Editorial


Intended Strategy of Opponents to Intensive Livestock Production

The recent Taking Action For Animals Conference (TAFA) held virtually on September 19th and 20th provided an insight into the strategy to be employed by the Humane Society of the United States (HSUS) and kindred organizations in future opposition to intensive livestock production.  In an October 2020 report circulated by the Animal Agriculture Alliance, it is clear that activists will capitalize on current public concern over COVID-19. HSUS and other organizations that oppose animal agriculture and promote a vegan agenda are adept at manipulating outbreaks of human disease and current public concerns to promote their cause.

 

In past years, HSUS has unjustifiably criticized commercial livestock agriculture for propagating animal diseases and increasing the risk of foodborne infections. In a departure from past claims Adam Zipkin, Counsel to U.S. senator Cory Booker (D-NJ.) stated, “Factory farms poison our environment. Factory farms create serious risks to public health.” He added without substantiation that “scientists are telling us in no uncertain terms that  the next pandemic is at least as likely to start on a factory farm here in the U.S. as it is at a wildlife market in some other country”. This is factually incorrect and unlikely since it is an epidemiologic reality that emerging viral infections including Ebola, Nipah disease, SARS, MERS and COVID had their origin in wildlife populations. The HSUS is providing a new twist to their ongoing opposition to meat consumption by suggesting that concentrated animal feeding operations serve as a potential source of new human diseases.

 

Zipkin also categorically implicated “rampant use of antibiotics in factory farms” as a factor responsible for the emergence of novel infections. Antibiotics do not act against viruses and as a counsel to a Senator, Zipkin should be aware of the statutory restrictions placed on the use of antibiotics by the Food and Drug Administration, effective January 1st 2017.

 

Without specifying diseases, Zipkin asserted that intensive agricultural operations are “breeding grounds for viruses, such as influenza, that can easily jump from farm animals to people.”  Although there is some justification for this statement, there is no specific example of an influenza pandemic originating directly from livestock.  Even the 1997 avian influenza H5N1 panornitic in China and Southeast Asia was responsible for only a limited number of cases relative to the extent of the infection in poultry and the exposure of individuals on farms and through the wet market distribution system in 50 nations.

 

Speakers at the virtual TAFA conference pointed to the prevalence of COVID-19 among workers in meat plants.  There was no evidence that workers acquired infection from the product handled. The high incidense rates from late February through April can be attributed to the proximity of workers, defective ventilation systems in plants, absence of personal protective equipment and failure to introduce test and isolation programs.  Predictably, speakers at the TAFA conference were eager to draw leap-of-faith correlations between confinement  of livestock and emergence of disease.

 

In the commentary on the TAFA conference, HSUS urged pressure on legislators to promote plant-based protein in the place of animal agriculture and to reduce the concentration of livestock.  The HSUS also calls for policies to protect natural ecosystems from agricultural expansion as exemplified in burning the fringes of the Amazon Rainforest for both cattle production and soybean cultivation in Brazil.  Although this is a laudable goal supported by this commentator, it has nothing to do with the emergence of human disease. There is only an indirect correlation between intensive agriculture and emergence of disease. Destruction of  rainforests displaces native species resulting in endemic viruses of free-living animals more accessible to humans. The same could be said for destruction of rainforests in Pacific nations to develop palm oil plantations having nothing to do with animal agriculture.

 

 The HSUS also calls for a ban on the sale of poultry at live bird markets, a sentiment which is supported as this system of distribution promotes the persistence of avian influenza and other infections. There is the possibility of emergence of new strains of avian influenza including H7N3 a pathogen of domestic birds infecting humans coming into contact with aerosols and viscera at wet markets.

 

The direction of the TAFA Conference demonstrates the cynical willingness of activist organizations to distort science and manipulate public concern to promote a vegan agenda. Their assertions have minimal scientific support. Epidemiologists recognize that emergence of human infections from wildlife, including SARS and Nipah virus and the most recent COVID-19, were bat-origin infections possibly with an intermediate reservoir host and were not in any way associated with livestock.


 

Egg Industry News


COMMODITY REPORT: October 16th 2020.

  • The financial and economic implications of the COVID-19 pandemic continue but gradual easing over an extended period is expected as society struggles to return to a “new normal” with recent noteworthy upsurges in incidence in both rural and urban areas of the U.S. Markets do not appear to be influenced by the imminent General Election on November 3rd.
  • Commodity prices this past week were mixed and fluctuated, influenced by export orders, lower projections for 2020 crop yields, ending stocks projected in the October 9th WASDE Report and the September Grain Stocks Report. Corn showed an increase of 2.0 percent for the week despite lack of orders from China but responding to a shipment to Mexico and in anticipation of large orders from China. Soybeans fell 1.3 percent in price this week despite orders booked by China and other nations and projected lower ending stocks attributed to a downward revision of yield and associated factors. Soybean meal rose by 1.7 percent disproportionate to soybeans.
  • Since July 10th year-to-date exports and 2020/2021 market-year orders for corn have attained 7.54 million metric tons (297.0 million bushels) but with a single order this past week. Exports and orders for soybeans amounted to 18.2 million tons (666.2 million bushels) of which 20 percent was ordered during September. Approximately 0.65 million metric tons (2.4 million bushels) was ordered this past week
  • Prospects for commodity exports to China during the 2020/2021 market year that began on September 1st for corn and soybeans have improved. China adjusted their domestic short-term demand for soybeans as a result of an apparent increase in the hog herd after severe losses in 2019 and early 2020 from African swine fever. White-feathered chicken production has now recovered after COVID disruptions and on QSR demand. China is also taking advantage of shipping rates that are rising sharply in order to build inventory. The Baltic Dry Index was 1,860 in mid-October 2019, fell to 744 in April 2020 and is now at 1,471.

 

The following quotations for delivery in the months as indicated were posted by the CME at close of trading on October 16th compared with values posted on October 10th (in parentheses) reflecting specified months for delivery.

 

COMMODITY

Corn (cents per bushel)

 Dec. 402 (394)

March ‘21 407 (402)

Soybeans (cents per bushel)

 Jan. ’21 1,051 (1,065)

March ’21 1,038 (1,047)

Soybean meal ($ per ton)

 Dec. 368 (362)

March ‘21 355 (364)

Changes in the price of corn, soybeans and soybean meal over five trading days this past week were:-

 

COMMODITY CHANGE FROM PAST WEEK

Corn: Dec. quotation up 8 cents per bushel (+2.0 percent)

Soybeans: Jan. quotation down 14 cents per bushel (-1.3 percent)

Soybean Meal: Oct. quotation up $6 per ton (+1.7 percent)

 

  • For each 10 cent per bushel change in corn:-

The cost of egg production would change by 0.45 cent per dozen

The cost of broiler production would change by 0.25 cent per pound live weight

 

  • For each $10 per ton change in the price of soybean meal:-

The cost of egg production would change by 0.44 cent per dozen

The cost of broiler production would change by 0.25 cent per pound live weight

 

Uncertainties still include:-

  • There are questions as to whether China will satisfy quantitative obligations in terms of the Phase One Trade during calendar 2020. The Agreement signed in mid-January incorporated U.S. tariff rescissions, promised purchases of agricultural commodities (valued at $36.5 billion in 2020 and $43.5 billion in 2021), concessions on some structural issues by China and strengthened enforcement provisions. For the first half of calendar 2020 China imported agricultural commodities to the value of $7.3 Billion

 

  • Domestic U.S. soybean and soybean meal demand is now less constrained by COVID-induced cutbacks in the intensive livestock and poultry sectors.

 

According to the October WASDE, corn to be harvested in calendar 2020 is expected to attain 14,722 million bushels with ending stocks projected at 2,167 million bushels. Final values will be modified by actual yield influenced by weather conditions and export volume. Compared with the October 9th at close of trading the CME quotation for corn on October 16th was up 8 cents per bushel for December delivery to 402 cents, adding to the 15 cent per bushel advance from the preceding week. The Friday October price was the highest since January 24th 2020 at 387 cents per bushel.

 

The social restrictions imposed in the U.S. as a result of COVID-19 will reduce ethanol demand by 1.5 billion gallons or 10 percent of projected 2020 requirement accepting a nominal ten percent addition to gasoline. More than thirty percent of U.S. ethanol fermentation capacity is off-line at present and the outlook for increased demand is questionable. Ethanol was priced higher at $1.43 per gallon on October 16th up 32 cents per gallon (28.8 percent) reversing the decline from the previous week and compared with a five-year low of $0.92 per gallon on March 26th. Concurrently gasoline at $1.17 per gallon (quoted, New York Harbor) is 26 cents per gallon lower than ethanol but has a 63 percent higher BTU rating.

 

With more plants producing ethanol in the 4th quarter, DDGS is now available but at a higher price than in the second quarter. Eastern Corn-belt product was priced at $165 per ton on October 13th, $11 higher than the previous week but $35 per ton less expensive than October 15th 2019.

 

Soybeans are the beneficiary of the Phase-One agreement with China but down 14 cents per bushel to 1,051 cents for January 2021 delivery. The USDA anticipates a 2020 crop of 4,268 million bushels, but this value is subject to continuing drought in some states. Ending stocks according to the October WASDE projection will attain 290 million bushels.

 

On October 16th the BRL exchange with the CNY was 0.84, (up 0.01 from the previous week). The conversion of the US$ to the CNY was set at 6.7 on October 16th, unchanged from the previous week.

 

For consecutive years 2017 through 2019 the U.S. supplied 34.4 percent of soybean requirements for China amounting to 95.5 million metric tons. This was followed by a decline to 16.9 percent of 88.5 million metric tons in 2018 and 16.6 percent of 88.0 million metric tons in 2019. The USDA anticipates that soybean imports by China will amount to 95 million metric tons during the 2020-2021 market year.

 

The following extracts from the September 30th 2020 edition of the Quarterly USDA Grain Stocks Report indicate the levels of storage on farms and in fields and off-farm for corn and soybeans.

 

  • “Old crop corn stocks in all positions on September 1, 2020 totaled 2.00 billion bushels, down 10 percent from September 1, 2019. Of the total stocks, 751 million bushels are stored on farms, down 8 percent from a year earlier. Off-farm stocks, at 1.24 billion bushels, are down 12 percent from a year ago. The June to August 2020 indicated disappearance is 3.02 billion bushels, compared with 2.98 billion bushels during the same period last year. Based on an analysis of end-of-marketing year stock estimates, disappearance data for exports, and farm program administrative data, the 2019 corn for grain production is revised up 2.67 million bushels from the previous estimate. Corn silage production is revised up 715 thousand tons. Planted area is revised to 89.7 million acres, and area harvested for grain is revised to 81.3 million acres. Area harvested for silage is revised to 6.62 million acres. The 2019 grain yield, at 167.5 bushels per acre, is up 0.1 bushel from the previous estimate. The 2019 silage yield, at 20.2 tons per acre, remains unchanged from the previous estimate”.

 

  • “Old crop soybeans stored in all positions on September 1, 2020 totaled 523 million bushels, down 42 percent from September 1, 2019. Soybean stocks stored on farms totaled 141 million bushels, down 47 percent from a year ago. Off-farm stocks, at 382 million bushels, are down 41 percent from last September. Indicated disappearance for June - August 2020 totaled 858 million bushels, down 2 percent from the same period a year earlier. Based on an analysis of end-of-marketing year stock estimates, disappearance data for exports and crushings, and farm program administrative data, the 2019 soybean production is revised down 333 thousand bushels from the previous estimate. Planted area is unchanged at 76.1 million acres, but harvested area is revised to 74.9 million acres. The 2019 yield, at 47.4 bushels per acre, is unchanged from the previous estimate”.

 

COMMENTS

Subscribers are referred to the October 9th WASDE #605 in this edition and the results of the 2020 Pro Farmer 7-State Tour retrievable under the Search TAB.

 

The President opined on July 10th that he is “not contemplating a second phase of a trade agreement with China”

 

Approximately $16 billion will be disbursed under the Coronavirus Food Assistance Program (CFAP). As of August 10th, $7.1 Billion was distributed. An additional $14 Billion relief package was announced by the Administration on September 18th with a proportion already distributed.


 

Status of 2019 Corn and Soybean Crops

The USDA Crop Progress Report released on October 19th documented the 2020 corn and soybean crops as almost mature and ahead of the 5-year average due to the earlier start in 2020. Over half of the 2020 corn crop has been harvested, significantly more than at this time last year. Almost three quarters of the soybean crop is in, progressing at a higher rate than the corresponding week of last year.

 

The condition of both corn and soybean crops deteriorated in late August and early September as a result of drought. The condition of corn and soybeans has improved following rains in the Midwest and both crops are moderately superior to the 2019 season. The USDA did not assess the condition of the soybean crop this past week and values reflecting October 11th are shown in the table below. Iowa and N. Dakota stand out as having poor soybean condition. Corn in Iowa, Colorado and Pennsylvania is suboptimal in quality contrasted to Minnesota, Wisconsin and Kentucky with corn superior to other states.

 

Subsoil and surface moisture levels denote some relief from drought conditions except in Western and Pacific states. Both topsoil and subsoil moisture levels are similar to the past week. The corn-belt has experienced unseasonal high temperatures in combination with elevated humidity that may predispose to mycotoxicosis in the 2020 corn harvest. CHICK-NEWS and EGG-NEWS will report on the progress of the two major crops as monitored by the USDA through the end of the 2020 harvest in November.

 

Reference is made to the October 9th WASDE Report #605 in this edition, documenting actual 2020 acreage, and projected yields and ending stocks for corn and soybeans. The Pro Farmer 7-State Crop Tour projected corn and soybean yields of 177.5 and 52.5 bushels per acre. These were respectively, lower than USDA estimates that were revised to 178.4 and 51.9 bushels per acre in the October 9th WASDE Report.

 

 

WEEK ENDING

 

Crop

October 4th

October 11th

5-Year Average

Corn Mature (%)

Corn Harvested

94

41

97

60

94

43

Soybeans Dropping Leaves (%)

Soybeans Harvested

93

 

61

97

 

75

95

 

55

Crop Condition

V. Poor

 Poor

Fair

Good

Excellent

Corn 2020 (%)

Corn 2019 (%) *

* late planting

5

4

9

10

25

30

46

45

15

11

Soybeans 2020 (%)

Soybeans 2019 (%)*

 * late planting N/A

3

4

8

10

26

32

49

45

14

9

Parameter

V. Short

Short

Adequate

Surplus

Topsoil moisture: Past Week

22

34

41

3

Past Year

8

16

59

17

Subsoil moisture: Past Week

20

33

47

3

Past Year

8

17

60

15


 

USDA-WASDE FORECAST #605 October 9th 2020

OVERVIEW

The October 9th 2020 USDA WASDE Report was updated from the September edition reflecting drought conditions and the August 10th derecho with consequences to corn and soybean harvests. October projections are based on updated estimates of harvest area and yield. The corn acreage to be harvested is currently estimated at 82.5 million acres, down 1.0 million acres from the September 11th WASDE report. Soybeans will be harvested from 82.3 million acres, down 0.7 million acres from the September 11th WASDE report.

 

The October 2020 WASDE estimate of corn yield was lowered fractionally to 178.4 bushels per acre, (168.0 bushels per acre in 2019). The projection of soybean yield was unchanged at 51.9 bushels per acre. (47.4 bushels per acre in 2019)

 

The October USDA projection for the ending stock of corn was decreased by 13.4 percent to 2,167 million bushels. Due to decreased supply and exports the ending stock for soybeans was reduced by 36.9 percent to 290 million bushels.

 

Projections for ending stocks of both corn and soybeans have influenced recent CME price quotations concurrently with increased compliance with the Phase-One trade agreement with China. The September WASDE projected the corn price at $3.60 per bushel and soybeans at 980 cents per bushel.

 

It is presumed that projections are based on the assumption that China will as far as possible honor commitments that were disrupted during the first quarter of 2020 by COVID-19. China booked substantial orders for corn and soybeans delivered through August for the 2019-2020 market year in addition to large quantities booked from September onwards for the 2020-2021 market year. Reports on export volumes of commodities to China will be included in upcoming editions of CHICK-NEWS and in subsequent mailings as data becomes available.

 

CORN

The corn harvest for 2020 documented in the October 2020 WASDE Report #605 is projected at 14,722 million bushels consistent with actual planting data and crop progress. The projected 2020 harvest can be compared to 2019 at 13,692 million bushels and is 2.8 percent lower than the previous 2016 record harvest of 15,148 million bushels. The “Feed and Residual” category was reduced by 1.7 percent to 5,775 million bushels. The “Ethanol and Byproducts” category was lowered to 5,050 million bushels despite reduced domestic demand for E-10 due to COVID-19 restrictions and competitive export markets. Corn exports were retained at 2,325 million bushels in the face of intense competition from Brazil and Argentine and high world domestic coarse grain production relative to demand. Ending stocks were decreased by 349 million bushels (13.4 percent) to 2,167 million bushels.


 

COMMODITY REPORT: October 9th 2020.

  • The financial and economic implications of the COVID-19 pandemic continue but gradual easing over an extended period is expected as society struggles to return to a “new normal” with recent noteworthy upsurges in incidence in both rural and urban areas of the U.S. Markets do not appear to be influenced by the imminent General Election on November 3rd.

 

  • Commodity prices this past week were higher, influenced by lower projections for 2020 crop yields developed from the Pro Farmer 7-state Tour, the October 9th WASDE Report and the September Grain Stocks Report. Corn showed an increase of 4.0 percent for the week despite lack of orders from China but presuming lower ending stocks. Soybeans rose 4.1 percent in price this week based on orders booked by China and other nations and projected lower ending stocks attributed to a downward revision of yield and associated factors. Soybean meal rose by 3.7 percent in proportion to soybeans.

 

  • Since July 10th year-to-date exports and 2020/2021 market-year orders for corn have attained 7.41 million metric tons (292.5 million bushels) but with no reported orders this past week. Exports and orders for soybeans amounted to 17.5 million tons (656.9 million bushels) of which 20 percent was ordered during September. Approximately 10 million metric tons (36.5 million bushels) was ordered this past week

 

  • Prospects for commodity exports to China during the 2020/2021 market year that began on September 1st for corn and soybeans have improved. China adjusted their domestic short-term demand for soybeans as a result of an apparent increase in the hog herd after severe losses in 2019 and early 2020 from African swine fever. White-feathered chicken production has now recovered after COVID disruptions and on QSR demand. China is also taking advantage of shipping rates that are rising in order to build inventory.

 

The following quotations for delivery in the months as indicated were posted by the CME at 15H30 on October 9th compared with values posted on October 3rd (in parentheses) reflecting specified months for delivery.

 

COMMODITY

 

Corn (cents per bushel)

 Dec. 394 (379)

March ‘21 402 (389)

Soybeans (cents per bushel)

 Jan. 1,065 (1,023)

March ’21 1,047 (1,005)

Soybean meal ($ per ton)

 Oct. 362 (349)

Dec. 364 (352)

Changes in the price of corn, soybeans and soybean meal over five trading days this past week were:-

 

COMMODITY CHANGE FROM PAST WEEK

Corn: Dec. quotation up 15 cents per bushel (+4.0 percent)

Soybeans: Jan. quotation up 42 cents per bushel (+4.1 percent)

Soybean Meal: Oct. quotation up $13 per ton (+3.6 percent)

 

  • For each 10 cent per bushel change in corn:-

The cost of egg production would change by 0.45 cent per dozen

The cost of broiler production would change by 0.25 cent per pound live weight

 

  • For each $10 per ton change in the price of soybean meal:-

The cost of egg production would change by 0.44 cent per dozen

The cost of broiler production would change by 0.25 cent per pound live weight

 

Uncertainties still include:-

  • There are questions as to whether China will satisfy quantitative obligations in terms of the Phase One Trade during calendar 2020. The Agreement signed in mid-January incorporated U.S. tariff rescissions, promised purchases of agricultural commodities (valued at $36.5 billion in 2020 and $43.5 billion in 2021), concessions on some structural issues by China and strengthened enforcement provisions. For the first half of calendar 2020 China imported agricultural commodities to the value of $7.3 Billion

 

  • Domestic U.S. soybean and soybean meal demand is now less constrained by COVID-induced cutbacks in the intensive livestock and poultry sectors.

 

According to the October WASDE, corn to be harvested in calendar 2020 is expected to attain 14,722 million bushels with ending stocks projected at 2,167 million bushels. Final values will be modified by actual yield influenced by weather conditions and export volume. Compared with the October 3rd 2020 at 15H30 the CME quotation for corn on October 9th was up 15 cents per bushel for December delivery to 394 cents, adding to the 14 cent per bushel advance from the preceding week. The Friday October price was the highest since January 24th 2020 at 387 cents per bushel.

 

The social restrictions imposed in the U.S. as a result of COVID-19 will reduce ethanol demand by 1.5 billion gallons or 10 percent of projected 2020 requirement accepting a nominal ten percent addition to gasoline. More than thirty percent of U.S. ethanol fermentation capacity is off-line at present and the outlook for increased demand is questionable. Ethanol was priced at $1.11 per gallon on October 2nd down 28 cents per gallon (20.1 percent) from the previous week and compared with a five-year low of $0.92 per gallon on March 26th. Concurrently gasoline at $1.21 per gallon (quoted, New York Harbor) is 10 cents per gallon higher than ethanol but has a 63 percent higher BTU rating.

 

With more plants producing ethanol in the 4th quarter, DDGS is now available at a lower price than in the second quarter. Eastern Corn-belt product was priced at $154 per ton on October 6th, $6 lower than the previous week and $24 per ton less expensive than October 8th 2019.

 

 Soybeans are the beneficiary of the Phase-One agreement with China and were accordingly up 42 cents per bushel to 1,065 cents for January 2021 delivery. The USDA anticipates a 2020 crop of 4,268 million bushels, but this value is subject to continuing drought in some states. Ending stocks according to the October WASDE projection will attain 290 million bushels.

 

On October 9th the BRL exchange with the CNY was 0.83, (unchanged from the previous week). The conversion of the US$ to the CNY was set at 6.7 on October 9th. (unchanged from the previous week).

 

For consecutive years 2017 through 2019 the U.S. supplied 34.4 percent of soybean requirements for China amounting to 95.5 million metric tons. This was followed by a decline to 16.9 percent of 88.5 million metric tons in 2018 and 16.6 percent of 88.0 million metric tons in 2019. The USDA anticipates that soybean imports by China will amount to 95 million metric tons during the 2020-2021 market year.

 

The following extracts from the September 30th 2020 edition of the Quarterly USDA Grain Stocks Report indicate the levels of storage on farms and in fields and off-farm for corn and soybeans.

  • “Old crop corn stocks in all positions on September 1, 2020 totaled 2.00 billion bushels, down 10 percent from September 1, 2019. Of the total stocks, 751 million bushels are stored on farms, down 8 percent from a year earlier. Off-farm stocks, at 1.24 billion bushels, are down 12 percent from a year ago. The June to August 2020 indicated disappearance is 3.02 billion bushels, compared with 2.98 billion bushels during the same period last year. Based on an analysis of end-of-marketing year stock estimates, disappearance data for exports, and farm program administrative data, the 2019 corn for grain production is revised up 2.67 million bushels from the previous estimate. Corn silage production is revised up 715 thousand tons. Planted area is revised to 89.7 million acres, and area harvested for grain is revised to 81.3 million acres. Area harvested for silage is revised to 6.62 million acres. The 2019 grain yield, at 167.5 bushels per acre, is up 0.1 bushel from the previous estimate. The 2019 silage yield, at 20.2 tons per acre, remains unchanged from the previous estimate”.

 

  • “Old crop soybeans stored in all positions on September 1, 2020 totaled 523 million bushels, down 42 percent from September 1, 2019. Soybean stocks stored on farms totaled 141 million bushels, down 47 percent from a year ago. Off-farm stocks, at 382 million bushels, are down 41 percent from last September. Indicated disappearance for June - August 2020 totaled 858 million bushels, down 2 percent from the same period a year earlier. Based on an analysis of end-of-marketing year stock estimates, disappearance data for exports and crushings, and farm program administrative data, the 2019 soybean production is revised down 333 thousand bushels from the previous estimate. Planted area is unchanged at 76.1 million acres, but harvested area is revised to 74.9 million acres. The 2019 yield, at 47.4 bushels per acre, is unchanged from the previous estimate”.

 

COMMENTS

Subscribers are referred to the October 9th WASDE #605 in this edition and the results of the 2020 Pro Farmer 7-State Tour retrievable under the Search TAB.

 

The President opined on July 10th that he is “not contemplating a second phase of a trade agreement with China”

 

Approximately $16 billion will be disbursed under the Coronavirus Food Assistance Program (CFAP). As of August 10th, $7.1 Billion was distributed. An additional $14 Billion relief package was announced by the Administration on September 18th with a proportion already distributed.


 

Export of Shell Eggs and Products, January-August 2020.

USDA-FAS data collated by USAPEEC, reflecting export volume and values for shell eggs and egg products are shown in the table below comparing the first eight months of 2020 with the corresponding period in 2019:-

PRODUCT

Jan.-Aug. 2019

Jan.-Aug. 2020

Difference

Shell Eggs

Volume (m. dozen)

90.4

94.9

+4.5 (+5.0%)

Value ($ million)

70.1

79.1

+9.0 (+12.8%)

Unit Value ($/dozen)

0.78

0.83

+0.05 (+6.4%)

Egg Products

Volume (metric tons)

20,088

25,784

 +5,696 (+28.4%)

Value ($ million)

63.9

69.8

+5.9 (+9.2%)

Unit Value ($/metric ton)

3,181

2,707

-474 (-14.9%)

 

U.S. SHELL EGG AND EGG PRODUCT EXPORTS DURING

JANUARY-AUGUST 2019 COMPARED WITH JANUARY-AUGUST 2020

Source USDA-FAS/USAPEEC

 

SHELL EGGS

Shell egg exports from the U.S. during the first eight months of 2020 increased by 5.0 percent in volume and 12.8 percent in total value compared to January-August 2019. Unit value was 6.4 percent higher or 5 cents per dozen for the comparison between 2020 and 2019. The top two importers, Hong Kong and Mexico combined, represented 70.2 percent of volume and 60.3 percent of total value.

 

Mexico was the leading importer of shell eggs in January-August 2020 with 34.6 million dozen representing 36.5 percent of volume and 29.6 percent of total value corresponding to a unit value of $0.68 per dozen. Prospects for additional sales will depend on continued acceptance of washed eggs held under refrigeration for retail sale, first announced in September 2018 but implemented in late 2019. For January-August 2020 imports of shell eggs by Mexico increased by 126 percent in volume and 144 percent in value compared to January-August 2019.

 

Hong Kong was the second-ranked importer of shell eggs in January-August 2020, with 35.8 million dozen representing 33.7 percent of volume and 30.7 percent of the $79.1 million total value of U.S. shipments of shell eggs. Average unit value was $0.76 cents per dozen, corresponding to the average prevailing nest-run USDA benchmark price during the eight months of 2020. 

 

Canada was a distant third in rank as an importer during January-July 2020 with 9.5 million dozen representing 10.0 percent of volume and 15.3 percent of total value at $12.1 million with a unit value of $1.27 per dozen. Canada reduced volume by 66.2 percent during January-August 2020 compared to 2019. With the advent of COVID-19, April consignments of shell eggs were down 80.6 percent from 2019 and in May, June and July exports were negligible. This reflected decreased demand from the food service sector paralleling the situation in the U.S. Shell eggs shipped to Canada represent the difference between domestic demand and production, limited by their national controlled marketing system that has reduced farmers’ quotas. August imports attained to 3.2 million dozen as domestic demand increased.

 

The Caribbean Region represented 6.2 percent of export volume for January-August 2020. This region was up 28.2 percent in volume and 28.3 percent in total value, an obvious improvement compared with January-August 2019. The unit value of shell eggs exports to the Caribbean apparently averaged $1.30 per dozen, ($1.39 during 2019). This is disproportionately high compared with the average export realization, most probably because a proportion of shell eggs enumerated may have been either fertile hatching eggs or enriched specialty eggs.

 

The Middle East Region imported 8.4 million dozen during January-August 2020 valued at $6.4 million with a unit price of $0.76 per dozen. Volume and value in January-August 2020 were respectively higher by 105 percent and 77.8 percent compared to January-August 2019. Southern E.U. nations in addition to India and Ukraine have a competitive transport advantage over the U.S in this market. Within the Middle East region the UAE ranked as the 4th largest importer from the U.S. with a volume of 2.4 million dozen. Israel ranked 6th with 1.6 million dozen, possibly based on depletion of flocks infected with SE and ending use of obsolete facilities. Collectively these nations imported shell eggs to the value of $5.5 million during January-August of 2020.

 

EGG PRODUCTS

The total volume of exported egg products during January-August 2020 increased by 28.4 percent and total value was higher by 9.2 percent compared to January-August 2019. Unit value decreased by 14.9 percent to $2,707 per ton from $3,181 recorded for January-August 2019. This decline reflects the relationship between World supply and demand with Ukraine and India as significant exporters.

 

Japan was the leading importer based on a value of $22.3 million with a volume of 6,152 metric tons that represented 23.9 percent of the total U.S. exports of egg products, an increase of 20.0 percent compared with January-August 2019. The high unit value of $3,625 per metric ton compares with the average value for all exports of $2,707 or $2,420 excluding Japan. The discrepancy in unit price reflects the product mix including yolks. With conclusion of a bilateral trade agreement the U.S. will no longer be at a competitive disadvantage with respect to the E.U.

 

Mexico continued as the second-ranked importer based on value in January-August 2020 receiving 7,993 metric tons comprising 31.0 percent of export volume and 21.1 percent of value with a unit price of $1,839 per metric ton.

 

Canada represented a distant third in rank among importers purchasing 4,509 metric tons comprising 17.5 percent of volume and 12.8 percent of value with a low unit price of $1,974 per metric ton. During January-August 2020 Canada increased volume by 22.7 percent but value increased 14.1 percent compared to the first eight months of 2019. During August 2020 Canada increased volume by 80.4 percent to 336 metric tons.

 

Notable changes over the first eight months of 2020 included an 84 percent increase in exports to the UK+EU of 1,525 metric tons representing 5.9 percent of volume valued at $7.1 million and at a unit price of $4,656 per metric ton.

 

South Korea increased imports 58.4 percent and value by 58.7 percent to $4.1 million. In August this nation imported 77 metric tons valued at $0.2 million with a unit price of $2,597 per metric ton.

 

Saudi Arabia imported 34 metric tons of egg products valued at $0.2 million representing a significant increase 0ver August 2019.

 

COMMENTS

Successful conclusion of negotiations to replace NAFTA led to the trilateral USMCA, announced on September 30th 2018. The subsequently-modified agreement was ratified by the Parliament of Canada, 17 months after signing the basic trade pact and only after adoption by the U.S. Congress and the Senate of Mexico in 2019. Exports of shell eggs and egg products to our neighbors were valued at $74.7 million in 2017, $89.7 million in 2018 and $80.8 million in 2019.

 

Prospects for long-term exports of shell eggs will be limited by the willingness of importers to accept the World Organization for Animal Health (OIE) principle of regionalization in the event of exotic Newcastle disease or isolation of either H5 or H7 avian influenza, irrespective of pathogenicity. Most importing nations are now applying regionalization and permitting imports on a county or state-exclusion basis following H5 or H7 AI infection.

 

Both the END outbreak in backyard flocks in southern California and the localized and limited LPAI outbreaks and one HPAI isolation in turkey flocks in the Carolinas are now officially over. In accordance with OIE principles no embargos should be imposed on either the states or counties affected.

 

Generally pasteurized egg products should not be subject to any embargo imposed following reports of AI or Newcastle disease in a region.


 

REVIEW OF SEPTEMBER 2020 EGG PRODUCTION COSTS AND STATISTICS.

HIGHLIGHTS

  • September 2020 USDA ex-farm blended nest-run benchmark price was 65.6 cents per dozen, 22.2 percent higher than the August value of 53.7 cents per dozen but 48.9 percent lower than the exceptionally high April value of 128.5 cents per dozen. The downward price trend from mid-May through July is attributed to restoration of normal consumer purchasing patterns coupled with diversion of eggs from breaking to the shell-egg market. Currently stock levels and prices indicate a balance between supply and demand albeit at a low price attributable to over-production and diversion from the egg-breaking sector.
  • September 2020 USDA average nest-run production cost was 2.1 cents per dozen higher than in August 2020 at 60.6 cents per dozen.
  • September 2020 USDA benchmark nest-run margin attained a positive value of 5.0 cents per dozen compared to a negative margin of 4.3 cents per dozen for August 2020.
  • August 2020 national flock in production (over 30,000 hens/farm) was down 3.1 million hens or 1.0 percent to 299.1 million. There are approximately 6.9 million hens in molt or due to return from molt.
  • August 2020 pullet chick hatch was up 8.3 percent from July 2020 to 25.0 million.
  • August 2020 export of shell eggs and products combined was up 6.9 percent from June 2020 to 805,100 case equivalents representing the theoretical production of 8.3 million hens.

INTRODUCTION.

Summary tables for the latest USDA September 2020 prices and flock statistics made available by the EIC on October 11th 2020 are arranged, summarized, tabulated and reviewed in comparison with values from the previous September 9th 2019 posting reflecting August 2020 cost and production data.

COSTS & REVENUE

Parameter

SEPTEMBER 2020

AUGUST 2020

5-Region Cost of Production ex farm (1st Cycle)

60.6 c/doz

58.0 c/doz

Low

57.4 c/doz (MW)

55.0c/doz (MW)

High

86.5c/doz (CA)

83.5c/doz (CA)

Components of USDA 6-Region 1stCycle nest-run Cost of Production:-

SEPTEMBER 2020

AUGUST 2020

Feed

31.2 c/doz

28.9c/doz

Pullet depreciation

11.1 c/doz

10.8 c/doz

Labor (estimate)

4.0 c/doz

4.0 c/doz

Housing (estimate)

5.0 c/doz

5.0 c/doz

Miscellaneous and other*

9.3 c/doz

9.3 c/doz


* Adjusted January 2020 and used as a rounding factor

Ex Farm Margin (rounded to nearest cent) according to USDA values reflecting SEPTEMBER 2020:-

65.6 cents per dozen1- 60.6 cents per dozen = 5.0 cents per dozen

(August 2020 comparison 53.71 cents per dozen – 58.0 cents per dozen = -4.3 cents per dozen.)

Note 1: USDA Blended egg price


 

Status of 2019 Corn and Soybean Crops

The USDA Crop Progress Report released on October 13th documented corn continuing to mature and soybeans dropping leaves ahead of the 5-year average due to the earlier start in 2020. Nearly half of the 2020 corn crop has been harvested, twice the volume at this time last year. Almost two thirds of the soybean harvest is in, three times the rate during the corresponding week of last year.

 

The condition of both corn and soybean crops deteriorated in late August and early September as a result of drought. The condition of corn and soybeans has improved following rains in the Midwest and both crops are moderately superior to the 2019 season. Iowa and N. Dakota stand out as having poor soybean condition. Corn in Iowa, Colorado and Pennsylvania is suboptimal in quality contrasted to Minnesota, Wisconsin and Kentucky with corn superior to other states. 

 

Subsoil and surface moisture levels denote some relief from drought conditions except in Western and Pacific states. Both topsoil and subsoil moisture levels are similar to the past week. The corn-belt has experienced unseasonal high temperatures in combination with elevated humidity that may predispose to mycotoxicosis in the 2020 corn harvest. CHICK-NEWS and EGG-NEWS will report on the progress of the two major crops as monitored by the USDA through the end of the 2020 harvest in November.

 

Reference is made to the October 9th WASDE Report #605 in this edition, documenting actual 2020 acreage, and projected yields and ending stocks for corn and soybeans. The Pro Farmer 7-State Crop Tour projected corn and soybean yields of 177.5 and 52.5 bushels per acre. These were respectively, lower than USDA estimates that were revised to 178.4 and 51.9 bushels per acre in the October 9th WASDE Report.

 

 

WEEK ENDING

 

Crop

October 4th

October 11th

5-Year Average

Corn Mature (%)

Corn Harvested

87

25

94

41

87

32

Soybeans Dropping Leaves (%)

Soybeans Harvested

85

38

93

61

90

42

Crop Condition

V. Poor

 Poor

Fair

Good

Excellent

Corn 2020 (%)

Corn 2019 (%) *

* late planting

5

4

9

11

25

30

46

44

15

11

Soybeans 2020 (%)

Soybeans 2019 (%)*

 * late planting N/A

3

4

8

10

26

32

49

45

14

9

Parameter

V. Short

Short

Adequate

Surplus

Topsoil moisture: Past Week

20

33

43

4

Past Year

10

16

55

19

Subsoil moisture: Past Week

17

33

47

3

Past Year

10

18

56

16


 

Egg Week

USDA Weekly Egg Price and Inventory Report, October 14th 2020.

  • The U.S. flock in production was up 0.6 million from the previous week to 312.8 million, with molted hens resuming production and pullets reaching maturity.
  • Shell inventory was up 3.6 percent after a 2.6 percent decrease last week indicating restoration of balance between demand and supply. There is some evidence of a return in the food service sector as the economy cautiously reopens but the incidence rate of COVID-19 is increasing in some regions.
  • USDA Midwest benchmark generic prices for Extra-large and Large sizes were 7.1 percent higher this past week consistent with seasonal demand to averages of 105.5 and 103.5 cents per dozen respectively. Mediums were up 21.5 percent to 90.5 percent.  Prices will continue to fluctuate as molted hens resume production and pullets commence lay unless offset by proportional increase in demand moving through the fourth quarter of 2020.
  • The price of breaking stock in the Midwest was up 4.7 percent to an average of 73.5 cents per dozen. Checks were up 3.3 percent to 62.5 cents per dozen.

 

OVERVIEW

Prices

According to the USDA Egg Market News Reports circulated on October 13th 2020 the Midwest wholesale prices for Extra-large and Large were up 7.1 and 7.3 percent respectively as delivered to DCs attaining averages of 105.5 and 103.5 cents per dozen. Mediums were up 21.5 percent to 90.5 cents per dozen. Prices should be compared with the USDA benchmark average 5-Region blended nest-run, (excluding provisions for packing and transport) cost of 60.6 cents per dozen in September 2020. The progression of prices during 2018-2020 is depicted in the USDA chart reflecting three years of data, updated weekly.

 

The October 12th 2020 edition of the USDA Egg Market News Report (Vol. 67: No. 41) documented a USDA Combined Region value rounded to the nearest cent, of $1.06 per dozen delivered to warehouses for the week ending October 7th. This average price lags current Midwest weekly values by one week.  The USDA Combined range for Large in the Midwest was $0.96 per dozen. At the high end of the range, price in the South Central Region attained $1.12 per dozen. The USDA Combined Price last week was almost equivalent to the 3-year average and approximately 35 cents per dozen above the corresponding week in 2019.

 

Flock Size

According to the USDA the number of producing hens this past week (rounded to 0.1 million) was up 0.6 million to 312.8 million. If USDA data is accurate, the producing flock contains molted hens coming back into production with approximately 5.8 million pullets reaching maturity during the week offset by flock depletion. The hen population producing eggs is now almost in balance relative to seasonal consumer demand but is depressed by lower industrial and food service off-take. Any number above 315 million hens in production during late fall moving towards the holiday buying surge portends lower than average prices and increased inventory, unless matched by proportional increases in demand. The “March Madness” buying in response to COVID-19 concern is long since over and the industry has not recovered from the downside of the roller coaster, with prices also depressed by shell eggs diverted from the food service sector.

 

The total U.S. egg-flock was up 0.7 million to 319.9 million hens including second-cycle birds and those in molt. The difference of 7.1 million between hens in production and total hens is equivalent to 2.3 percent of the national flock. This means that as molted hens come back in production and young pullets are placed, the size of the producing flock could be raised to a possible 314.5 million suggesting that the national flock should be reduced less by transitory molting but more by depletion than is evidently occurring. The obvious reduction in hen numbers in Iowa and to a lesser extent in the next three largest producing states is reversing in anticipation of the holiday period. Chick placement data suggests that 25 million pullets will commence production in October. This has implications for prices, given current supply, higher stock levels given the level of seasonal demand.

 


 

Comparison of Commodity Prices in China with CME Quotations.

The relative prices expressed in US$ per short ton for corn, soybeans and soybean meal, December delivery, were downloaded from the Dalian Commodity Exchange website reflecting major contracts at close of trading on October 15th.  These values were compared with the spot price at noon on the CME indicated in parentheses. 

 

Commodity

Dalian CE

52-week range

CME 09/02

Corn

$345*

$257-$349

$144

Soybeans

$609*

$496-$623

$354

Soybean Meal

$433*

$358-$443

$371

 

* short ton with exchange rate CNY 6.7=US$1

 

It is evident that due to the higher price of feed, producers of hogs, eggs and conventional broilers in China are at a disadvantage in production cost compared to their counterparts in the U.S. and Brazil.

 

Large eggs (57g) traded on the Dalian exchange at 33 cents per dozen.

 


 

Eggland’s Best Supports Susan G. Komen Foundation

2020 marks the eleventh consecutive year of Eggland’s Best “going pink” in support of Susan G. Komen® in the fight to end breast cancer!

  

Eggland’s Best continues to support Susan G. Komen by helping to fund Komen’s mission to save lives by ensuring that all people receive the care they need, and finding breakthroughs that prevent and cure breast cancer.

 

"We're thankful to have generous partners such as Eggland's Best to support us in our mission to eliminate breast cancer," said Sarah Rosales, Komen's VP of Corporate Partnerships. "One in eight women during their lifetime will have a moment that will change everything – the moment they are told they have breast cancer.  Eggland's Best's long-standing support ensures that we are able to be there for everyone touched by breast cancer, every step of the way."

 

To highlight our commitment and to encourage action from millions of consumers in the fight against breast cancer, the iconic red Eggland’s Best-stamped eggs will instead showcase Susan G. Komen’s pink Running Ribbon throughout October, National Breast Cancer Awareness Month. During this time, Eggland’s Best egg cartons will also feature special pink Susan G. Komen graphics.

“Eggland’s Best is thrilled to once again join forces with Susan G. Komen to support research, advocacy and patient support to help save lives from breast cancer,” said Charlie Lanktree, CEO of Eggland’s Best. He added  “while we’ve come a long way, this awful disease still touches too many Americans each year. We are committed to helping the life-saving work of the Konen Foundation.”


 

Berkshire Hathaway Passed on Whole Foods Purchase

According to Conscience Leadership authored by John Mackey then CEO of Whole Foods Market, investor Warren Buffett passed on purchase of the company in 2017.  At this time Mackey was concern that JANA Investments was attempting a hostile takeover.  Apparently Albertson’s was also disinclined to consider purchase of the company that was eventually acquired by Amazon in June 2017 for $13.7 billion.

 


John Mackey

 

Food Trends Resulting from COVID

Speaking at the virtual The Wall Street Journal Global Food Forum, Mark Clouse CEO of Campbell Soup Company reviewed trends in food purchases since the onset of COVID-19 in the U.S. Clouse noted that during the early phase of the infection requiring shut-down of restaurants and QSRs, stay-at-home cooking created a market for “comfort foods”.  Subsequently, over succeeding months, consumers have continued to purchase from the center of the store with food and beverage sales up 13 percent in the second quarter compared to the corresponding period in 2019.

 

According to the report on the virtual Global Food Forum, The Wall Street Journal noted that IRI data documented a change in demand for products for creative cooking and the re-emergence of health concerns.  Home confinement coupled with a shift from offices to homes as the new workplace has created a demand for snacks that will probably persist post-recovery.

Steve Cahillane, CEO of the Kellogg Company noted that his company has recorded an increase in consumption in cereal as “people are having breakfast together with their families.”  Kellogg specifically experienced declines in sales as younger consumers reject the bland appeal of soggy cereal.

 

It is clear that the challenge facing food manufacturers is to discern trends and determine what consumers need to satisfy demand through an extended period of COVID-dominant patterns. The American Egg Board has shifted emphasis in promotion and egg-based further-processed products are appearing in the market place, compensating for the decline in demand from the food-service sector.


Mark Clouse

 

Egg Consumption in Ghana Up by 37 Percent Since 2016

The World Initiative for Soy in Human Health mounted a promotional campaign for eggs in Ghana commencing in 2015.  According to government statistics, per capita consumption increased from 172 to 235 eggs between 2016 and 2020.  The promotion was funded by a USDA program, Assist in the Management of Poultry and Layer Industries with Feed Improvement and Efficiency Strategies, a project in Ghana that commenced in 2015.  The AMPLIFIES project has now ended, but the Ghana National Egg Campaign will continue promotion to improve consumption of shell eggs, an inexpensive and nutritious food.


 

Danielle Nierenberg Receives 2020 Julia Child Award

Danielle Nierenberg is the 2020 recipient of the Julia Child Award to be presented during the Smithsonian Food History Gala on October 15th.  Nierenberg is a hard-working journalist traveling extensively and interviewing food producers both in the U.S. and the international arena.

 

The presentation will be part of a program organized by the Smithsonian, the Julia Child Foundation and the Food and Agriculture Organization of the United Nations.  The featured speaker will be Chef Jose Andres a nominee for the Nobel Peace Prize, who has received wide acclaim for his efforts in alleviating hunger following catastrophic events worldwide.


 

Milk Exports Soar in August

While egg exports languish, the U.S. Dairy Industry enjoyed a bumper August.  According to the U.S. Dairy Export Council, a total of 190,000 tons of milk powder, cheese, whey, lactose and butter fat was shipped representing a record. Exports were up 11 percent up for the month compared to August 2019 and up 14% year to date.  The dairy industry anticipates exporting products to the value of $6 billion in 2020.  Michael Dykes, President and CEO of the International Dairy Foods Association (IDFA) stated, "volatility and uncertainty remain a factor in the dairy market and trade, but IDFA remains optimistic that with continued demand for dairy around the world especially in South East Asia and China, 2020 will end on a high note".  Dykes ascribed the increase in exports to China to the Phase One Trade Agreement. Essentially the purchases represent their need and have little to do with an agreement that was concluded on the basis of political expediency

 

Whey exports were up 29 percent with most of that increase due to buying by China as it rebuilds hog herds.  August shipments to China attained 17,000 tons up, 318 percent from August 2019.  The increase to China was offset by it declines to the rest of Southeast Asia and Mexico that was down 60 percent.

 

In contrast to the dairy industry year-to-date through August shell egg exports attained 94.9 million dozen valued at $79 million. Egg product exports rose to 25,784 metric tons valued at $69.8 million for a total of $148.4 million. On an annualized basis egg exports by the egg industry are approximately 4 percent of the value of dairy products shipped.


 

Zero Egg Launches in the U.S.

Using World Egg Day as a point of emphasis, Zero Egg launched both Egg Basics and Bake Basics on October 9th directed to the food service industry.  Both products will challenge the plant-based egg substitute from Just that is based on mung-beans

 

Zero Egg was developed by founder and CEO, Liron Nimrodi in 2018 working in the Kitchen FoodTech Hub, a technology incubator in Israel. The product incorporates plant proteins from soybeans, potato, peas and chickpeas and was developed specifically for the food service industry. Zero Egg claims lower fat and calorie content compared to conventional eggs.  Zero Egg is currently marketed in Israel and in the EU.  The U.S. subsidiary has partnered with Gordon Food Service for distribution and operates a manufacturing plant in Cookeville, TN.

 

Isabelle Francois, GM of Zero Egg North America stated, "we are launching the egg-for- everyone on World Egg Day to crack old food paradigms and proudly demonstrate that Zero Egg is the best choice as the only plant-based egg ".She added, "now it is time to disrupt the plant-based egg category and become the leader by offering the most ethical, tasty, versatile and economical egg alternative".

 

Egg Basics™ can be used for traditional egg entrees and breakfast dishes.  Bake Basics™ was developed for specialty baking.  Both products are presented as a fine powder that is reconstituted with oil and water.

 

Mario Rodriguez, executive chef for Zero Egg stated, "the product can be used to make scrambles, omelets, quiches, French-toast, waffles and many other dishes".


 

FDA Issues Warning Letters to Companies Touting Herbal Medicines for COVID-19

Prairie Dawn Herbs and Griffo Botanicals received warning letters from the U.S. FDA asserting the illegality of promoting and selling products with unsubstantiated claims to improve the function of the immune system and to prevent or ameliorate symptoms associated with COVID-19.

 

The letters contain the statement "based on our review, products are an unapproved new drug under section 505 of the Federal Foods Drug and Cosmetic Act and furthermore products are misbranded drugs”.

 

There are no FDA-approved products to prevent or treat coronavirus infection.  Remdesivir is administered under emergency use authorization in hospitals under supervision of medical professionals.

 

Following receipt of the FDA letters the two companies concerned have modified their websites with respect to claims relating to COVID-19.


 

COVID Takes Toll on Restaurants

The Ruby Tuesday chain has permanently closed 185 restaurants that were temporarily shuttered during the home-confinement phase of the COVID outbreak during spring and summer.  The loss of revenue resulted in the company filing for protection under Chapter 11 of the Bankruptcy Act.  Approximately 240 company-owned restaurants will continue to operate under the management of the company according to Shawn Lederman, CEO of the chain. 

 

A franchise of Golden Corral Corporation 1069 Restaurant Group a subsidiary of Holm and Holm  has also filed for Chapter 11 bankruptcy.  The franchise located in Winter Park FL. Has only six restaurants in Floridas and Georgia open out of the chain  of 33 locations. The Golden Corral Chain has closed 35 company-owned restaurants as a result of COVID restrictions and a disinclination of customers to patronize stores that have been converted from a buffet format.

 

There were no bidders at an October 8th auction for the California Pizza chain that declared Chapter 11 in July.


 

Hotraco Egg Flow Controller

Based on experience with both in-line and off-line plants in the EU and North America, Hotraco-Agri B.V. of Holland has introduced an upgraded egg flow control system for initial or retro-fit installation that reduces breakage and optimizes packer capacity.

 

Features of the Hotraco Egg Flow Control and counting system include the capability of simultaneous egg collection from a number of barns generally referred to as “blended collection”.  The egg controller will also allow collection from individual barns with counting and ensuring a regular flow to the grader.

 

Hotraco egg counters claim an accuracy of 99.5 percent and are suitable for barns equipped with either cages or aviaries systems optimizing egg flow contributing to packer efficiency.

 

Hotraco systems are installed and maintained by expert engineers with 24/7 support available.

U.S. agents are Val-Co Systems located in New Holland, PA. a prominent supplier to the egg industry.

 

Additional information can be accessed on the Hotraco website www.hotraco-agri.com 

The Val-Co website www.val-co.com provides U.S. contact information.

 


 

FDA Imposing New Rule on Traceability of High-Risk Foods

The FDA has proposed “requirements for additional traceability records for certain foods” as a component of the New Era for Smarter Food Safety, consistent with the Food Safety Modernization Act of 2010.  Foods regarded as high-risk for which records must be maintained include shell eggs and a range of vegetables and fruits implicated in foodborne outbreaks during the past five years.

 

In announcing the initiative, the FDA noted, “While limited to only certain foods this proposal lays the foundation for a standardized approach to traceability and record keeping paving the way for the industry to adopt, harmonize and leverage more digital traceability systems in the future”.

 

 


Frank Yiannas Driver of the FDA Traceability Initiative

 

The proposed rule will permit either electronic or paper records.  In the event of a disease traceback, the company concerned will have to provide an electronic spreadsheet containing relevant traceability information within 24 hours of a request by the FDA.  Key data elements include the traceability lot code, date product was received, date product was shipped and a product description presumably including packing.

 

The FDA will hold public meetings on November 6th and 18th and December 2nd to review public comments on the proposed requirement before publishing a Final Rule.


 

Dreyer’s Drops ‘Eskimo Pie’ in Favor of ‘Edy’s Pie’ Brand

Dreyer’s Grand Ice Cream a subsidiary of Froneri has announced that henceforth, Eskimo Pie bars will renamed Edy’s Pie.

 

Dreyer’s considered that the name was associated with a racial stereotype.  The previous label artwork depicting a child in a parka is also being removed. Possibly this may have to do with global warming and the disappearance of ice floes in the Arctic.  It is hoped that people named Edy will not complain since the name change may be regarded as stereotyping.


 

Southeastern Grocers Promoting Fresco Y Mas Banner

Southeastern Grocers Inc. will open a Fresco Y Mas store converted from a Winn-Dixie unit. Anthony Hucker, President and CEO of Southeastern Grocers stated “we are committed to cultivating a shopping experience that meets the needs of each community that we serve and is tailored to the everyday lifestyles of our customers.  With a growing desire for Hispanic products in Southwest Florida we are thrilled to introduce the Lehigh Acres Community to our Hispanic grocery store.”

 

Although Southeastern Grocers established the Fresco Y Mas Banner in 2006, it has only recently commenced converting Winn-Dixie locations.  The store is the first in the Fort Myers area to incorporate a carniceria (Latin Butcher Shop) and a panaderia (bakery).


 

Oskaloosa Food Products Integrates Ovotrack™ with Sage X3

Oskaloosa Food Products in Iowa was featured in a recent Ovotrack newsletter. The Company has introduced an OvoTtack solution to integrate their 2019 system with the company Sage X3 ERP system.

 

All eggs produced by Oskaloosa Food Products are labeled with a unique tag for each pallet.  Ovotrack records the weight of each pallet on the electronic tag.  As eggs are loaded onto a collection vehicle, both pallet tags and the unique barcode for the truck are scanned.  Ovotrack generates a bill of lading by recording individual pallet tags and the total weight.  This documents eggs produced by Oskaloosa Farms and confirms the weights and quantities as pallets are transferred to the receiving cooler.  Eggs from external suppliers are labeled at the point of unloading at the plant. 

Since the Ovotrack and Sage X3 systems are integrated Oskaloosa Food Products operates with a real time inventory and a record of the farm producing eggs.  Pallets are scanned as eggs are loaded onto the breaker automatically removing them from inventory. The input weight is used to calculate yield an essential management parameter.

 

According to the Oskaloosa CFO, Brad Hodges, implementation went according to plan with cooperation between the Ovotrack and Sage teams in Holland and local technical personnel.


 

Projected Demand for Plant Protein in Food

Urner-Barry estimates the current global market for plant-based protein foods at $8 billon, to expand at an 11 percent compound annual growth rate to attain $12.5 billion in 2023.  Currently the market is dominated by soy protein with 85 percent of content followed by wheat protein at six percent and pea protein at four percent.

 

 It is considered significant that mung beans included in the “other legume category” collectively represents approximately one percent of 2019 plant protein used for food. Mung beans apparently form the basis of the egg substitute marketed by Just Foods Inc..


 

Unions and Organizations Sue Federal Departments Over PPE

A lawsuit has been filed in the United States District Court for the District of Columbia relating to an emergency rulemaking petition concerning provision of PPE.  Case 1:20-cv-02876 was filed on September 8th by twenty unions representing teachers, flight attendants, transport workers, and members of the United Food and Commercial Workers International. 

 

On August 11th, the AFL-CIO petitioned the Department of Health and Human Services and the Department of Homeland Security to enforce rules relating to providing workers with appropriate protective equipment.  Neither Department responded to the petition.  The lawsuit was filed in accordance with the Administrative Procedures Act and seeks injunctive relief, directing the two Federal Departments to respond to the petition and to ensure that workers be provided with adequate PPE.


 

Instacart Receives Third Round of Investor Funding

Following infusions of capital by investment groups in October 2018 and June 2020, Instacart received $200 million from Valiant Peregrine fund and D1 capital partners.  Instacart now is valued at $17.7 billion.  The company has expanded from groceries into beauty care and home goods and claims a support base of 500 retailers delivering from 40,000 store locations.

 

In commenting on the investment in his company, Founder and CEO, Apoorva Mehta stated, “Today’s investment is a testament to the strong conviction our existing investors have in the strength of our teams and the important role Instacart plays for customers, partners, and the entire grocery ecosystem.”


 

Canadian Food Inspection Agency Orders Recall of Shell Eggs

On October 8th, the Canadian Food Inspection Agency issued a recall of eggs from Hilly Acres Farm as a result of Salmonella contamination although the serotype was not specified.  Eggs were distributed in Newfoundland, Labrador and Nova Scotia under a number of brands including Maritime Pride, Nova Eggs, Great Value, and Farmer John Eyking.  The recall extends to all eggs produced or packed by Hilly Acres with a code date of September 2nd through October 31st.

 

It is understood that the recall following identification of Salmonella infection, presumably SE, in flocks following routine surveillance.  At this time no reports of illness have been documented.

 

Between June 16th and July 27th, a Salmonella Enteritidis outbreak occurred in the Province of New Brunswick with thirteen confirmed cases.  No specific source or vehicle was identified in this outbreak and there is no evidence at this time that the cases identified were associated with the Hilly Acres recall.  Obviously molecular analytical techniques including WGS will be applied to ascertain if there was any involvement of the farm involved in the current recall.


 

Cantaloupes Back in the News

The Meijer Chain and their supplier Eagle Produce LLC of Aguila, AZ. have initiated a six-state recall of cantaloupes and fruit trays containing cut cantaloupe following an investigation by the Michigan Department of Agriculture and Rural Development. Routine monitoring demonstrated the presence of Salmonella contamination. There have been no reports of illnesses from consuming cantaloupes and derived items.

 

Cantaloupe was identified as the vehicle of infection in 23 foodborne outbreaks reviewed by the CDC occurring between 1984 and 2002. A total of 1,434 cases infected with Salmonella, Listeria and E.coli resulted in 42 hospitalizations and two fatalities.

 

Bowen, A. et al. Infections associated with cantaloupe consumption: a public health concern. Epidemiology and Infection.134: 675-685 (2006)


 

Shipt to Hire for the Holiday Season

Shipt a subsidiary of the Target Corporation has announced that it intends hiring 100,000 in-store and delivery workers for the holiday season increasing the payroll to 300,000.  The company plans to target major metropolitan areas in Michigan, Minnesota, New York, California and Texas.  CEO Kelly Caruso commented, “We are embarking on a holiday season like none other before and taking proactive steps to ensure we can help American families get everything on their holiday list in a safe, affordable and convenient way.”

 

During the past six months Shipt has doubled it personal shopper count and expanded the membership and customer base.  The Company has initiated a pay-per-order option allowing consumers to use the service without an annual membership. Currently a payment of $99 per year provides unlimited free deliveries for orders valued at $35 or more.  Shipt-passes are now available for $10 per online delivery order declining to $8 each for five orders.

 

Target acquired Shipt in December 2017 for $550 million and now provides services in 5,000 U.S. cities delivering groceries, kitchen goods, household staples, pet care, health and wellness items and alcohol.

 


 

MOBA Sales Appointment

MOBA announces the appointment of Joe Gardner to the sales team with responsibility for Diamond and MOBA grader installations and Pelbo egg breaking and processing equipment.

 

Joe has extensive experience in the U.S. poultry industry and is a graduate of Cal- Polytech with a minor in poultry science. He resides in San Miguel, CA.

 

He can be contacted through the U.S. Headquarters in Farmington Hills (248) 476 7100

 

Information on the MOBA Group and products can be accessed by clicking on to the MOBA logo on the right side of the Welcome page.

 


 

Commentary


Farmers Accused of Indifference to COVID-19 Among Migrant Workers

Investigative journalists have reviewed county data on prevalence rates of COVID-19 among migrant workers in Northwest States and Florida.  The Columbia University, Brown Institute for Media Innovation undertook interviews with county officials and agricultural workers in ten states during the 2020 harvest season for fruit in the northwest and produce in Florida.

 

The investigation disclosed that farm and food-plant workers continued in their labor despite the risk of exposure to COVID-19 as they were designated "essential" in terms of the Presidential Executive Order on April 28th.  In addition, migrant farm workers on H-2A visa programs are in reliant on daily labor for survival and for remittances to their families in their home countries. 

 

Problems that were uncovered in the investigation included:-

  • Failure to maintain social distancing when transporting workers from temporarily accommodation to fields
  • Failure to provide even the most basic PPE
  • Failure to undertake testing followed by isolation of infected individuals
  • Allowing workers to live in accommodation with primitive hygiene facilities conducive to infection
  • Deliberate obstruction of county and state officials investigating outbreaks of COVID-19
  • Reluctance to cooperate with county officials and non-profit healthcare organizations to provide counseling on protection against COVID-19
  • Prompt dismissal of workers complaining of COVID-like symptoms or requesting protective measures

 

Epidemiologic studies confirm that the prevalence rate of COVID-19 among migrant farm works far exceeded the level in the general population in counties with intensive agriculture that employed a large number of workers for seasonal cultivation or harvesting.  Investigations demonstrated instances of collusion between county and state officials and large employers with respect to testing workers and reporting results. State agencies in California distributed masks to H-2A visa workers picking strawberries and other crops.

 

COVID-19 will be a fact of life for the foreseeable future in cultivation of fruit and produce, even with deployment of an effective vaccine in the U.S. Since H-2A workers come from nations where vaccination programs will not be carried out, it will be necessary to vaccinate and test workers before entry to the U.S. 

 

Irrespective of protective modalities, no industry, irrespective of Presidential executive orders can ignore the realities of disease and to subject H-2A workers to exposure resulting in illness and in some cases, death.  Individual family-owned and corporate farms supply packers with brand name products that are sold in supermarkets.  These chains are vulnerable to adverse publicity in the court of public opinion and will be implicated in class action litigation. Ultimately producers will be subject to Federal or state mandates on protection from COVID-19 and other communicable diseases. It would be preferable to adopt a more realistic and proactive approach to preventing COVID-19 among migrant workers in 2021.


 

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Dr. Simon M. Shane
Simon M. Shane
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