Editorial


EPA Counters California Labeling Requirement for Glyphosate

09/12/2019

EPA has issued a letter stating that the Agency would not approve any labels for products containing glyphosate that claim potential carcinogenicity. Recently California listed glyphosate as a potential carcinogen in terms of the 1986 Safety Drinking Water and Toxic Enforcement Act (Proposition 65).  As justification, California cited the now withdrawn WHO-International Agency for Research on Cancer report.  The IARC finding that glyphosate was “probably carcinogenic” was widely discredited by the scientific community.  A co-author of the IARC report subsequently emerged as an expert witness for plaintiffs’ attorneys suing Bayer alleging that glyphosate was responsible for non-Hodgkin lymphoma.  Bayer acquired Monsanto in 2018 and has lost three consecutive lawsuits decided by jury in California.  It is noteworthy that the conclusions of a study conducted by the Environmental Protection Agency were not submitted as evidence to defend Bayer-Monsanto.  Scientific opinion disfavors the role of glyphosate in the development of specific cancers.

 

The EPA letter clearly stated that label warnings in terms of Proposition 65 constituted a “false and misleading statement”.  The issue of a California label warning was raised in a 2018 Federal case in which a judge granted an injunction against California in favor of plaintiffs that used glyphosate in their farming operations, claiming that the label requirement would violate their First Amendment rights.

 

The California Office of Environmental Health assessment is apparently adhering to their policy of sanctifying a discredited, biased and retracted report from the IARC and characterizing the EPA letter as being “disrespectful of the scientific process.”  The Wall Street Journal correctly admonishes California and justifiably maintains that scientific evidence should determine the legal status of glyphosate.

 

In a letter to The Wall Street Journal published on September 12th Allan Hirsch, of the California Office of Environmental Health Hazard Assessment defends his Department’s decision, again invoking the discredited and “cherry picked” IARC report considered as justification to require a warning label. He claims that “warnings enable Californians to make informed choices about their use of products that could expose them to toxic chemicals” By the same token dihydroxy oxygen (or water to you and me) is harmful or even lethal if ingested in a sufficient quantity. Does California intend to label water as harmful? Californians are in no position to “make informed choices” over whether or not glyphosate plays a role in non-Hodgkin lymphoma since there is even contention among experts. By unjustly labeling glyphosate-containing herbicides as “potentially carcinogenic” a range of products are effectively demonized. This is all a result of Proposition #65, enacted by ballot, providing bureaucrats with job-security and contributing to the collective neurosis inherent to the State.


 

Sustainability Claims Questioned

08/21/2019

Sustainability has emerged as a significant determinant of corporate responsibility extending to brands and product categories.  Most large food companies issue regular reports on their programs emphasizing savings in energy and reduced emission of greenhouse gases.  These efforts are commendable although investment may detract from short-term earnings. Enhanced sustainability may create a favorable image among consumers by demonstrating social responsibility and even contribute to EPS over the long term.

 

Sustainability can be “encouraged” by grants and tax concessions that distort the principle of a free economy. A specific example of misplaced government intervention is the use of wood pellets to power electric generation.  The Drax Power Plant in the U.K. receives $2.2 million per day in subsidies to burn wood pellets in place of coal.  Burning wood is considered to be carbon- neutral but the math does not support this widely held contention.  It is now evident that burning wood and biomass, liberating carbon dioxide, is not necessarily offset by regrowth of forests that are harvested for timber.

Reestablishing mature trees to a level that can absorb the carbon dioxide released from combustion may take 40 to 100 years depending on location.  This is especially the case for deforestation in the Southeast to produce wood pellets exported to the U.K. and other EU nations.  If in fact the wood pellets were derived from timber unsuitable for construction and from waste material, there could be some justification for the practice.  Selling mature trees, whether derived from clear cutting or under a managed forestry program, will increase carbon dioxide released over an extended period during which forest regrowth cannot compensate by photosynthesis.

 

 It is possible that a recent study published in Switzerland is valid. The authors claimed that 1.2 trillion additional trees would cancel a decade of carbon emissions. Unfortunately the time required to exert a beneficial effect is inconsistent with the urgent need to reduce carbon dioxide emission.  Although the fallacy of sustainability through burning wood chips is now recognized as a scientific reality, the industry has gained its own momentum with numerous plants operating in southern U.S. states including a proposed plant in Lucedale, MS which has generated concerted opposition.

 

Similar fallacious claims relating to sustainability are used to justify corn-based ethanol production.  The legislation that set in motion the conversion of food to fuel was based on  concern that the U.S. imported energy in the form of oil from potentially hostile nations.  Subsequently with the introduction of fracking, the U.S. has become independent with respect to hydrocarbons.  The ethanol industry continues to make unjustified claims for sustainability.  If all the energy required to grow corn and convert it to ethanol is taken into account, carbon emissions exceed those of refining oil and using gasoline as a fuel.  Manufacturers and owners of electric-powered vehicles claim zero emissions. This is true of true if only the tail pipe is considered. The “green” claim conveniently ignores the carbon emission associated with generating power used to charge the vehicles batteries and even the fabrication of electric motors and batteries.  Depending on the source of electric power a diesel powered small sedan in Germany is probably more sustainable than an equivalent electric vehicle given the dependency on “beautiful clean coal” for power generation in that nation.  The situation would however be different in Norway where most electric power is derived from hydroelectric plants.

 

Claims relating to sustainability should be viewed through a wide-field lens.  By cherry-picking aspects of any system it is possible to generate claims that influence consumer attitudes towards industries, companies and products.  The situation becomes even more complicated when politics clouds issues with unsubstantiated claims for job generation and environmental enhancement that invariably require mandates or subsidies. The RFS is a classic example of a good intention at a point in time degenerating into an indirect tax on all who drive and eat benefitting corn growers and ethanol refiners.


 

Recall of Belgian Eggs Due to Dioxin Contamination

08/19/2019

The Brussels Times Reported on Wednesday August 14th that eggs packed in Limburg under the EKE brand have been recalled as a result of dioxin contamination. The current problem is reminiscent of the 1999 episode in which animal feed was contaminated with polychlorobiphenyls (PCBs) and dioxins.  The case was investigated following mortality in chicks showing characteristic changes associated with PCB toxicity including hydropericardium and degenerative changes in skeletal and cardiac muscle tissue.  These lesions were first described in the 1960’s as “chick-edema disease” or “toxic fat syndrome” following ingestion of polyhalogenated hydrocarbons as a contaminant of fat incorporated into poultry diets.

 

The 1999 event was confirmed by the presence of high levels of dioxins in feed, meat, eggs and the fat of poultry fed specific batches of feed containing contaminated feed-grade oil.  Traceback investigations showed that used mineral oil had been added inadvertently to recycled fat that was subsequently rendered for use in animal feed.  Flocks and herds on over 2,500 farms were affected requiring extensive recall of pork, eggs and dairy products in Belgium, Holland and Germany.  The episode led to the introduction of routine surveillance for PCB and dioxin on a wide range of food products in Belgium.

 

Studies are currently in progress in the present case to determine the extent and severity of contamination. Presumed affected product has been removed from the shelves of major supermarkets including Delhaize and Carrefour.  Since product has an expiration date of August 18th a proportion of the affected eggs have obviously been consumed.

 

To their credit Belgium responded promptly to the problem as opposed to delays in reacting to fipronil contamination affecting flocks in Holland and Belgium in 2017. 

 

In an expression of schadenfreude, Andrew Joret chairman of the British Egg Industry Council stated, “This incident is just the latest in a long line of food safety issues related to non-U.K. eggs.”  He added, “U.K. food businesses should protect themselves by putting trust in British Lion eggs and egg products which are produced at a higher standard of food safety.”  While Joret’s comments may be well accepted by his membership, the situation that has occurred in Belgium may well have been in reality in the U.K. or any nation using recycled fats.  In 2015 fat from restaurants rendered in a western Michigan plant was contaminated with residue from a facility producing an ionophore anticoccidial. Incorporation of the recycled oil in diets resulted in the death of over 15,000 turkeys and contaminated hogs. 

 

The entire chain of manufacture of animal feed extending from ingredients, both harvested and processed, requires appropriate quality control and surveillance for contaminants.  Investigation of instances of accidental introduction of toxic compounds have been investigated and proven to be costly.  The possible deleterious effect of undetected contamination cannot be assessed especially with compounds associated with chronic toxicity or those which occur infrequently.

 

Experience is a great educator.  The events of 1999 in Belgium and the subsequent introduction of routine surveillance obviously averted a more serious reoccurrence twenty years later.

 


 

Proposed funding of project to evaluate the price of eggs under conditions affecting supply

08/18/2019

Prior to 2015 the U.S. egg industry was characterized by seasonal fluctuation in demand with peaks over Easter and Christmas yielding high unit prices followed by declines in consumption with a corresponding reversal in the price trend. In addition cyclic periods of overproduction depressed prices at approximately three-year intervals stimulating consolidation among producers.

      

 Factors that have impacted the relatively predictable traditional relationship between production volume and price include:-

 

  • Transition from conventional cages to alternative aviary and floor systems in response to welfare demands by consumers, QSRs and retailers
  • Highly pathogenic avian influenza leading to the depletion of 40 million hens in 2015 with disruption of the fairly stable relationship between the shell egg and liquid sectors that under normal conditions operate independently
  • Investment in new in-line shell egg complexes housing over two million hens and requiring capital expenditure of over $100 million per location.
  • The rise in branded enriched specialty, organic and cage-free eggs accompanied by the emergence of store brands
  • Increased productivity of current commercial strains given improved nutrition and immunization over an extended non-molt cycle.
  • Consumers accepting the nutritional content and value of eggs in the absence of concern over cholesterol content.

 

Given the changing situation producers faced with investment decisions should have a clear understanding of the factors influencing the price of shell eggs in a more complicated market influenced by extrinsic and intrinsic factors affecting production and demand.

 

  Currently producers, integrators and financial institutions that provide capital are obliged to make investment decisions without the benefit of quantitative data or economic models depicting supply and demand relationships. This is especially the case with erection of alternative housing systems with or without replacement of existing flocks. Clearly ad hoc decisions are being made to implement, cancel or re-schedule new complexes without reference to models describing the price elasticity of generic shell eggs and alternative presentations.

 

 

 EGG-NEWS has previously advocated for a study on egg prices as determined by supply and demand especially when factors such as disease occur. The events of 2015 involving HPAI and its aftermath are self-evident. The fipronil crisis in the EU and then HPAI in S. Korea are examples of a transitory increase in export demand drawing shell eggs from the domestic market and into the liquid sector of the industry.   

 

It is proposed that a team of agricultural economists preferably at a Land Grant University should be invited to submit research proposals (RFPs) to develop models to determine future prices for generic and alternative types of shell eggs, given defined levels of production. Events contributing to wide swings in price since 2014 would provide a valuable dataset to establish correlations between production and price accepting that demand has displayed a shallow trajectory in recent years Additional considerations should include the relationship between shell-egg and egg-liquid components of the industry under conditions that restrict output of either or both segments.

 

 It is suggested that a modular approach should be implemented with RFPs reflecting the most immediate needs of the Industry. A comprehensive and detailed project requiring extensive research with a distant completion date is disfavored.

 

The question now is to determine the terms of reference and how a project could be funded. Let us not follow the parable of the mice that decided that if the house cat could be fitted with a bell they would be warned of its approach. The impasse then became which of the mice would bell the cat!


 

Larry Summers on the Tariff War with China-Relevant Observations

08/12/2019

Adding gravitas to the growing criticism by professional economists concerning the White House trade conflict with China, Prof. Larry Summers, ex-Treasury Secretary and President Emeritus of Harvard University, concurred with those expressing concern over escalation. Speaking on the Fareed Zakaria program Global Public Square aired on CNN on Sunday August 11th Summers characterized the current sequence of retaliatory tariffs as “the riskiest moment since the financial crisis” His rhetorical question is whether the “foolish trade conflict” is advancing U.S. interests, presumably in the intermediate and long term.

 

In responding to a question on whether China is hurting more than the U.S. he noted that our adversary is prepared to endure short-term pain and that the leadership of China does not have to face their electorate in November 2020.

 

Summers opined that our actions have engendered a deep-seated antagonism towards the U.S. in China and the implications of an extensive trade war have raised concern and damaged our credibility with traditional allies.

 

The imposition of protective tariffs to preserve jobs is regarded as an economically fallacious tactic costing in the region of $1 million per position, although generating short-term political capital. Summers noted the high cost of bailing out foundering industries. He was alluding to a recent study that confirmed that steel tariffs had preserved 12,700 domestic jobs in that industry at a cost of $11.5 billion in tariffs ultimately borne by consumers.

 

It is axiomatic that once protective or punitive tariffs are imposed it is extremely difficult to rescind them. Industries become habituated to their “cheese” and use every lobbying tactic to preserve their benefits. In 1964 when Volkswagen planned to market a light truck in the U.S., a 25% tariff was imposed by President Lyndon B. Johnson on imports of this category of vehicles that is still in effect 55 years later.

 

It would be advantageous for the White House to listen to a broader range of economists and strategists and devise a program to resolve issues with China by negotiation. The only bargaining chip left to the White House appears to be to ramp up the tariff from 10 percent to 25 percent on the remaining $300 billion in annual imports from China. Apart from currency manipulation, China has many other arrows in their quiver.

 

Economists are predicting a third quarter GDP growth of 1.2 percent even if there is no further escalation in tariffs. In the event that we go “full Monty” the result will be a global reduction in trade precipitating a recession. The current White House strategy is reminiscent of the Tariff Act if 1930 (“Smoot-Hawley”) In retrospect this law turned a recession into a depression. The extended title of the legislation was “An act to provide revenue, to regulate commerce with foreign countries, to encourage industries of the United States, to protect American labor and for other purposes” Does this sound familiar?

 

If we did not have tariffs and with normal trade the U.S would be pouring chicken and pork into China, given the geographic spread and prevalence of African swine fever. As it is we are excluded from this market.

 

 Let us develop a program devised to achieve stepwise progress with negotiations based on an understanding of the needs of both the U.S and China and the restrictions that limit their acquiescence. We will never have a Grand Bargain negotiated over a steak dinner. We will never achieve our objectives by bluster and inflicting mutual economic pain.

 

The concession of delaying imposition of the September 1st tariffs announced by tweet, on Tuesday morning at 10H00 sent the DOW Index up by over 450 points   within minutes reversing the 400 point decline the previous day. We will now see if China reciprocates by importing corn, soybeans, pork and even chicken. The alternative to accommodation is continued escalation with disruption of trade, the need to support farmers, a rising national debt and an inevitable recession


 

No Off-Ramp for the Growing Trade Dispute with China

08/08/2019

The trade dispute which now might be characterized as a “war” has escalated to the point that the stability of the international economy is at risk.  We have endured a mutually destructive series of tariffs on trade between the U.S and China extending from May 2017 to the present.  Each successive imposition of a tariff on goods from China has been matched with a retaliatory response impacting U.S agricultural commodities representing the largest single category of exports to China.  In past weeks both EGG-NEWS and CHICK-NEWS have documented the impact on farmers and on commodity prices.  Under normal conditions, a reduction in acreage planted as result of late 2019 spring rains and flooding should have resulted in an escalation in the price of soybeans, corn and other ingredients. This has not been forthcoming in 2019 especially with respect to soybeans.

 

At the beginning of the confrontation, the administration was justified in calling out China for gross violations of WTO rules and a string of self-serving policies including deliberate disregard of intellectual property, coercive trade practices and subsidies to state-owned companies unfairly competing with the U.S. and the E.U.  We expected breakthroughs as a result of bilateral discussions between the President and the Premier of China.  The last meeting at the end of June at the G-20 gathering in Osaka, Japan could have resulted in agreements to tone down rhetoric and rescind some tariffs.  Subjects of concern to China both with respect to their economy and also image (“face”) could also have been resolved including the status of Huawei and other issues. 

 

The unilateral decision to impose a 10 percent duty on the remaining $3 billion of annual imports from China within weeks of the G-20 meeting was regarded by our trading partner as a “serious violation of the consensus reached by the two countries”.  It is now understood that Presidential advisors including the Secretary of the Treasury, Steven Mnuchin and U.S. Trade Representative Robert Lighthizer and others within the inner-White House circle were against the new tariff. Trusting his instincts and taking advice from avowed Sinophobe, Dr. Peter Narvarro, the President played the tariff card in an attempt to coerce China to make concessions.  This may well be a misreading of both the Premier of that Nation and the resolve of his Government.  It is fairly obvious that no concessions will be made in the immediate future especially not before the celebrations to mark the 70th celebration of the founding of the Communist Party of the Peoples Republic of China to be celebrated beginning October 1st.

 

Trade wars are not easy to win and they are not quick, despite assertions in 2017, especially when confronting the world’s second largest economy.  The leaders of China do not have to stand for re-election in the foreseeable future and their philosophy is to remain resolute in the face of demands for structural change as their current policies are integral to future growth.  To effective comply with American demands would reduce the growth rate in the Nation and conflict with the “Made in China 2025” initiative.

 

The 3.0 percent drop in the Standard and Poor’s Index on August 5th and a corresponding 3.5 percent decline in the NASDAQ albeit with recovery later in the week confirm concern by investors over current insecurity which encompasses the agricultural sector and now involves all aspects of the U.S. economy.

 

Despite disbursement of $12 billion to farmers in 2018 and a proposed allocation of $16 billion in 2019, delinquencies on agricultural loans have tripled since mid-2015 to a level last recorded in 2011. The U.S. Chamber of Commerce warned that the proposed tariffs scheduled to take effect on September 1st will inflict considerable pain on American businesses, farmers, workers and consumers and undermine an otherwise strong U.S. economy.

 

The trade dispute has now metastasized into a currency dispute with the U.S. declaring China to be a “currency manipulator”.  The events since the June G-20 meeting have only served to inflame opinion in China and have detracted from attaining a series of amicable agreements based on mutual concessions.

 

Leakage from the White House, whether valid or not, that the U.S. Trade Negotiator and the Secretary of the Treasury opposed the President, has seriously undercut their image and ability to successfully conduct future negotiations.  China recognizes that there is effectively only one determiner of policy and will accordingly disregard the negotiating endeavors by designated officials representing the Administration.

 

Economists have suggested that in a worst-case scenario if the U.S. were to apply a 25 percent tariff on all imports from China, disruption in World trade could induce a recession.  With the world’s two largest economies locked in combat, the situation has become more complex with the sideshows of Brexit and the tension between or Asian allies, Japan and South Korea. Restoration of trade relations through resolution of conflicts will be to the benefit of all nations including China and the U.S. 

 

There will never be a single Grand Bargain.  The best the U.S. and China can hope for is a series of graduated and progressive agreements each building confidence to advance to the next level.  It is hoped that a new attitude of realpolitik and statesmanship will be introduced into the impasse for the benefit of both nations and the international community.


 

Attorney Bill Marler Contrasts the “Blue Bell Licker” with Blue Bell Management Over Listeriosis

07/18/2019

EGG-NEWS strongly supports the opinion of Attorney Bill Marler, an experienced legal practitioner with a practice concentrating on litigating food safety claims. Marler entered the field in 1993 following a series of Jack-in-the-Box STEC cases involving as many as 750 children, many of whom developed hemolytic uremic syndrome.

At issue is the disparity in potential penalties facing a juvenile in Lufkin, TX. and the management of Blue Bell Creameries responsible for a listeriosis outbreak in 2015. The Lufkin case involves a juvenile licking the top of a container of Blue Bell ice cream taken from a supermarket freezer. Unfortunately for the perpetrator, the posted video went viral and resulted in a police inquiry. In the interest of public health, the store was forced to remove all containers of Blue Bell ice cream from the freezer at relatively high expense.

If the perpetrator were an adult, penalties for deliberate "adulteration" of a food could run to twenty years of incarceration. In the present case, the perpetrator and a number of copycat successors will probably face less severe penalties under the Texas juvenile justice system.

The principal contention advanced by Marler is that a prank might result in a multi-year prison term if the accused were to be found guilty of a felony. Marler contrasts the Lufkin case to the Listeria outbreak precipitated by contaminated Blue Bell ice cream in 2015. The investigation of the outbreak was documented in both EGG-NEWS and CHICK-NEWS. (Retrieve by entering Blue Bell in the Search block). A total of ten consumers were diagnosed with listeriosis in four states resulting in all being hospitalized and including three fatalities in Kansas. In April 2015, Blue Bell Creameries recalled all products on the market and effectively ceased operation in three locations in Texas, Oklahoma and Alabama. The financial impact on the family-owned company was extreme and subsequently ownership and management were replaced.

The CDC and FDA investigations disclosed grievous deviations from acceptable production standards in all three plants. These included

  • inadequate microbial testing to detect Listeria which could be reasonably expected to be a contaminant of dairy products

  • failure to train employees in appropriate food handling procedures

  • deficiencies in design of buildings and equipment contributing to condensation and environmental contamination

  • insufficient cleaning and sanitizing of equipment and work areas including food-contact surfaces

There was evidence that management was aware of the presence of Listeria in plants, but neglected to apply appropriate corrective measures. These deficiencies rise to the level of deprived indifference to public health. The outbreak of listeriosis with consequential fatalities was inevitable given the violations in all three of the Blue Bell Creamery plants. The extent of infection was either known or should have been known to quality control personnel, their supervisors and extending upwards to the top management of the enterprise.

Marler clearly points out the inconsistency of police action following a stupid prank staged for social media and the far more serious implication of a company knowingly or negligently distributing a product contaminated with a potentially lethal bacterial infection.

To date, no Blue Bell manager or officer has been charged with any crime although there are parallels to the DeCoster-precipitated outbreak of egg-borne Salmonella Enteritidis in 2010. The Blue Bell Creamery listeriosis case also has parallels with the 2009 Peanut Corporation of America Salmonella outbreak that resulted in prolonged prison terms for the owners and also for production and QC personnel since fraud and falsification of assay results were involved.

Bill Marler might be regarded as an irritant by food processors, but his professional endeavors have created a higher concern for food-borne infection His legal activities have raised the standard of prevention in plants and stimulated more forceful responses by regulatory agencies to protect consumers.


 

Egg Industry Center to Fund Research on Air Quality in Aviaries

07/10/2019

The Egg Industry Center will offer challenge grant awards to develop proposals to investigate air quality in a aviaries. The issue arises from 2016 data collected by scientists conducting a research project comparing conventional cages, enriched colonies and aviaries under the auspices of the Coalition of Sustainable Egg Supply. In the event, the study was seriously flawed by high mortality in the pullets transferred from rearing to the laying aviary. This was a function of mismanagement, incompetence and a disinclination to follow the advice of specialists. Early mortality as a result of dehydration, persecution obviously impacted the financial return from the aviary group.

EGG-NEWS commented adversely on the results obtained by the scientists concerned and advised that the calculated financial return should have been adjusted to account for mortality. The only conclusion that could have been derived from the study was that dead hens do not lay eggs.

The selection of air quality which the EIC Advisory Board considered “a challenge” is in all probability spurious. Effective ventilation in houses or compartments containing upwards of 100,000 hens, if adequate in terms of fan capacity and with effective control systems is not responsible for either particulate contamination or ammonia levels which are injurious to flocks or caretakers.

There are far more important aspects of aviary housing which should be evaluated. Based on experience, shell damage is an important consideration with some operations experiencing in excess of 15 percent downgrades. Investigation shows interactions between strain, equipment design, lighting, management of the flocks and operation of egg collection and rate of grading.

Each one percent increase in shell downgrades on a complex of one million hens represents a loss of $250,000 annually given an average of 80 percent hen-week production and a nominal nest-run value for cage-free eggs of $1 per dozen.

Shell damage in aviary housing is a complicated issue and may involve defects in the design and installation of curtained nesting areas; transport of eggs on belts over distances exceeding 400 feet; damage on elevators which may move eggs among four levels and the design and operation of graders extending from accumulator tables through to crack detection.

Soiling of eggs may be a substantial cause of downgrading. This is in part due to floor laying. Surely research should be extended to causes and prevention of the source of loss through downgrades. The intensity and spectrum of light, positon of lamps in aisles, strip lighting on tiers  and under-module illumination should be evaluated to provide appropriate recommendations to producers as they transition from conventional cage housing in high-rise units to modern aviaries.

There is little work on the welfare and production aspects of multi-tier aviary installations. It appears that the industry is moving from three-tier to two-tier configurations, that with limited experience reduce the tendency of flocks to concentrate on the highest level where there is imperfect visualization of flocks and imbalanced stocking density within the house.

 If the Egg Industry Center assigns a considerable sum of money to a consortium to evaluate air quality, which may in fact not be a problem, other more pressing and financially significant problems associated with aviary housing will be neglected. In any event, the time required to plan and execute a field trial on the atmosphere of aviary houses and the prolonged period for scientific groups to analyze and publish their results will be of little immediate benefit to the industry. The proposed study will not contribute to the mission of the EIC, which is to acquire and disseminate science-based information for the benefit of producers.


 

Bill to Restrict Authority of the President on Tariffs Introduced

07/08/2019

Rep. Stephanie Murphy (D-FL), a member of the House Ways and Means Committee, Trade Subcommittee has introduced the Reclaiming Congressional Trade Authority Act.  This would limit the authority of any administration to impose tariffs on national security grounds to a duration of 120 days unless confirmed by Congress. The proposed legislation would encompass Section 232 of the Trade Expansion Act of 1962, the International Emergency Economic Powers Act or the Trading with the Enemy Act . The Trade Authority Act introduced into the House parallels similar legislation in the Senate introduced by Sen. Tim Kaine (D-VA).

 

The Bill would require any administration to provide Congress with the objective of any proposed tariffs imposed under Section 301 of the U.S. Trade Act of 1974.  Congress would be able to block tariffs through a joint resolution of disapproval.

 

Legislation restricting the powers of the President to unilaterally impose tariffs is supported by the National Retail Federation.  The Senior Vice-president for Government Relations, David French commented, “We agree with the need to deliver fair and balanced trade deals but taxing Americans isn’t the answer – especially without a single vote from Congress.”  He added, “This legislation represents an important step forward.  We urge members of both parties to join this effort and protect hard-working Americans from a growing trade war that could destroy thousands of jobs and raise costs for families across the country.”

 

The National Retail Federation is a leading opponent of tariffs emphasizing that they are effectively taxes imposed on consumers.  Tariffs also increase the cost of parts and materials used to manufacture items in the U.S., reducing company margins and eventually leading to layoffs.

 

Prior to the June meeting between President Trump and President Xi at the G-20 Summit in Osaka, the National Retail Federation determined that the proposed tariff on an additional $300 billion on goods imported from China would add $4.4 billion annually for apparel, $3.7 billion for toys, $2.5 billion for footwear and $1.6 billion for household appliances.  Currently tariffs of 25 percent have been imposed on $250 billion in items imported from China.  These tariffs will remain, the proposed tariffs on the additional $300 billion in imports has been deferred while trade talks continue.

 

China has indicated that some concessions on structural issues will be offered in negotiations but progress will only be made if existing tariffs are relaxes or rescinded. It appears that the trade dispute has assumed the proportions of a stalemate to the mutual detriment of both nations.


 

Disruption in Services Anticipated From ERS Relocation

07/03/2019

On June 25th, Liz Crampton writing in Politico reviewed the impact of the proposed relocation of the USDA Economic Research Service from D.C. to a new facility in Kansas City. It is intended that the new center in Kansas will be operational on September 1st

The American Federation of Government Employees representing workers at the Economic Research Service (ERS) and the National Institute of Food and Agriculture (NIFA) estimate that two out of three employees are determined not to move. The USDA has decided that 76 ERS personnel will remain and 200 positions will be moved to Kansas City. For NIFA, 294 positions out of 315 will be relocated to Kansas City.

Of significance is the fact that none of the personnel in the Information Technology Infrastructure have any intention of moving and will remain in the Washington, D.C. area in new positions for which they are suited, possibly outside government.

Approximately 90 percent of employees surveyed in the Resource and Rural Economics Division and the Food Economics Division have indicated that they do not wish to move. It is assumed that a similar proportion of employees inside NIFA will decline to relocate.

Observers and commentators outside Government including economic professionals at Land Grant Universities have highlighted the potential loss of expertise and the impact on policy, market and industry research.

Although USDA has commenced advertising for positions to replace employees who are retiring and resigning, the market for qualified and experienced people is tight and the USDA will be hard pressed to fill positions.

When the relocation was originally announced, USDA Secretary Dr. Sonny Perdue explained that the motivation was to bring ERS and NIFA closer to the farming communities and agencies they serve. A supporting benefit promoted by the USDA was a potential reduction in cost by moving employees from D.C., a high-income area to Kansas.

The union representing ERS personnel has demanded that USDA commence collective bargaining negotiations over the relocation. In a statement, Peter Winch, Special Assistant to the National Vice President of the American Federation of Government Employees stated “The Union proposed to have all bargaining relating to this subject conducted within the context of agreed-upon ground rules and to have all implementation of the relocation be held in abeyance until the ERS has fulfilled its collective bargaining obligations”.  In a June 18th communication to USDA, Winch stressed “this would include a freeze on all individual relocation decisions until after the bargaining is completed”. The Union has requested a civil rights impact analysis for the relocation with specific reference to many employees without college degrees but with considerable lengths of service.

Dr. Perdue claimed that relocation to Kansas City would save $300 million over a 15-year period. In contrast, the Agricultural and Applied Economics Association estimates that relocation would cost between $37 to $128 million because the USDA did not take into account the lost value of institutional knowledge from the employees who will leave the agencies. It is evident that new hires, if available and even with equivalent education and experience, will still take a number of years to achieve the level of productivity of those they will replace.

The justification for moving two vital and productive components of USDA from a central D.C. location to Kansas appears flimsy. Doctoral-level economists are not extension personnel who are required to kick sods and slop hogs or have direct contact with farmers. The savings projected by USDA to justify the move appear at best speculative. A number of commentators both within and outside the ERS have opined that the intended move, resulting in large-scale resignations, will eliminate personnel who have expressed views at variance with current USDA and Administration policy. Climate change, SNAP and related policy issues have been raised as less than overt justifications for the radical change in location.

If the proposal to move ERS and NIFA from Washington was based on considerations of cost and service, Secretary Perdue should heed the advice of those in academia and industry and reverse the decision before further damage occurs. If in fact the decision was based on other than the intention to reduce cost and enhance service, USDA should be required to justify their decision before Congress if necessary. If there was a covert motivation for the recently abandoned reorganization and now the relocation, the USDA is committing a disservice to both the personnel of the agencies concerned and their constituencies. It is hoped that the decision to relocate personnel will be dispassionately reviewed and if unjustified, the project will be rescinded.


 

The Need for New Antibiotics

07/03/2019

It is ironic that while the medical and veterinary professions are reducing their use of antibiotics, there is an urgent demand for new and more effective products.  These are especially required to treat drug resistant pathogens.  In 2017 the World Health Organization identified the need for antibiotics to counteract both critical and high-priority categories.  The critical category comprised effective drugs against carbapenem and cephalosporin-resistant pathogens including the genera Acinetobacter, Pseudomonas and Enterobacter.  Among the high priority category vancomycin and fluoroquiolone-resistant strains of the genera Camplyobacter, Salmonella and Enterococcus will require effective alternative drugs.  The WHO declared that the World is running out of functional antibiotics.  Accordingly, the Global Antibiotic Research and Development Partnership was established under the auspices of a “drugs for neglected diseases” program.  The Welcome Trust funded this collaboration comprising six EU nations and South Africa with a $70 million grant to establish new products.

 

The problem of antibiotic resistance is more pronounced in developing nations in part due to inappropriate and uncontrolled use in addition to the availability of local products with suboptimal concentration predisposing to emerging resistance.  Dr. Mya Nadimpalli conducting research at the Pasteur Institute determined that six percent of children presented to hospitals in Paris carried drug-resistant bacteria carrying genes coding for beta-lactamase.  In Cambodia where she conducted field studies, the prevalence rate of antibiotic resistance exceeded thirty percent Dr. Nadimpalli is now affiliated with the Tufts Center for Adaption Genetics and Drug Research, actively studying mechanisms of antibiotic resistance.

 

The Pew Charitable Trust issued a report in September 2018 emphasizing the dearth of candidate drugs in the antibiotic pipeline.  Of 42 prospects under development, major pharmaceutical companies were involved in only two of these compounds. Small start-up biotechnology companies are responsible for the majority of current antibiotic development, relying on venture capital and public sector funding. Achaogen a typical example, recently filed for bankruptcy.

 

The reasons for lack of development for new antibiotics relates to suboptimal financial return.  The cost of meeting regulatory requirements through a series of studies to demonstrate safety and efficacy are disproportionately high in relation to potential return.  New antibiotics have limited sales and a short market life compared to blockbuster drugs to treat cancer, cardiovascular disease and metabolic conditions.  It is estimated that only one in five candidate antibiotics is commercially successful even after considerable investment in development and testing.

 

Faced with the inevitability of emerging drug resistance and the need for new classes of antibiotics, alternative approaches to research and evaluation are required.  Lord O’Neill who chaired a UK parliamentary study on drug resistance suggested that development of new antibiotics should be undertaken by the public sector.  Antibiotics developed solely from government funding would be regarded as joint intellectual property and could be manufactured by generic drug companies. The price of these products would therefore not carry the costs of development now imposed on antibiotics of “last resort”.

 

Public-private consortia could be responsible for developing new products especially with a more realistic approach to evaluation.  The Global Antibiotic Research and Development Partnership participates in evaluating and promoting new antibiotics for pediatric infections.  Carb-X serves as a public-private partnership providing funding for basic antibiotic research especially directed to small companies that have developed basic concepts that require time and money to develop.

 

The livestock industry has been the beneficiary of human research with respect to antibiotics and antiparasitics since many pathogens are common to humans, livestock and companion animal species. Accordingly innovative models leading to the development of new drugs will ultimately benefit animals. Health professionals involved in livestock production should therefore encourage the development of new drugs as variations on novel classes for humans may have application in commercial production. Veterinarians in industrialized nations have reduced their use of antibiotics in responding to restrictions imposed by regulatory agencies in addition to ethical concerns. Practitioners in production medicine are relying more on vaccination, prebiotic, probiotic and botanical feed additives and are modifying ventilation, biosecurity, housing and management systems to reduce stress and promote an immune response. Notwithstanding these modalities, new antibacterial drugs are required against existing and emerging pathogens now and in the future.

 


 

Are We Closer to a Single Food Agency?

06/25/2019

Representative Rosa DeLauro (D-CT) and Senator Dick Durbin (D-IL) have jointly introduced the Safe Food Act of 2019.  In addressing a meeting of the Congressional Food Safety Caucus DeLauro outlined the intent of the Bill which was framed to correct the fragmentation which currently exists in the food safety system.

 

The Government Accountability Office has identified 15 Federal agencies administering over 30 laws relating to food safety.  Admittedly the FDA and the USDA-FSIS are responsible for most of the heavy lifting but inconsistencies and in some cases turf battles impede efficiency.  Areas of concern include regulation of food produced outside the boundaries of the U.S. and preventing foodborne disease outbreaks which are increasing in incidence.

 

The Safe Food Act of 2019 would consolidate food safety including inspection, enforcement and labeling under the jurisdiction of a single entity.  The Bill if enacted would intensify inspection of foreign food production and inspection at points of entry.  Traceability would be enhanced.  The diverse resources currently extended to research would be focused on detection and suppression of pathogens.

 

Representative DeLauro cites the 2010 recall of eggs distributed by Jack DeCoster, and the problems associated with romaine lettuce, ground turkey meat, wheat flour, beef and raw milk.  Addressing the Food Safety Caucus DeLauro stated, “For consumers and businesses alike food safety is a problem we must be focused on.   A problem that demands our attention is the hopelessly fragmented and outdated food safety system.”

 

CHICK-NEWS recognizes the immense logistic and structural challenges facing a profound reorganization of the food inspection and safety system. The industry has developed a modus vivendi with FSIS and other sectors function in accordance with FDA requirements.  Introducing a single food safety agency would require new perspectives and adjustments and would entail short-term confusion and problems.

 

When previously advocates of food safety have suggested a single agency, FSIS and FDA sensing erosion of their respective jurisdictions have circled the wagons and signed memorandums of agreement frequently using the Food Safety Modernization Act as their umbrella.

 

The success of unified food safety agencies have been demonstrated in the UK and EU.  When confronted with a national crisis, various departmental activities related to national security were combined into the Department of Homeland Security within a year.  It is time to dispassionately evaluate the potential advantages of a single food safety agency and to reason through valid objections and to develop programs that facilitate a transition.


 

ARM Video on Fair Oaks Farms Dairy Creates Concern

06/18/2019

On June 4th, Animal Recovery Mission (ARM) released videos apparently depicting gross mishandling of calves, maltreatment of mature cows and other undesirable issues. The resulting publicity drew responses from other animal rights and welfare advocates in addition to the Coca-Cola Company, a partner in the FairLife™ brand of dairy products produced by Fair Oaks Farms. Both Fair Oaks Farm in Indiana and FairLife™ were co-founded and managed by Dr. Mike McCloskey and his spouse.

Following release of the videos, Dr. McCloskey issued a comprehensive and far-reaching         mea culpa. McCloskey stated “I am disgusted by and take full responsibility for the actions seen in the footage as it goes against everything that we stand for in regard to responsible cow care and comfort. The employees featured in the video exercised a complete and total disregard for the documented training that all employees go through to ensure the comfort, safety and wellbeing of our animals”.

This encapsulation of the statement is somewhat at variance with the opinion of Dr. Jan Shearer, an Extension Veterinarian at Iowa State University. Shearer was requested to comment on the videos by The Center for Food Integrity as a member of the Animal care Review Panel provided a lukewarm opinion acknowledging “handling issues” and noting that “management could have been done differently”. With respect to the video filmed in the milking parlor he saw “no willful animal abuse”. This over-generous appreciation cannot be extended to the handling of calves if the video represents an accurate depiction of events as recorded by the ARM agent and is not contrived or staged. For the purposes of this editorial, it is accepted that the videos were representative with respect to calves as noted by the comments by Dr. McCloskey and the subsequent legal action taken by the Newton County Sherriff’s office that has charged three workers identified by authorities. One perpetrator in custody is an illegal immigrant raising additional questions for a company claiming to be E-verify compliant.

I along with other veterinarians involved in the intensive animal industry express disgust and condemn the circumstances relating to care and management of the Fair Oaks herd. At least Dr. McCloskey has taken responsibility for the deficiencies in handling as recorded. Apparently when he learned that a video with negative implications for his company was about to be released, he requested a third party review, which was apparently favorable. Despite the report, Dr. McCloskey notes “It is a shock and an eye-opener for us to discover that under our watch, we had employees who showed disregard for our animals, our processes and for the rule of law”.

This case in which an admittedly welfare-conscious CEO was unaware of activities on farms under his control is unfortunately a familiar occurrence. Training programs can only go so far. The process of management incorporates the necessary stages of review to establish and document practices that promote welfare and prohibit willful abuse. These are only the initial steps in the process of maintaining a culture of responsibility. The second component of training is essential but at the end of the day, someone in authority must verify that procedures are followed. In this instance, there was clearly a deficiency with respect to direct supervision and monitoring of the activities of workers.

There is concern that events such as those presumed to have occurred at Fair Oaks Farms, that retribution is directed against the actual perpetrators representing the lowest level of operation. This has been seen in cases where hogs and cattle have been mishandled in lairage, gross misconduct in harvesting broilers, those operating killing rooms of broiler plants and in depletion of laying hens. 

Any disclosure that becomes the subject of media attention and is disseminated on the web is a problem for all participants in intensive livestock production. Understandably the public generally has a higher regard for animals, especially young livestock, in comparison to chickens, since there is a greater degree of identification with their pets. As an omnivore, I could be induced to remove veal from my diet as a result of viewing the videos, despite the fact that I am a poultry veterinarian with 50 years experience. How would a young mother respond to depictions of deliberate, callous and willful abuse of sentient animals?

The repercussions from the ARM videos as distributed will extend far beyond the acknowledgment and apology extended by Dr. McCloskey. The Coca-Cola Company has initiated an investigation since multinational companies are extremely concerned over brand image. FairLife® is the recipient of two class-action lawsuits from animal rights organizations alleging deceitful marketing practices. Unless the plaintiffs are regarded by the Courts as lacking in standing or if it is ruled that legal action is frivolous, Fair Oaks Farms will be subject to intensive discovery, which may prove embarrassing. At the very least Fair Life™ has lost brand image and Fair Oaks may even be obliged to change structure or ownership. 

The take-home lessons from the incident extend beyond documentation relating to animal handling and transcend training. The complete cycle of welfare management should emphasize inspection and control. Dr. Temple Grandin has correctly advocated for the installation of video cameras and recording systems in lairages, the killing rooms of hog and beef plants and in the hanging area of broiler processing facilities. A number of prominent turkey and broiler companies routinely video harvesting and transport. This is both a deterrent against deviation from accepted company policy and training but also to confirm good handling practices in the event of intrusion videos.

Since a company invests in developing procedures and in training, management of welfare compliance requires direct supervision. It is hoped that there are not many other Fair Oaks Farms in the intensive livestock industry. Unfortunately, disregard for welfare by upper levels of management will allow unacceptable practices by lower-echelon employees irrespective of comprehensive procedures manuals and training. In a commentary on the episode Hannah-Thomas Weeman of the Animal Agricultural Alliance contended that “it could happen to any of us”. Not so Ms. Weeman. Only in a Company with deficiencies in the cycle of management and a lack of responsible supervision and with inappropriate involvement by those responsible for the wellbeing of the enterprise.  

In the age of the web, brand value can evaporate as a result of a welfare incident. Prevention through sound management practices and commitment from executive levels downwards will contribute to acceptable practices and prevent nauseating video depictions.


 




















































































































































































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