Transcript of UTZ GUI AN OUM NT
UTZ GUIDANCE DOCUMENT Code of Conduct supply chain in Turkey
Guidance on implementation of Mass Balance traceability level for
Code of Conduct
members
Code of Conduct Hazelnut Supply Chain in Turkey Guidelines for
members and Certification Bodies
1. Introduction
In Turkey, most of the producer groups are organized by exporters
who act as both Code of Conduct
and Chain of Custody members. After the hazelnuts are harvested,
they are passed down the supply
chain by intermediaries until they reach the facilities of the Code
of Conduct member. This temporary
approach will provide more visibility to the activities of
intermediaries and provide a stepping stone
from which members can move towards stricter traceability levels
(IP).
For information about the certification requirements for
intermediaries please refer to Annex 2 of the
Certification Protocol.
2. Definitions
Consumer-end product
A product that requires no further transformation in terms of
processing or packaging prior to consumption, and is destined for
retail sale or foodservice
Cracking The process of removing the shell of the nut
Group A group of organized producers that are part of a shared IMS
and are certified together under the option “Group certification”
or “Multi-Group certification”. The group can be organized in an
association or cooperative or managed by a supply chain actor (such
as an exporter) or another entity.
Group member A producer who is certified as part of a group. It can
be the person who is the actual operator of the farm (e.g. a
sharecropper) and does not need to be the land owner.
Group administrator
An actor that organizes and administers a producer group and that
is held responsible for the IMS. The group can be led by an
association, union, chamber, cooperative or supply chain actor
(exporter), or another entity
Group member premium
Part of the UTZ premium received by a group that is forwarded to
the individual group member, in cash and/or in kind. The group
member premium does not include group management spending (such as
use of premium for audit costs and other administrative purposes),
nor services or products delivered to the whole group/community
(such as facilities or trainings).
Hazelnut kernel (Natural) hazelnut kernel of the nut free from the
shell
Intermediary Any actor in the Code of Conduct supply chain that
physically handles, collects, trades and/or stores UTZ certified
product before it reaches the central location(s) of a
Producer/Producer Group. This includes all actors regardless of
whether they own the product, are subcontracted by the
Producer/Producer Group or are part of the Producer/Producer
Group.
Internal inspection Inspection carried out on behalf of the IMS and
by one or more internal inspectors to assess conformity of group
members with all applicable requirements of the UTZ Code of
Conduct.
Internal management system (IMS)
A documented system of quality management required for group and
multi-group Code of Conduct certification. The purpose of an IMS is
to facilitate the efficient organization and management of the
group and to ensure that the group and group members comply with
the applicable requirements of the UTZ Code of Conduct.
In-shell hazelnuts In-shell nut free from husk
Member All producers, producer groups and SCAs that have
successfully registered with UTZ.
Processed hazelnut Processed hazelnut kernel (roasted or natural)
or pure consumer-end hazelnut product obtained after blanching,
chopping, slicing, grinding and other processing activities.
Processed hazelnut includes: chopped, sliced, diced, blanched,
ground, and crushed hazelnut, amongst others.
Roasted kernels Product obtained by roasting natural hazelnut
kernel.
Code of Conduct Hazelnut Supply Chain in Turkey Guidelines for
members and Certification Bodies
3. Certification options for Certificate holders in Turkey
The group administrator is held responsible for all the actors
operating under its scope as shown in the
tables below. It should be noted that Intermediaries may be
associated with several Code of Conduct
members. However, the group administrator can only receive product
as UTZ certified in its Code of
Conduct scope if:
-The group administrator takes responsibility for compliance of the
intermediary with
traceability requirements for intermediaries
groups own plantation or group members.
Option 1: Union/chamber-led group Applies to A group of organized
producers (group members) that implements an IMS. The
group can be organized by a group administrator (association,
cooperative, union or chamber). To ensure the traceability of the
product, the group administrator needs to work in collaboration
with the UTZ exporter/processor that buys from the group members
and/or intermediaries to create a system that ensures traceability
between the group members and the UTZ exporter/processor.
Applicable standard Chain of Custody and Hazelnut Annex Code of
Conduct and Hazelnut Module
Self-assessment Evaluation performed by or on behalf of a member of
its own of one or more of the UTZ standards.
Subcontractor A supply chain actor contracted by the member to
carry out specific activities. Typically they do not own the UTZ
certified product.
Supply chain actor (SCA)
An entity that operates within the UTZ supply chain and is not a
producer / producer group. Examples of SCAs are processors
(including subcontractors) and traders.
Traceability level Defines to what degree a product can be traced
back to its certified source. In the UTZ program, there are three
options (IP, SG and MB) of traceability levels that can apply to
the certified product and related processes. Identity Preserved
(IP): The identity of a certified producer/producer group is
maintained along the supply chain. The product can be traced all
the way back to the producer/producer group that it originates
from. A variation of the IP traceability level is Mixed Identity
Preserved (MixIP). Under this level, the product from multiple
producers/producer groups is mixed, but the product can be traced
back to this group of producers/producer groups. Requirements which
apply to the IP traceability level also apply to MixIP. Segregation
(SG): UTZ certified product from different producers/producer
groups is mixed. The product was produced by UTZ certified
producers/producer groups, however the identity of the specific
producers is lost. Mass Balance (MB) (Note: the MB option is only
possible for UTZ certified cocoa and hazelnut SCAs): Administrative
traceability of a certified product. Mass balance traceability
allows a proportion of the outputs of a SCA to be sold with an UTZ
MB claim, corresponding to the quantity of UTZ certified inputs
(and considering the conversion rates).
UTZ Premium An additional cash amount paid above the market price
for a similar conventional (noncertified/ non-verified) product,
because the product is sustainably produced and meets the
requirements of the UTZ Certified standards. The UTZ premium is
mandatory and agreed upon between the UTZ Code of Conduct certified
group or producer and the first buyer, is net of any deductions for
repayment of pre-financed goods or services, and is registered in
the UTZ traceability system.
Code of Conduct Hazelnut Supply Chain in Turkey Guidelines for
members and Certification Bodies
Responsibility for compliance Chain of Custody
The exporter/processor is responsible for: (1) the compliance with
all the applicable CPs of the individual site/all sites under the
central management that handle UTZ product, (2) for the compliance
of the subcontractor(s) that handle UTZ product with the applicable
CPs, (3) the conformity of the intermediaries that handle UTZ
product with the applicable CPs.
Code of Conduct
The group administrator is responsible for: (1) the proper
functioning of the IMS and for conformity with the CPs applicable
to the group, (2) the conformity of the group members with the CPs
applicable to the group members, (3) the conformity of the
intermediaries with the CPs applicable to intermediaries (if
applicable)1
Code of Conduct and Chain of Custody
Both the exporter/processor and the group administrator are
responsible for sharing the necessary information to keep the
traceability of the products and ensure the compliance of both
parties with the applicable CPs.
Option 2: Exporter/processor-led group Applies to An actor
(exporter /processor) that has one site or multiple sites
(administered under
a central management) where processing activities (excluding
farming) may take place. This same actor can act as a group
administrator for a group of organized producers (group members)
that implements an IMS.
Applicable standard Chain of Custody and Hazelnut Annex Code of
Conduct and Hazelnut Module
Responsibility for compliance Chain of Custody
The exporter/processor is responsible for: (1) the compliance with
all the applicable CPs of the individual site/all sites under the
central management that handle UTZ product, (2) for the compliance
of the subcontractor(s) that handle UTZ product with the applicable
CPs.
Code of Conduct
The group administrator is responsible for: (1) the proper
functioning of the IMS and for conformity with the CPs applicable
to the group, (2) the conformity of the group members with the CPs
applicable to the group members, (3) the conformity of the
intermediaries with the CPs applicable to intermediaries2
4. Traceability levels
In Turkey, groups are mostly organized by exporters or, to a lesser
extent, by chamber/unions.
Depending on these options, there can be other actors involved in
the trade of hazelnuts at Code of
Conduct level, such is the case of manavs or crackers.
Additionally, there could also be other actors
subcontracted at Chain of Custody level. The group administrator,
being responsible for the correct
implementation of the Code of Conduct requirements and, if
applicable, Chain of Custody
requirements, is held responsible for the compliance of all the
actors involved in the chain
(intermediaries and subcontractors). In case of union/chamber led
groups, this responsibility falls
under the exporter/processor the group is associated to. Each actor
must function under a specific
traceability level that is equal to or lower than the supplied
input. The applicable traceability levels are
listed below from “strongest” to “weakest”:
Traceability level Type of traceability CoC ChoC
1 Refer to Annex 2 of the Certification Protocol for additional
information 2 Refer to Annex 2 of the Certification Protocol for
additional information
Code of Conduct Hazelnut Supply Chain in Turkey Guidelines for
members and Certification Bodies
Identity preserved Physical traceability with producer
information
Applicable Applicable
Mass balance Administrative traceability
Applicable Applicable
Chamber/union led groups: the graph below shows the possible
combinations of traceability levels
through the chain for these groups. In this case, the group
organizer needs to work in collaboration
with one specific exporter/processor. The exporter/processor is
held responsible for the
subcontractors acting on its behalf.
Exporter/processor led groups: under this structure, there are
often other actors involved in the
trade and processing of hazelnuts, such as, manavs and crackers
(intermediaries). The graph below
shows the possible combinations of traceability levels through the
chain, under the Code of Conduct
scope, for such groups.
Code of Conduct Hazelnut Supply Chain in Turkey Guidelines for
members and Certification Bodies
5. Clarification of compliance with the Code of Conduct Control
point G.A.23 of the Code of Conduct mentions that “the UTZ
certified product, including
carry-over stock from previous certification years, is visually
identified as such and is at all times
strictly separated from non UTZ certified products”. However, for
members operating at MB, only
documentary traceability is required.
6. Hazelnut supply chain in Turkey In Turkey, the supply chain of
hazelnuts can have different structures and hence, different
actors
involved. The scheme below shows the most common group
administrators, supply and suppliers.
Group administrator
hazelnuts to the subcontractors of a chosen UTZ exporter
Exporter/processor
Exporter buys in-shell hazelnuts from manavs and/or group
members and cracks them in its own facilities/subcontracts
this
activity
Code of Conduct Hazelnut Supply Chain in Turkey Guidelines for
members and Certification Bodies
The following diagrams represent a simplified version of the UTZ
hazelnut supply chain, including
the main actors and traceability levels.
Option 1: Chamber/union led groups: group members sell in-shell
hazelnuts to the subcontractors
of a chosen UTZ exporter/processor. To ensure the traceability of
the product the chamber/union
works in collaboration with one exporter/processor.
3 For additional information consult the Hazelnut Annex of the
Chain of Custody Standard
Traceability requirements per actor
Group members All group members belonging to a specific group sell
in-shell hazelnuts to the subcontractors of the chosen
exporter/processor or directly to the exporter/processor.
Documentary and physical traceability must be kept.
Group administrator (chamber/union)
The group administrator (chamber/union) must ensure that the group
and group members comply with the applicable requirements of the
UTZ Code of Conduct. The group administrator has a Code of Conduct
account in the UTZ traceability system and should work together
with one chosen exporter/processor to guarantee traceability of the
products and ensure the compliance of both parties with the
applicable CPs.
Subcontractors (manavs and/or crackers)
Manavs buy in-shell hazelnuts from group members. The traceability
level applied to manavs depends on the traceability level they can
offer and are subcontracted for by the exporter. - IP: when UTZ
in-shell hazelnuts from a particular group are separated from
in-
shell hazelnuts from other UTZ groups and from conventional
hazelnuts - MB: when UTZ in-shell hazelnuts are mixed with in-shell
hazelnuts from other UTZ
groups and with conventional in-shell hazelnuts. In this case,
manavs must keep a documentary traceability. And manavs are only
allowed to sell onwards with the UTZ MB claim, a volume
corresponding to the quantity of UTZ certified hazelnuts they have
bought from UTZ group members
Crackers buy in-shell hazelnuts from manavs and sell hazelnut
kernels to the group administrator. Such volume must respect the
conversion rates for cracking 3 - IP, 1:0,50 (with bandwidth
0,45-0,56) - MB, 1:0,50
The conditions for the traceability levels previously explained for
manavs, also apply to crackers. Both need to keep documentary
and/or physical traceability depending on the traceability level
they have agreed upon with the group administrator.
Exporter/processor Exporter/processors are held responsible for the
subcontractors (manavs, crackers) they work with. Therefore, they
must safeguard their compliance and guarantee the traceability of
the product. To ensure this, exporters/processors must work in
collaboration with the group administrator. The exporter/processor
must choose a traceability level (IP, MB) and agree on it with the
subcontractors. This actor can buy in-shell hazelnuts or hazelnut
kernels as explained below: - Manavs or group members:
exporter/processors buys in-shell hazelnuts from the
group members or from manavs. Once these arrive to the facilities,
they are converted to hazelnut kernel on-site or by subcontracted
crackers.
- Crackers: exporter/processors buys hazelnut kernel from
crackers.
Based on the amount of hazelnuts received the exporter/processor
agrees upon a transaction in the UTZ traceability system with the
group administrator, taking into account the conversion rates from
in-shell hazelnuts to hazelnut kernel, in accordance with the
chosen traceability level. Hazelnut kernels can be further
processed into other products (processed hazelnuts, roasted
hazelnuts)
Manufacturer of consumer-end products
Manufacturer of consumer-end products buy hazelnut kernels,
processed hazelnuts or roasted hazelnuts to produce (pure and/or
not pure) hazelnut consumer-end products. Consumer-end
product
Code of Conduct Hazelnut Supply Chain in Turkey Guidelines for
members and Certification Bodies
manufacturers can only choose a traceability level with a physical
link that is equal to or lower than the supplied input.
Code of Conduct Hazelnut Supply Chain in Turkey Guidelines for
members and Certification Bodies
Option 2: Exporter/processor-led groups: there are two
scenarios.
- Exporter/processor buys in-shell hazelnuts from manavs and/or
group members and cracks them in its own facilities or subcontracts
this activity
- Exporter/processor buys hazelnut kernels directly from
crackers
4 Depending on how the group administrator sets the supply chain,
crackers could be under the scope of Code of Conduct or Chain of
Custody. 5 For additional information consult the Hazelnut Annex of
the Chain of Custody Standard
Traceability requirements per actor
Group members All group members belonging to a specific group sell
in-shell hazelnuts to intermediaries or the group administrator.
Documentary and physical traceability must be kept
Intermediaries (manavs and crackers)
Manavs buy in-shell hazelnuts from group members. The traceability
level applied to manavs depends on the traceability level they can
offer and what is agreed upon with the group administrator. - IP:
when UTZ in-shell hazelnuts from a particular group are separated
from in-
shell hazelnuts from other UTZ groups and from conventional
hazelnuts - MB: when UTZ in -shell hazelnuts are mixed with
in-shell hazelnuts from other
UTZ groups and with conventional in-shell hazelnuts. In this case,
manavs must keep documentary traceability and are only allowed to
sell onwards, with the UTZ MB claim, a volume corresponding to the
quantity of UTZ certified hazelnuts they have bought from UTZ group
members
Crackers 4 buy in-shell hazelnuts from manavs and sell hazelnut
kernels to the group administrator. Such volume must respect the
conversion rates for cracking 5 - IP, 1:0,50 (with bandwidth
0,45-0,56) - MB, 1:0,50
The conditions for the traceability levels previously explained for
manavs, also apply to crackers. Both actors keep documentary and/or
physical traceability depending on the traceability level.
Group administrator (exporter)
The group administrator has Code of Conduct and Chain of Custody
accounts in the traceability system. The group administrator must
choose a traceability level (IP, MB) and agree on it with their
intermediaries at Code of Conduct level. Exporters/processors can
buy hazelnut kernels or in-shell hazelnuts as explained below: -
Manavs or group members: exporter/processors buys in-shell
hazelnuts from the
group members or from manavs. Based on the amount of in-shell
hazelnuts bought as UTZ and on the traceability level, the group
administrator can make transactions in the UTZ traceability system
of in-shell hazelnuts from the Code of Conduct account to the Chain
of Custody account. Once the volume has been transferred to the
Chain of Custody account, it can be further processed to obtain
hazelnut kernel. In this case, the group administrator can crack
the hazelnuts in its own facilities or can subcontract a cracker,
if this is done, the group organizer is held responsible for the
compliance of the subcontractor(s).
- Crackers: the group administrator (exporters/processors) buys
hazelnut kernels from crackers. Based on the amount of hazelnut
kernels bought as UTZ and on the traceability level, the group
administrator can make transactions in the UTZ traceability system
of hazelnut kernels from the Code of Conduct account to the Chain
of Custody account
Hazelnut kernels can be further processed into other products
(processed hazelnuts, roasted hazelnuts)
Code of Conduct Hazelnut Supply Chain in Turkey Guidelines for
members and Certification Bodies
Manufacturer of consumer-end products
Manufacturer of consumer-end products buy hazelnut kernel,
processed hazelnuts or roasted hazelnuts to produce (pure and/or
not pure) hazelnut consumer-end products. Consumer-end product
manufacturers can only choose a traceability level with a physical
link that is equal to or lower than the supplied input.
Code of Conduct Hazelnut Supply Chain in Turkey Guidelines for
members and Certification Bodies
Involvement of TMO in the UTZ hazelnut supply chain
In Turkey it can occur that TMO (Turkish Grain Board)6 is involved
in the hazelnut supply chain. The
involvement of TMO in the hazelnut supply chain is considered
similar as the involvement of Manavs
in the hazelnut supply chain. TMO buys in-shell hazelnuts from
group members. Exporter/processor
buys in-shell hazelnuts from TMO and/or group members and cracks
them in its own facilities or
subcontracts this activity.
If TMO is involved in a certificate holder’s supply chain and the
certificate holder wants to sell the
volumes purchased from TMO as UTZ certified, TMO must be included
as actor in the certificate
holder’s supply chain in order to maintain traceability from the
group members to IMS. UTZ
recognizes that a governmental actor such as TMO is excluded from
the possibility of receiving an
internal as well as external inspection in context of the UTZ
program. However, traceability at Mass
Balance level is to be maintained through documentation at all
levels. TMO must be included in the
certificate holder’s supply chain if they are to operate as their
manav.
7. Mass Balance at Code of Conduct level
When intermediaries operate at Mass Balance traceability level, the
volume sold with the UTZ MB
claim must correspond to the quantity of UTZ certified inputs. This
implies that the group
administrator may not receive the entire certified volume and thus
can only make transactions
based on the UTZ volume that arrives to its facilities. Please note
that crackers operating at MB
must take into account the conversion rate from in-shell to
kernels7. The following example and
diagram portrays manavs as intermediaries.
Example: the diagram below shows an exporter/processor-led group
with a certified volume of
40.000 kg. This member has both, Code of Conduct and Chain of
Custody certificates.
6 The Turkish Grain Board (TMO), founded in 1938, is a limited
liability and autonomous state economic enterprise running
on state capital in accordance with the provisions under Decree Law
No 233 of 08/06/1984 on State Economic Enterprises.
TMO is mainly purchasing grain, maize, paddy, poppy and hazelnut
and is taking protective measures for producers and
consumers by regulating agricultural product markets, especially
grain market, within its field business.
TMO offices in Black Sea Region purchase hazelnuts from farmers,
often (far) above market price. Due to this price
difference farmers may decide to sell their hazelnuts to TMO. The
amount purchased by TMO varies from year to year. In
2017, TMO purchased over 135.000 tons (in-shell hazelnut) from more
than 75.000 farmers in all Black Sea Region.
7 IP, 1:0,50 (with bandwidth 0,45-0,56), MB, 1:0,50
Group members Two group members with a certified production of
20.000 Kg each. Each group member sells 10.000 kg to (1) UTZ manavs
working with the group administrator and (2) to non-UTZ manavs.
Group members are only allowed to sell as IP.
Code of Conduct Hazelnut Supply Chain in Turkey Guidelines for
members and Certification Bodies
The conditions mentioned above also apply to chamber/union-led
groups. In such a case, the
exporter/processor working in collaboration with the group
administrator is held responsible for the
traceability of the product and for the compliance of its
subcontractors (manavs and crackers).
Intermediaries (manavs)
The group administrator works with two manavs. As these manavs
operate at MB level, a documentary traceability must be kept and
they are only allowed to sell onwards, with the UTZ MB claim, a
volume corresponding to the quantity of UTZ certified hazelnuts
they have bought from UTZ group members. In this example, each of
the manavs bought 10.000 kg from group members and, therefore, is
allowed to sell a maximum of 10.000 Kg each to the group
administrator. However, as one of the manavs sold 5.000 Kg to a
non-UTZ exporter, they only sold a total of 15 000 Kg to the group
administrator.
Group administrator (exporter/ processor)