.

    The 2018 strawberry tampering incident in Australia where strawberries were found to be inserted with sewing needles is a prime example of tampering.

  3. Over-run – Where a product is made over production agreements or due to deliberate under-reporting of production. Problems arise when a fraudulent product is sold outside of regulated or controlled supply chains.

  4. Theft – Where a legitimate product is stolen and enters the market as legitimately procured. While we do not have Australian data yet, recent reports from the US indicate theft of food shipments increased by 600 per cent between 2022 and 2023. Stolen products are often sold alongside or co-mingled with legitimate products.

  5. Diversion – Refers to the sale or distribution of legitimate products outside of intended markets. For example, in Yemen, it was found that donated UN food aid destined for needy people was instead being sold in street markets.

  6. Counterfeit – Occurs when aspects of the fraudulent product and packaging are fully replicated, often the most popular products. Honey is one of the most ‘faked’ foods in the world, with mislabelling of the country of origin and or adulteration with sugar syrup.

  7. Simulation – Similar to counterfeit, but here illegitimate product ‘knock-offs’ mostly with lower quality or safety are designed to look like, but not exactly copy the legitimate products.

Some foods are more vulnerable to food fraud

Food fraud can occur in any type of food and beverage but is more common in high-value or premium products.

Saffron can be adulterated using cheap synthetic colourants and even natural adulterants. Mislabelling, presenting lower-grade saffron as superior and misrepresenting its geographic origin are also common fraud practices.

Substitution of cheaper Chinese truffles closely resembling expensive black French truffles has been a problem for decades.

Seafood is the most valuable and highly traded food. Adulterated prawns injected with different chemicals including jelly-like materials is a growing problem in China.

Fraud prawns usually have similar colour appearance and even a fresh look, but their weight is increased to gain higher profits. These materials could be non-food grade and have the potential to cause serious health issues. Caviar fraud is also common all around the world.

A popular roasted fish fillet product sold in China was found to have a 75 per cent mislabelling rate when it was substituted with other species (often outside the expected family of fish) including potentially toxic pufferfish species. This study was based on a DNA barcoding method, that identifies a species by sections of DNA from a particular gene or genes.

The same technology showed higher rates of mislabelling and substitution of fish species in sushi and sashimi at supermarkets, retail and even in restaurants in Lima, Peru.

Dairy products are also common in global food fraud incidents, with contamination and fraud issues occurring along the dairy supply chain. A study by UK scientists found cheese products have the highest number of safety and adulteration alerts.

India is the world’s largest milk producer, but milk adulteration with harmful chemicals like urea or contaminated water is an increasing problem.

Probiotic dairy products like yoghurt are considered highly vulnerable to fraudulent practices, as these beneficial probiotic microorganisms are invisible to consumers.

There is a growing risk of these products not meeting the minimum number of live probiotics claimed on the packaging.

Meat products may be substituted for other species like the 2013 Europe scandal where DNA testing revealed horsemeat in one-third of beefburgers sampled and pig meat in 85 per cent.

Higher-priced commodities like alcoholic beverages, oils, fats, nuts and spices are highly vulnerable to food fraud. The increase in e-commerce and online selling of products provides more opportunities for deceptive and dishonest practices involving food fraud.

What can we do about food fraud?

Because everyone needs to eat, the only way to fully avoid food fraud is to have honest food chains. But we cannot expect this all the time. So buying locally from a trusted vendor would be the best way, given that longer supply chains provide more opportunities for food fraud.

Even though it can be difficult to detect, check for any possible fraud in food and beverages, like packaging tampering and altered use-by dates. High-value products being sold at a lower price than the market price may also be suspicious.

Techniques currently available to detect certain types of food fraud include DNA barcoding of meat and fish, but these aren’t always available, being expensive, time-consuming and requiring skilled labour.

Implementing vigorous controls and the inspection of raw materials, as well as an effective system to monitor food handling, processing and distribution systems all help to minimise food fraud.

But this needs to be supported by the enforcement of strict regulations and good manufacturing practices by food regulatory authorities – targeting all stakeholders involved along the food supply chain before they reach the consumer.

With stricter regulations, and educating consumers and those at every stage of the food chain, we can better protect ourselves from fraud and have the confidence to enjoy our food.

/Public Release. View in full here.