Editorial


Free-Range Does Not Mean Wholesome

11/11/2019

EGG-NEWS is indebted to the Food Safety newsletter distributed by attorney William Marler for a reference to an outbreak of Salmonella Typhimurium attributed to consumption of free-range eggs that were washed on the farm.  The outbreak was limited to the Australian Capital Territory and involved three confirmed cases in May 2018.  Molecular biological evaluation of the common isolate revealed a rare MLVA (Multiple Locus Variable-number Tandem Repeat Analysis) confirming the single source.

 

According to the article, fecally soiled eggs were soaked in a chlorine solution of variable concentration and were washed and sanitized in an obsolete bucket-type washer.  Inspection confirmed that the grader, the environment of the packing shed and personal hygiene were all deficient.

Hens that are colonized with intestinal Salmonella will deposit bacteria on the shell during oviposition.  Improper washing subsequently facilitates penetration of the pores of the shell and the absence of refrigeration will contribute to proliferation of the pathogen within the egg.  Cooking at a temperature exceeding 165F through to the center of the yolk for at least 30 seconds is necessary to inactivate Salmonella.

 

Approximately 50 percent of eggs marketed in Australia are derived from small to medium-sized flocks allowed access to pasture.  A number of packers collect eggs from contractors and independent farmers and subject these eggs to appropriate shell decontamination using equipment similar to those in use in the U.S.  From personal observation, eggs are not refrigerated from the time of packing through purchase even in large chain supermarkets.

 

A number of cases of Salmonella Enteritidis infection in consumers have been reported from  various states in Australia.  Elimination of SE in pasture-maintained flocks is impossible and modalities including vaccination and post-pack refrigeration can only suppress vertical transmission.  Accordingly, a number of producers in Australia are considering in-shell pasteurization using microwave treatment that has been successfully employed in the Republic of South Africa.  Thermal immersion has a higher capital cost and is associated with significant shell damage in addition to deterioration in internal quality.  This is reflected in the fact that less than one percent of shell eggs in the U.S. are subject to thermal-immersion pasteurization.

 

*Sloan-Gardner, T. S. et al  Free range eggs does not mean safety eggs: an outbreak of Salmonella Typhimurium linked to free range eggs. Commun.Dis.Intl. 43: doi.org/10.33321/cdi.2019.43.52


 

USDA IG to Inquire into Suppression of Research Results

11/01/2019

Following representations by a dozen Democratic Party Senators, the Ranking Member of the Agricultural Committee Sen. Debbie Stabenow (D-MI), requested an investigation into deliberate suppression of research results relating to the effect of climate change. The Inspector General (IG) of the USDA was asked to specifically examine “potential instances of suppression and alteration of scientific reports, documents or communications generated by USDA”. The investigation to be carried out by the IG will determine whether any changes in policy influence publication of scientific articles or communications resulting from USDA research.

According to a recent report in Politico, an author of an accepted peer-reviewed manuscript on the effect of atmospheric carbon dioxide levels on nutrient content of rice was allegedly subjected to coercion to withdraw the paper. The crop scientist concerned apparently resigned from the Department.

Phyllis Fong, the USDA IG commented on concerns over the relocation of the Economic Research Service and the National Institute of Food and Agriculture from Washington, D.C. to Kansas City. The move resulting in mass resignation of senior economists and scientists was justified by extremely flimsy justifications. An October 21st letter to Fong from Representative Chellie Pingree (D-ME) requested that the broad probe could examine whether the relocation was “used as a means to suppress research on controversial topics such as climate change”.

It is understood that USDA currently has 60 percent of ERS positions vacant. This represents not only a loss of personnel, but also collective wisdom, experience and cohesion in areas critical to evaluation and planning of future food supplies. Farmers and the public are entitled to the results of scientific research to enable adaptation to whatever environmental changes may or may not be occurring irrespective of how unpalatable this may be from a political perspective.


 

American Policy towards China on Trade and Structural Issues

10/31/2019

Speaking at the Woodrow Wilson International Center this past week, Vice President Mike Pence averred “the U.S. seeks engagement with China in a manner consistent with fairness, mutual respect and the international rules of commerce.”  Pence noted, “The United States does not seek confrontation with China.”

 

The Vice-President however noted that ongoing negotiations with Beijing would address the disparity in trade, disregard for intellectual property rights and coercive relationship with foreign companies intending to invest in China.

 

The remarks from the Vice President obviously raise the underlying structural issues that form the basis of complaints by the U.S. and which generated the trade of war exceeding18-months in duration. The October 10-11th negotiations and the proposed subsequent discussions leading to a Phase-1 agreement on trade apparent skirt the basic structural issues.

 

CHICK-NEWS has consistently observed that there cannot be a comprehensive and all- encompassing agreement on trade and structural issues in 2019 and possibly not before the 2020 election.  In the interim, it would be in the interest of both nations to resolve the trade issue involving mutually destructive tariffs and to address the more fundamental disputes on an individual basis over an acceptable time period.


 

Questions Relating to the October 11th Pre-Phase 1 Agreement

10/23/2019

Exactly what was decided with regard to agricultural commodities during the October 10th – 11th negotiations between China and the U.S. has yet to be confirmed.  The White House quoted a figure of $50 billion in intended purchases of farm products by China although there are no details on the specific quantities of commodities and the time period over which purchases will be made. Current U.S. understanding, already expressed by China is that any purchases, irrespective of the $50 billion figure as quoted by the President, is contingent on the U.S. rescinding the proposed 15 percent tariff on approximately $150 million worth of consumer goods intended to start on December 15.  Increased tariffs threatened for October 15th were not imposed as part of the negotiation.

 

According to a Dow Jones report on October 16th, China purchased agricultural products to the value of $29 billion in 2013 falling to $25 billion in 2017 before the initiation of the trade war. During the past 12 months, the Commerce Department reported export sales of $9.2 billion.  To date, China has purchased 20 million tons of soybeans and has indicated they may purchase an additional 10 million tons before the end of the year. 

 

There is obvious concern regarding premature releases by the White House on the claimed result of negotiations. The President previously announced that China would purchase considerable quantities of agricultural commodities following his meeting with Premier Xi in Osaka, in late June.  China did not confirm the commitment and in fact later commented that no promise had been made.  This may have been the motivation for the decision to impose additional tariffs that apparently had the effect of bringing China to the negotiating table in October.

 

The Dow Jones article makes mention of stringent and unrealistic technical requirements applied to U.S. agricultural products.  Since 2015, China has not imported any poultry products extending from breeding stock to processed broiler paws based on their expressed concerns over avian influenza. The U.S. has been free of both low- and high-pathogenicity strains of H5 and H7 for almost a year and these strains are endemic in China. This suggests that as usual officials in China are using imports as a bargaining chip and to protect domestic producers. Recent issues preventing unrestrained trade include spurious allegations of insect infestation, pesticides, drug residues or pathogens in agricultural products. Deliberate delays in licensing and approval of new GM cultivars are examples of overt protectionism.

 

Wendy Cutler, vice president at the Asia Society Policy Institute and a former negotiator with the Office of the U.S. Trade Representative, commented, “There is so much that can happen in the next few weeks to undermine the $50 billion number touted by Mr. Trump.”  The only way that the $50 billion can be achieved over a minimum of two years would be for state-owned trading enterprises including Cofco to serve as the buying agent.  The fact that state-managed importers are exempted from tariffs confirms government control and management of trade.

 

It is expected that China will eventually cooperate on importation of agricultural commodities given their needs especially for pork. The Government of China will probably make concessions with regard to agricultural products and technology. They are however expected to dig in on structural issues such as theft of intellectual property, coercive trade practices and misuse of WTO dispute resolution procedures.

 

It is noted that the U.S. will distribute up to $28 billion to farmers over the 2018-2019 period  in part to compensate for “short-term” losses sustained as a result of depressed prices caused by the trade dispute. This is both a financial and political necessity for farmers but will be to the account of current taxpayers and succeeding generations bearing the interest burden of an expanding national debt.

 

The trade war will not end quickly, nor will there be a grand bargain. Confrontation will be defused through a series of mutually beneficial trade agreements that will fail to address underlying structural issues.  If for no other reason, political expediency in both nations will predicate a partial resolution of the trade dispute with respect to agricultural products. Commodities and protein are more amenable to negotiation than the underlying conflicts that are refractory to diplomacy and reason. The structural issues ignored or tolerated by previous Administrations are integral to the desire by China to dominate Asia and to exercise its influence on the world stage. This is exemplified by the Made in China 2025 program, the Belt and Road initiative and military expansion.


 

NAMI to Challenge California Proposition #12

10/16/2019

Here we are again.  The North American Meat Institute (NAMI) has filed a lawsuit in the District Court for the Central District of California challenging the constitutionality of California Proposition #12.  The Institute has requested an injunction to halt implementation of the legislation enacted by ballot. NAMI claims that the space requirement for veal calves and gestating sows violates certain clauses of the U.S. Constitution.  This approach was litigated ad nauseum for Proposition #2 with respect to eggs and was upheld by by federal courts.

 

Proposition #12 adopted by California voters relates to sale of livestock products in the state.  Accordingly producers in other states intending to ship to California must adhere to the same standards as producers in California.

 

In a press release, the president and CEO of NAMI, Julie Potts stated, “If this unconstitutional law is allowed to stand, California will dictate farming practices across the nation.”  She added, “California overreach creates an unworkable patchwork of differing state regulations that will make it impossible for the supply chain, for small farmers or local grocer to function.” It should be accepted by Ms. Potts that California does effectively dictate farming practices with respect to products but only with respect to items sold in California.

 

There is little or no public support for veal crates or for confining sows during gestation.  Most of the hog integrators have transitioned to group housing for sows to comply with customers’ requirements. The owners of small family farms are reluctant to invest in new equipment to upgrade facilities or to change traditional farming practice despite their obsolescence. The train has left the station. Supermarkets, QSRs and restaurants have committed not to accept pork derived from systems confining sows during gestation. This market reality has effectively invalidated any opposition to Proposition #12 by NAMI.

 

The Organization should recognize that the egg industry has adapted to the housing requirements mandated by Proposition #2 and is working towards compliance wit Proposition #12 by erecting cage-free units in California. Producers in supplying states have also made capital investments to comply with California requirements.


 

Wisconsin Newspaper Questions Check-Off Program for Dairy

10/09/2019

Cary Spivak published an incisive article in the Milwaukee General Centennial on September

30th, questioning the management and effectiveness of check-off programs.  At issue is the $420 million paid annually by dairy farmers.  Approximately $155 million was funneled to Dairy Management Inc. located in Rosemont, IL.  As with all check-off programs, funds should be expended on direct marketing of the commodity, consumer research and scientific evaluation with the objective of developing new products.  All expenditures are subject to audit and control by USDA-AMS.  At issue are the high salaries paid to Dairy Management officials including the CEO Thomas Gallagher who has received an average of $976,000 annually since 2010.  The top ten executives for Diary Management were paid an average of $800,000 each in 2017 with two collecting $1.2 million as determined from IRS documents.  This expenditure can be viewed against the closure of 503 dairy farms in Wisconsin and 1,600 nationwide during 2017.  Thomas Vilsak previously Secretary of Agriculture under the Obama Administration was paid $800,000 for his services to the dairy industry in 2018.

 

Disclosures have followed investigations by the Organization for Competitive Markets.  This group has requested financial and audit records relating to the beef check-off program also under scrutiny. 

 

Questions concerning mismanagement of funds are now being raised by legislators. These include Senators Mike Lee (R-UT), Rand Paul (R-KY), Elizabeth Warren (D-MA) and Cory Booker (D-NJ). Various organizations representing the interests of farmers are advocating a bill to require public disclosure of financial records for each of the mandatory check-off programs.

 

The lack of transparency associated with the dairy and beef check-off programs should be contrasted with the American Egg Board (AEB).  The 2018 Annual report detailed revenue of $25 million, small in comparison with dairy, pork and beef. Expenditure on overhead and management represented six percent of expenditures and funds for the Egg Nutrition Center (14 percent), consumer promotion (53 percent) food service promotion (8 percent) are legitimate activities under the leadership of Anne Alonzo who joined the AEB after questionable non-financial decisions by previous management emerged.

 

Senator Ron Johnson (R-WI) stated, “Pushing for greater transparency in check-off programs is an important step Congress should take to ensure that Wisconsin farmers’ hard-earned money is being used wisely.”  Senator Tammy Baldwin (D-WI) opposed the transparency provision in the recent Farm Bill based on the fact that she believed that there was insufficient support from dairy farms and groups for enhanced oversight.


 

Adverse Effects of Climate Change

10/02/2019

The Intergovernmental Panel on Climate Change released a report during the United Nations General Assembly documenting climatic and environmental changes as a result of carbon dioxide emission.  The report was prepared by an international panel of prominent geoscientists and environmental specialists and concentrated on the deleterious effects on oceans covering 70 percent to the World’s surface including 10 percent covered by ice and snow.  We rely on oceans to absorb 90 of excess heat resulting from increased carbon dioxide pollution of the atmosphere and to retain a proportion of the carbon dioxide emitted from fossil fuels.  Oceans are now rising at one-seventh of an inch annually, approximately twice the rate measured between 1900 and 1990.  Since 1970 scientists have recorded a 1 to 3 percent decline in oxygen in oceans and this trend will continue at an accelerating rate. 

 

Due to atmospheric warming, Greenland and Antarctica are losing 720 billion tons of ice annually.  The snow cover of the Arctic this June has shrunk by more than half since 1967.  Arctic sea ice in September has diminished by 13 percent per decade since 1980.  Unless carbon dioxide emission is reduced, there is a 10 to 35 percent probability that the Arctic will be free of sea ice during the month of September.  The rise in ocean levels due to melting of ice sheets in the Antarctic and Greenland will result in a 2 to 4 foot increase in sea levels by the turn of the Century.  This will inundate many coastal areas characterized by high population density and infrastructure. 

 

The report predicted severe changes to the cryosphere (ice and snow covered areas) with weakening ocean currents, wetter and stronger hurricanes and more extreme El Nino events.  This will reduce fish populations and have a severe effect on agriculture, marine and terrestrial bird life and mammals.

 

Politicians can deny climate change and administrations can impose restrictions to prevent dissemination of incontrovertible data.  The reality is that progressively, carbon dioxide levels are increasing in oceans and in the atmosphere and global warming is increasing at a measurable rate. Resulting  impacts on agriculture and livestock health are becoming more evident. 

 

Deniers of climate change are entitled to their opinions but not their facts.  The voice of Greta Thunberg the 16-year old Swedish environmental activist is resonating among her generation and is amplified by environmentally conscious citizens. Her concern, based on scientific reality emphasizes the need for action. The present generation of administrators, business leaders and politicians is leaving a bleak inheritance for our children and grandchildren.   


 

Influence of Welfare Claims on Consumer Preference Questioned

09/19/2019

The University of Missouri recently concluded a survey to determine whether welfare considerations influenced consumer attitudes towards restaurants. The study surveyed 433 participants subjected to marketing messages from fictional restaurants. Messages included text only or text with visual supplements including certification seals. Four social attributes were evaluated comprising health, environmental concerns, animal welfare and human services.

As expected, messages incorporating visual elements resulted in greater response than plain text. The surprising conclusion was a sense of apathy regarding animal welfare expressed by the responders. Dr. Day-Young Kim of the University of Missouri College of Agriculture, Food and Natural Resources stated “When we see this marketing fall flat for restaurants addressing animal welfare it tells us that this style of message isn’t the problem. People are simply ignoring restaurants when they discuss that particular cause”.

Dr. Kim questions whether consumers actually are concerned over welfare and suggest that the advertising message should include context in order to make an impression. He notes that mention of animal welfare in relation to a pet food advertisement will generate a positive response. This reflects the traditional emphasis of pets’ wellbeing in relation to their food. In contrast an equivalent favorable response is not elicited among consumers subjected to advertisements for restaurants that incorporate an animal welfare message.

Although not comprehensive and involving a small number of respondents, the study support the contention that quick service restaurants were coerced into pressing for a transition to alternatives to cage housing for hens by animal welfare groups. Quick service restaurants in their urgency to outdo each other in complying with welfare requirements were responding more to the power of the HUS and kindred organizations rather than to a genuine consumer preference. It is evident that QSRs and members of the FMI are in fact having second thoughts over the transition to cage-free housing. It is extremely doubtful whether the lofty goal of a complete transition from cages by 2025 will become a reality. In common with many industry observers, EGG-NEWS believes that at least 30 percent of hens producing shell eggs in five years will be housed in enriched colony cages that were originally installed with the option of subsequent conversion from an enrichable configuration.

When the principle of complete conversion to alternative systems to cages was enthusiastically and precipitously adopted by members of the FMI, NRA and NCCR, these groups were unaware of the cost consequences of the far-off decision. Producers were faced with spending upwards of $30 per hen housed for conversion of existing houses or considerably more for a new house or a green-field complex. The concern in 2015 was whether cage-free eggs would drift down in price becoming the “new generic”. This does not appear to have occurred, as supply has matched demand, supermarkets have supported multi-tier pricing for the existing major categories of cage-derived, cage-free, pasture-housed, enriched and organic eggs. Nationally branded eggs continue to be offered in either cage-free (aviary or slat-and-litter alternatives) or conventional cage options. This gives consumers a choice in other than the West Coast and some New England states where ballot initiatives have constrained housing options. In the absence of a Federal standard and state mandates, retailers can source and price accordingly but are and should be subject to acceptable welfare standards. What the egg-production industry and their customers currently need are clear definitions of categories of housing to avoid deceptive advertising and misrepresentation.


 

Trade Disputes Exacerbate Plight of the Ethanol Industry

09/13/2019

It is an undeniable fact that the ethanol industry is undergoing a period of losses with margins declining below break-even during 2019. Green Plains Inc. and Poet LLC have closed plants in major ethanol-producing states in the Midwest. The Archer Daniels Midland Company that expressed intentions of becoming an energy producer is now disillusioned as indicated in the most recent quarterly report.

The fault lines which have emerged as a result of the trade dispute with China have clearly demonstrated the reliance of the ethanol industry on government mandates and support. The intent of generating energy independence when the program was initiated in 2005 is no longer valid and for many years, the ethanol industry has survived only by indirect taxation of consumers. In some nations, conversion of sugar cane to ethanol can be a viable enterprise. A similar case cannot be made for corn-based ethanol in the U.S.

The plight of the ethanol industry is reflected in the viability of corn production. Approximately one third of corn is diverted into fermentation to produce ethanol. The reality is that with improved logistics and enhanced fuel consumption efficiency, the demand for ethanol at a 10 percent blend level and demand has declined below the projections on which the RFS was based. Domestic consumption has in fact declined in 2019 YTD compared to 2018. This is reflected in the price of ethanol now in the $1.35 per gallon range.

Although purporting to support farmers who in large measure were responsible for election of the current Administration, waivers granted to 31 petroleum refineries by the EPA reduced demand for ethanol. The biofuels industry turned to exports to compensate for overcapacity. China began importing ethanol but the trade war has turned the spigot on that outlet.

Positive action by the Administration to support the industry during the past year includes allowing ethanol to be incorporated into gasoline year- round at a level of 15 percent. This has done little to boost demand given the problem of dispensing other than a 10 percent blend. There is also a growing recognition among consumers that ethanol effectively dilutes the energy content of gasoline offsetting the lower price with higher consumption. An appeal to patriotism can only go so far.

Diversion of corn to ethanol has increased the cost of feed corn for the pork, poultry, egg and other livestock sectors. Producers in the vicinity of ethanol plants generally pay over 25 cents per bushel more than they would otherwise pay since ethanol plants requiring a constant supply of corn are obliged to pay a premium for their substrate. Based on backlash as a result of the refinery waivers, the President has indicated that he would assist the ethanol industry and indirectly farmers, but no specifics have been advanced. The waivers created dissention between the USDA and the EPA and the political implications of support for corn farmers and ethanol producers place the issue firmly in the Oval Office.

The purchasing power of the intensive livestock industry and its dependence on corn cannot continue to be ignored. Industry associations including the NCC and NTF have consistently and justifiably opposed the Renewable Fuels Standard and will continue to do so. A complete reevaluation of the justification for the ethanol industry is required since energy security is not an issue and sustainability is questionable. Biofuel from corn was in any event intended as a stopgap until cellulosic ethanol became a reality. This was a myth used to establish and perpetuate the RFS.


 

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!


 
























































































































































































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