Economic aspects of implementing a mold growth risk monitoring system

2023-05-23, 20:13

Autor: dr Aleksandra Ostrowska, Wydział Nauk Ekonomicznych, Instytut Ekonomii i Finansów

Economic aspects of implementing a mold growth risk monitoring system

The implementation of a system for monitoring the presence of mold growth risk in stored cereals is of significant economic importance, contributing to maintaining high quality of stored raw materials, minimizing losses and ensuring food security. Read more for the full expert opinion on the economic aspects of implementing a mold growth risk monitoring system.


The solution proposed in the draft is economically significant and touches on the problem of storing production raw materials. Grain storage is one of the basic links in the food production chain. Depending on the geographical location, processed cereal crops account for between 30-70% of the daily human nutritional intake (Przybył, Sęk, 2010). Properly conducted warehouse management ensures the maintenance of high-quality of stored grain, which determines the continuity of production and sales, and also provides a hedge against changes in grain prices (Kowalski, Tabor, 2003). This is a factor that determines the competitive advantage of the enterprise in the market (Szymonik 2010). Agricultural products, such as grains, feeds, and oilseeds, due to their characteristics, including perishability and susceptibility to external factors, must be properly stored (Rut, Kulinska, 2021). This problem is relevant under the current macroeconomic situation, especially in the context of inflationary processes and the armed conflict in Ukraine. They are mainly related to the increase in energy costs and storage of grain oversupply due to its import from Ukraine. It should be noted that grain prices in Poland show high dependence on the situation on both European and world markets (Ginter, Szarek, 2010). The solution proposed in the project is also important from the point of view of ensuring food security and preventing food waste in the European Union.

The implementation of an appropriate storage system for agricultural products implies many benefits for the enterprise. Reduced grain quality due to biological contamination generates economic losses (Kręcidło, Krzyśko-Łupicka, 2015). According to a study by Abass et al. (2014) quantitative grain losses generating economic losses include 15% in the field, 13-20% during processing and 15-25% during storage. Preventing them requires the introduction of modern solutions aimed at extending storage time and reducing costs (Zhuk 2008). Computer support of this area can contribute to appropriate management decisions (Olorunfemi et al. 2015). The cost of grain storage, related to, among other things, providing the right place, method, monitoring, or insurance, is a basic decision-making criterion in an enterprise (Lai et al. 2003). Inadequate grain storage causes both quantitative and qualitative losses. Quantitative losses occur as a result of grain being consumed by insects, rodents, mites, birds, or microorganisms, leading to a reduction in the weight or volume of the stored commodity. They are the cause of qualitative losses in the form of an increase in moisture, a decrease in pH, or protein content negatively affecting nutritional values and undesirable changes in terms of taste, color, or textural qualities (Broda and Grajek 2009; Ramesh 1999; Hodges et al. 2011; Saavary et al. 2019). Safe storage of cereals involves minimizing quantitative and qualitative losses by protecting them from weather, microorganisms, insects, rodents and birds, and contaminants (Befikadu 2014). 

One of the main problems during grain storage is the risk of mold formation, which determines the appearance of mycotoxins that negatively affect human and animal organisms (Zain 2011; Mielniczuk et al., 2020). Mycotoxins are toxic chemical compounds that are naturally produced by certain types of molds (fungi)*, which primarily include Fusarium,, Aspergillus, Penicillium, Alternaria, Claviceps, and Rhizopus (Kwiatkowska, Harasim, 2019; Janik et al. 2020). According to FAO estimates, mycotoxins are responsible for losses of 25-40% of stored grain in world production (Eskola et al. 2020; Kręcidło, Krzyśko-Łupicka, 2015). In the case of grains, the way they are grown, harvested, transported, and stored is important (Perrone 2020), and the responsibility for ensuring their required quality lies with the participants in this chain. The most important is the first stage of this cycle, that is, the grain cultivation itself. If mycotoxins develop in this stage, they can no longer be removed, transferring them to other plants, and if such grain is used in the production of food products, it will also result in a loss of quality of such a product. Consumption by consumers may cause serious damage to their health (Farian 2019). It should be mentioned that the use of such grain for feed also causes negative effects on animals. As a result, the consumption of meat or products from such animals also causes negative effects on the human body, and may even be life-threatening. It is pointed out that in countries with strict regulations on grain cultivation and possible concentration of mycotoxins, as in the United States, the economic losses are greater compared to the losses in human bodies. This is because grain infected to a high degree with mycotoxins usually has to be disposed of. Thus, it will not reach the consumer in this form, and only the grain producer will suffer financial losses (Mitchell et al. 2016).

[*, [accessed 17/04/2023].

The formation of mycotoxins is determined by a combination of various factors. Among them, Mir et al. (2021) point to climatic conditions before and during harvest, humidity at harvest and during storage, storage conditions, percentage of grain damage, drying conditions, and storage temperature. Thus, climatic conditions play the biggest role (Daou 2021), including temperature and humidity (Zingales et al. 2022; Neme and Mohammed, 2017) and CO2 concentration (Perrone 2020). African countries are at increased risk of mycotoxin formation due to their hot climates, but due to a warming climate, the risk is increasing in most countries around the world, including Europe (Fumagalli et al. 2021). It is pointed out that storing cereals in conditions where relative humidity is kept above 18% is the basis for mold growth. This reaction can occur even when maintaining low temperatures (Sobczyk 2000). Therefore, it is recommended to maintain humidity in the range of 10-14% (Rut, Kulinskaya, 2021 after Pohorecki, Wroński, 1979). It should also be mentioned that the grain drying process is one of the most energy-intensive and thus the most costly due to the high consumption of electricity and solid or liquid fuels (Rut, Kulinska, 2021). Quality losses resulting from negligence in this regard affect economic losses through a decrease in grain prices (Ipsita et al. 2013). The unsuitability of raw materials for food production results in the loss of the possibility of their original use, which affects the inability to meet the demand of potential customers, the loss of their confidence, which negatively affects future opportunities for cooperation, and, as a result, the loss of market competitiveness. Among the uses of such a commodity, one can point to the use of spoiled grain for fertilizer or feedstock for biogas production. However, this requires the search for new customers, which may result in the need to reduce the price of the offered grain due to the need to act quickly to prevent the risk of further spoilage. Therefore, the system for monitoring the increase in the risk of mold development is an important solution that can reduce losses and operating costs of the company, positively affecting its financial condition, and maintaining positive relations with contractors and market position. 

Advanced mold growth that makes grain completely unfit for consumption in any form also generates other types of costs for the enterprise. The greatest losses occur when the purchased raw material cannot be sold, as the cost of its purchase cannot be covered to any extent by sales revenue. The loss, on the other hand, reduces the value of net profit. However, it can be reduced if another outlet is found and spoiled grain is used. If its price has to be lowered, however, sales revenue will be lower than its originally assumed value. Other types of losses involve the cost of disposing of spoiled grain and transporting it, as well as cleaning the tanks in which spoiled grain was stored and decontaminating them to restore them to their original storage functions. It is indicated that any amount of spoiled grain left in a silo will transfer contaminants to new grain (Tys et al. 2011). It should also be mentioned that as a result of the development of globalization and the growth of international trade, the transfer of mycotoxins has become a global problem and affects both underdeveloped and highly developed countries (Kowalska, Kowalski, 2020).

It should also be mentioned that the implementation of a system for monitoring the risk of occurrence and development of mold involves costs, which include the purchase of apparatus and sensors that allow monitoring of parameters such as temperature and humidity, their installation, or subsequent monitoring and ongoing analysis of the data. In the long term, however, these costs will certainly be lower compared to the value of the losses that would be generated by spoiled raw materials. 

In conclusion, the proposed solution for monitoring the risk of mold growth can be an important factor in avoiding losses resulting from the storage of agricultural raw materials. This is important from the point of view of cost by and profit generation from operations. As the expected economic benefits that the success of the project implementation may bring in the absence of external factors, the following can be pointed out: maintaining the prices of stored agricultural products due to their high quality, ensuring continuity of sales, and maintaining positive contacts with existing customers and the possibility of acquiring new contractors, competitive advantage in the market in terms of the innovative solution used. The economic benefits of the proposed solution will certainly outweigh the costs incurred.

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