Shane Commentary


Outcome of NAFTA Negotiations to Influence Mexican Presidential Election

01/12/2018

Unilateral withdrawal or attempting to impose deal-breaking conditions in NAFTA negotiations will have a negative effect on the outcome of the 2018 presidential election in Mexico. President Pena of the PRI party is currently highly unpopular and although he is constitutionally prevented from running, the nominated candidate lacks charisma and carries the baggage accumulated by the current Administration.

Candidate, Andres Manuel Lopez Obrador is rising in popularity. Clearly a populous socialist demagogue, Obrador ran unsuccessfully against previous Presidents Calderon and Pena claiming rigged elections and creating turmoil with each narrow loss. Obrador was once aligned with the PRI, the dominant political party in Mexico for decades. In 1989 he split to form the socialistic PRD party. According to Mary Anastase O’Grady in an opinion published in The Wall Street Journal on January 8th, it is clear that if elected, Obrador would introduce policies detrimental to the U.S. Abandoning NAFTA would create considerable economic hardship in Mexico benefitting Obrador.

Trade negotiations have potential outcomes far beyond U.S. jobs, agricultural exports and intellectual property. An unfavorable outcome could result in a Venezuela on our doorstep.

(SMS 083-18 January 12th 2018)  


 

Prospects for Egg Prices in 2018

01/03/2018

Despite optimistic projections made by the Egg Industry Center of Iowa State University, the wholesale price of eggs in 2018 will be determined by the balance between supply and demand. There is no evidence that per capita consumption will increase materially during the first quarter of 2018. USDA projections note an increase of less than one egg per capita between Q1 of 2017 and Q2 of 2018. At the end of December, U.S. total flock attained 327 million hens with 317 million actually in production in commercial flocks above 30,000 hens. During the last week of December 2017 the stock level of generic eggs increased by 7.9 percent over the previous week to 1,653,800 cases of which 80.8 percent were shell eggs.

Prospects for exports do not appear as optimistic as expressed in recent press releases. The fipronil crisis in the E.U. has largely passed as the affected flocks have been cycled out of production and replaced by non-contaminated hens. Korea has largely restocked flocks depleted by the 2016 outbreak of highly pathogenic avian influenza. In any event, U.S. exporters of shell eggs are non-competitive on the basis of price and shell color compared to product shipped to Korea from Spain, Turkey, the Ukraine and Asian nations.

To state ingenuously that during the first quarter of 2018, egg prices will be 35 percent above the corresponding period in 2017 is not a material advance for the egg industry. The comparison is against unprecedented low prices, considerably below production cost. U.S. producers experienced negative margins for the first nine months of 2017 based principally on the disparity between production and demand.

(SMS 024-18 January 3rd 2018)


 

New South Wales Government Criticized for Consultation with Industry on Welfare Standards

12/29/2017

The New South Wales government has engendered criticism for consultation with the egg-production industry of the State regarding new welfare regulations relating to housing of hens.

Animal welfare activists exercised the “Freedom of Information” laws in NSW to obtain communications and reports of meetings which the Animal Law Institute claims to be collusion in the standards-writing process. According to disclosures a NSW Department of Agriculture employee suggested elimination of requirements reminiscent of California Proposition 2 since this would have disqualified conventional battery cages.

The Royal Society for the Prevention of Cruelty to Animals maintains that the process of developing standards was “stage managed” for the benefit of producers. A blatantly unfair provision in the development of standards was a requirement that non-profit organizations would have to pay $3,000 to suggest policy options for aspects of the regulations including stocking density. This provision was characterized by Dr. Thomas Clarke of the Corporate Governance Research Center at the University of Technology in Sydney as “absurd and worrying”. He added “I have never heard of an accountable government anywhere in the world charging for contributions to a policy initiative.”

The situation in Australia where the state governments of Victoria and Western Australia have developed their own independent standards has relevance to the U.S. The egg industry of any nation cannot function effectively over the long term unless there is harmonization of welfare standards with clearly defined nomenclature for alternative systems. EGG-NEWS has reported previously on dissention among producers and confusion among consumers as to what constitutes “free-range” and “pastured” in terms of space allowances.

(SMS 2,117-17 December 29th 2017)


 

Efficacy of Foot Baths in Relation to Preventing AI

12/22/2017

Studies conducted by the University of California-Davis have questioned the value of foot baths containing quaternary ammonia compounds (“quats”) in combination with glutaraldehyde solution in foot baths. It was demonstrated that foot baths were unable to destroy either low pathogenicity or high pathogenicity avian influenza (AI) virus on footwear. A chorine-based granular powder in foot baths was however able to destroy virus on contact. “Footwear” is a non-defined concept. The efficacy of exposure to a disinfectant under practical conditions must vary depending on whether one is dealing with smooth-soled footwear or cleated boots with impacted litter and fecal material. 

Despite the reassuring comments made by the CEO of a large broiler integrator to the uninformed at an investor’s conference in 2015, foot baths as a single modality are incapable of preventing introduction of pathogens including AI into commercial flocks.

Simulation studies showed that low pathogenicity AI (LPAI) using H6N2 strain in feces and litter persist for approximately 24 hours. In contrast, highly pathogenic strains of avian influenza (HPAI) using H5N8 strain demonstrated viability for at least 96 hours. The authors of the paper urged further studies on appropriate methods to interdict infection and to evaluate procedures to decontaminate farms after a diagnosis of AI*

The egg-production industry in the U.S. has invested in enhanced Structural Biosecurity (change rooms with showers, blacktop roads, vehicle washing) and Operational Biosecurity (personal protective clothing, restrictions on inter-farm movement, banning hunting) which have raised barriers to introduction of infection. Applying inference from current knowledge of the biology of AI virus and the epidemiology of LPAI and HPAI it has been possible to develop recommendations to reduce the probability of introducing AI into flocks in the face of wild bird dissemination of virus. The effectiveness of current measures varies according to investment in protective measures, training at all levels of personnel and diligence in complying with prevention programs.  

*Hauck, R. et. al., Persistence of Highly Pathogenic and Low Pathogenic Avian Influenza Viruses in Foot Baths and Poultry Manure. Avian Diseases. 61:64-69. (2017)

(SMS 2,096-17 December 22nd 2017)


 

Consumers Confused by Labels Describing Housing and Feeding

12/18/2017

A review of labels in stores catering to high-income demographics and discussion with both producers and retailers confirms confusion among consumers as to what is actually being offered. The outstanding issues are:-

  • Nutrition of flocks-Certified organic or non-GMO
  • Outside access- Occasional release; sun-porches; free-range; pasture with space allowances from 2 ft2 to 108 ft2 per hen

It is interesting that one producer has actually imprinted labels with a notation that
“All organic is GMO-free”. This is in recognition of the reality that GMO-free is growing at a rapid rate while growth in Certified Organic has reached a plateau.

There is overwhelming confusion among consumers as to outside access. Vital Farms, in an evident expression of frustration with outside access claims competing with their 108 ft2 pasture-housed standard initiated a controversial advertising campaign featuring a “No Bull**it” theme.

It is evident that AMS in cooperation with the egg industry will have to develop standards which must be followed by producers as an exercise in fair description. The situation with regard to the image and competitive status of the USDA-AMS Certified Organic seal is a more difficult proposition. Promotion of other than a brand is difficult and ultimately expensive. An attempt by the Organic Standards Board (OSB) to impose even greater outside access and thereby disqualify in-line operations providing access to sun porches has been deferred. The proposed action by the OSB in 2016 would have raised the cost of production and hence selling price, further reducing the attraction of “organic” against less expensive Non-GMO eggs and alternatives. 

(SMS 2,063-17 December 18th 2017)


 

Impact of Banning Glyphosate

12/17/2017

In November, the European Union agreed to extend the license for glyphosate for five years after protracted negotiations and considerable opposition from opponents of intensive crop agriculture and specifically GM technology.

A recent study* calculated that if glyphosate were to be banned, the advantages associated with GM herbicide-tolerant crops would be lost. At the present time, it is estimated that 375 million acres are planted to herbicide-tolerant cultivars. The annual loss to global farm production would be $6.8 billion as a result of reducing soybeans by 18.6 million tons, corn by 3.1 million tons and canola by 1.4 million tons respectively. It is calculated that without glyphosate and GM herbicide-tolerant cultivars, an additional 9,000 tons of herbicide would be required with a profound environmental impact. Carbon emissions would increase the equivalent of adding 12 million autos to the world’s fleet. Yields of crops without the use of glyphosate would fall with soybean output decreasing by 3.7 percent. Land use would have to change with additional planting of 1.9 million acres resulting in deforestation adding to release of carbon dioxide.

*Brookes, G. et al., The Contribution of Glyphosate to Agriculture and Potential Impact of Restrictions on Use at the Global Level. GM Crops and Food, doi.org/10.1080/21645698.2017.1390637 11th December 2017

(SMS 2,050-17 December 17th 2017)


 

Commentary

12/07/2017

Speaking at the recent U.K. Egg and Poultry Industry Conference, Dr. Nigel Gibbens, CBE, Chief Veterinary Officer of the Department for Environment, Food and Rural Affairs (DEFRA) (equivalent to USDA), questioned the  move to adopt free-range management which represents over 50 percent of U.K. egg production.  In 2012, conventional cages were banned in the E.U.  The U.K. and to a lesser extent Germany, adopted the enriched colony module as an alternative to conventional (“barren”) cages to achieve compliance by January 12, 2012. 

Following trends in E.U. nations and the subsequent commitments in the U.S. by members of the FMI, NRA and NCCR to convert to cage-free production by 2025, there are questions as to the safety and desirability of maintaining flocks outside houses either under free-range (22 square foot per hen) or on pasture (100 square foot per hen).

At issue is the inevitability of exposure to avian influenza.  Migratory waterfowl were responsible for introduction of both LPAI and HPAI strains H5 and H7 over successive years in the E.U. and in the U.S.

Dr. Gibbens emphasized the “conflict between the public’s demand for ethical eggs from free-range hens and the need to protect flocks from avian influenza.”  He opined, “Hens left outside are a greater risk of being infected by wild birds carrying a disease.” In a subsequent interview with a leading U.K. agricultural periodical, Dr. Gibbens noted, “free-range farms are also at higher risk from other diseases based on their exposure.”

During the 2016 and 2017 AI outbreaks in the U.K., DEFRA issued “”confinement orders” which obliged producers in an area where AI had been diagnosed to confine flocks to barns.  Each year the period of risk is extended and the E.U. has lengthened the period of confinement from 12 to 16 weeks without flocks losing their “free-range” status.

The remarks by Dr. Gibbens, based on sound epidemiology and experience evoked considerable negative reaction from welfare organizations in addition to some members of the UK veterinary profession.  He was accused of “brazen endorsement” of the practice of keeping hens in cages which deprive them of “natural behavior”. Based on reports of his address to the Industry Conference this is a biased characterization of his message.

(SMS 1,993-17 December 7th 2017)


 

Advocacy Groups Promote Elimination of Potentially Hazardous Chemicals

12/07/2017

Organizations such as Safer Chemicals, Healthy Families are pressuring retailers to stock items which are free of potentially hazardous chemicals.  Personal care and home cleaning products are at the top of the list but it is expected that the range of products will be expanded.  The “Personal Safety and Health” organizations are evaluating products and rating retailers assigning grades from A to Fail with annual updates on improvements. 

In the newly released November 14th report card, retailers scoring B or higher included Apple, Walmart, Target, CVS Health, while Albertsons and Costco were assigned C- grades.  Walmart published a chemicals policy in 2013 and has joined the Chemical Footprint Project supported by Clean Production Action, a non-chemical and alternative advocacy group. 

Studies conducted by CVS Health showed that shoppers are concerned about potentially hazardous chemicals. This is fueled by information of dubious value available on the internet.  House brands appear to be a specific target of organizations promoting “green chemistry” and CVS is actively urging suppliers to remove parabens, phthalates and any compound that releases formaldehyde from their products.

As with many regulatory trends, EU standards are readily adopted by U.S. activists groups.  The list of 2,700 chemicals to be eliminated or reduced in consumer products was compiled by the EU Registration, Evaluation, Authorization and Restriction of Chemicals Regulations (REACH).

The problem of blanket bans on specific compounds by chemical name does not take into account either level of exposure either through concentration or duration.  Unfortunately the exercise of demonizing beneficial compounds and additives may degenerate into a “Science Babe” exercise of eliminating all compounds that a person with a high school education cannot pronounce.

In the short term, it would not appear that the egg industry has any immediate concerns with either shell eggs or liquids. Packaging material or chemical compounds used in the production process may be subject to scrutiny and result in restrictions or sanctions.

As with welfare, a major restraint to the egg industry, consumer concerns, fanned by organizations ranging in their motivation from sincerity through mendacity and extending to zealotry may have an influence in the near future.  As with many trends, it is best to understand the motivation of critics and antagonists in order to develop a preemptive defense. If there are any obvious problem compounds including insecticides, these must be voluntarily removed from the production chain in advance of condemnation.

 

(SMS 1,991-17 December 7th 2017)


 

Childhood Obesity Advances in the U.S.

12/01/2017

According to a study on 42,000 children and adults, Dr. Zachary Ward of the Center for Health Decision Science at the Harvard T. H. Chan School of Public Health in Boston estimates that 57 percent of children aged 2 to 19 in 2016 will be obese by the time they reach 35 years of age.

It was determined that obesity in childhood is reflected in adult obesity with consequential health issues including diabetes, cardiovascular disease and renal complications.  Currently six percent of U.S. children are severely obese with a body-mass index of 35 or higher.  The study determined that Hispanics and non-Hispanic blacks were more likely to be obese than white children and differences among races were present at two years of age.  The converse is also true in that children that are not obese during childhood have a lower probability of adult-onset of obesity.  Children with a low or normal BMI have less than a 50 percent chance of becoming obese by 35 years of age.

The authors of the article cited a 2015 study in Health Affairs concluding that placing a tax on sugar-sweetened beverages, setting nutrition standards for foods served in schools and eliminating tax deductions for advertising unhealthy food would be beneficial with respect to obesity.  There appears to be a lack of logic in these recommendations since two-year old obese children would not be at school and their diets would not be influenced by youth-centered advertising. 

Clearly the solution lies in comprehensive education directed at the demographics at risk, both ethnic and economic that have the highest prevalence of obesity.  The “nanny state” directive approach advanced by previous First Lady Michelle Obama and also by Mayor Michael Bloomberg, although well-intentioned was not especially beneficial.  EGG-NEWS did however report on success among lower income immigrant families in Amsterdam, the Netherlands involving a comprehensive program of education, modifying school meals and promoting exercise together with family counselling.

(SMS 1,970-17 December 1st 2017)


 

Unilever Searches for Next CEO

11/29/2017

On October 16th, EGG-NEWS posted an article on the succession plans for the CEO of Unilever.  At issue was the policies followed by Paul Polman, the incumbent since since 2009.  The company disappointed investors failing to meet market expectations on both the top and bottom line for fiscal 2016.  Management also came under criticism for rejecting the Kraft Heinz Company bid, valued at $143 billion. Simply repurchasing stock, divesting segments with low margins and introducing cost-saving measures are ameliorative but do not address the basic problem of rising competition experienced by large multinationals from more agile local enterprises. It is now up to the Unilever board under newly appointed chairman Marijin Dekkers to select from either aspirant candidates within the organization or to appoint a disruptive outside candidate.

During the past decade Unilever has been at the forefront of promoting animal welfare issues using its prestige and international reach to make common cause with pro-vegan activist organizations.  The Company has also become embroiled in conflicts relating to GMO technology. The Ben and Jerry’s subsidiary supports mandatory labeling of products containing GMO ingredients, a position supported by Paul Polman during a 2014 visit to the company headquarters in Vermont.  In contrast as a corporate entity, Unilever has opposed legislation at state level to mandate GM-labeling and contributed to the campaign to oppose a California ballot initiative on GM-designation.

It is hoped that the next CEO of Unilever will adopt a more balanced policy towards welfare, GM and environmental issues and recognize that the responsibility of the company is to its shareholders. Management should not base policy on the Company acting as a vehicle for social change or intertwine their personal inclinations with corporate concerns.

(SMS 1,954-17 November 29th 2017.)


 

Brunch Emerging as a Trend Favoring Egg Consumption

11/26/2017

According to research conducted by Mintel and Technomic, Millennials have overtaken Boomers as the largest demographic group.  Studies show that Millennials enjoy meals as social occasions. They like to eat whatever and whenever they wish and are eager to try new dishes.  Technomic determined that 38 percent of Millennials enjoy consuming foods later in the morning but also enjoy traditional breakfast dishes including eggs, potatoes, and cheese.

The requirements of Millennials were instrumental in the decision by McDonald’s to extend their program of all-day breakfast to the entire chain with beneficial results to traffic and same-store sales.

Technomic® has determined that 40 percent of consumers eat brunch at least once a week and 30 percent consider breakfast to be a destination.  Millennials appear to be skipping breakfast more in 2017 than in 2015 based on time related considerations.

This trend will obviously benefit the industry if new egg-dishes can be developed suitable for brunch.  Eggs will be incorporated as toppings on burgers, pizzas and in bowls for consumption in QSRs, for casual dining in restaurants and as on-the-go meals. The American Egg Board is at the forefront of developing new dishes suitable for brunch servings.

(SMS 1,946-17 November 26th 2017)


 

Promotion of Enriched Omega-3 Diets will Benefit Consumers

11/22/2017

Dr. Alice Stanton of the Royal College of Surgeons of Ireland recently reported on an experiment involving 161 subjects consuming chickens and eggs enriched with omega-3 polyunsaturated fatty acids.  Devenish Nutrition is promoting incorporation of an algae-derived ingredient in diets for laying hens and broiler to increase the omega-3 level of egg yolk and breast muscle of broilers.

The clinical study documented an increase in serum levels of omega-3 fatty acids and a more favorable omega-3 index in red blood cell membranes.  A low omega-3 index attributed to inadequate intake of omega-3 fatty acids including ALA, DHA and EPA is generally associated with an increased risk of cardiovascular disease.

Dr. Heather Hayes director of food innovation for Devenish noted, “Offering birds a natural and sustainable omega-3 PUFA is good for the bird and good for the consumer.  Taste panel studies have shown omega-3 enriched chicken taste as good if not better than conventional chicken.”

Dr. Patrick Wall, Professor of Public Health at the University College Dublin stated, “By enriching the birds’ diet, meat and eggs become naturally enriched with omega-3 polyunsaturated fatty acids (PUFA) and the associated nutritional benefits are then passed on to consumers.”

It is possible to raise the omega-3 level in commercial eggs to 115 mg per large egg by supplementing diets with canola oil, flaxseed or flax oil.  Currently eggs containing from 100 to 250 mg omega-3 PUFAs are commercially available including the leading national brand in the U.S. which is also supplemented with a range of B complex vitamins in addition to high levels of vitamins E and A.

Algae-derived dietary supplements are marketed in the U.S. and on the international market to be included in diets for hens, broilers and hogs to raise omega-3 fatty acid levels.

(SMS 1,921-17 November 22nd 2017)


 

Cornucopia Institute Highlighting Issues for National Organic Standards Board Meeting

11/05/2017

In a recent press release the Cornucopia Institute, representing the interests of small-scale organic producers, highlighted the issues which will be reviewed at the semi-annual meeting of the USDA National Organic Standards Board to be held in Jacksonville, Florida. The major concerns relate to hydroponic culture of produce, fraudulent certification of imported organic feed ingredients and the composition of the National Organic Standards Board.

The Cornucopia Institute maintains that family-operated small-scale farms are being squeezed out by larger producers represented by the Organic Trade Association a sentiment they consider degrades the image of the of the organic label.

The Cornucopia Institute has campaigned aggressively against in-line egg-production complexes which are both efficient and sustainable. The organization fails to recognize that these farms supply the Nation’s supermarkets and wholesale club stores with organic eggs at an affordable price, necessary for the growth of the entire organic sector. In reality much of the organic egg production in the U.S. is derived from individual family-owned farms under contract to integrators, co-operatives, feed mills and packers who provide working capital, logistics and marketing which are beyond the capability of independent producers with small flocks.

 

(SMS 1,798-17 November 5th 2017) 


 

Financial Viability of Dutch Kipster Facility Questioned

10/31/2017

Despite laudatory articles relating to an “environmentally friendly” house for laying hens, there are serious questions as to return the on investment even with a premium price for the eggs produced. The entire production of the Kipster house will be assigned to Lidl, a company not exactly noted for its generosity towards suppliers.

 

The Kipster house incorporates over 1,000 solar panels which supply electrical power with a claimed 60 percent of generated capacity sold back into the grid. The article provides no indication of whether this proportion is based on a limited period of maximum solar exposure or whether it represents an average over 24-hours throughout the year. 

 

A feature of one article in an E.U. poultry periodical was obviously authored by a lay-journalist who suggested that “the feed given to the chickens is made from agricultural farm waste products”. This is arrant nonsense. To achieve acceptable production parameters from flocks, it is necessary to satisfy all nutrient requirements including energy, amino acids, minerals, vitamins and micronutrients. A balanced diet cannot be compounded from “waste which would otherwise not be used for human consumption.” Chickens, as with all monogastric livestock effectively compete with humans for ingredients.

 

The design of house incorporates a sunporch and an indoor garden with a glass roof. Outside access will be allowed during acceptable weather conditions and under low risk of avian influenza. Eggs produced by the Kipster Farm will receive a three star certification from the Beter Leven program

 

The lavish description showered on the Kipster project is reminiscent of the “Rondeel” introduced nearly a decade ago and supported by supermarket chain Albert Hein. Apart from the prototype and a small demonstration unit only three other commercial installations have been sold and the concept may be regarded as a commercial if not a practical failure. It will be interesting to determine if any subsidies or financial support was extended to the Kipster operation which would reduce the capital required by the owners and hence lower the fixed cost component of production.

 

Any serious evaluator of the Kipster concept would require capital investment, projection of fixed and variable costs and the selling price specifying any premium to determine the return on investment. Financial data would be more convincing than a discussion of environmental benefits.

 

(SMS 1,777-17 October 31st 2017)


 

Organic Tarragon Spice Recalled for Salmonella Adulteration

10/24/2017

Health authorities in numerous states have informed the retail food distribution industry of the mandatory recall of organic tarragon spice distributed by Spicely Organics located in Fremont, CA. The product was distributed in 21 states although no cases of salmonellosis have been diagnosed. The recall was initiated following detection during routine sampling.

Spices are frequently implicated in outbreaks of food-borne infection. Due to the fact that they are minor ingredients frequently not declared on labels, identifying a pathogen associated with a specific spice included in a recipe is extremely difficult. This is evidenced by the 2011 outbreak of E. coli O104: H4 in North Germany, responsible for 4,300 diagnosed cases with 852 reports of severe hemolytic uremia syndrome. Ninety percent of the cases were adults with 50 fatalities. It took many weeks and a number of false trails to actually determine the specific vehicle of infection. Eventually the vehicle of infection for E. coli O104: H4 was identified as contaminated fenugreek spice imported from Egypt in 2009. At the outset of the investigation cucumbers were implicated but with additional patient surveys on foods consumed, sprouts appeared to be the vehicle of infection although these ingredients were shown to be free of contamination.  Further studies showed that fenugreek was in fact the culprit. Apart from the costs associated with treatment and loss of life and earnings, there was considerable disruption of the food distribution chain and loss of traffic in restaurants in North Germany due to fear of infection apparently associated with salads but without knowing the specific cause.

Spices are mostly imported from developing countries where cultivation, drying and processing lack appropriate HACCP and Good Manufacturing Practices. Although sampling to determine the presence of a pathogen is an established procedure, it is evident that sampling errors will occur allowing potentially adulterated material to contaminate fairly large quantities of food. This is especially the case with salads and other uncooked foods that deprive consumers of  protection from a heat process.

Irradiation of spices using either electron beam pasteurization or cobalt60 irradiation effectively destroys bacterial pathogens. Despite FDA approval for the process, there is little acceptance of irradiation based on the misinformed perception of the benefits of this application of radiation technology.

 

In the case of the contaminated organic tarragon, the product was certified as USDA Organic and therefore would not have been eligible for irradiation.

 

Lessons from this case include:

  • Organic status offers no assurance of food safety.
  • A little bit of spice can go a long way in contaminating a large quantity of food.
  • Demonstrating that a spice is a vehicle of infection is extremely difficult using retrospective menu-recall.
  • Traceback beyond a supplier or distributor is virtually impossible especially with imported spices.
     

(SMS 1,701-17 October 24th 2017)


 

Insurance Policies May Not Indemnify Against Pollution Claims

10/09/2017

A posting on September 25th in the Texas Agriculture Law Blog documents a court ruling against a dairy attempting to claim on an insurance policy arising from groundwater pollution.

Judge Thomas Rice of the United States District Court for the Eastern District of Washington ruled that an insurance company was justified in denying coverage based on “absolute pollution exclusion clauses in the policies issued to the dairy.”

In 2013, the Cow Palace Dairy located in Washington State was sued by environmental groups alleging that seepage from retention ponds resulted in pollution of an underground aquifer. Claims were filed under the Federal Resource Conservation Recovery Act and the Comprehensive Environmental Response Compensation and Liability Act.

The action was successful and the Cow Palace was obliged to settle the lawsuit at a considerable cost. The dairy in turn claimed on their insurance policy. The policy specifically excluded liability arising from discharge, dispersal, seepage, migration, release or escape of pollutants at or from the premises and at or from any site or location used for the handling, storage, disposal, processing or treatment of waste.

The report authored by Tiffany Dowell notes that this verdict is the second which has held that exclusion clauses indemnify insurance companies against coverage resulting from environmental pollution involving manure.

The take home message is that egg production companies, especially those operating lagoons, must be aware of the limits of their insurance. Effectively in most cases they are liable for damage resulting from environmental pollution since this risk is expressly excluded from their insurance cover.   

(SMS 1,622-17  October 9th 2017)


 

Cornucopia Institute Foiled By USDA

10/03/2017

The Cornucopia Institute has received a determination letter dated September 27th from the USDA-AMS dismissing a formal complaint against Aurora Dairy Farm in Colorado. The action relates to a formal complaint against that livestock had been denied outside access which the Cornucopia Institute considers to be essential for organic certification. The fact that commercial dairies can operate at densities of ten cows per acre compared to one cow per acre for small organic dairy farms (of questionable profitability) has created an adversarial situation between the Cornucopia Institute and USDA-AMS.

Similar complaints have been raised against large organic egg producers providing outside access in the form of sun porches on large in-line complexes. Cornucopia Institute has sought to disqualify large dairies and egg producers under the USDA organic program. Their efforts are less directed at maintaining the integrity of the USDA organic seal than eliminating competition for the benefit of their membership.

(SMS 1,579-17 October 3rd 2017)


 

Panera Bread Introduces Kid’s Menu

09/25/2017

Panera Bread is now offering virtually all items on their menu as small-sized dishes for children.  Ron Shaich Founder, Chairman and CEO of Panera Bread stated, “For too long restaurants in America have served menus full of nutritionally empty chicken nuggets*, pizza and fries paired with sugary drinks and cheap toys.”  He added, “I’m challenging the CEOs of some of the largest companies in the industry to personally eat exclusively from their restaurants’ kids meals for an entire week and if not, to take a thoughtful look at what they are offering our smallest guests."

Panera Bread has from its inception promoted so called “clean menus” appealing to an affluent demographic with an inordinate concern over nutrition and health but susceptible to hype and misinformation.

It is a matter of record that the major chains including McDonald’s Corporation and Wendy’s have modified their kids’ menus to include fruit and juices, low-sodium and low-fat items and with deletion of artificial coloring agents and unnecessary additives.

Shaich in his inimitable way is again promoting his Company and his products at the expense of competitors by dissemination of unsubstantiated claims and innuendo. He did not define the term “empty” in relation to nuggets which have stated values for calories, protein, sodium and fat and the use of the pejorative is sheer hyperbole unworthy of a person in his position. 

 

(SMS 1,530-17 September 25th 2017)


 

USDA Grants for Value-Added Agriculture

09/07/2017

The USDA will make available $18 million in funding for producers to establish viable value-added enterprises. The program is administered by USDA- Rural Development. Grants will allow producers to conduct feasibility studies, develop business plans and initiate marketing programs.

Providing seed money for new agricultural enterprises may appear to be both practical and contribute to agricultural output benefitting communities and consumers. What is important is to establish that expenditure on grants and programs demonstrates a positive return. USDA is quick to announce programs some of which appear to be highly speculative but is reticent in releasing financial evaluation of expenditure of public funds.

The USDA has been less than transparent in publishing the results achieved by recipients of grants. Accordingly under the new administration of Dr. Sonny Perdue, a veterinarian and businessman, the evaluation of projects will presumably be undertaken at the grant-application level but then should be followed through to completion.

 

(SMS 1,440-17 September 7th 2017)


 

Lawyers Deprived of Fees in Unjustified Lawsuit

09/01/2017

Judge Diane Sykes of the 7th Circuit Court of Appeals denied a $525,000 settlement to cover plaintiff's legal fees allowed by a lower court in a class-action suit against the Subway chain. At issue was a contention that some "foot-long" sandwiches were only 11 inches from end-to-end.

Judge Sykes characterized the lawsuit as "utterly worthless" and served only to enrich lawyers who filed the case. Nine customers in the class received $500 each in settlement.

Sykes invoked "common sense" avowing that a company cannot guarantee that every roll is exactly 12 inches in length but customers receive the same quantity of ingredients on their sandwiches.

Regrettably, members of the tort bar ("slip and trip shops") are taking their cue from the "oldest profession" and are constantly searching for plaintiffs to initiate shakedown lawsuits against food manufacturers and restaurants claiming spurious damages or alleging deceptive promotion. Hopefully the case law established by this judgement will avert future litigation.

(SMS 1,416-17 September 1st 2017)


 

Recrimination over Fipronil Debacle

08/18/2017

Following revelations that authorities in Belgium knew of Fipronil contamination of eggs in early June but only notified the EU in late July, beleaguered officials are now blaming the Netherlands.  The company allegedly responsible for supplying the insecticide cocktail containing Fipronil applied to as many as 200 farms was based in the Netherlands.  Belgium claims that Holland was tardy in their investigation delaying critical information until the end of July.
   

 

The Minister of Agriculture for Belgium Denis Ducarne addressing a Parliamentary investigation noted "One month without having any information from the Dutch Agency" --presumably the Dutch Food Authority.  Ducarne maintains the Dutch had been aware of Fipronil in eggs since November 2016 without any declaration.

It is significant that no official reports or media articles have actually quoted levels of Fipronil in eggs.  This data would be of interest to actually assess the risk to consumers. Actual assay results will be necessary to reconcile conflicting statements of low-risk made by Dutch, Belgian and U.K. officials in contrast to a more pessimistic interpretation by Germany.

It is hoped that investigations will soon be concluded which will reveal the duration of contamination, the levels in eggs from affected farms and the concentration of residual Fipronil in tissue from culled flocks.  Results from epidemiologic studies involving temporal and spatial considerations included in a comprehensive report should be forthcoming since there are lessons to be learned from this incident which is eerily reminiscent of the dioxin contamination in Germany and the Benelux Nations in 2011.

 

Agriculture Minister Dennis Ducarne of Belgium
reviewing aspects of the fipronil scandal with the media


 

FDA to Delay Compliance Inspections for FSMA

08/16/2017

According to a posting on the website of the U.S. Food and Drug Administration, the Agency has delayed inspections of feed plants to ensure compliance with the Food Safety Modernization Act. Inspections scheduled for 2017 will be delayed until the Fall of 2018 according to Dr. Steve Solomon, Director of the FDA Center for Veterinary Medicine. This will also delay inspections under the Foreign Supplier Verification Program.

 

The move was enthusiastically endorsed by the American Feed Industry Association. Richard Sellers, Senior Vice President of Public Policy and Education commented "Producing safe, nutritious food and compliance with the law is the animal food industry's number one priority. However, given FSMAs far-reaching and expensive regulatory impact that extends into all areas of our members' business operations, we have been asking the Administration and Congress to provide a reasonable timeframe so that our members can conduct the necessary action they need and dedicate new resources to come into full compliance with the law."

The action by the FDA is an indication of their deficiencies in planning and execution. The egg industry will recollect the problems associated with introduction of on-farm inspections required under the Salmonella Prevention Rule. There was little coordination among regions carrying out inspections, personnel were totally ill-equipped and untrained to evaluate farms or to appreciate the realities of commercial egg production. Inspectors who had spent the majority of their careers in pharmaceutical plants were confronted with farms with high-rise houses, six feet of manure and mice. Initially the inspections were time-consuming and laborious since farmers, their Veterinarians and quality assurance personnel had to virtually train and instruct the FDA inspectors. The program only gathered speed when the USDA delegated responsibility for farm inspections in a number of states to respective department of agriculture in major egg-producing states including Ohio, Indiana, Pennsylvania, California and Iowa.

In advance of a FMSA debacle, the FDA would be well advised to step back, ensure that guidance documents are provided for review and comment by the industry. Inspectors must be trained as to what might be considered acceptable and normal and to realistically evaluate deviations from standard procedures. If FSMA degenerates into a paperwork exercise, the value with respect to prevention of food-borne infection will be lost.

The underlying message for FDA is that they should communicate with industry organizations and specialists in both industry and academia to establish standards and to ensure that personnel are appropriately trained before embarking on a national inspection program.

The Salmonella Prevention Program was incubated and hatched entirely in isolation by the FDA without consulting the industry. Within three months of inception of the program, individuals associated with the rule were still trying to obtain information on the efficacy of vaccination which had already been adopted by the U.S. industry as a standard and had proven effective in the E.U. for over a decade prior to 2010. The guidance documents were only available after initiation of the program

(SMS 1,345-17 August 16th 2017)


 
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