The Administration will introduce a proposal entitled Strengthening Transparency and Regulatory Science that would have the effect of suppressing valid scientific research in developing policy and regulations. The proposal would require that scientists disclose all of their raw data including confidential medical records before an academic study could be considered.

Scientists and physicians in research maintain that the proposed rule would reduce the contribution of scientific studies to developing policy. The EPA justifies the decision on the basis of “transparency”. Andrew Wheeler, Administrator of the EPA noted “We are committed to the highest quality science” In testimony before a Congressional committee in September Wheeler stated “Good science is science that can be replicated and independently validated, science that can hold up to scrutiny. That is why we are moving forward to ensure that the science supporting Agency decisions is transparent and available for evaluation by the public and stakeholders.”

The measure to be adopted by EPA is a thinly veiled attempt to exclude politically embarrassing studies from consideration in reviewing clean air and water rule making. The EPA is well aware that disclosing raw data would be contrary to maintaining confidentiality. This measure if adopted would be yet another obstacle in denying science to establish policy and regulations.

The initiative by the EPA is in some respects analogous to the suppression of politically unpalatable results of studies conducted by scientists affiliated to the USDA or funded by the Department that quantify the deleterious effects of climate change.

Ignoring scientific findings in the interest of political expediency is irrational and does not alter reality. Inappropriate decisions made by regulatory agencies based on deliberate suppression of scientific facts will only exacerbate the outcomes of environmental degradation to achieve short-term parochial advantages.

The December 9th USDA Crop Progress Report, the last for the 2019 season, documented a continued advance in harvesting a crop delayed by late planting due to flooding in spring, drought in some areas at mid-stage and inclement weather during the harvest period.

As of December 8th in 18 major corn-producing states, responsible for 94 percent of the 2018 crop, 92 percent of corn had been harvested. This compares to a five-year average of 98 percent. During the past week, 3 percent was gathered consistent with the trend of diminishing returns at the end of each harvest year. States with suboptimal harvests of corn included N.Dakota (43 percent of projected total) and Wisconsin and Michigan at 74 percent each. The remaining 15 states posted harvests of 93 percent to 100 percent.

Farmers harvested an additional 4 percent of soybeans crop past week completing the harvest of the faster-growing crop. North Carolina harvested only 75 percent of soybeans planted with Michigan and Wisconsin at 75 percent each. Other states ranged from 92 percent (N. Dakota) to 100 percent as of December 8th.

Any remaining corn or soybeans in fields can be regarded as unmarketable.

Based on the importance of cage-free production, the USDA-AMS issues a monthly report on volumes and prices for the information of Industry stakeholders. There is some doubt as to the accuracy of the individual monthly flock numbers especially with reports that show either no change or a significant increase in the cage-free flock for a specific month. It is questioned whether it would not be more informative to post accurate quarterly data in place of questionable monthly figures.

EGG-NEWS summarizes and comments on data and trends in the monthly USDA Cage-Free Report, supplementing the information posted weekly in the EGG-NEWS Egg Weekly Price and Inventory Report.

The USDA Cage Free Report for the month of November 2019 released on December 2nd documented a 0.6 percent increase in hens producing under the Certified Organic seal. The National cage-free flock increased by 0.7 percent. (Accepting USDA data). The respective numbers of hens in organic and cage-free flocks should reflect the realities of supply and demand in the market over successive quarters. Average flock production was increased to 76.3 percent for both categories of non-caged hens reflecting younger flocks placed to mature for the Christmas market.

Subscribers are referred to weekly USDA wholesale and retail prices posted in the EGG-NEWS Egg Price and Inventory Report E-mailed each Friday. The previous Monthly Cage-Free Report is available under the STATISTICS Tab.

The December 2nd USDA Crop Progress Report documents continued but slow advances in harvesting the 2019 crop delayed by late planting due to flooding and inclement weather over the harvest period.

As of December 1st in 18 major corn-producing states responsible for 94 percent of the 2018 crop, 89 percent of the corn had been harvested. This compares to a five-year average of 968percent. During the past week 5 percent was gathered  consistent with the trend at the end of each harvest year.

Farmers harvested an additional 2 percent of the soybean crop this past week to bring the total in the bin to 96 percent compared to a five-year average of 99 percent.

USDA Weekly Egg Price and Inventory Report, December 5th 2019.

• Hen numbers in production down 0.3 million to 333.3 million .
• Shell inventory up a significant 6.1 percent after a 3.0 percent drop in previous week
• USDA Midwest benchmark generic prices for Extra large and Large unchanged at 153.5 and 151.5 cents per dozen. Mediums were down 5.3 percent to 89.5 cents per dozen. A stable USDA benchmark price after three weekly rises and a sharply higher inventory this week suggests lower prices after a move up from a prolonged 8-month depressed market unless demand increases to match production.
• Price of breaking stock unchanged at 77.0 cents per dozen. Checks unchanged at 63.0 cents per dozen reflecting shell-egg prices. Both categories are now above the cost of production

China-U.S. Phase-1 a Cliff-Hanger.

With only nine days to go before the U.S. imposes additional tariffs on imports from China there is considerable uncertainty over the outcome and resolution of the conflict. President Trump dashed hopes during the NATO meeting earlier this week indicating that an agreement might only be concluded and signed after the 2020 election. China is demanding an extensive roll back of tariffs, not only those deferred until December 15th. This would deprive the U.S. of their leverage on China necessary to bring about more equity in trade and resolving the structural issues underlying trade relations between the World’s two largest economies.

On Thursday President Trump was non-committal regarding an outcome but he confirmed that negotiations were proceeding. The trade issues are now complicated by Congressional action over Hong Kong and a tit-for-tat disagreement over the respective rights of diplomats in the U.S. and China.

Meanwhile the domestic storage of soybeans comprises a carryover of about 850 million bushels from the 2018 harvest in addition to 3,550 million bushels from the most recent crop. There is no sign of the promised $40 to $50 million in purchases of U.S. agricultural commodities by China as announced by the President in October.

The Kroger Company has entered into a strategic partnership with Infarm to install modular hydroponic units to grow produce. Suzy Monford, Vice-president of Fresh for Kroger stated, “Our partnership with Infarm allows us to innovate by combining ground-breaking in-store farming technology with our passion for fresh, local produce and ecological sourcing.” The question remains as to whether this is a carefully researched project accretive to earnings or yet another diversion into technology.

Kroger is encountering criticism for deviating from their core function in the face of competition with consequentially anemic growth in same-store sales and net earnings. Accordingly Kroger has announced that it will slow the program of refurbishing stores and is cutting expenses by retrenching staff at the store level.

Chief Executive, Rodney McMullen stated, “It took us too long to do it, we put too many things on our stores to execute.”  The Ocado Group distribution centers will represent heavy demand for capital although efficiencies may relate to improved bottom-line performance.  Other innovations that may be less productive include driverless delivery in cooperation with Nuro Inc. and Home Chef, a recently purchased meal kit company.

Kroger estimates that it has saved $1 billion in annual cost in each of the last two years through economies and possibly at the expense of same store sales.  Kroger posted a 2.2 percent increase during the most recent quarter compared to 3.4 percent at Walmart and 4.5 percent at Target.

Agricon is a prominent multinational supplier of prefabricated housing and components for the intensive livestock industry. The Company functioned for a number of decades as Betco until acquired by the Big Dutchman Group in 2017 as the construction component of their enterprise. Originally involved in international development with operations completed in 44 nations in Asia, Africa, Australasia and Latin America, Agricon has since completed poultry projects in Florida, Texas, Utah, California, Illinois and the Dakotas.

 The Company uses the most advanced designs and materials for superstructure and cladding and is prepared to supply expertise in design, project management, engineering, erection, coordination and commissioning. The association with Big Dutchman brings in the combined expertise of specialists in complementary areas including feeding equipment, waste handling, ventilation, process control and monitoring of environmental parameters.

Additional information and contacts can be accessed by clicking on to the Agricon logo on the right side of the Welcome page.

Impossible Foods Inc. is discussing with potential investors an infusion of between $300 million and $400 million for expansion. If successful, the fundraising initiative could position the company for an IPO in 2020 with a valuation of between $3 and $5 billion.

A spokesperson for impossible Foods commented “We need to consider every option for fueling our long-term growth. However, we have not announced any plans for timing regarding an IPO.”

Obviously, existing shareholders in Impossible Foods are aware of the meteoric rise in share value of Beyond Meat with a market capitalization of $4.8 billion, although having suffered a decline in recent months following the May IPO. A further consideration is the advent of numerous competitors’ products from multinationals including Nestle, Tyson Foods, Cargill and Maple Leaf Foods.

Federal Judge Edward G. Smith has issued an order in response to a Department of Justice request for a civil injunction on behalf of the USDA Food Safety and Inspection Service.

At issue is the assertion by Miller that he and Miller’s Organic Farm located in Bird-In-Hand, PA. are exempt from Federal regulations relating to inspection of meat and milk as he operates as a private membership association.

The civil injunction enjoins Miller from operating as a non-Federally inspected producer of meat and poultry products.

Commenting on the order, William M. McSwain, U.S. Attorney stated “Food establishments in this district must follow Federal food safety laws that protect the public”. The Administrator of the FSIS, Carmen Rottenberg stressed that “Inspection is the cornerstone of our food safety regulatory system enabling consumers to purchase and prepare meat and poultry with confidence in the safety of these products”.

Miller has refused to allow access to his farm and plant by Federal officials and has engaged in litigation supported by a misdirected GoFundMe campaign, Miller has indicated that he will continue business under a custom-exempt plan. In accordance with the ruling, the court will retain jurisdiction and ensure compliance with relevant legislation including labeling requirements and adherence to the Commonwealth of Pennsylvania food codes and licensing.

The Miller case is important since it establishes a precedent for state and Federal oversight over processing and production of food in the interest of public safety.

EGG-NEWS has previously commented on the trend towards feeding domestic pets with raw food. GoRaw of Cottonwood, UT has recalled bags of Quest™ cat food containing raw beef. The U.S. Food and Drug Administration identified Salmonella in a sample on routine surveillance. In contrast the company was apparently unable to detect Salmonella using their own assay.

It is evident that cats or dogs consuming the Quest™ frozen food would in all probability have become colonized with Salmonella resulting in intermittent shedding. This represents a hazard to other pets and members of the household including children. The further problem is that handling contaminated raw cat food in the kitchen could cross-contaminate with utensils, work surfaces and hands.

Raw pet food containing meat is not suitable for pets given the high probability of contamination with food-borne pathogens.

November was National Diabetes Month and accordingly the Egg Nutrition Center with a staff of dietitians and scientists emphasized the value of eggs in diets for people at risk. Weight loss is an important preventive measures for individuals predisposed to Type-2 diabetes. Eggs have little or no effect on blood glucose level and can be a component of a weight-loss diet.

Eggs have been shown to reduce weight and body fat in a group of adults with risk factors for Type-2 diabetes. Participants in a trial sponsored by the Egg Nutrition Center of the AEB consumed two eggs each day for three months with beneficial effects.

Consuming eggs at breakfast contributes to satiation necessary to avoid overconsumption of calories and weight gain. Numerous studies have demonstrated that individuals with Type-2 diabetes benefit from consuming eggs at breakfast.

During the past two years, there have been four extensive outbreaks of foodborne STEC infection attributable to lettuce. A total of 320 cases were confirmed in the four outbreaks with a high proportion of hospitalization and with five fatalities.

The CDC identified Romaine lettuce as the vehicle after extensive field surveys. Growers in the Yuma Valley of Arizona have made changes to irrigation systems to avoid contamination from concentrated animal feeding operations adjacent to their fields.

For the period November 2019 to November 2020, the FDA will collect samples from the Yuma and Imperial Valleys and the central coast fields of California with higher frequency during the March and April and October to November periods. The FDA will collect 270 samples following aseptic procedure in accordance with the FDA Investigations Operations Manual. Samples will be obtained from wholesalers, food service distribution centers, commercial cold storage facilities and on-farm holding coolers. Samples will not be collected from growing fields.

If FDA detects either Salmonella or pathogenic E.coli (STEC) in a sample, the producer will be notified and advised to implement appropriate corrective action. FDA will perform whole genome sequencing on any pathogens detected and will enter data into a sequence repository.

Rembrandt Foods recently announced closure of the Renville, MN. complex due to market oversupply. The justification advanced by Paul Hardy, president of the company, that the action was market-driven and in response to legislative move to cage-free production is to a large extent invalid. Other companies are managing the transition at a relatively slow rate consistent with anemic growth in demand for cage-free eggs at the retail level.

It should be remembered that Rembrandt was impacted by avian influenza in 2015, possibly depleting financial reserves. The extended period of low egg prices has obviously influenced owner Glenn Taylor who has extensive interest in other enterprises that by comparison generate an acceptable return on investment.

Given the extended period of negative margins from April through October, it is possible that a number of independent and family-owned enterprises have depleted their working capital. Acquisitions and closures are inevitable irrespective of the transitory seasonal rise in prices leading up to Christmas.

A JV between Ajinomoto Company and Accenture will create a Ajinomoto Digital Partners Company responsible for management of all Ajinomoto businesses. Accenture will apply expertise in digital transformation in consumer goods and services to their one-third ownership. Ajinomoto a manufacturer of amino acids and specialty food additives is expected to benefit through improved efficiency and service.  

Scientists at Corteva Agri Sciences have demonstrated that modifying the expression of a corn gene, zmm28 enhances yield. In a published paper*, a transgenic approach was used to insert a  promoter altering the expression of zmm28. Modified plants showed increased leaf biomass and plant height due to improved photosynthesis and carbon assimilation. This resulted in a significant increase in grain yield.

The modified corn was subjected to field trials from 2014 through 2017 allowing selection of hybrids ranging in maturity from 105 to 113 days at 58 locations. Among the locations, two transgenic cultivars exceeded the yield of controls by 79 percent.

*Wu, J., et. al. Overexpression of zmm28 Increases Maize Grown Yields in the Field. Proceedings of the National Academies of Science. Doi.org/10.1073/pnas:1902593116 (November 4, 2019)

The Newcastle disease outbreak in Southern California appeared to be at an end in September of this year with what appeared to be the last cases on August 14th, August 31st and September 18th. There were no incident cases diagnosed during the previous eight weeks before this series. On November 16th and 20th the California Department of Food and Agriculture announced that two cases appeared on adjacent backyard farms in San Bernardino County. The 3rd and 4th cases in the most recent series were diagnosed at a feed store and in a backyard flock in San Bernardino County on November 20th and 22nd respectively. 

APHIS has recorded 455 cases of velogenic viscerotropic Newcastle disease (vvND) in backyard flocks (predominantly “fighting cocks”) in the Counties of San Bernardino (147), Riverside (260), Los Angeles (45), Alameda (1), San Diego (1) and Ventura (1) from late-May 2018 to November 29th 2019. A single case of ND was diagnosed in a backyard flock (type and size not specified by CDFA) near Redwood City in Alameda County during the week of March 11th 2019.There was no extension from this location.

The successive monthly incidence rate of ND declined in November 2008 but a surge in cases in Riverside County occurred in mid-December 2008. Presumed extension from cases of vvND was confirmed in a flock of 103,000 replacement pullets aged six weeks near Perris, CA. on December 14th resulting in rapid depletion and disposal. This outbreak was followed by infection of three spatially and temporally related egg production farms with a combined population of approximately 250,00 hens. The infection was diagnosed in a flock of fighting cocks in Utah County, UT. on January 18th 2009 and in Coconino County, AZ (near Flagstaff) in early April 2009, presumably due to illegal movement of birds from Southern California.

It is understood that $45 million was assigned for eradication although the objective of control of endemic vvND in game fowl could have been achieved by hyperimmunization rather than playing “whack-a-mole” Editorials in CHICK-NEWS on December 24th 2018 and March 1st 2019 were posted dealing with the ongoing outbreak. (see EGG-NEWS and CHICK-NEWS under the SEARCH tab entering “Newcastle disease”).

The most recent outbreaks are not entirely unexpected given that Newcastle disease is in all probability endemic in the game fowl (cock fighting) and backyard chicken population. The first cases of Newcastle disease were diagnosed during May 2018 and the infection although essentially confined to four adjacent counties is expected to demonstrate an upsurge in incident cases after mid-December into 2010. The factors contributing to endemnicity and dissemination of vvND virus include movement of individual birds and flocks, proportion of immune birds in the population at risk and lack of biosecurity.

Mexico has recognized the OIE principle of regionalization after intensive negotiations between SENASICA and U.S. counterparts in USDA-APHIS assisted by USAPEEC. Exports of broiler parts, fertile eggs and breeding stock should not be impeded unless there is extensive dissemination of vvND with involvement of the commercial poultry industry in central or northern California or in adjoining states.

Marler Clark, a professional law corporation involved in representing plaintiffs in food-borne infection cases has donated $25,000 to the Pearl City High School to stimulate interest in science. Each year, the school will offer a $1,000 scholarship to a student applying to a two- or four-year university curriculum involving science or a medically-related field of study. Applicants are required to submit an essay describing how science will impact their future career intentions. Preference will be extended to students with financial need.

Attorney Bill Marler, Managing Partner stated “Food-borne illness outbreaks can affect a great many people. With this donation we want to encourage young minds to consider science or medicine in the hope that the next generation can improve food safety for us all”.

In a press release dated December 4th The Kroger Company (KR) announced results for the 3rd Quarter of Fiscal 2019 ending November 9th

The following table summarizes the results for the period compared with the values for the corresponding quarter of the previous fiscal year (Values expressed as $ x 1,000 except EPS)

52-Week Range in Share Price: $20.70 to $30.40: 50-day moving average $26.14

Market 14H45 post release December 5th $26.72 down 3.4 percent from open

Forward P/E 11.5

Same store Sales (excluding fuel) grew by 2.5 percent (1.7 percent Q3 FY 2018)

Digital sales increased by 21 percent over previous quarter.

Our Brands ™ increased by 3.4 percent compared to Q3 FY 2018 and 231 new items were introduced in Q3

Kroger has 1,915 pickup locations and 2,326 delivery hubs
 

In commenting on Q3 Chairman and CEO Rodney McMullen stated "Kroger's customer obsession and focus on operational excellence continued to generate positive results in the third quarter. Identical sales were the strongest since we started Restock Kroger and gross margin rate, excluding fuel and pharmacy, improved slightly in the quarter. At the same time, we continued to reduce costs as a percentage of sales.

We are using the power of Kroger's stable and growing supermarket business to create meaningful incremental operating profit through the alternative profit stream businesses, which adds up to a business built for long-term growth that generates consistently attractive total shareholder returns. Kroger continues to generate strong and durable free cash flow as reflected by the fact that the company has reduced debt by $1.5 billion over the prior four quarters and continues to increase its dividend to create shareholder value.

On December 5th Eggland’s Best announced that has partnered with Sur La Table to present an interactive cooking series at classes across the U.S. through December 15th.

The cooking series is part of the EB Better Family Meals program initiated during September to empower families to stay healthy by choosing more nutritious foods. In each class, attendees will be able to take home additional nutritious recipes created by the American Heart Association and Eggland’s Best. 

The Sur La Table program follows the joint promotion of the enriched egg with the American Heart Association. Families can find helpful resources, recipes and tips on the Association website created in collaboration with Eggland’s Best to make mealtime easier and more nutritious.

“This cooking series has reached thousands so far with practical information they can use to help their families eat better,” said Charlie Lanktree, CEO of Eggland’s Best. He added “we are committed to improving health and are proud of our track-record working with like-minded companies and organizations to boost family meals and improved nutrition.”

For additional information and registration for a class access www.surlatable.com/egglandsbest.

The U.S. Poultry and Egg, Harold E. Ford Foundation (USPOULTRY Foundation) and the Poultry Science Association Foundation (PSA Foundation) has arranged the 3rdAnnual advanced-degree job fair. The event will take place during the International Production & Processing Expo (IPPE), scheduled for January 28th from 08H00 to 11H30 at the Georgia World Congress Center concurrent with the International Poultry Scientific Forum (IPSF).

This program is designed to serve U.S. Poultry & Egg Association (USPOULTRY) member companies and allied suppliers. The target participants are Post-Doctoral scientists in addition to Ph.D. and DVM students. 

USPOULTRY, through the USPOULTRY Foundation, also hosts the well-established and successful College Student Career Program during IPPE. The integral component of this outstanding program is the interview opportunities with member companies and exhibitors for summer internship employment and entry-level career positions for B.S. and M.S. students seeking employment in the poultry production, processing and allied supplier industries.

A team of twelve students in Israel representing diverse biological science disciplines won prizes at the International Genetically Engineered Machine Competition organized by the Massachusetts Institute of Technology.

The multidisciplinary group produced a honey substitute using a nectar solution subjected to fermentation with a Bacillus subtilis isolate modified to produce enzymes paralleling secretions in the digestive tract of bees.

The team posted on their website, “Our vision is to create a sustainable Bee-Free Honey using engineered bacteria to process a nectar-like solution using secreted enzymes mimicking the honey-stomach environment of the bee”.

The iGEM competition attracted 300 teams worldwide. In total, 163 gold medals were awarded recognizing excellence in genetic engineering.

The BeeFree Team

Abnormally cold weather in northern tier states of the U.S. and Canada will sharply reduce the 2019 potato harvest.  USDA estimated that domestic production will decline by six percent from 2018 with an equivalent drop recorded in Idaho, the nation’s leading producer of potatoes.  The situation in Canada is more severe with a 20 percent drop in output from Manitoba.

Since a proportion of the potato crop is processed into French fries (or possibly “Freedom” fries based on the outcome of the NATO summit) prices to QSRs will escalate.  Whether this will be reflected in an increase in price to consumers “wanting fries with that” depends on competitive factors and the willingness of consumers to pay more for their munchable calories.  The QSRs could shave cost by smaller portions that would beneficial from a health perspective providing they do not make up the weight with more salt.

According to Dr. Craig Coufal, founder of Innovative Poultry Solutions, a combination of exposure to ultra violet light in combination with hydrogen peroxide reduces shell contamination.  The combination of modalities is superior in reducing the level of Salmonella Enteritis in a suspension coated into shells compared to spraying with either a chlorine solution, a QAT or peracetic acid.

Based on experience, to be effective shell decontamination must be applied as early as possible after egg collection since motile bacteria will penetrate the shell through pores.  Delaying decontamination until pre-setting will reduce bacterial levels during incubation but will not affect bacteria that have penetrated the shell and outer membrane.

In years gone by in the U.S. and currently in nations were it is permitted, formaldehyde fumigation using appropriate chambers on breeder farms is effective in reducing the incidence of aspergillosis and omphalitis in chicks during the first week of brooding. The improvement is however dependent on the chain of hygiene extending from the time of collection through on-farm storage, transport and the hatchery environment.

The Senior Director of Marketing and Communication for the American Egg Board, Ashley Richardson received recognition for ten years of service at an office ceremony this past week

Through her unstinting efforts, Ashley has provided support to her colleagues and by application of innovation and leadership she has advanced the interests of the AEB and the U.S. egg production industry.

In recent months, Kroger seems to be diverging from its core competency as a leading food retailer through its supermarket chain.  The latest iteration is a joint venture with an enterprise named ClusterTruck.  With the initial reading of the announcement it occurred to this commentator that it was in fact a spoof.  The first negative was the unfortunate name of the company deploying mobile kitchens, basically sophisticated food trucks.  The name may have appeared amusing at 2 am in an extended planning session involving superannuated frat boys back in 2015 but the appellation is inconsistent with good taste.

The ClusterTruck concept involves consumers ordering a meal using an app and within 30 minutes will receive a cooked delivery less than 10 minutes from the oven.

Susie Monford, Group Vice-president of Fresh for Kroger stated, “Kroger delivery kitchen customers can order pizza or pad Thai on the same order and get it hot and fresh within minutes of the meals being prepared.  We are excited to work together to bring this partnership to life to provide our customers with real food delivered to their doorstep.”

Chris Baggott, co-founder and CEO of Cluster Truck stated, “This winning combination has allowed us to thrill customers across the country while achieving profitability.  We are excited to partner with Kroger to redefine the food experience for their valued customers.”

I’m now sure that this isn’t a spoof but whatever happened to either cooking in one’s own kitchen or simply dining in a restaurant?