Coagro Corp: How Quality Standards set in the Commodity Industry

Commodity markets need well-established quality standards.

Every industry sets quality standards for their products. These are determinant for the development of the industry, as well as to set the general goods' value on the market. Businesses focus on creating a quality standard with lower and higher margins for each product. But this is no arbitrary decision. There's a whole process behind them that makes these standards effective for the market where they are set. For most industrial activities, these quality standards are established after careful studies per product, with several factors taken into account.

The upper and lower quality margins can be adjusted according to the requirements of the market where these products will establish. The broader product categories consider all their characteristics, as they play an important part in the norms that are used to define the individual standards. This is done through the investigation of the goods' uses and their basic composition, as well as the conditions that can be considered damaging for those elements. For example, certain food products are more prone to pests (like wheat is to certain insects). That means that the quality standard has to contain an indication of the product's tolerance to these pests, even if they are small numbers. This of course, also depends on the use of the product.

Any industrial activity will require the specification of what an ideal product should look like for that particular area. This ‘look’ is not only regarding the aspect. It also implies flavor, texture, freshness and other characteristics, depending on the nature of the product. The intended use will also play a fundamental role in the quality normative. Products that are going to be consumed (with little to no processing) by humans need to have a different normative regarding chemicals and pests than those that are going to be manufactured and form part of the alimentation process for cattle, for example. While that’s an arbitrary example, it’s what most business use as a general guideline: depending on the origin and future use of the material, they set norms.

These will often be related to the consumer safety, but they can also refer to the particularities of the market. For example, certain products have a higher quality standard per country, such as coffee in Colombia or cacao in Venezuela. Both countries focus on exporting the highest-quality material according to their industry, meaning individual set characteristics for these products, as the purity and flavor profiles. And many industries do the same. Focusing on those particular aspects, they define what can be tolerated as a ‘flaw’ and lower quality standards, while the higher standards are set based on purity and general value of the product in that location.

Did you know that these standards variate per industry and even within the category of product? Commodities are an ever changing market, that according to many experts, evolves at an incredibly fast pace. For that reason, staying on top of those changes, especially those related to the products' quality, is fundamental for a successful work. Coagro Corp focuses on it and makes sure to know the current quality standards to acquire the best raw materials for their clients. Contact them and learn more about what they can provide to your company!