Good Practice Principles for Regulating Large‑Scale Food Fortification

Principle 6: Coherent policies strengthen supply and demand for fortified foods

 

Principle definition
Policy coherence removes barriers and strengthens both supply and demand for fortified foods, supporting sustainable market development and nutrition impact.
Sub-principles	Criteria
6.1. Removing policy barriers to the supply of fortified foods.	Policy coherence across sectors and levels of government is analysed and adjustments are made accordingly. Regulations are reviewed to identify and remove unnecessary compliance costs and burdens. Unnecessarily high import tariffs and taxes on premixes and equipment are reduced.
6.2. Enhancing supply and demand of fortified foods through policy.	Benefits of policy incentives outweigh the costs and negative impacts, including those related to market distortions. Governments consider integration of fortified foods in social safety nets to create stable demand and reach targeted populations. SME participation and market entry is encouraged.

Implementing effective and sustainable fortification programmes requires policy coherence across all policy areas from the outset. Food systems today face a “triple challenge”: providing food security and nutrition for growing populations; sustaining livelihoods for millions of actors across the value chain; and supporting environmental sustainability (OECD, 2021[211]). LSFF sits at the intersection of these objectives and policy areas. While its public health benefits are well-established, fortification entails real costs for producers including purchasing premix, installing and maintaining dosing equipment, strengthening quality control systems, and adjusting production processes. Evidence suggests that the incremental costs of fortifying materially affect net margins for processors, which can act as a disincentive to invest in fortification (Hystra, 2025[46]), particularly in competitive markets where fortified and non-fortified products coexist (Ebata et al., 2021[212]). Without alignment between health, trade, industry, finance, environmental and agricultural policies, these costs can undermine the commercial viability of fortification.

Misaligned policies can constrain the availability, affordability, and accessibility of fortified foods – preventing fortification mandates from delivering nutrition gains in practice. For example, high import tariffs on premix, lengthy customs clearance procedures, limited access to finance for equipment upgrades, or restrictive technical rules on fortification machinery can increase costs and slow implementation. In such cases, fortification may be mandatory in law but difficult for businesses to sustainably implement in practice. Under financial pressure, some producers may compromise on their fortification practices, pass higher costs on to consumers, or exit the market altogether if compliance becomes unviable.

These constraints are particularly acute for small and medium-sized enterprises (SMEs). SMEs have a prominent role in improving nutrition in low- and middle-income countries where they distribute up to 80% of food commodities and generate 40-70% of agrifood employment (Monroy-Gomez et al., 2022[68]). It is therefore crucial that regulatory frameworks consider and support SMEs specific circumstances and needs.

This chapter examines how governments can look to policy levers to “fortify the business case” (2025[46]) and strategically enhance both supply and demand for fortified foods. Subprinciple 6.1 explores measures that can help to reduce costs and other barriers to the supply of fortified foods. Subprinciple 6.2 discusses how social safety net programmes and public procurement of food can generate sustained demand, encourage business participation, and reinforce the sustainability of fortification markets. Together, these measures help ensure that regulatory mandates are supported by an enabling policy environment, to deliver measurable and lasting public health improvements, consistent with the OECD’s Recommendation on Policy Coherence for Sustainable Development (OECD, 2019[213]) which also underlines the critical need to align actions across sectors and levels of government to advance sustainable development.

6.1. Removing policy barriers to the supply of fortified foods

Systematically reviewing policy frameworks to identify and address barriers to fortification is essential to supporting a steady and sustainable supply of fortified foods. Even when fortification standards are clear, other rules in trade, taxation, licensing, finance, or technical regulation may unintentionally raise costs or delay production. By aligning policies across sectors and reviewing frameworks for unintended distortions, governments can remove avoidable obstacles, lower unnecessary costs, and create conditions in which fortification is both commercially viable and effective in improving nutrition outcomes.

Ensuring policy coherence and removal of barriers to enhance the supply of fortified foods

Policy coherence plays a decisive role in determining whether fortified foods can be produced and supplied at scale. When nutrition policies mandate fortification but trade, tax, finance, or industrial policies raise the cost of premix, restrict access to equipment, or complicate business licensing, producers face conflicting signals. Aligning policies across sectors and levels of government helps ensure that regulatory objectives are not inadvertently jeopardised by other rules. A coherent policy framework is a necessary condition to reduce unnecessary costs and uncertainty and enable businesses to invest with confidence in fortified food supply.

A systematic review of existing policies and regulations can help identify barriers that unintentionally hinder fortification efforts. Reviewing the broader regulatory framework allows governments to detect unnecessary regulatory barriers and adjust policies that make compliance more difficult than intended. These may include overly burdensome business registration, licensing requirements or planning regulations that can discourage market entry for producers, especially smaller ones. As one example, Canada’s 2019 Agri-food and Aquaculture Targeted Regulatory Review systematically reviewed the existing regulatory environment across the agri-food supply chain, explicitly noting that barriers and cumulative burdens may not be apparent when regulations are considered individually. Comments identified, for instance, that multiple, sequential food labelling changes made independently by Health Canada and the Canadian Food Inspection Agency create unnecessary costs and burden on industry (Canadian Food Inspection Agency, 2023[214]; OECD, 2019[213]). In response, the two federal ministries developed a joint food labelling co-ordination policy (Health Canada and CFIA, 2021[215]).

Policy reviews can also identify trade-related barriers such as high import tariffs for premixes and fortification equipment, complex customs documentation and procedures, or prolonged border clearance procedures which can increase costs and interrupt production schedules. Reducing or adjusting value added tax (VAT) and import duties on fortified foods, fortification equipment, and premixes can significantly lower market entry costs (WFP and GAIN, 2022[216]). This can be particularly important in emerging markets where premixes and specialised equipment are not produced domestically and must be imported, increasing overall production costs for local processors. It can also play a critical role in supporting regional supply chains for fortified foods, particularly in contexts where national markets are limited.

In many low- and middle-income countries, small and medium-sized businesses in particular report that high tariff rates on premix are a major barrier to food fortification (Monroy-Gomez et al., 2022[68]) (Monterrosa et al., 2017[217]; Haddad, 2019[218]). Implementing tariff and import duty exemptions for premix and equipment used in mandatory fortification programmes, as illustrated in Box 6.1, alongside efforts to address non-tariff barriers, can help reduce these constraints. In practice, however, implementing such exemptions has sometimes encountered challenges, including securing political buy-in (Hystra, 2025[46]).

Box 6.1. Tariff exemptions for premixes and fortification equipment

Malawi exempts micronutrients and fortification equipment from import duties.

In Guatemala, the General Law of Food Enrichment establishes in Article 5 that "Machinery, mechanical and laboratory equipment, accessories, spare parts, specific micronutrients, and chemicals used in the fortification, enrichment, or standardization of foods shall be exempt from import duties.”

In Cote d’Ivoire, the Government decided to exempt premixes from customs duties to facilitate the acquisition and to support the manufacturers launch their fortification programme.

Source: (Global Alliance for Improved Nutrition (GAIN) & East, Central and Southern African Health Community (ECSA HC), 2017, pp. 21-23[219]), (Congress of Guatemala, 1992[220]), (UNICEF & Helen Keller International, 2022[221]).

Divergent premix standards or certification requirements that are not aligned with international norms may further restrict sourcing options and reduce supplier competition. In line with the OECD Declaration on Trade Policy (1980[222]), which emphasises open, predictable, and rules-based trade to support resilience and sustainable development, reviewing trade, customs, and standards frameworks can help ensure that cross-border rules facilitate – rather than hinder – the reliable and affordable production of fortified foods. Box 6.2 illustrates an initiative by GAIN to facilitate procurement of high-quality premix, in response to policy barriers consistently flagged by actors involved in fortification.

Box 6.2. GAIN’s Premix Facility

To help address challenges related to procuring high-quality premix for fortified food production, the Global Alliance for Improved Nutrition (GAIN) established its own Premix Facility. Vitamin and mineral premix are one of the most significant recurring input costs for large-scale food fortification programmes. A number of barriers exist to procuring adequate quality premix, including accessing suppliers, volatile prices for premix, lack of quality assurance and monitoring of delivered products, and a lack of funds to purchase premix.

GAIN’s premix procurement model was set up with three distinct components: a certification process that establishes industry-wide standards and guidelines for premix production to ensure consistent quality, a procurement facility that makes premix more accessible to countries and private industry engaged in fortification, and a credit facility mechanism that helps projects finance premix purchases.

After three years of operation, 15 premix suppliers and 29 micronutrient manufacturers have been certified, and more than USD 23 million worth of premix that met quality standards has been supplied in 34 countries in Africa, Central and Southern Asia, and Eastern Europe, reaching an estimated 242 million consumers.

Source: (Guinot et al., 2012[99]; Global Alliance for Improved Nutrition (GAIN), 2022[223]).

In addition, overly prescriptive regulations that specify narrow types of approved fortification equipment can restrict innovation and prevent the adoption of newer, more efficient technologies. For example, rules that only recognise a fixed blending model or a specific type of feeder may exclude newer digital dosing systems that automatically adjust micronutrient flow based on production speed, improving accuracy and reducing waste. Similarly, portable or small-scale fortification units designed for decentralised mills may not fit legacy equipment specifications, even if they meet nutrient standards. Consistent with OECD’s Recommendation for Agile Regulatory Governance to Harness Innovation (OECD, 2021[106]), regulation should prioritise outcome-based approaches and limit overly prescriptive requirements to increase business innovations. Overly prescriptive or restrictive regulations can also negatively impact competition – for instance, if it advantages a specific supplier or limits the ability of others beyond what is necessary to achieve the desired nutrition outcome, or if it mandates a level of fortification beyond what is suggested by scientific evidence and a well-informed consumer would choose (OECD, 2019[224]), Where regulatory frameworks remain prescriptive, periodic review and updating, as highlighted under Principle 2, are essential to reflect technological advances and avoid unintentionally constraining innovations that enhance precision, lower costs, and strengthen compliance. Table 6.1 illustrates select policy areas and key considerations to support coherence in and across regulatory frameworks for LSFF, building upon work undertaken by GAIN.

Table 6.1. Select areas and considerations in a policy coherence review for food fortification

Policy area	Key considerations
Health policies	Alignment between fortification standards, nutrient targets, dietary guidelines, and monitoring frameworks.
Industrial, economic, and monetary policies	Impact of taxation, credit conditions, SME support, and investment incentives on fortification costs and viability.
Social policies	Integration of fortified foods into social safety nets and alignment with poverty and nutrition objectives.
Agricultural policies	Effects of grain pricing, input subsidies, and value chain support on availability of fortifiable staples.
Environmental policies	Compatibility of fortification processes with sustainability goals, packaging rules, and energy regulations.
Trade policies	Tariffs, customs procedures, standards alignment, and certification requirements affecting premix and equipment supply.

Source: (Global Alliance for Improved Nutrition (GAIN), 2019[225]), Tanzania Country Brief: Diagnosing Policy Coherence for Food Systems – Results from Tanzania, https://www.gainhealth.org/sites/default/files/tanzania-country-brief.pdf.

6.2. Enhancing supply and demand of fortified foods through policy

Removing policy barriers creates a more enabling environment for fortification, but in some contexts additional, well-designed incentives may be needed to catalyse supply, particularly during early implementation. When producers face significant upfront investments or transitional costs, time-bound support can help bridge the gap between regulatory requirements and commercial viability. Governments need to ensure that their support follows international rules and that the expected benefits outweigh the cost including any costs related to market distortions.

Providing incentives to enhance supply of fortified foods

As a further step to support supply, governments could consider interventions that provide incentives to businesses especially at the outset of food fortification programmes. Specifically, governments should ensure that these interventions are carefully designed in line with good practices, with benefits that outweigh the costs and consideration of any potential unintended consequences (IMF, OECD, World Bank, WTO, 2022[226]), as well as leveraging impact assessment frameworks, as set out in Principle 1, to support this. Support measures should be proportional to the issue they address and time-limited. It is crucial that these interventions minimise market distortions with adverse effects on competition, trade, innovation and investment. These interventions may include financial measures such as providing tax incentives, or offering below-market loan rates or grants for fortification equipment. In Burundi for example, premixes are exempt from VAT as a form of reducing the cost of fortification (Republic of Burundi, 2015[227]).

Where possible, support measures can apply horizontally to businesses on equal terms, based on transparent and objective eligibility criteria. Horizontal policies cover the entire economy while vertical policies typically focus on one sector (OECD, 2025[228]). Horizontal measures are generally less distortive of competition than targeted instruments as the latter risk un-levelling the playing field by favouring certain industries or firms (OECD, 2024[229]). Where more targeted intervention is justified, it can be linked to a clearly identified market failure or specific transition cost associated with fortification, rather than to the financial performance or viability of individual firms. Within the realm of targeted policies, demand-side instruments are generally less distortive than supply-side instruments (OECD, 2024[229]). The OECD’s Competitive Neutrality Toolkit (2024[230]) includes good practices to support public officials in identifying and reducing distortions to competition due to state intervention.

Financial incentives such as low-interest loans or grants can play an important role, especially in contexts where small-scale food businesses are prevalent in staple food production. In Nigeria, through the Small and Medium Enterprise Development Agency of Nigeria, the government partners with financial institutions to improve access to finance for SMEs. Programmes by the Bank of Industry and the Central Bank of Nigeria also provide loans to micro, small, and medium enterprises. Other financial measures can include credit guarantee schemes, concessional loans for equipment upgrades, or integrating fortification into existing SME support programmes. When such measures are granted based on clear, transparent, objective and non-discriminatory criteria, they can reduce investment risk and support market entry. The state support measures should grant the minimum support necessary to achieve the desired change in behaviour (OECD, 2024[230]).

Governments may also, where justified and carefully designed, provide support to help offset the upfront and recurring costs associated with large-scale food fortification. This can include time-limited direct subsidies to cover part of the cost of dosing equipment or premix purchases, particularly during initial programme rollout. In some contexts, public authorities or partners may facilitate access to in-kind equipment, shared blending facilities, or locally pooled premix supply to reduce costs and improve quality assurance. Box 6.3 sets out examples of support that has facilitated the supply of fortified flour. When such measures are transparent, proportionate, and designed to minimise long-term market distortion, they can lower barriers to entry and support a more stable and competitive supply of fortified foods.

Box 6.3. Examples of support to food fortification in small rural markets

Sanku Project

The Sanku project supports food fortification by equipping small and medium-sized flour mills with automated dosifiers that add essential micronutrients during production. Sanku also provides fortification tools, training, and support to small-scale maize flour mills, enabling them to fortify their flour with essential micronutrients.

Sanku has developed a cellular-connected dosifier that accurately adds micronutrients. The premix is dispensed based on the weight of grain passing through the machine. Data is stored digitally and transmitted via secure link, allowing Sanku to monitor dosing accuracy remotely. To distribute the premix, Sanku purchases flour bags in bulk and sells them bundled with the premix, so that millers pay only the price of bags and receive premix for free. This model reduces miller implementation costs, strengthens compliance with fortification standards, and improved access to fortified staple foods.

The Sanku dosifier technology has been installed across five countries throughout East and Southern Africa, starting in Tanzania and Kenya, and extending to Rwanda, Malawi, and Mozambique.

Small-Scale Mills (Chakkis)

In Pakistan, the majority of people, including poorest and most at risk of malnutrition, purchase their wheat flour from the country’s 70 000 small-scale mills, chakkis, which produce around 0.5–2 metric tons per day and directly supply local households. With many chakkis passed down through generations consumers rely on them for their everyday wheat flour needs.

WFP initiated a pilot programme that was implemented in co-ordination with the National Fortification Alliance and the Food Department, to support small-scale chakki mills in fortifying their wholemeal flour with essential vitamins and minerals: iron, zinc, folic acid, and vitamin B₁₂. The project included several activities, including training chakki owners and workers on fortification; compliance and monitoring; specialised equipment such as customised microfeeders and testing kits for micronutrient levels. WFP also supported mills in the registration process with government authorities and creation of a quality assurance control system. Additionally, public awareness campaigns were conducted as a part of promotional activities.

The participating chakkis experienced business growth, attracting new customers among local businesses, alongside with existing clientele. As a result, sales of chakki-produced flour increased by 25-65% through these new opportunities. The project had expanded to include 50 chakkis (compared to the initial 10) from two municipalities- twin cities of Islamabad and Rawalpindi and reached 2.2 million people.

Source: (World Food Programme (WFP) Innovation, 2024[231]), Sanku: Fortifying flour through a micronutrient dosifier, https://innovation.wfp.org/project/sanku, (World Food Programme (WFP) Innovation, 2024[232]), Chakki: Engaging small‑scale producers to fortify wheat flour for the hardest‑to‑reach, https://innovation.wfp.org/project/chakki; (Tewes-Gradl, Gilbert and Nelson, 2023[233]).

Importantly, however, systems that rely heavily on ongoing subsidies can create dependence on public or donor financing and make later withdrawal of support difficult without compromising fortification frameworks. If businesses have not adapted their cost structures or supply arrangements by that point, ending subsidies can disrupt production, raise prices or reverse earlier gains in fortification coverage. In general, state support measures should include clear exit strategies, in order not to perpetuate state support beyond the necessary (OECD, 2024[230]). The transition away from subsidies therefore needs to be considered from the outset, with a plan for how potential disruptions during and after the transition will be managed. As one example from Tanzania, premix was initially made available to producers through a Premix Hub that initially subsidised 40% of producers’ vitamin and premix costs, reducing support to 20% after six months and ending it within one year as agreed. During this period, producers were introduced to alternative certified suppliers and trained on strategic sourcing. By the time the Hub closed in 2014, suppliers were selling directly to industry, allowing producers to continue purchasing premix without subsidies. Smaller producers also continued pooling orders to benefit from bulk pricing (GAIN, 2016[234]).

In contexts where production is highly fragmented or capacity is limited, policies that promote cooperative models or centralised fortification facilities can enable small and medium-sized millers to achieve economies of scale. In Costa Rica, a supportive regulatory framework enabled SMEs producing fortified salt to consolidate into cooperatives, strengthened by strategic alliances between public authorities and the private sector (UNICEF, 2013[235]). Pooling resources through collaborative arrangements, allows businesses to share blending equipment, quality control services, and premix procurement, thereby reducing per-unit costs and improving consistency. Such models also allow smaller operators to participate in fortification programmes that might otherwise be technically or financially out of reach, while maintaining oversight and compliance standards. In collaborative arrangements, co-operation between competing businesses can also create competition risks if it facilitates co-ordination or the exchange of commercially sensitive information. Such arrangements therefore need clear boundaries on the activities covered and the information that can be exchanged, with information sharing limited to what is necessary for the stated purpose and consistent with applicable competition law. Where appropriate, competition authorities can provide guidance or be consulted on the design of such arrangements, particularly where they involve joint procurement or ongoing exchanges between competitors (OECD, 2026[236]).

Generating demand and encouraging business entry through social safety net programmes

Social safety net programmes are a central instrument through which governments support vulnerable populations while advancing broader development objectives. Programmes can be delivered as cash, vouchers, or specific goods with or without contribution from beneficiaries (Gentilini and Omamo, 2011[237]). Food-focused programmes may include direct food distributions to low-income households, food voucher schemes, school feeding programmes, maternal and child nutrition packages, or cash transfer schemes designed to facilitate the purchase of nutritious foods. These programmes are typically targeted toward specific population groups – such as children, pregnant women, low-income households, or communities affected by crises (FAO, 2015[238]) – and operate at scale through established administrative and distribution systems. Box 6.4 sets out an example of how Bangladesh integrated fortified foods into their social safety net programme.

Box 6.4. Distribution of fortified rice through social safety net programmes: Bangladesh

The Government of Bangladesh has progressively introduced fortified rice into major rice-based social safety net programmes, to strengthen nutrition outcomes. Rice is the primary staple in Bangladesh, with average per capita consumption of approximately 469 grams per day, compared to about 42 grams for wheat flour. Given its high consumption and broad reach across the population, rice represents a significant vehicle for improving micronutrient intake at scale.

The programmes include the Food Friendly Programme, which provides subsidised rice to low-income households during lean seasons; the Vulnerable Group Feeding programme, which distributes food assistance in response to shocks and emergencies; and the Vulnerable Group Development programme, which provides regular food support and complementary services to women from low-income households. At present, fortified rice distribution covers a portion of beneficiaries under these programmes, providing a foundation for scaling up to improve population coverage as rice milling capacity continues to modernise and consolidate.

With technical support from partners such as Nutrition International and the World Food Programme, fortified rice had reached approximately seven million individuals by 2022.

Source: (Food Fortification Initiative (FFI), 2021[239]); (Ministry of Food, The People's Republic of Bangladesh, 2018[240]).

Beyond generating nutrition benefits, integrating fortified foods into social safety net programmes can help create stable and predictable market demand. When governments commit to procuring fortified rice, flour, oil, or salt on a recurring basis, producers gain greater certainty regarding future sales. Where appropriate, multi-year procurement planning, procurement frameworks or other predictable purchasing mechanisms can provide greater visibility of future demand and enable producers to plan investments in production capacity and supply-chain resilience (OECD, 2015[241]; 2026[242]). This stability can encourage new firms to enter the market, justify investments in dosing equipment and quality control systems, and support the development of technical expertise in fortification. Over time, sustained demand for fortified staples can strengthen supply chains, reduce unit costs through economies of scale, and reinforce compliance with fortification standards.

Public procurement of food is a key feature of many such programmes including school meal programmes, healthcare catering and social safety nets. The tender documents, aligned with applicable public procurement rules, as well as applicable food, health, trade, and other sectoral or cross-cutting requirements, can specify not only the quantity of food purchased, but also its characteristics, including whether products are of good quality, culturally appropriate, environmentally sustainable, nutritious, and/or fortified. However, in specifying such characteristics, programmes should aim to maintain opportunities for smaller business, to the extent that it does not compromise fortification policy objectives. Disproportionate technical and financial capacity requirements can unnecessarily exclude SMEs by default from public procurement. Focusing selection criteria on the capacity needed to perform the specific contract, rather than on the general capacity of producers, can help to mitigate this risk (OECD, 2018[243]). By incorporating fortified foods into procurement specifications for school meals, subsidised food packages, or voucher programmes, governments can directly improve micronutrient intake among nutritionally vulnerable populations.

As procurement systems operate at national, regional, and local levels, they can be adapted to reflect local production capacities and nutritional priorities, helping ensure that fortified foods are consistently available and accessible across diverse contexts. Regulatory frameworks can also specify sources, such as local farmers, small businesses, women, youth, and other vulnerable groups to ensure that local and targeted producers benefit from a steady demand mechanism.

Effective procurement systems characterised by transparency, clear standards, timely payments, and accountability, are essential to building public trust and achieving procurement objectives. Sound, integrity-driven public procurement systems are thus essential not only for ensuring transparent and effective operations but also for generating the highest value added for society. Transparent public procurement systems enable the public to track procurement activities, thereby helping in re-gaining trust in the public sector and democratic institutions. The OECD Recommendation on Public Procurement (OECD, 2015[241]) emphasises principles such as transparency, efficiency, integrity, and strategic use of procurement to advance policy goals. Applying these principles to food procurement enables governments to use purchasing power not only to obtain value for money, but also to support nutrition objectives, strengthen local markets, and enhance resilience.