Egg Industry News


Senate Agriculture Committee Advances Three Senior USDA Nominees for Confirmation

09/29/2022

On September 27th the Senate Committee on Agriculture, Nutrition and Forestry advanced three USDA nominees for a full Senate vote.  The nominations were strongly supported by agricultural associations based on the experience, qualifications and strong personal qualities of the three candidates:

 

  • Ms. Alexis Taylor was nominated as Undersecretary of Agriculture for Trade and Foreign Agricultural Affairs.  Ms. Taylor was recently the Director of the Oregon Department of Agriculture.
  • Dr. Jose Emilio Esteban as Undersecretary of Agriculture for Food Safety.  With multiple degrees, Dr. Esteban has served as Chief Scientist for the FSIS and is a 21-year veteran of the Agency.
  • Doug McKalip as Chief Agricultural Trade Negotiator at the office of the USTR.  McKalip has served as an agricultural policy leader and trade expert for close to 30 years and has advised successive Secretaries of Agriculture.  His nomination was strongly supported by US Trade Representative, Ambassador Katherine Tai.

 

Indications for a Severe Influenza Season

09/29/2022

Houston Methodist Hospital has reported a sharp increase in the number of cases of influenza.  Their ER treated 226 cases in the week ending September 15th.  According to the Medical Director of Diagnostic Microbiology, Dr. Wesley Long, “We experienced an early uptick in mid-September but these numbers we usually see in December, not now.”

 

The early rise in cases in Texas confirms previous warnings that the 2022-2023 season will be challenging.  This is based on experience in Australia during their winter that usually reflects future incidence rates in the Northern Hemisphere.

 

The past two influenza seasons have been relatively mild in the U.S. due to the public health precautions imposed to prevent COVID.  Dr. Lorraine Washer, Medical Director of Infection Prevention and Epidemiology at Michigan Medicine, noted, “With return to normal levels of social interaction, higher transmission of flu is likely this season.” 

 

Accordingly, egg-production companies are urged to arrange for immunization of all employees, especially those working with live poultry to prevent a possible recombination event. Delivery drivers have a high probability of exposure and should be protected. Packing plant workers are frequently in close proximity on packers and in break rooms. Comprehensive immunization reduces absenteeism and protects workers from undesirable complications of influenza especially for those with predisposing conditions.


 

COMMODITY REPORT

09/29/2022

WEEKLY COMMODITY REPORT: SEPTEMBER 29th 2022.

OVERVIEW

Over the past five trading days the price trend for December corn was down (2.9 percent) compared to the previous week paralleled by November soybeans that also moved lower (3.2 percent). The market has digested the projections of crop size and ending stocks in the September 12th WASDE #628. Despite fluctuating economic sentiment, the sixth week following restoration of shipping from Black Sea ports has temporarily reduced price pressure on wheat and other grains although bellicose statements by President Putin influenced the price of wheat. Commodity prices in the U.S. were also influenced by a rising Dollar Index, lower orders placed by China recovering from a national holiday and in anticipation of the 20th Congress of the ruling party and an apparent decline in the domestic U.S. demand for corn ethanol.

 

Factors influencing commodity prices in either direction included:-

  • With renewed fears of a U.S. recession due to an aggressive Federal Reserve and following the Jackson Hole Economic Meeting, the September 13th CPI release and the September 21st upward rate adjustment, equity markets moved lower this past week. (transitory downward pressure on markets)
  • Hot and dry conditions in extensive areas of the Corn Belt reduced the yield and quality of the late-planted 2022 corn crop. The size of the corn and soybean harvests were updated in the September WASDE and were reduced by 2.9 and 3.4 percent respectively from the August Report to 172.5 bushels per acre for corn and 50.5 bushels of soybeans per acre. (upward pressure with lower carryover)
  • Geopolitical tensions that impacted wheat, corn, oilseeds and vegetable oil exports from Ukraine persist. The apparent restoration of shipments according to an agreement to lift restriction on Black Sea shipping brokered by Turkey and the U.N. is in jeopardy. Russia has inflicted extensive and deliberate damage on the agricultural infrastructure of Ukraine including elevators and crushing plants and has placed landmines in fields. Russia has destroyed 14 percent of grain storage capacity in Ukraine. (upward pressure on corn and wheat and an indirect effect on soybeans if Black Sea shipping is interrupted.)
  • Expectation of high soybean and corn crops from Brazil for the 2022-2023 season. (lower prices in the future subject to favorable reports on planting and crop progress)
  • Volatility of the Dollar Index (DXY) that declined from 105 on May 12th to 101 on June 2nd but rising again to 113 on September 28th has influenced timing and volume of export orders (contributes to fluctuation in corn and soybean prices, depresses U.S. sales)
  • Speculation in commodities by hedge funds is declining consistent with falling equity prices this week coupled with a steady decline in the value of cryptocurrency. Concerns over a possible recession have re-emerged as the Federal Reserve is intent on raising benchmark funds rates to suppress inflation. (downward pressure)

 

Based on CME quotations on September 29th U.S. farmers are now receiving and conversely livestock producers and ethanol refiners in the Midwest will pay above $6.70 per bushel for corn delivered in December, down 2.4 percent from the quotation last week. Crushers will pay $14.16 per bushel for soybeans plus transport and basis for November delivery. December soybean meal fell 4.9 percent or $21 per ton, compared to the quotation last week. Prices continued their moderate inter-day fluctuation and continued the upward trend from the previous week reflecting both domestic and export demand.

 

EXPORTS

The restored ‘legacy’ FAS Export Report released on September 29th for the week ending September 22nd reflecting market year 2022-2023, confirmed that outstanding export orders for corn amounted to 11.38 million metric tons (44.85 million bushels) with 1.60 million metric tons (63.0 million bushels) actually shipped. During the past week net orders for the 2022-2023 market year amounted to 0.51 million metric tons (20.2 million bushels) with 0.57 million metric tons (22.6 million bushels) shipped. Early in the current market year outstanding sales of corn to date are 52.1 percent higher than at the corresponding week a year ago. For market year 2023-2024 outstanding sales this week amounted to 0.25 million metric tons (9.8 million bushels), with 0.16 million tons (6.3 million bushels) ordered for the 2023-2024 market year.

(Conversion 39.36 bushels per metric ton)

 

The FAS Export Report released on September 29th for the week ending September 22nd reflecting market year 2022-2023, recorded outstanding export orders for soybeans amounting to 25.52 million metric tons (937.5 million bushels) with 1.21 million metric tons (44.5 million bushels) actually shipped. Net weekly soybean orders attained 1.0 million metric tons (36.9 million bushels) with 0.27 million metric tons (9.9 million bushels) shipped. Early in the current market year to date outstanding sales of soybeans are 9.8 percent lower than at the corresponding week a year ago. Sales recorded for market year 2023-2024 are negligible at 30,000 tons (1.1 million bushels). (Conversion 36.74 bushels per metric ton)

 

For the week ending September 22nd 2022 net orders of soybean meal and cake amounted to 86,300 metric tons for the market year 2022-2023. During the past week 249,700 metric tons of meal and cake combined was shipped, representing 2.2 percent of the total 11,252,600 metric tons shipped during the previous marketing year. This quantity is 1.4 percent higher than the previous market year.

 


 


Cal-Maine Statement on Hurricane Ian.

09/29/2022

On September 29th Cal-Maine Foods, Inc.  provided an update on the status of the Company’s facilities located in Florida following landfall of Hurricane Ian and the related flooding in the region. The Company reported that some of its farms and production facilities sustained only minor physical damage and light flooding, and several locations have lost power and are currently operating on back-up generators.

 

Dolph Baker, Chairman and CEO of Cal-Maine Foods, Inc., stated, “We are thankful that we have not had any reports of injuries to any of our employees as a result of this devastating hurricane. We have experience managing through catastrophic weather events and our top priority has been and will continue to be the safety of our employees, and the health and wellbeing of the animals under our care. We also want to acknowledge and commend our dedicated employees who worked tirelessly to prepare for the storm and will continue their efforts to fully restore normal operations. Hurricane Ian is a storm of historic proportions, and we are deeply saddened by the extreme devastation in Florida. We are grateful for the support from local authorities and the heroic work of first responders who are dealing with the aftermath of the storm as conditions allow.”

 

At this time, the Company does not anticipate any material loss in egg production. The Company is closely monitoring the storm situation and will provide additional information if there is a significant impact on its operations.


 

Egg Week

09/29/2022

USDA Weekly Egg Price and Inventory Report, September 29th 2022.

Market Overview

  • The average wholesale unit revenue for Midwest Extra-large and Large sizes were higher by a substantial 25.5 percent on average, maintaining the ongoing trend of unseasonal high prices. Mediums were up by 16.3 percent extending their upward trajectory although supply will increase as many pullet flocks enter production, placing price pressure on this size. Retail sales are projected to be relatively higher over the short-term given low stock levels and constrained production. Both retail prices and demand will continue higher than in previous years sustained by consumer perceptions of value in an inflationary environment with a high cost for protein. Availability and hence prices are influenced by depletion of close to 36 million hens in 15 large complexes in ten states extending from the last week in February through September 21st.
  • Total industry inventory decreased 0.9 percent overall this past week to 1.54 million cases with a 3.5 percent increase in shell eggs and a concurrent 9.8 percent decrease in breaking stock. Wholesale unit prices during the first half of 2022 through July contrasted favorably with the corresponding periods in both 2020 and 2021 characterized by low ex-plant unit revenue. Generic eggs are still yielding high positive margins given the USDA benchmark average combined costs for nest-run of 82.5 cents per dozen in August (feed, chicks, housing, labor and fuel), In addition the average cost of grading, packaging and delivery amounted to approximately 50 cents per dozen according to the EIC.
  • It is now apparent that the inventory held by chains and other significant distributors may be more important to establishing wholesale price than the USDA regional inventory figures published weekly, especially over the short term. The seasonal strategy of retailers is to adjust purchases only in response to retail demand and to hold down inventories in their DCs and stores while marking up shelf margins and pressuring suppliers for rapid replenishment of stocks to DCs and through DSD. Market data suggests that chains have priced generic white eggs in response to prevailing demand and are only seldom featuring Medium and Extra Large sizes.
  • Due to the depletion of close to 36 million hens through September 21st as a result of HPAI, unseasonal high unit revenue will now be a reality through fall. Prices will progressively decline as flocks are restocked until the pre-Thanksgiving rise. The occurrence and extent of further outbreaks of HPAI cannot be assessed until more information is revealed concerning the molecular and field epidemiology relating to cases suggesting modes of transmission and possible deficiencies in biosecurity on affected complexes with identification of specific risk factors.
  • The current relationship between producers and chain buyers based on a single price discovery system constitutes an impediment to a free market. The benchmark price amplifies both downward and upward swings as noted during March to the present. The benchmark functions to the detriment of the industry over the long term and a CME quotation based on Midwest Large, reflecting demand relative to supply would be more equitable. If feed cost is determined by the CME then so should generic shell eggs.
  • According to the USDA the U.S. flock in production was down 4.5 million or 1.5 percent to 279.9 million hens during the week ending September 28th. The flock in production includes about 2.0 million molted hens that resumed lay during the past week plus 4.0 million pullets attaining production.
  • There is some prospect of a return in the food service sector but with frozen and dried egg prices stable or moderately higher over the past three weeks. The ex-farm price for breaking stock was up 22.8 percent this past week to 263 cents per dozen. Checks delivered to Midwest plants were 35.9 percent higher to 265 cents per dozen. Prices for breaking stock will remain high in relation to season for the duration of the recovery period as replacement flocks are reared, reminiscent of 2015-2016.

 

Week in Review

Prices

According to the USDA Egg Market News Reports released on September 26th the Midwest wholesale price (rounded to one cent) for Extra-large was up 25.5 percent to $3.62 per dozen. Large size was up 25.5 percent to $3.60 per dozen; the Medium price was up 16.3 percent to $2.50 per dozen as delivered to DCs. Prices should be compared to the USDA benchmark average 6-Region blended nest-run cost of 82.5 cents per dozen (excluding provisions for packing, packaging materials and transport amounting to 50 cents per dozen according to the EIC) during August 2022. The progression of prices during 2022 to date is depicted in the USDA chart reflecting three years of data, updated weekly.


 


Survey on Industry Employment and Economic Contribution

09/28/2022

Recently, the International Fresh Produce Association commissioned a research company to conduct a survey of their industry with specific reference to employment and contribution to the U.S. economy.

 

Data assembled included:-

  • Contribution of the fresh produce industry to the national economy
  • Number of direct and indirect workers with annual trends and projections of post-COVID expansion of employment through defined components of the supply chain
  • State and regional concentration of employment and secondary effects

 

It is possible that this data on the egg industry is available, but to date, EGG-NEWS is unaware of a comprehensive report.  It would be appropriate for UEP to consider funding a project to quantify employment and economic benefits from egg production.  Data would be useful in lobbying and justifying federal and state grants to educational institutions and other agencies.


 

Zero Egg to Market Scrambled Egg Substitute

09/28/2022

Zero Egg located in North Riverside, IL. has created a ready-to-eat frozen plant-based substitute for real scrambled egg.  It is claimed that Zero Egg Scoopable Scramble™ will have similar taste and texture to the product it intends to replace. The product will be marketed alongside Zero Egg patties and liqid in a pouch.

 

According to the Company press release, Zero Egg will be distributed to restaurants and institutional users positioning the scramble as a component of burritos and other breakfast products.

 

According to Liron Nimrodi, Co-Founder and CEO, Zero Egg Scoopable Scramble will be promoted with claimed benefits relating to sustainability.  No indications were provided regarding nutritional content or price in comparison to real eggs.


 

Broad Support for Export Promotion Program in Senate

09/28/2022

A broad, bipartisan consensus led by Senators Chuck Grassley (R-IA), Tina Smith (D-MN), Joni Ernst (R-IA) and Angus King (I-ME) to promote the Cultivating Revitalization by Expanding American Agricultural Trade and Exports (CREAATE) Act of 2022.  This legislation would increase the Market Access Program funding from $200 to $400 million annually and would raise funding for the Foreign Market Development Program from $35 million to $69 million. The Bill will be considered by both the House and Senate Agricultural Committees to be incorporated in the next Farm Bill.

 

According to the Coalition to Promote U.S. Agricultural Exports, the programs would generate an additional $44.4 billion in agricultural exports over a 5-year period, commencing in 2024.The Chair of the Coalition noted that Market Access Program funding has not been increased since 2006 and Foreign Market Development Program funding has remained constant for 20 years.

 

The efforts of the USAPEEC over the past three decades are self-evident, with effective promotion of exports of broiler, turkey and duck meat in addition to eggs and egg products. The Council has played a pivotal role in expanding exports of poultry products through trade shows, demonstrations, educational programs directed to importers and has coordinated responses to disease outbreaks by interacting with state and federal agencies and the World Organization for Animal Health.  Over the past two decades, federal funding through the MAP and the FMD programs have been supplemented by contributions from state and national agricultural associations. This has allowed the USAPEEC to develop programs for specific importing nations and to sustain promotional activities in competition with other exporting nations.


 

Cal-Maine Foods Reports on Q1 of FY 2023

09/27/2022

In a press release dated September 27th Cal-Maine Foods (CALM) announced results for the 1st Quarter of FY 2023 ending August 27th 2022. The Company exceeded the topline consensus estimate of $617 million and the projection of an EPS of $2.55. This report summarizes data provided in addition to the Q-10 Report

 

Cal-Maine serves as a bellwether for the shell egg sector as the only public-quoted pure-play company in the industry. The following table summarizes the results for the period compared with the values for the corresponding quarter of the previous fiscal year (Values expressed as $ x 1,000 except EPS)

 

1st Quarter Ending

August 27th 2022

August 28th 2021

Difference (%)

Sales:

$658,344

$324,986

+103

Gross profit:

$217,490

$6,645

+3173

Operating income (loss):

$163,850

$(39,667)

+513

Pre-tax income (loss)

Net income (loss)

$165,490

$125,134

$(33,864)

$(18,026)

+589

+794

Diluted earnings (loss) per share:

$2.57

$(0.37)

+795

Gross Margin (%)

33.0

2.0

+1,550

Operating Margin (%)

24.9

-12.2

+304

Profit (Loss) Margin (%)

19.0

-5.6

+439

Long term debt:

nil

nil

-

12 Months Trailing:

Return on Assets (%)

6.5

Return on Equity (%)

12.5

Operating Margin (%)

7.8

Profit Margin (%)

7.5

Total Assets August 27th 2022/May 28th 2021

$1,554,729

$1,427,489

+8.9

Market Capitalization Sept. 27th 2022

$2,960,000

 

Notes: $1.6 million ‘other income,’ Q1 2023 compared to $5.8 million in Q1 FY2022:

$33 million gain on disposal of assets, Q1 2023 compared to $213 million loss in Q1 2022.

$ 0.43 million Royalty Income, Q1 2023 compared to $0.27 million Q1 2022

$0.15 million from equity investment, Q1 FY 2023 compared to $0.14 million Q1 2022

$0.90 million interest income, Q1 FY 2023 compared to $).23 million Q1 2022

No acquisitions in Q1 2023

Trailing P/E 22.2

 

52-Week Range in Share Price: $34.29 to $61.83 50-day Moving average $54.89

Market Close, Tuesday, July 27th pre-release: $60.53.

After hours trading post-release: $60.40 (down 0.2 percent)

In reviewing the CALM quarterly report the following calculated values represent key data for the most recent Quarter. (Q1 Fiscal 2022 and percent difference in parentheses):-

  • Shell egg sales attained $626,085 million in Q1 2023 based on this category representing 95.1 percent of total revenue. ($314,586 million in Q1 2022, based on 96.8 percent of revenue. Value up by 99.0 percent)
  • Dozen shell eggs sold (thousands): 275,317 (254,622; +8.1%)
  • Average selling price of all shell eggs calculated from data released: $2.27 per dozen; ($1.24 per dozen; +83.1%).
  • Average selling price of specialty eggs (excluding co-pack) calculated from data released: $2.08 cents per dozen; ($1.87 per dozen; +11.2%).
  • Average selling price of generic eggs calculated from data released: $2.38 cents per dozen; ($0.99 cents per dozen; +140.4%).
  • Differential between generic and specialty eggs: -$0.30 cents per dozen; ($0.88 per dozen; -134.1%)
  • Specialty eggs as a proportion of volume sold: 34.7%; (27.8%; +24.8%)
  • Specialty eggs as a proportion of sales value: 31.8%; (42.0 %; -24.3%)
  • Proportion of eggs sold that were produced by Cal-Maine and contract flocks: 93.6% (92.9% +0.8%;).
  • Feed cost: 66.7 cents per dozen, (54.5 cents per dozen, +22.5%)

 

The following observations relate to the comparison of Q1 2023 with the corresponding quarter in 2022:-

  • Cal-Maine Foods was not affected by the 2022 avian influenza epornitic as of the release.
  • Q1 of FY 2023 represented a more favorable marketing comparison to Q1 2022 based on higher prices for shell eggs, as influenced by depopulation of 32.7 million hens prior to and during Q1, coupled with high demand. Restrictions due to COVID on institutional and consumer segments were in large measure removed during Q1 of FY 2023
  • Gross profit was impacted positively by higher unit revenue for generic eggs but offset by significantly higher production costs including feed (66.7 cents per dozen) and obviously by inflation in labor, fuel and packaging (37.9 cents per dozen).
  • In a market characterized by high unit prices, the relative contribution of specialty eggs is less important to net earnings in contrast to a down market as in Q1 of FY 2022. Enigmatically generic eggs generated a higher unit price and margin compared to specialty eggs.
  • Responding to the shortage of available eggs and their cost in Q1 2023 (average price $2.57 per dozen), Cal-Maine reduced the purchase of nest-run eggs for packing and sale to 6.4 percent of sales volume compared to 7.1 percent during the corresponding 1st quarter of FY 2022.
  • Apart from the Family-trust and other insider shareholding of 14.5 percent, institutions hold 92.7 percent of equity. Shares short on August 31st attained 9.3 percent of float.
  • Cal-Maine Foods declared a dividend of $0.85 per share.

 

In commenting on results for the 1st Quarter of FY 2023, Dolph Baker, Chairman and CEO of Cal-Maine Foods, commented, “We are pleased to begin fiscal 2023 with record quarterly sales for Cal-Maine Foods. We benefitted from higher average selling prices and record specialty egg sales volumes leading to historic Company record revenue for both conventional and specialty shell eggs. We continue to focus on offering consumers a choice with a favorable product mix in line with changing demand trends. We believe this strategy has created momentum across retail channels and delivered a performance that has outpaced the industry.

 

Baker added “Our operations ran well during the quarter, and we are pleased with our ability to manage the business despite significant inflationary pressures contributing to rising costs for feed, labor, packaging, and distribution, among other costs. We remain focused on the aspects of the business we can control with a shared commitment across Cal-Maine Foods’ operations to be the most efficient and sustainable producer of fresh shell eggs and egg products in the United States.”

 

Max Bowman, CFO of Cal-Maine Foods, added, “Our financial performance over the quarter reflects our ability to execute our operating strategy in dynamic conditions, while continuing to meet the expanding needs of our customers. The significant increase in pricing and favorable volume trends in specialty egg sales, along with efficient expense management, led to improved profitability with a gross profit margin of 33.0% for the first quarter of fiscal 2023”.

 

The earnings release included information on future conversion to cage-free production: “Cal-Maine Foods continues to offer a differentiated product mix to meet the needs of our customers. The Company maintains its specialty egg business focus as a key driver of growth. In line with expanding consumer demand and state requirements for cage-free eggs, the Company has continued to make significant investments in production capacity to position Cal-Maine Foods as an industry leader to supply the growing demand for specialty egg offerings, including cage-free eggs. Cage-free egg sales comprised 20.3% of total net shell egg sales in fourth quarter 2022 and represented 22.1% of total net shell egg sales in fiscal 2022”.

 

The release addressed the issue of conversion to cage-free housing noting “Providing customers with a favorable product mix is an important differentiator for Cal-Maine Foods. Specialty eggs are an integral part of the Company’s growth strategy and remain a primary focus for fiscal 2023. Cal-Maine Foods continues to make significant investments in production capacity to meet the demand for specialty eggs, including cage-free eggs, as customer demand has evolved in line with state requirements”.

 

“A significant number of Cal-Maine Foods’ customers have previously announced goals to offer cage-free eggs exclusively on or before 2026, subject in most cases to availability of supply, affordability and customer demand, among other contingencies. Some of these customers have recently changed those goals to offer 70 percent cage-free eggs by the end of 2030. The Company’s customers typically do not commit to long-term purchases of specific quantities or types of eggs, and as a result, it is difficult to accurately predict customer requirements for cage-free eggs. The Company continues to engage with its customers in efforts to achieve a smooth transition toward meeting their announced goals and needs. Sales of cage-free eggs represented approximately 19.4 percent of shell egg revenues for the first quarter of fiscal 2023. Cage-free dozens sold increased 58% in the first quarter of fiscal 2023 as compared to the first quarter of fiscal 2022”.

 

“Cal-Maine Foods has invested significant capital in recent years to acquire and construct cage-free facilities and remains focused on future expansion projects that will include cage-free facilities. At the same time, the Company understands the importance of continuing to provide more affordable conventional eggs in order to provide its customers with a variety of egg choices and to address hunger in more communities”.

 

The Q-10 Report documented an approved capital investment of $293.9 million for cage-free conversions and upgrades to processing for FY 2023 through 2025. Of this total $143.0 million has been commited with $130.9 to be assigned in FY 2024 and 2025.

 

On the topic of HPAI the report commented, “Cal-Maine Foods continues to monitor the current outbreak of highly pathogenic avian influenza (“HPAI”), that was first detected in commercial flocks in the U.S. in February 2022 and, which was most recently detected in commercial flocks in the U.S. in September 2022. There have been no positive tests for HPAI at any Cal-Maine Foods’ owned or contracted production facility as of September 27, 2022. The USDA division of Animal and Plant Health Inspection Service (“APHIS”) reported that approximately 35.6 million commercial layer hens and 1.0 million pullets have been depopulated due to HPAI. The Company believes that HPAI outbreak will continue to have an impact on the overall supply of eggs through the balance of this calendar year and possibly beyond. According to LEAP Market Analytics, layer hen inventory is not projected to exceed the 320 million mark until October of 2023”.

 

“While no farm is immune from HPAI, Cal-Maine Foods believes it has implemented and continues to maintain robust biosecurity programs across all its locations. The Company is also working closely with federal, state and local government officials and focused industry groups to mitigate the risk of this and future outbreaks and effectively manage a response, if needed”.


 

Circle-K To Increase Food Sales.

09/26/2022

Alimentation Couche-Tard, Inc. of Canada, the parent company of the Circle-K chain of convenience stores, has embarked on a program to increase food sales.  This strategy is in part motivated by the projected decline in long-term demand for gasoline and diesel. It is estimated that in 2030, half of all new vehicles sold will be powered by electricity.

 

The chain currently derives the majority of income from fuel sales but plans to increase revenue from produce and from both unprepared foods and meals to generate 25 percent of North American sales in the intermediate term.

 

The company is drawing on experience gained in Europe to improve food offerings and is applying a concept derived from Holiday Station Stores of Minnesota acquired in 2017.

 

The Couche-Tard operation has 7,011 locations in the U.S., 13 percent of which are operated by franchisees.  The company has 2,076 stores in Canada and 3,070 units in Europe. Couche-Tard joined Kroger and Restaurant Brands International in July to fund Kitchen United, Inc. an  operator of “ghost kitchens”.


 

Crop Progress

09/26/2022

Status of 2022 Corn and Soybean Crops

The USDA Crop Progress Report released on September 26th documented continued progress in both soybean and corn crops. Corn maturity is delayed in areas affected by drought and heat. Fifty percent of corn was mature on September 25th up from 40 percent last week and twelve percent has been harvested. The fact that a high proportion of the corn crop was planted over a two-week period created widespread vulnerability to heat and drought at the critical stage of silking and this had an adverse impact on corn yield in severely affected areas contributing to a low average national yield of 172.5 bushels per acre.

 

Sixty three percent of the soybean crop was dropping leaves on September 25th with eight percent harvested, five percent behind the corresponding week in 2021.

 

For the week ending September 25th topsoil and subsoil moisture levels are still lower than the corresponding weeks in 2021 although some central and easterly states in the corn-belt have had relief from drought.

 

EGG-NEWS will report on the progress of the two major crops as monitored by the USDA through November.  

 

 

WEEK ENDING

Crop

August 21st

August 28th

4-Year Average

Corn Dough (%)

Corn Dented (%)

Corn Mature (%)

Corn Harvested (%)

100

87

40

7

100

92

50

12

100

94

61

14

Soybeans Setting Pods (%)

Soybeans Dropping Leaves (%)

Soybeans Harvested (%)

100

42

3

100

63

8

100

65

13

Crop Condition

V. Poor

 Poor

Fair

Good

Excellent

Corn 2022

Corn 2021

9

5

 12

 10

27

26

42

45

10

14

Soybeans 2022

Soybeans 2021

5

4

10

 10

30

28

46

47

9

11

Parameter

V. Short

Short

Adequate

Surplus

Topsoil moisture: Past Week

21

33

43

3

Past Year

19

31

46

4

Subsoil moisture: Past Week

23

33

43

1

Past Year

21

31

45

3

 

The August 2022 ProFarmer Tour estimated the corn crop at 13,759 million bushels with an average yield of 168.1 bushels per acre. Their estimate of the soybean crop was 4,535 million bushels with an average yield of 51.7 bushels per acre.

 

The September 12th WASDE #628 estimated the average U.S corn yield at 172.5 bushels per acre with a 2022 harvest of 13,944 million bushels. The soybean yield was estimated to attain 650.5 bushels per acre with a 2022 harvest of 4,378 million bushels.

 

The September WASDE #628 is posted under the STATS tab.


 

Will FAST Recovery Act be Repealed by Ballot ?

09/26/2022

Assembly Bill 257, known as the FAST Recovery Act, was signed into law on Labor Day.  This legislation increases wage rates for employees of “fast-food restaurants”. Specific provisions of the law will be implemented by a ten-person Council that will set standards for wages, hours and other conditions of employment.  According to the Bill, “fast-food restaurants” are defined by providing counter-service, food paid for before the order is delivered, and the chain having more than 100 locations.  This would include conventional QSRs and hybrid operation such as Chipotle Mexican Grill.

A filing for a ballot has been initiated and if sufficient signatures are gathered, that is considered inevitable, voters will consider repealing the FAST Act in November 2024 thereby invalidating the law.  Based on a recent ballot to overturn ride-sharing legislation, it is anticipated that both labor unions and restaurant operators will expend millions to engender support for their respective causes.


 

DOJ Indicts 47 Over School Feeding Scam

09/26/2022

The Department of Justice has released details of criminal charges against 47 in Minnesota involved in a $250 million scam to divert COVID funding designated for feeding children to their personal gain. The DOJ characterized the actions of the accused as “the largest pandemic relief foods scheme charged to date”. At the center of the extensive misappropriation is “Feeding Our Future”, a Minnesota nonprofit that had limited experience in feeding children prior to COVID.

 

It is inevitable that with large amounts of money released in response to an emergency but with lax controls, that many unscrupulous individuals would attempt to divert and embezzle funds. The DOJ alleges that Aimee Bock was the central figure in establishing a pyramid that obtained and misappropriated close to $250 million in 2021. Her organization claimed that the funding was used to provide meals for children in need.  The fraudulent scheme generated illegal income used to purchase luxury vehicles, and real estate in the U.S. Kenya and Turkey.

 

If a federal or state agency erects numerous hen houses over a short period, it is necessary to guard against the numerous foxes that will be attracted.  The situation is even more serious when the foxes collude and attack hen houses according to a concerted scheme while farmers sleep. Aesop would have had a field day with the ineptitude of the federal agency responsible.


 

Avian Influenza Reported on a Large Farm In Belgium

09/26/2022

According to a ProMED report, an outbreak of H5N1 strain avian influenza involving 30,000 commercial poultry (type not specified) was diagnosed in Sint-Laureins in East Flanders, Belgium on September 18th.  It is presumed that the infection involved contact with wild birds as stated in the WOAH report. 

 

Outbreaks of H5N1 Avian Influenza persist in wild birds, backyard farms and commercial flocks through various nations in Europe. This week WOAH received a report of a limited outbreak in a small commercial farm near Lodz, Poland.  For 2022 to date, 35 outbreaks of HPAI have occurred on poultry farms in Poland with an additional 28 diagnosed cases in wild birds.

 

During previous outbreaks of Highly Pathogenic Avian Influenza, cases occurred at the beginning of the Fall migration of waterfowl, commencing in November and December and ceasing by March.  For 2021 through 2022, incident cases followed the early seasonal pattern but persisted through Summer and now into Fall.  This presumes dissemination of virus by non-migratory endemic birds and now small mammals. The incidence rate represents a major shift in the epidemiology of HPAI and hence, the need to reassess prevention relying on biosecurity and control comprising depopulation with quarantine and decontamination. These modalities are appropriate for an exotic disease but it must now be questioned whether HPAI has not become seasonally or continually endemic.


 

World Commodity Markets Monitoring Ukraine Harvest and Exports

09/25/2022

Following the agreement between Russia and Ukraine to allow free passage of grain-carrying vessels in the Black Sea, approximately two million tons of corn with some soybeans, sunflower meal and barley have been shipped from the three designated ports of Odessa, Chornomorsk and Pivdennyi.  The port of Mykolaiv was excluded from the agreement but is the second largest export terminal.  The potential combined capacity of the three ports is 3.0 million tons per month. 

 

It is estimated that the 3 to 4 million tons of commodities stored in the three ports were moved during August through mid-September to make room for the incoming 2022 Harvest.  Approximately 20 million tons of wheat will have to be shipped in addition to approximately 20 million tons of grain stored in silos through Ukraine.  It is difficult to see how Ukraine will be able to export 6 million tons in each of October and November.  Export volume has been restricted to relatively small vessels to date. Ocean freight operators are concerned over safety of vessels and crews due to the presence of sea mines laid by both Ukraine and Russia, some of which are now free floating, representing a danger to navigation.  Insurance will only be offered to ship operators if vessels are assured of free passage and the absence of mines.  Lloyd’s of London is extending $50 million cover for every voyage but with high insurance rates that will be added to the cost of grain.

 

President Putin of the Russian Federation has indicated that the July free-passage agreement will be renegotiated, and he will evidently demand concessions for Russia in exchange for extending the agreement.  It is evident that the naval forces of NATO, including the U.S., may become involved in maintaining free passage of vessels, a situation that could escalate hostilities and disrupt world prices for commodities. 

 

The Ministry of Agriculture in Ukraine estimates a total corn harvest of 25 to 27 million metric tons down from 42.1 million in 2021.  Due to hostilities, total grain and oilseed production will be halved to approximately 50 million metric tons.  To date, 26 million tons of grain has been harvested from the 2022 crop, representing 60 percent of the seeded acreage.


 

HPAI Outbreaks Continue in the Netherlands

09/25/2022

Recent outbreaks of H5N1 Highly Pathogenic Avian Influenza were diagnosed on poultry farms in Groningen in the north of the Nation and Overijssel in the east-central quadrant.  To date, there have been 70 outbreaks on commercial farms.  Quarantines imposed in accordance with EU directives and WOAH recommendations are disruptive since farmers cannot move eggs or live birds to prevent spread of the virus.

The Netherlands has 1,700 poultry farms divided among egg production, broilers and waterfowl.


 

Outbreaks Of H5N1 In Canada

09/25/2022

The Canadian Food Inspection Agency recently issued a summary of outbreaks of H5N1 Highly Pathogenic Avian Influenza to the World Organization of Animal Health (WOAH).  According to a posting on September 20th, 65 infected farms have been depleted and are undergoing depletion and decontamination.  Sixty-six farms previously infected have been released from quarantine and are presumably being restocked. 

 

To date, 2,363,000 commercial poultry of diverse species have been depopulated with 43 outbreaks in the Province of Alberta involving 1,075,000 birds.  The second highest number of depopulations occurred in Ontario, with 27 outbreaks involving 561,000 birds.  Nine provinces, from the Maritimes to British Columbia, have reported cases.

 

It is presumed that recent cases are attributable to dissemination of virus by both migratory and domestic birds.  The extent of infection is noted in the isolation of the virus previously from foxes and seals.  The most recent report of an infection in mammals involved a bear in the Province of Quebec that was euthanized following demonstration of neurologic signs. An H5N1 virus was isolated and encephalitis confirmed by histopathology.

 


 

 


 

Recruitment of Seasonal Retail Workers Begins

09/25/2022

Target Corporation anticipates hiring 100,000 seasonal workers in stores and distribution centers this Christmas Season.  Target will be offering starting wages ranging from $15 to $24 an hour, depending on location and skills.

 

Walmart plans to add 40,000 workers to its complement of stores and distribution centers.  The projected number is lower than the 150,000 who were hired in 2021.

 


 

Alltech Appoints Global VP for ESG

09/23/2022

Alltech, Inc. has appointed Tara McCarthy as the Global Vice-president of Environmental, Social and Corporate Governance.  In her role, Ms. McCarthy will support the advancement of the Alltech program of Working Together for a Planet of Plenty™.

 

In commenting on the appointment, Dr. Mark Lyons, president and CEO of Alltech, stated, “Agriculture is the sector most integral to planetary health from its role in the nourishment and well-being of humans and animals, to the capabilities it has to not only safeguard but to benefit our Earth’s environment.”

 

Prior to joining Alltech, Ms. McCarthy served as the CEO of the Irish Food Board, and she has 25 years experience in the food industry.  She has developed initiatives to support programs for students and early-career executives and entrepreneurs within the food industry.  In 2019, Ms. McCarthy co-founded Active AGDIF, encouraging diversity in the Irish food industry and motivated the establishment of the Green Global Council.

 

Ms. McCarthy received a baccalaureate degree in commerce from the National University of Ireland followed by a master’s degree in business studies from the Michael Smurfit Graduate Business School of the University College Dublin.  She is the recipient of a number of awards, including UCD Alumna of the Year for Business and Commerce in 2017 and the UCD Smurfit School Alumna of the Year in 2019.


 

Costco Corporation Posts Q4 and FY2022 Results

09/22/2022

On September 22nd Costco Wholesale Corporation (COST) posted results for Q4 and FY2022 ending August 28th. For the quarter, the Company earned $1,868 million on revenue (including fuel and membership fees) of $72,091 million with a diluted EPS of $4.20.  For the corresponding Q4 of FY2021, Costco earned $1,670 million on equivalent revenue of $62,675 million with a diluted EPS of $3.76.  Revenue was 15.0 percent higher than in Q4 of FY2021 and net earnings rose by 11.9 percent. Gross margin for Q4 FY2022 declined to 10.1 percent compared to 10.9 percent in Q4 FY2021 attributed to higher cost of goods sold in an inflationary environment. Concurrently operating margin fell from 3.6 percent in Q4 FY2021 to 2.2 percent for the most recent quarter associated with increased freight, transport, wages and utilities.

 

For FY 2022, the Company earned $5,844 million on revenue (including fuel and membership fees) of $226,954 million with a diluted EPS of $13.14.  For FY2021, Costco earned $5,007 million on equivalent revenue of $195,929 million with a diluted EPS of $11.27

 

Total adjusted comparable same-store sales for FY 2022 (excluding fuel) attained 10.6 percent. U.S. same store sales were up 10.4 percent; Canada by 12.1 percent and the Other International category, 11.2 percent.

 

On August 28th Costco posted total assets of $64,166 million, up 8.3 percent from Q4 FY2020. Long-term debt and lease obligations attained $43,519 million. Costco had an intraday market capitalization of $215,800 million on September 23rd. The Company has traded over the past fifty-two weeks in a range of $406.51 to $612.27 with a 50-day moving average of $528.68.

 

Twelve-month trailing operating margin was 3.5 percent and profit margin 2.6 percent.  The Company generated a return on assets of 10.1 percent and 38.8 percent on equity.

 

At the end of Q4 FY2022, Costco operated 838 warehouses. There are 578 in the U.S; 107 in  Canada; 40 in Mexico; 31 in Japan; 29 in the U.K. and 53 others in seven nations among the E.U., Asia and Australia.


 

McDonald’s Corp. Facing Lawsuit Alleging “Racial Stereotyping”

09/22/2022

District Judge Fernando Olguin of the U.S. District Court in Los Angeles denied a motion of dismissal filed by McDonald’s Corporationon Wednesday, September 21st. At issue is a lawsuit by media mogul Byron Allen, CEO of Entertainment Studios Networks, Inc. and Weather Group, LLC, claiming that McDonald’s Corporation constrained spending for minority-owned media.  Allen claims that McDonald’s Corporation used a separate ad agency with a small budget for what he designated as an “African American Tier”.

 

In his ruling, Judge Olguin noted, “Taken together and construed in the light most favorable to plaintiffs, they have alleged sufficient facts to support an inference of intentional discrimination.”

 

In rebuttal, the lawyer representing McDonald’s Corporation claimed that the lawsuit was about revenue, not race and that there was no discrimination.  Allen presented evidence that, although Black customers represented 40 percent of fast-food revenue, McDonald’s spent 0.3 percent of its $1.6 billion U.S. ad budget on Black-owned media in 2019.  Most recently, McDonald’s pledged to boost National ad spending with Black-owned media to 5 percent, suggesting that pre-trial submissions by the plaintiff had some substance.


 

Darden Restaurants Commits To Cage-Free by 2027

09/22/2022

Darden Restaurants, operators of the Olive Garden and Long Horn Steakhouse, has committed to sourcing cage-free eggs by the beginning of 2027.  Darden operates 1,850 locations in North and Central America and Asia.  With respect to international franchisees, cage-free eggs will be purchased “as available by the end of 2027”.

 

The announcement by Darden follows similar commitments by Bloomin’ Brands, Restaurant Brands International, Yum Brands and JAB Holdings.

 

Restaurants and food service operations are able to pass on the incremental cost of cage-free eggs over cage-derived eggs to consumers.  The situation is obviously different with retailers that must price according to consumer income demographics.  It is however, significant that commitments by restaurants have extended the previous 2025 date and it is anticipated that further extensions will be announced.

 

Uncertainty over the status and constitutionality of California Proposition #12 and the equivalent ballot measure in Massachusetts has led to a moratorium on new conversions from cages to alternative systems. It is possible that numerous enrichable cages installed during the 2000s may be converted to enriched colony modules as a compromise acceptable to customers and consumers. If California Proposition #12 is declared unconstitutional as conflicting with interstate commerce, many existing aviary units will be operated with closed fronts becoming enriched colony modules depending on markets served.


 

Farmers Increasingly Dependent On Supplementary Income

09/22/2022

Dan Kowalski of CoBank recently highlighted the need for farming families to receive supplementary income.  Young and beginning farmers require off-farm jobs.  His data shows that 56 percent of the principal operators of a farm had a supplementary job in 2017 compared to 37 percent in 1974.  Two-thirds of younger operators had primary off-farm jobs in 2017.  Many of the young farmers seeking a non-farm job are attracted by healthcare and other benefits.

 

Traditionally, rural communities are becoming urbanized because of the relocation of businesses that attract part time workers from farms, especially for service jobs including healthcare, retail and hospitality sectors.


 

HPAI Outbreak in Spain

09/21/2022

An egg production farm in Spain with 600,000 hens was diagnosed with H5N1 strain highly pathogenic avian influenza on September 8th.  The outbreak was confirmed by the Central Veterinary Laboratory of Algete.  The farm is located in the municipality of Fontanar in the Province of Guadalajara and is the 35th reported outbreak in Spain this year.

 

Epidemiologic investigations are in progress, but the origin of the virus is presumed to be a defect in biosecurity allowing contact with wild birds.

 

Appropriate responses by the Junta de Castilla-La Mancha in compliance with E.U. directives and WOAH recommendations have been implemented.

 

The Ministry of Agriculture Fisheries and Food has advised producers to upgrade biosecurity and has intensified surveillance in wild bird populations.


 

National Farm Safety And Health Week

09/21/2022

The President proclaimed September 18th through September 24th as National Farm Safety and Health Week.  This motivates farmers, ranchers, agricultural institutions and organizations to reaffirm a dedication to farm safety and health. 

 

The Proclamation also urges Americans to express appreciation and gratitude to farmers, farmworkers, and ranchers for service to the nation.  The White House Proclamation acknowledges challenges faced by the agricultural sector, represented by extreme weather, fluctuating commodity prices, accidents and injuries that threaten livelihood.


 

Retail Spending Persists Despite Economic Uncertainty

09/21/2022

The U.S. Census Bureau confirmed that retail sales in August were up 0.3 percent from July and 9.1 percent from the corresponding month in 2021.  This data is supported by the National Retail Federation that recorded a 0.1 percent increase in core retail sales in August over July and up 8 percent from August 2021.  Core retail spending excludes automobiles, gasoline and restaurants.  Grocery and beverage sales were up by 0.5 percent month-over-month and 8 percent year-over-year.  General merchandise was up 0.5 percent, health and personal care sales down 0.6 percent and online and non-store sales down 0.7 percent between July and August but up 12.3 percent from August 2021.

It may be presumed that consumers are becoming more selective in their purchases and making trade-offs at the shelf on the basis of price and need, as noted in previous postings on EGG-NEWS.

 


 

Is COVID Really Over?

09/21/2022

On September 18th, the President implied that the COVID pandemic is over in the U.S., although accepting “We still have a problem.” Subsequently White House and Administration spokespersons issued modifications, walk-backs and restatements.

 

It is undeniable that the COVID situation, as measured by incident cases, hospitalizations and fatalities, has declined from previous peaks but there is still a need for “a lotta work on it”, to quote the President.

 

The Director-General of the World Health Organization, Dr. Tedros Ghebreyesus, stated on September 14th, “We have never been in a better position to end the pandemic, but we are not there yet, although the end is in sight.”

 

The U.S. has recorded 95.7 million diagnosed cases of COVID caused by a range of variants.  Documented fatalities have attained 1,053,840 to early September but excess mortality attributed to COVID is estimated at 1,177,083 deaths.  As of the second week in September, the CDC counted 13,783 hospitalizations due to COVID with 3,681 patients in ICU.  For the week ending September 10th, there were 831 fatalities attributed directly to COVID, 75 percent of which were in patients over 65 years of age.

 

The U.S. has deployed 843 million does of COVID vaccine of which 612 million have been administered.  Of our population of 332 million, 69 percent have received the two primary vaccines, 109 million have received a first booster and 24 million a second booster. 

 

 

n

 


 

Egg Week

09/21/2022

USDA Weekly Egg Price and Inventory Report, September 22nd 2022.

n

Market Overview

  • The average wholesale unit revenue for Midwest Extra-large and Large sizes were higher by a substantial 27.9 percent on average, maintaining the ongoing trend of unseasonal high prices. Mediums were up by 12.6 percent extending their upward trajectory although supply will increase as many pullet flocks enter production, placing pressure on price for this size. Retail sales are projected to be relatively higher over the short-term given low stock levels and constrained production. Both retail prices and demand will continue higher than in previous years sustained by consumer perceptions of value in an inflationary environment in which the cost of protein is high. Availability and hence prices are influenced by depletion of close to 36 million hens in 15 large complexes in ten states extending from the last week in February through September 21st.
  • Total industry inventory decreased 5.9 percent overall this past week to 1.52 million cases with a 3.7 percent decrease in shell eggs and a concurrent 13.8 percent decrease in breaking stock. Wholesale unit prices during the first half of 2022 through July contrasted favorably with the corresponding periods in both 2020 and 2021 that were characterized by low ex-plant unit revenue. Generic eggs are still yielding high positive margins given the USDA benchmark average combined costs for nest-run of 82.5 cents per dozen in August (feed, chicks, housing, labor and fuel), In addition the average cost of grading, packaging and delivery amounted to approximately 50 cents per dozen according to the EIC.
  • It is now apparent that the inventory held by chains and other significant distributors may be more important to establishing wholesale price than the USDA regional inventory figures published weekly, especially over the short term. The seasonal strategy of retailers is to adjust purchases only in response to retail demand and to hold down inventories in their DCs and stores while marking up shelf margins and pressuring suppliers for rapid replenishment of stocks to DCs and through DSD. Market data suggests that chains have priced generic white eggs in response to prevailing demand and are only seldom featuring Medium and Extra Large sizes.
  • Due to the depletion of close to 36 million hens through September 21st as a result of HPAI, unseasonal high unit revenue will now be a reality through fall. Prices will progressively decline as flocks are restocked until the pre-Thanksgiving rise. The occurrence and extent of further outbreaks of HPAI cannot be assessed until more information is revealed concerning the molecular and field epidemiology relating to cases suggesting modes of transmission and possible deficiencies in biosecurity on affected complexes and identification of specific risk factors.
  • The current relationship between producers and chain buyers based on a single price discovery system constitutes an impediment to a free market. The benchmark price amplifies both downward and upward swings as noted during March to June as flocks were depopulated. The benchmark functions to the detriment of the industry over the long term and a CME quotation based on Midwest Large, reflecting demand relative to supply would be more equitable.
  • According to the USDA the U.S. flock in production was up 0.6 million or 0.2 percent to 302.4 million hens during the week ending September 21st. The producing flock includes about 2.0 million molted hens that resumed lay during the past week plus 4.0 million pullets attaining production.
  • There is some prospect of a return in the food service sector but with frozen and dried egg prices stable or moderately lower over the past three weeks. The ex-farm price for breaking stock was up 25.3 percent this past week to 203 cents per dozen. Checks delivered to Midwest plants were 22.6 percent higher to 195 cents per dozen. Prices for breaking stock will remain high in relation to season for the duration of the recovery period as replacement flocks are reared, reminiscent of 2015-2016.

 

Week in Review

Prices

According to the USDA Egg Market News Reports released on September 19th the Midwest wholesale price (rounded to one cent) for Extra-large was up 27.7 percent to $2.88 per dozen. Large size was up 28.1 percent to $2.86 per dozen; the Medium price was up 12.6 percent to $2.15 per dozen as delivered to DCs. Prices should be compared to the USDA benchmark average 6-Region blended nest-run cost of 82.5 cents per dozen (excluding provisions for packing, packaging materials and transport amounting to 50 cents per dozen according to the EIC) during August 2022. The progression of prices during 2022 to date is depicted in the USDA chart reflecting three years of data, updated weekly.

 

 The September 9th 2022 edition of the USDA Egg Market News Report documented a USDA Combined Region value rounded to the nearest cent, of $2.34 per dozen delivered to warehouses for the week ending September 13th 2022. This average price lags current Midwest weekly values by one week. The USDA Combined range for Large in the Midwest was $2.24 per dozen. At the high end of the range, price in the South Central Region attained $2.42 per dozen. The USDA Combined Price last week was approximately $1.40 above the 3-year average. This past week Midwest Large was approximately $0.90 above the corresponding week in 2021 that increased before the Labor Day weekend and held price thereafter. Prices were higher last week due to increased demand. Potential infection of commercial egg, turkey and broiler flocks with HPAI until recently considered unlikely, resulted in cases among turkeys and broiler breeder flocks in California, growing turkeys in Minnesota and large egg-production complexes in Ohio and Colorado and egg-producing flocks in a number of Canadian provinces. Prices appear to have following the trend evident during the 2015 epornitic although for a relatively longer period and at a higher level in 2022.


 


Black Sea Agreement Allows Shipments from Ukraine Ports

09/21/2022

According to press reports, 165 ships have left the Ukraine ports of Odessa, Chornomorsk and Uzhnyi since the deal brokered by the United Nations and Turkey was concluded.  Destinations include Africa, Asia and Europe.  Based on the loads carried by ten vessels that departed on September 18th it is calculated that 1.5 million metric tons of commodities have been consigned to date, below the target of 3 million tons per month.

 

Clearing inventory stored in ports is critical before the 2023-2022 harvest that is estimated at 67 million metric tons of grains and oil seeds.  Although some product will be shipped westward by rail, Ukraine is strongly dependent on Black Sea export routes.

 

President Putin of the Russian Federation has threatened to withdraw from the agreement when it is renegotiated at the end of October. He will use Ukraine exports as a bargaining chip to demand relaxation of sanctions against his nation.  He claimed that Russia was duped into the agreement on the basis of providing necessary grain to support nations in Africa that are dependent on imports of wheat to prevent famine.  Putin claims that Ukraine shipped the majority of stored commodities exported under the agreement to Middle East and European markets.

 

Should the agreement be cancelled, free passage through the Black Sea for agricultural commodities will require the navies of the EU and the U.S. to become involved. As with a previous situation in the Straits of Hormuz free passage for bulk tankers was established with escort through defined corridors.  Naval mines laid by both Russia and Ukraine in the Black Sea represent a challenge to shipping with one vessel having been severely damaged by a mine that drifted from its mooring.


 

IRI Appoints Strategy Officer to Extend Services

09/21/2022

The merger of Information Resources Inc. (IRI) and the NPD Group has the potential to extend analytical services provided to clients.  The company has appointed Malli Vangala as Chief Strategy Officer. He was the leader of the Microsoft 365 strategy team from 2016 to 2019, was involved in the launch of Saa Solutions and was previously VP of Corporate Strategy at SAP. He has worked as a consultant for McKinsey & Co.

Vangala holds a Bachelor's degree in engineering from his native India, a Master's degree in Management Information Systems from Texas A&M and an MBA from the Wharton School of the University of Pennsylvania.

 

Commenting on his appointment, Vangala noted, "we are focused on setting a new standard for innovative technology and data-driven advisory services for clients in an evolving and dynamic consumer landscape".

Accurate information on the sales of both shell-egg and egg-products categories in comparison with alternatives and substitutes is necessary to establish and modify marketing programs and to  establish pricing. The combination of IRI and NPD will provide data and its interpretation extending from sales to consumer trends.


 

Canada Restricts Imports of Fresh, Raw Poultry Products and Eggs

09/19/2022

The Canadian Food Inspection Agency has issued a ban on private importation of raw, unprocessed poultry products or byproducts from any U.S. state that has reported an outbreak of highly pathogenic avian influenza.  This requirement presumably relates to both commercial and backyard outbreaks within 28 days of the date of importation, if the nation is following WOAH rules.

 

Specified products include raw turkey and chicken meat, table eggs, cooked leftovers from restaurants, raw pet food and feathers.  Fully cooked poultry products can be imported irrespective of outbreaks reported in the state origin.  Acceptable products include rotisserie chicken, hotdogs, deli meats, hard-boiled eggs and cooked kibble or canned pet food.

Restrictions on commercial poultry products are subject to a bilateral agreement between the U.S. and Canada in accordance with World Organization of Animal Health (WHOA) guidance including regionalization, compartmentalization, quarantine, depopulation and surveillance.

 


 

Plant Based Foods Association Launches Lobbying Arm

09/19/2022

The Plant Based Foods Institute was launched as a subsidiary of the Plant Based Foods Association this past week.  The objective will be to lobby the public sector to be more receptive to plant based foods, to modify agricultural practices and to promote regenerative and sustainable food systems.

 

The Plant Based Foods Institute will obviously attempt to influence federal policy on diets including the “Dietary Guidelines for Americans” in addition to legislation including the Farm Bill.  The Plant Based Foods Institute will also promote alternatives to livestock products for schools, hospitals and the food service sector. 

The Board of the Institute will comprise Dr. Jaime Athos of the Tofurky Company, Matt Dunaj of Follow Your Heart, Liz Ross, founder of Rethink Your Food, Audrey Lam of the Center for Energy, Tyler Whitley of Mercy for Animals and Dr. Garrett Broad of Rowan University.

 

It is evident that the Plant Based Foods Association will become more active in both promoting products manufactured by their membership but also in opposing foods from the intensive livestock industry.  This will require commensurate action on the part of livestock and poultry associations to counter what will evidently be a program of questionable veracity emphasizing health, welfare, sustainability and environmental considerations.

 


 

Burger King to Invest in Brand Identity to Stimulate Sales

09/19/2022

Burger King has announced that it will invest $400 million over the two years to implement  “royal reset” and “fuel the flame” programs.  Approximately $150 million will be designated for advertising in mainstream and digital media in the “fuel the flame” component.  The “royal reset” will involve investment of $250 million in restaurant technology, remodels and relocations.

 

The “royal reset” component will include upgrades to 3,000 stores to improve guest experience to match the adverting campaign.  Over $200 million will be used to rehabilitate 800 restaurants over two years.

 

Tom Curtis, president of Burger King North America developed the plan and consultation with franchisees. The initiative was developed to enhance the perception of the Burger King brand, improve menu offerings and value and to modernize restaurants. 

 

The deployment of $400 million will have an adverse effect on EPS through FY 2024 but the investment will be accretive to adjusted EPS for 2025 onwards.

 

Burger King intends to develop a chicken sandwich portfolio launching the Royal Crispy Chicken that will extend the present original chicken sandwich offering.

 


 

Injuries Caused by Collapse of Barn Under Construction

09/19/2022

Ten workers suffered injuries requiring hospitalization when part of a dairy barn under construction collapsed on September 13th in Watertown, SD. 

 

An investigation of the incident is to be undertaken by the Occupational Safety and Health Administration. This Agency will determine whether the event was due to defective design, an error in construction, extraneous factors or their combination.

 

Many livestock and poultry producers undertake their own construction projects with varying levels of input by professionals including structural, electrical and mechanical engineers.  Reputable general contractors have personnel on-staff including experienced site project managers to avoid accidents and to deliver buildings and installations conforming to federal, state and local codes.


 

Crop Progress

09/19/2022

Status of 2022 Corn and Soybean Crops

The USDA Crop Progress Report released on September 19th documented continued progress in both soybean and corn crops. Corn now corresponds closely to the 4-year average. Eighty seven percent of corn was at the dented stage on September 18th up from 77 percent last week and 40 percent of the crop was mature and seven percent has been harvested. The fact that a high proportion of the corn crop was planted over a two-week period created widespread vulnerability to heat and drought at the critical stage of silking and this had an adverse impact on corn yield in severely affected areas contributing to a low average national yield of 172.5 bushels per acre.

 

Forty two percent of the soybean crop was dropping leaves on September 18th with three percent harvested. Crop condition was behind the corresponding week in 2021.

 

For the week ending September 11th topsoil and subsoil moisture levels are still lower than the corresponding week in 2021 although some central and easterly states in the corn-belt have had relief from drought.

 

EGG-NEWS will report on the progress of the two major crops as monitored by the USDA through November.  

 

 

WEEK ENDING

Crop

August 21st

August 28th

4-Year Average

Corn Dough (%)

Corn Dented (%)

Corn Mature (%)

Corn Harvested (%)

100

77

25

5

100

87

40

7

100

88

45

8

Soybeans Setting Pods (%)

Soybeans Dropping Leaves (%)

Soybeans Harvested (%)

100

22

0

100

42

3

100

47

5

Crop Condition

V. Poor

 Poor

Fair

Good

Excellent

Corn 2022

Corn 2021

9

5

 12

 10

27

26

41

45

11

14

Soybeans 2022

Soybeans 2021

5

4

10

 10

30

28

46

47

9

11

Parameter

V. Short

Short

Adequate

Surplus

Topsoil moisture: Past Week

20

32

45

3

Past Year

18

32

47

3

Subsoil moisture: Past Week

21

32

45

2

Past Year

21

31

46

2

 

During mid-July AccuWeather projected that drought and heat would reduce the corn crop to a range of 14,000 to 14,300 million bushels compared to the WASDE August value of 14,360 million bushels.

 

The 2022 ProFarmer Tour estimated the corn crop at 13,759 million bushels with an average yield of 168.1 bushels per acre. Their estimate of the soybean crop was 4,535 million bushels with an average yield of 51.7 bushels per acre.

 

The September 12th WASDE #628 estimated the average U.S corn yield at 172.5 bushels per acre with a 2022 harvest of 13,944 million bushels. The soybean yield was estimated to attain 650.5 bushels per acre with a 2022 harvest of 4,378 million bushels.

 

The September WASDE #628 is posted under the STATS tab.


 

EPA to Release Renewable Fuel Standard by Mid-November

09/19/2022

According to a recent statement by Michael Regan, Administrator of the Environmental Protection Agency (EPA) the Renewable fuel Standard will be released by mid-November.  This is a departure from previous years in which EPA was unable to provide a RFS value within the period designated by Congress.

 

In June the EPA approved renewable volumes for refiners covering the 2020-2022 cycle. For 2022, the RVO was set at 20.6 billion gallons based on 15.0 billion gallons of corn ethanol.

 

The EPA should soon issue a decision on a request by eight Midwest states to market E15 blend year-round. During the summer of 2022 sale of E15 was allowed through emergency waiver.


 

USDA to Supplement School Feeding Programs

09/19/2022

The USDA has announced that $2 billion will be devoted to food banks and school meal programs to overcome supply chain disruptions and higher food costs. An allocation of $500 million will be transferred from the Commodity Credit Corporation for school feeding.

 

Approximately $1 billion be used to purchase food for emergency distribution to food banks in addition to $500 million for the Local Food Purchase Assistance Cooperative Agreement involving 49 states, 33 tribes and 4 territories.  The allocation to school meal programs represents the third round of the Supply Chain Assistance funding.  This is used by school districts to purchase fresh fruit, milk, cheese and hopefully eggs from local suppliers.

In announcing the funding, USDA Secretary Tom Vilsack stated, “Funding these initiatives is paramount to the fight against hunger.”  He added, “We must ensure Americans have access to safe, healthy, and affordable food for longevity and optimal health.”


 

Egg Production In Mexico To Expand In 2023

09/18/2022

According to the USDA-FAS report MX 2022-0045 released on September 6th, egg production in Mexico will expand by 3.0 percent in 2023, compared to the previous calendar year.  Net imports corresponded to 1.8 percent of production of 3.243 million metric tons, corresponding to an annual production of 4.504 billion dozen.  Assuming a population of 132 million, annual consumption was 415 eggs per capita, up 3.2 percent from 2022.

 

The top producing states for eggs are Jalisco (55 percent); Puebla (13 percent); Sonora (8 percent) and La Laguna and Yucatan (5 percent each).  The market comprises 98 percent white shelled eggs with 99 percent of hens housed in cages. 

 

During July, white eggs at retail were $1.40 per dozen, up from $1.00 per dozen in July 2021.  Approximately 77 percent of eggs in Mexico are sold in traditional markets and the remainder, as packaged product, in supermarkets and groceries.  Eight percent of production is processed.  Based on the projected egg production and assuming an average 78 percent hen-day value, the egg producing flock in Mexico is between 190 and 200 million hens in production.

 

Mexico was the third ranked U.S. importer of shell eggs during the first seven months of 2022, receiving 3.8 million dozen representing 9.4 percent of U.S. export volume and 6.8 percent value, corresponding to a unit price of $1.16 per dozen.  This was 37 percent below the USDA nest-run benchmark average of $1.86 per dozen for the seven months.  Compared to the first seven months of 2021, exports to Mexico in 2022 were down 89 percent in volume and 84 percent in value.  During 2021, Mexico was second-ranked in shell egg exports from the U.S., receiving 52.2 million dozen valued at $41.9 million.

 

Mexico was fourth-ranked as an importer of egg products during the first seven months of 2022, receiving 1,185 metric tons from the U.S., representing 8.1 percent of volume and 6.9 percent of value with a unit price of $4,219 per metric ton.  Volume and value over the seven months of 2022 were down, respectively, 68.6 percent and 37.5 percent compared to the corresponding period in 2021.  During entire 2021, Mexico imported 9,774 metric tons of egg products valued at $18.9 million.


 

California Courts Rule Against USDA Over Electronic Labeling of GMO Foods

09/18/2022

A U.S. District Court in California has declared as unlawful a USDA decision to allow genetically engineered (GMO) foods to be labeled with an electronic “QR” code.  The 2018 rules for labeling GMO foods that came into effect on January 1, 2022, were developed in accordance with the USDA National Bioengineered Food Disclosure Standard.

Activist organization, the Center for Food Safety filed the case against the USDA in 2020 on behalf of organizations promoting organic foods.  The Court held that simply applying a “QR” code to labels in the absence of a text statement concerning GMO status was “a significant error” since many consumers would be deprived of meaningful information.  In 2018 when the regulation was framed, USDA were aware that simply placing a “QR” code on a label would be inadequate.  The Court noted that Congress intended for the USDA to provide “additional and comparable options” to improve accessibility of the electronic disclosure.  The ruling, unless overturned on appeal, will require the USDA to revise the 2018 rules and add additional disclosure options.

 

The Court accepted USDA nomenclature, including “Bioengineered”, and would require the USDA rules to only mandate GMO labeling of foods if genetic material is detectable.


 

Patient Numbers Higher In Daily Harvest Toxicity Case

09/18/2022

By September 15th, the Food and Drug Administration had received 386 consumer complaints related to consumption of “Lentil and Leek Crumbles” manufactured and sold by Daily Harvest and distributed online and through stores in Chicago and Los Angeles. The clinical problem is characterized by gastrointestinal symptoms and liver dysfunction and has resulted in 130 hospitalizations to date.

The ingredient suspected of being responsible for the adverse effect is tara flour derived from a plant in Peru.  By mid-June, Daily Harvest had received complaints from 470 consumers from April onwards. “Lentil and Leek Crumbles” were recalled on June 17th, but product may still be in homes and should be destroyed


 

FDA Criticized Over “Top-To-Bottom” Review

09/18/2022

Brian Ronholm, Director of Food Policy for Consumer Reports and previously, Deputy Undersecretary for Food Safety at the USDA, is criticizing the U.S. FDA over restraints imposed on a comprehensive review of operations.  The Reagan-Udall Foundation was commissioned to conduct a review of structure and operations with the objective of providing recommendations to improve intradepartmental communication and the overall efficiency of the Agency. 

Ronholm reports that the Reagan-Udall Foundation will not consider the Center for Veterinary Medicine, depriving the reviewers of a critical component of FDA activity.  Ignoring the CVM confirms the need for radical change since it confirms the culture of fragmentation and is contrary to the principal of a “One Health” approach to both human and animal disease endorsed by the Agency. 

 

Consumer groups and industry trade associations have previously called on the FDA to harmonize the Agency’s diverse structural entities involved in food safety. EGG-NEWS has previously noted that appointing foundations, however well intended, to conduct structural reviews is an exercise in futility, wasting time and providing cover to avoid constructive action.

Food safety in the U.S. should be based on an independent and committed Agency that in the U.S. would comprise the food-related responsibilities of the FDA and the FSIS component of the USDA.

 

Despite the federal funds allocated to the FDA for food safety, the Agency has consistently demonstrated deficiencies and has failed to implement the Food Safety Modernization Act intended to proactively protect consumers.


 

Swiss Voters To Consider a Ballot Similar to Proposition #12

09/18/2022

Voters in Switzerland will decide on whether to ban intensive livestock production by placing minimum space allowances for livestock and poultry and establishing strict environmental limitations.

The rules if passed will have the force of law. The ballot includes a requirement that imported animal products and also foods with ingredients of animal origin would have to be produced in accordance with the Swiss standards.

 

The initiative has considerable support from environmental and welfare activists, including vegans. Jasmijn de Boo, Vice-President of ProVeg International, noted, “Factory farming should no longer be tolerated today.”  She added, “The system is responsible for agricultural run-off and mass river pollution, greenhouse gas emissions, compacted soil and increased risk of antimicrobial resistance.”

It is hoped that the astute voters of Switzerland will take a careful look at the initiative and consider the effects of both a domestic ban on intensive production and more importantly restrictions on imports.  The proposal would markedly reduce the availability of animal protein and disrupt food production in the nation.  The adoption of the ballot initiative would be a classic case of a vociferous minority imposing their intentions, however sincere, on the entire population and generating unintended consequences.


 

Consumers Response to Higher Grocery Prices

09/15/2022

IRI recently released the August 2022 Price Check that documents retail food and beverage prices and inflation with commentary on consumer trends.

 

August data collected by IRI in collaboration with partner, NPD Group, showed that prices for food at home increased by 1.6 percent from the end of July to the end of August and up 13.4 percent year-over-year through August 28th, 2022.

In August, carbonated beverages and fruit increased by 5.3 percent from the end of July.  Butter and other spreads were up 30 percent compared to August 2021.

 

Retail food and beverage unit sales declined by 4.5 percent compared to August 2021 and volume was down 4.0 percent.  Categories including frozen dinners, cookies and coffee that have experienced sharp escalations in price showed the largest reduction in volume.

 

The IRI report noted that despite total sales of retail food and beverages remaining fairly constant, low-income households are buying fewer discretionary items and are searching for favorable prices.  The report concluded that customers are making more frequent trips to a greater range of food stores.  Quick trips were up 6.7 percent during August 2022 compared to the corresponding month in 2021 and shopping trips to replenish pantries were down by 0.6 percent.  Club stores and deep discount groceries have benefitted from the search for lower prices but apparently among middle and upper income consumers.

 

IRI determined that trends in consumer purchases were driven predominantly by low-income households with a sharp reduction in purchases of discretionary categories, including seafood, candy and prepared meals.


 

Online Grocery Sales Enter Plateau

09/15/2022

According to Brick Meets Click and partner Marcatus, online grocery sales in August attained $8.5 billion, down from $8.6 billion in August 2021.  Pickup from stores declined from $3.7 billion to $3.5 billion.  Delivery to homes increased from $2.9 billion to $3.5 billion.  Ship-to-home, using common carriers and parcel services, fell to $1.4 billion from an August 2021 value of $2.0 billion. The Census Bureau reported retail food and beverage sales to be $71 billion in August 2022 up 7.7 percent from August 2021.

 

Despite the evident plateau in total value and some changes within the three channels, the impact of COVID on online grocery sales is evident from the four-fold increase in total compared to August 2019.  In this pre-COVID month, total online grocery sales attained $2.0 billion with pickup amounting to $0.7 million, delivery $0.5 billion and ship-to-home $0.8 billion.

 

The similarity in value between August 2022 and August 2021 suggests that those who are using online services now represent a stable demographic and that, further expansion in online sales may be limited by cost.  Declining prices for gasoline and a desire to select value-priced items together with a general release from COVID restrictions will predicate more extensive in-person shopping.


 

2023 Farm Bill Proposals

09/15/2022

Depending on the composition of the House and Senate in 2023, the next Farm Bill might be radically different from existing legislation and is certain to generate controversy.

Members of House committees have to take into account the reality of climate change, disruption in supply chains persisting after the control of COVID and geopolitical events.

 

The Administration plan will attempt to include a variety of politico-social considerations into the Farm Bill based on stated priorities.  These include:-

  • Reducing hunger by strengthening food assistance programs.
  • Respond to climate change by investing in research, technical assistance and support for farmers and ranchers.
  • Emphasizing racial justice through actions that compensate for alleged past discrimination and by assigning resources, including grants to communities regarded as historically under-invested and underserved.
  • Improving the safety and remuneration of workers by increasing wages, providing healthcare and housing.
  • Protecting farmers and consumers from unfair competition.
  • Ensuring safety of the U.S. food supply by reducing bacterial contamination.

 

The tone of the approach by USDA and those advocating for a radical change in the Farm Bill is denoted by the use of the term “factory farms” in place of CAFOs, referring to intensive livestock production facilities.


 

Inflation Plateau In July

09/15/2022

The Consumer Price Index rose 8.5 percent in July compared to the corresponding month in 2021.  The Index was however lower than the 9.1 percent year-over-year increase in June 2020.  In comparing items within the Consumer Price Index, it is evident that groceries have yet to respond to the evident relaxation in supply chain pressures and other costs since groceries increased by 13.3 percent.  This contrasts with restaurant meals that were up 7.6 percent.  By comparison, gasoline was 4.4 percent higher and rent up 6.3 percent, although both showed a lower rate of increase from June and less than the weighted CPI.  Eggs were a standout with an increase of 38 percent over July 2021.  This is attributed to depopulation of over 34 million hens, disrupting the equilibrium between supply and demand. The increase in the retail prices of meat and other protein has influenced the demand for eggs but even at current high shelf prices, they provide value in terms of nutrient content.

 

The U.S. is not alone in experiencing inflation. The 19 nations using Euro currency recorded an 8.9 percent increase in CPI in June and the U.K. recorded a 9.4 percent higher index compared to June 2021.

 

Release of the CPI that was predicted to be slightly lower strengthened sentiment that the Federal Reserve would raise benchmark interest rates by 0.75 percent at the September 20th-21st meeting.  Concern that the Fed FOMC would continue increasing rates to combat inflation stimulated a 4 percent swoon in major stock market indexes on Tuesday, September 13th with smaller daily declines persisting through the remainder of the week.


 

STOP PRESS

09/15/2022

Rail Strike Averted

 

Following a marathon negotiating session extending over 20-hours, the railroad operators and the consortium of unions representing workers have agreed to terms for a five-year contract, averting a nationwide rail strike. The implications of a strike to the economy, disruption of supply chains and the political implications of a work stoppage of even short duration are self-evident. 

 

The involvement of the White House and Labor secretary Marty Walsh contributed to the accord that now requires ratification by rank-and-file members of the unions involved.

 


 

National Biotechnology and Bio-manufacturing Initiative

09/14/2022

By Presidential Executive Order, the Administration has approved the establishment of a National Biotechnology and Bio-manufacturing Initiative.  The objective of the action is to develop markets for bio-based products and to stimulate research and development associated with biotechnology. The initiative will harness the resources of diverse Federal agencies to expand U.S. manufacture of bio-based products.

 

The White House noted, "investments, programs and partnerships within the initiative would advance research and development in engineering biology and bio-manufacturing, expand the strength and domestic bio-manufacturing capacity and create a resilient supply chain.

 


 

Bridgewater Farms Correction

09/14/2022

The September 9th Edition included a report on an SE recall by Bridgewater Farms. The posting should have specified that the outbreak, in common with other farms in four States in Australia occurred in 2019. The farm was depopulated followed by decontamination.

 

According to a communication from the Company, Bridgewater Farm has been under quarantine by the State of Victoria and has not produced eggs since the outbreak.

 

The alleged mishandling of flocks during depopulation that received extensive media publicity was the responsibility of a contractor.

 

EGG-NEWS apologizes for stating that the SE diagnosis was a recent event.

 


 

QC Supply Issues 2022 Fall Catalog

09/13/2022

QC Supply with thirty U.S. locations has issued their 2022 Fall catalog detailing available equipment, installations, consumables, disinfectants and items required to maintain and optimize the operation of live bird facilities.

 

For additional information on lighting, ventilation, welfare, pest control and biosecurity, access the company website by clicking <here> or onto the QC Supply logo on the right side of the Welcome page.


 

Kalmbach Feeds Establishes Veritas Agrilabs™

09/13/2022

A groundbreaking ceremony was held for Veritas Agrilabs™ during the past week on the campus of Kalmbach Nutritional Services in Carey, OH.  The facility will provide analyses of animal feed ingredients, and forages.  Veritas Agrilabs™ will be an independent accredited laboratory dedicated to providing accurate and timely results for the feed and livestock industries of the U.S. Technology offered will include NIR spectroscopy, mycotoxin assay and proximate analysis.

 

Veritas Agrilabs™ will be managed by Joy Fetter with extensive experience operating pharmaceutical and feed laboratories.  In commenting on her appointment Joy noted that the laboratory will provide accurate and consistent results, outstanding customer service and rapid turnaround time.

 

Paul Kalmbach Jr. president of Kalmbach Feeds stated, “This laboratory, in addition to the multiple research and innovation sites that Kalmbach has added over the last two years is a continuation of our desire to create value for our customers and be able to better serve them for years to come.

 

The facility will be completed in December 2022 with full laboratory services extended to the industry during the first quarter of 2023.

 


 

Kalmbach Feeds Establishes Veritas Agrilabs™

09/13/2022

A groundbreaking ceremony was held for Veritas Agrilabs™ during the past week on the campus of Kalmbach Nutritional Services in Carey, OH.  The facility will provide analyses of animal feed ingredients, and forages.  Veritas Agrilabs™ will be an independent accredited laboratory dedicated to providing accurate and timely results for the feed and livestock industries of the U.S. Technology offered will include NIR spectroscopy, mycotoxin assay and proximate analysis.

 

Veritas Agrilabs™ will be managed by Joy Fetter with extensive experience operating pharmaceutical and feed laboratories.  In commenting on her appointment Joy noted that the laboratory will provide accurate and consistent results, outstanding customer service and rapid turnaround time.

 

Paul Kalmbach Jr. president of Kalmbach Feeds stated, “This laboratory, in addition to the multiple research and innovation sites that Kalmbach has added over the last two years is a continuation of our desire to create value for our customers and be able to better serve them for years to come.

 

The facility will be completed in December 2022 with full laboratory services extended to the industry during the first quarter of 2023.

 


 

QC Supply Issues 2022 Fall Catalog

09/13/2022

QC Supply with thirty U.S. locations has issued their 2022 Fall catalog detailing available equipment, installations, consumables, disinfectants and items required to maintain and optimize the operation of live bird facilities.

 

For additional information on lighting, ventilation, welfare, pest control and biosecurity, access the company website by clicking <here> or onto the QC Supply logo on the right side of the Welcome page.


 

Deleterious Effects of Antibiotic Administration on Neonatal Mice

09/13/2022

A research team at the University of Melbourne has documented changes in intestinal function and in the microbiome as a result of administration of vancomycin for the first 10-days after birth.  Effects persisted through to six weeks of age corresponding to young adulthood in humans.  Antibiotic-treated male mouse pups had significantly lower fecal weight compared to controls and antibiotic-treated females had longer whole gut transit times.  Fecal water content was increased in both male and female mouse pups.

Vancomycin affected myenteric and submucosal neurons with males more affected than females.  Antibiotic administration induced chronic changes in the microbiome of the colon with reduced serotonin levels in the mucosa.

 

Additional studies will have to be conducted since mice are not small humans, despite similarities in gastrointestinal function.  The study did, however, demonstrate that vancomycin had a prolonged effect on the enteric nervous system with possible parallels in human development.

 

*Poon, S. et al, Neonatal antibiotics have long-term sex-dependent effects on the enteric nervous system. Journal of Physiology. doi.org/10.1113/jp282939. September 2022


 

Brinkmanship Over Imminent Rail Strike

09/13/2022

The Association of American Railroads, the trade group representing five major freight train companies and Amtrak and indirectly, all commuter rail systems, responded to increasing pressure imposed by the White House and  seven of twelve unions to accept offers by operators or face Congressional involvement before the strike deadline of Friday September 16th.

 

Tentative agreements were reached, covering 21,000 workers but seven unions representing approximately 90,000 workers delayed accepting the recommendations made by the Presidential Emergency Board that recommended a five-year contract, incorporating a 24 percent raise and a $5,000 bonus.  Outstanding issues that were resolved included scheduling, health benatits and pay scales. Job security was a major point of contention with a proposal to reduce crews from two to one engineer to save costs. This provision advanced by operators would have contravened safety regulations to be imposed by the Federal Railroad Administration

 

In a projection released by the Association of American Railroads, the cost of a strike could have exceed $2 billion per day, although prevailing sentiment was that Congress would have acted expeditiously to avoid a strike, with obvious political repercussions.

 

The Sheet Metal, Air, Rail and Transportation Workers Union urged Congress to remain neutral, obviously to provide the Union with leverage. In contrast a coalition of agricultural associations requested Congress to intervene and block a strike before the deadline.

 

Agreement on a  contract will have to be ratified by members of the unions involved. Resolution provided the unions and the railroad operatorswith security and the Administration will benefit from avoiding a strike shortly before the  mid-term elections. The agribusiness and livestock sectors have dodged a bullet.


 

TekniPlex Rebrands to Harmonizine Corporate Identity

09/13/2022

In a September 8th announcement, Brenda Chamulak, president and CEO of TekniPlex, stated, “By consolidating all brands under the TekniPlex name, we will be able to better service our customers by providing greater visibility into the full-breadth of our capabilities and offerings.”  She added, “We will also be able to more thoroughly leverage our synergies between our businesses and solidify our position as a leading materials, science solutions partner to many of the world’s largest brands.”

 

The altered brand structure unites many diverse business units under two divisions, respectively, Healthcare and Consumer Products.  The latter division will include Dolco, MMC Packaging Equipment, Keys and Fribro, among others.

 

Dolco is a significant supplier of polystyrene cartons to the shell-egg segment of the industry.  The company sharply increased production to satisfy demand following the emergence of COVID when breakers were forced to divert product to the shell market.

 

TekniPlex employs 7,000 team members through operations in the U.S., Canada, Brazil, Germany, China and seven other nations.  For additional information, access  <www.Tekni-Plex.com>.


 

Kroger Benefits from Private-Label Brands-Introducing Low-cost Line

09/13/2022

In an earnings call following the release of financial results for the second quarter, Chairman and CEO of The Kroger Company, Rodney McMullen, noted that sales of private-label brands increased by 10.2 percent during the quarter, contributing to improved financial performance.  Home Chef™ and Kroger Our Brands, including Simple Truth®, Private Selection® and Heritage Farm® contributed to the improved sales.

 

Kroger will now introduce the Smart Way® private label within the Our Brands portfolio.  The Smart Way® line will appeal to budget-conscious consumers and will include canned vegetables, juices, bread and other staples

 

Juan DePaoli, Vice-President of Our Brands for Kroger, stated, “We are confident Smart Way will have something for everyone.  This new product line incorporates features families need to put an even more affordable meal on the table.”

 

It is possible that the Kroger initiative to introduce a lower-priced line of private-label items is an attempt to regain market share lost to the deep discount grocers, including Aldi and Lidl, where they compete.

 

Chairman and CEO, Rodney McMullen, stated, “In the movement to Our Brands what we always find is that customers are lured initially to save a bit of money, but they fall in love with our product.”  He added, “Part of the continued acceleration of growth in Our Brands is driven by value but part of it is just the quality of the product.”

 

Subscribers are referred to the report on the second quarter results for the Kroger Company in this edition. 


 

Continuing Outbreaks of HPAI in Wild Birds

09/13/2022

A serious outbreak of H5N1 highly pathogenic avian influenza has reduced the population of Gannets breeding on the island of Rouzic, part of the Sept-Iles Archipelago off the coast of Brittany, France.  This outbreak is unfortunate as it has affected a rare colony of Northern Gannets (Morus bassanus), killing adults allowing chicks deprived of parental care to starve. 

 

H5N1 strain avian influenza has caused serious losses in diverse wild bird species including cranes, storks, hawks, cormorants, pelicans, geese, gulls, and penguins.  The infection has also been diagnosed in seals, porpoises, and foxes on both sides of the Atlantic.

 

Dr. Pascal Provost, Director of the Bird Reserve including Rouzic Island noted, “Bird flu is hitting sea birds in the spring and in the summer. That is totally new, traditionally bird flu mainly affects waterfowl during winter.

 

The Ministry of Agriculture of France issued a statement commenting on the exceptionality of the outbreaks of avian influenza both with respect to numbers of birds involved with over 19 million commercial waterfowl, chickens and turkeys having to be culled from November 2021 through May 2022.


 

Meijer To Open New Format Stores

09/10/2022

Departing from the Hypermarket format, Meijer will debut an 80,000 square foot store concept located in Ryan Township in Michigan to be opened in early 2023.  The “Meijer Grocery” store will include fresh produce, meat, a bakery, deli, pharmacy and sections for pets and consumables.  Stores will have a single corner entrance for convenient access from parking.

 

Don Sanderson, Group V.P. of Foods, stated, “We are excited to provide our customers with yet another way to shop.”  He added, “This new concept store will not only provide our customers with everything they need on their weekly shopping trip but also a quick and easy solution for last-minute requirements.”


 

HPAI Outbreak In Portugal

09/10/2022

ProMED reported an extensive outbreak of Highly Pathogenic Avian Influenza, in Vendas Novas, Evora affecting 50,000 growing ducks. The outbreak is presumably attributed to H5N1, confirmed on August 29th.  The origin of infection is unknown. Appropriate protective measures have been imposed consistent with WOAH recommendations.

 

Between November 2021 and September 2022, Portugal recorded 26 outbreaks of Highly Pathogenic Avian Influenza H5N1, confirmed by the National Institute of Agricultural and Veterinary Research.  Outbreaks involved wild birds, turkeys, chickens and ducks. 


 

White House Recommends Annual Covid Booster

09/10/2022

As the Omicron bivalent COVID vaccines are ready for release, the White House has issued a recommendation for annual vaccination paralleling the program for annual influenza vaccination.

 

The annual booster plan will prevent confusion and hopefully establish a routine pattern that will lead to high levels of population immunity, preventing acute COVID symptoms and limiting “long-COVID” that now appears to affect more than 25 million. 

 

It is estimated that the first generation of COVID mRNA vaccines saved as many as 20 million lives. Protection of our population is unfortunately incomplete with approximately 70 percent having received the two priming doses. Only a third are considered fully vaccinated following at least one booster.

 

Pharmaceutical companies are working on variations of existing vaccines that will hopefully be available within two years.  These may include:

  • Broad spectrum (pancoronavirus) vaccines to provide protection against a broad range of mutations.  According to Dr. Katelyn Jetelina in the Your Local Epidemiologist newsletter, the Walter Reed Army Institute of Research is developing a nanoparticle vaccine that incorporates RNA from a conserved region of the SARS-CoV-2 virus that will provide broad protection of variants that are certain to emerge.
  • Mucosal vaccines will stimulate tissue immunity and will be administered by inhalation following effective systemic immunity stimulated by injected mRNA vaccines.
  • Combination influenza and COVID vaccines - Novavax is conducting Phase II clinical trials on a combination vaccine that may be available in 2023.

 

In 2020 the development and production of a range of COVID vaccines was funded by the Federal government under the “Warp Speed” initiative. This relieved manufacturers (other than Pfizer) from the risks of investing up to $1 billion for R&D and completing trials through Phase-3, required for FDA approval.

 

We know that existing vaccines provide protection against severe clinical symptoms and hospitalization.  Until a new range of vaccines is available, we should take advantage of the convenience offered and be protected against both COVID and influenza through separate doses that can be administered simultaneously.


 

Stocking Density During Pullet Rearing Evaluated By Purdue University

09/10/2022

Egg-NewsDr. Darrin M. Karcher of Purdue University recently completed a study on pullet rearing funded by the U.S. Poultry Foundation as Project F083.  In the first study, brown- and white-feathered strain Lohmann pullets were reared at either 670 cm2/bird (104 inch2/bird) or low density 1,352 cm2/bird.(210 inch2/bird)  There was no difference in uniformity, weight at 16 weeks or the subjective evaluation of keel integrity or feet.  In the brown-feathered strain, high stocking density resulted in decreased uniformity and lower feather covering.  Low stocking density improved feed conversion.  White-feathered pullets subjected to high density were more uniform and feather coverage than this strain reared at low density.

 

A second trial compared three stocking densities ranging from 1,247 cm2/bird (195 inch2/bird) through a medium allowance of 519 cm2/bird (80 inch2/bird) and high density 155 cm2/bird (24 inch2/bird).  High stocking density resulted in “poorer feather condition” but enhanced feed conversion ratio.  This trial incorporated two feeder space allocations.  Irrespective of density, reducing feeder space depressed feed conversion ratio.

 

The results failed to identify any outcome measures of stress and welfare attributable to stocking density, irrespective of feeder space allocation or density. Pullets were essentially similar with respect to practical parameters.  It is hoped that further data will be released relating to the subsequent age at onset of production and peak, egg weight with hen week production, case weight, feed conversion and livability data through at least 50 weeks of age.

 

The trials conducted by Dr. Karcher, and his colleagues are important since they provide quantifiable, scientific evaluation of growth and evaluation of stress that are important in establishing standards.  Clearly, the financial implications of rearing pullets at either 670 cm2/bird or 1,352 cm2/bird are self-evident. Standards imposed by certifiers of animal welfare based on subjective evaluation by panels should be justified by appropriate data.

 


 

Black Sea Shipping Agreement In Question

09/10/2022

The agreement between Ukraine and Russia, brokered by the United Nations and Turkey is now in jeopardy.  Resumption of ocean shipping of wheat and other agricultural commodities from Black Sea ports still operated by Ukraine reduced the price of wheat.

 

In addressing the Eastern Economic Forum in Vladivostok last week, President Putin noted, “We are honoring the agreement, but it turns out that the West has just screwed us over and not just us, but the poorest countries whose interest was the pretext for the agreement.”  President Putin now wishes to renegotiate the deal based on the reality that international sanctions are impacting his economy and ability to wage war against Ukraine. 

 

At issue is the price cap on Russian oil at $44 per barrel imposed by the G7 nations.  This figure is believed to be the current average cost of production from Russian fields.  Adewale Adeyemo, U.S. Deputy Secretary of the Treasury, noted, “We are not going to set a price below Russia’s cost of production.”  He noted that $44 per barrel should maintain production but not allow the Russian Federation to gain benefit from market fluctuation caused by their invasion of Ukraine.  The price cap is scheduled to take effect on December 5th. There is a question as to whether all signatories to the agreement will conform.  Japan has indicated that oil from the joint venture Sakhalin-2 Project will be excluded from the price cap.

 

In the event that Russia reneges on the agreement, shipments from Ukraine ports through the Black Sea will be curtailed, resulting in sharp increases in the price and availability of wheat and sunflower oil.  The EU and the U.S. may intervene establishing safe ocean passage requiring extensive naval presence in the Black Sea and through the Bosphorus Strait.  This will inevitability involve a conflict with Russian naval forces that are clearly inferior to the EU and U.S. capability.


 

Bellinger Foundation to Celebrate Career of Dr. Gary Smith

09/08/2022

Over the October 14th and 15th weekend, the Bellinger Foundation will honor Dr. Gary Smith, an eminent scientist at Texas A&M University and an innovator in the meat industry.

 

The program commencing Friday, October 14th will begin with an appreciation to Dr. Smith at the Briscoe Western Art Museum in San Antonio.  On Saturday, a seminar will take place in his honor reviewing pathogens, sustainability and regulatory issues.

 

John Bellinger stated, "whether they know it or not, Dr. Smith's work has benefited the lives of nearly every consumer from keeping people safe to standardizing the way the industry grades carcasses to mentoring today's preeminent meat scientists. The effect Dr. Smith has had on the industry cannot be overstated”. 

 

The program will raise money for the Gary'68 and Kay Smith Meat Judging Team Excellence Endowment.


 

Purdue University Develops Simple Dust Monitoring App

09/08/2022

A research team led by Dr. Rose Ambrose has developed a mobile app using a smartphone camera to image and quantify atmospheric dust levels.  Technology using laser detection is incompatible with rapid screening of workplace environments and livestock buildings.    

The mobile app created by the Purdue University team uses a smartphone camera to image and record dust levels with acceptable accuracy. Portability and speed are obvious advantages with using a smartphone.  It is hoped that the technology will be commercialized since it had direct application in feed mills and poultry houses where issues of both flock and worker health are concerned.


 

Farm Workforce Modernization Act To Be Considered By The Senate

09/08/2022

The House has passed the Farm Workforce Modernization Act that will make available additional H-2A visas.  Rep. Zoe Lofgren (D-CA) the sponsor of the House bill, noted, “At a time when labor shortages are contributing to inflation and high food prices, it’s clear that we need the Senate to pass our Farm Workforce Modernization Act to stabilize the agricultural workforce and protect America’s food supply.”

 

The Senate version is sponsored jointly by Sen. Mike Crapo (R-ID) and Michael Bennet (D-CO).  The Senate concern regarding the House bill is that holders of H-2A visas and current undocumented farm workers will receive work-based residency with an eventual pathway to citizenship.

 

The bill enjoys strong support from agricultural groups.  They cite a 2022 Texas A & M University study that found that additional H-2A workers could reduce cost of production and hence inflation. The release of additional H-2A visas would not affect the employment of U.S. citizens who are, in large measure, disinclined to fill available jobs in agriculture.


 

USDA-FAS Weekly Export Sales Report Suspended

09/08/2022

Subscribers will note that weekly Commodity Report has omitted the export data for corn, soybeans and soybean meal for the past two editions.  In a statement dated August 31st, Daniel Whitley the Administrator of the USDA Foreign Agricultural Service (FAS) ascribed the failure to post the weekly updates as “the result of unanticipated difficulties with the launch of the new Export Sales Report and Maintenance System.”  The FAS will reintroduce the original system on September 15th.  The new reporting system was designed to maintain security of data and to allow for future enhancements.

 

According to the statement, FAS has worked over many months to transition to the new system.  Notwithstanding this explanation, the technical factors resulting in the defective launch should have been anticipated through simulation and testing.

 

Whitley observed that “export sales reporting is a partnership between USDA and U.S. agricultural exporters and we recognize data integrity and data quality are interrelated.”  Could this comment be construed as a subtle attempt to shift blame for the debacle?  The delayed launch of the system was ascribed to “unanticipated difficulties”.  This suggests incompetence at some level, denoting structural deficiencies within FAS. Failure to release data required by the agricultural sector and traders is unacceptable.  The Inspector General of the USDA should investigate to determine if:-

  • The problem was attributed to a failure in performance by FAS personnel
  • Defective deliverables supplied by a contractor
  • Lack of coordination between the Agency and their contractor.

 

It is questioned whether those responsible for implementing the new reporting system will be held to account or whether corrective action will be taken to avert a reoccurrence.


 

California Bills To Reduce Plastic Waste

09/08/2022

The California Legislature has passed a series of bills designed to reduce plastic and hazardous waste. All bills were enacted following signature by Governor Gavin Newsom.

 

The package includes:-

  • Commencing 2025, plastic bags in produce sections of supermarkets must be reusable, recyclable or compostable.
  • Clamshell thermoform containers will have to contain increasing proportions of recycled plastic, commencing with 10 percent in 2025 extending to 30 percent by 2030.
  • Disposal of electronics, bottles and batteries will be regulated.  Single-use propane canisters will be banned by 2028.

 

The legislation was predictably opposed by the California Chamber of Commerce, the Plastics Industry Association and the American Chemistry Council. In addition to producer groups representing produce and fruit farmers. 

 

One of the bills redefines incineration as an unacceptable method of disposal of a range of waste products. This will affect the two remaining solid waste incinerators located in Long Beach and Modesto. Many municipalities in California were sending up to ten percent of their waste to incineration.

 

In accordance with the 1989 Integrated Waste Management Act, half of collected waste must be diverted from landfills into recycling. 

 


 

Bivalent mRNA COVID Vaccines Approved by FDA and CDC

09/08/2022

In a press release dated August 31st, the U.S. Food and Drug Administration (FDA) issued an emergency use authorization for both Moderna and Pfizer-BioNTech Covid vaccines incorporating both the original SARS-CoV-2 and BA.4 and BA.5 linages.  The authorization allows the Moderna vaccine as a booster for individuals 18 years of age and older and the Pfizer product for those 12 years of age and older.  The modification to the mRNA vaccine is intended to extend protection against the BA.4 and BA.5 variants of the original SARS-CoV-2 virus now predominating in the U.S. and in many nations.

 

In comments justifying emergency use approval, FDA Commissioner Dr. Robert M. Califf stated, "As we head into fall and begin to spend more time indoors, we strongly encourage anyone who is eligible to consider receiving a booster dose with a bivalent COVID vaccine to provide better protection against currently circulating variants".  He added, "The vaccines including boosters continue to save countless lives and prevent the most serious outcomes including hospitalization and death as a result of COVID".

 

Dr. Peter Marks, Director of the FDA Center for Biologics Evaluation and Research stated, "The FDA has been planning for the possibility that the composition of the COVID vaccines would need to be modified to address circulating variants.  We have worked closely with the vaccine manufacturers to ensure the development of these updated boosters was done safely and efficiently".  He added, "The public can be assured that a great deal of care has been taken by the FDA to ensure that these bivalent COVID vaccines meet our rigor of safety, effectiveness and manufacturing quality standards for emergency use authorization".

 

The authorization was based on a review of immune response data from 600 adults over 55 years of age previously immunized with a two-dose primary series followed by one booster dose.  Protection was compared with volunteers receiving a second booster dose of either the bivalent vaccine with the controls receiving a monovalent vaccine.  There was no difference in the manufacturing process for either the monovalent or bivalent vaccines.  No differences were observed in clinical response or adverse reaction including the risk of myocarditis and pericarditis.

 

On Thursday, September 1st the Centers for Disease Control and Prevention issued use recommendations for the bivalent vaccines that are now being distributed.


 

White House Conference on Hunger, Nutrition and Health

09/08/2022

The Administration has announced that the 2022 Conference on Hunger, Nutrition and Health will take place on September 28th.  This is the first conference on the comprehensive role of hunger and its interaction with health since 1969.  Topics to be considered by participants include:

 

  • Improving food access and affordability with special reference to food assistance programs and logistics.

 

  • Integrating nutrition and health including disease prevention and management obviously with reference to intake of calories, salt and sugar and their deleterious effects including obesity, hypertension, diabetes and other metabolic conditions.

 

  • Empowering all consumers to have access to healthy food choices and increasing access to healthy food.

 

  • Public messaging and education directed to specific demographics will be required for urban, rural, and Tribal communities.

 

  • Encourage physical activity through a campaign to increase awareness of the benefits of physical activity and facilitating exercise in safe locations

 

  • Enhancing research on nutrition and food security including methods to improve data collection and research on nutrition and health and to enhance food security

The White House is promoting community-based organizations, health care professionals, trade universities, academia and Tribal governments to organize concurrent events relating to hunger and nutrition.


 

FAO Food Price Index For August

09/07/2022

The Food and Agricultural Organization (FAO) of the U.N. released the August Food Price Index on September 6th.  The Index for August averaged 138.0 points, down 1.9 percent or 2.7 points from July, representing the fifth consecutive monthly decline.  Notwithstanding the trend, the Index is 7.9 percent above the August 2021 value and closely corresponding to the U.S. rate of inflation.  The FAO Food Price Index comprises five components. Excluding sugar these comprise:-

 

  • The Cereal Price Index averaged 145.2 points in August, down 2.0 points but 11.4 percent above August 2021.  The decline was attributed to a reduction in wheat price with higher supplies from Canada, the U.S. and the Russian Federation coupled with resumption of exports from the Black Sea region.  World corn prices were up 1.5 percent due, in part, to lower projected harvests from the EU and the U.S. as affected by drought.  This was offset by lower prices for barley and sorghum.
  • The Vegetable Oil Price Index averaged 163.3 points, down 5.5 points from July.  Lower prices for palm, sunflower and rapeseed oils balanced higher prices for soybean oil.
  • The Meat Price Index averaged 122.7 points in August, down 1.8 points but still 9.3 points above August 2021.  The lower value was attributed to higher availability and prices for poultry meat and a decline in beef price on weak demand.  Pork rose due to reduced supply despite lower purchases by China.
  • The Dairy Price Index averaged 143.5 points in August, down 3.0 points but 27.3 points above August 2021.  Milk production was lower in Western Europe and the U.S. and there was concern over supplies from New Zealand, despite weaker demand from major importers.

 

Historically, the annual FAO Food Price Index has almost doubled from 2005 (67 points) to 2010 (107); 2015 (93); 2020 (98); 2021 (125) with the August 2022 Index at 138 points.


 

Organic Metal Antibody Technology Developed to Identify Foodborne Pathogens

09/07/2022

A team led by Professor Hiroshi Shiigi at the Graduate School of Engineering, Osaka Metropolitan University has developed technology to identify specific foodborne pathogenic bacteria.  Nanohybrid structures with adherent antibodies can serve as indicators for the presence of homologous pathogens.  The metal nanoparticles can be detected based on color differences under scattered light.  The nanohybrid structures bind to pathogens and depending on the specificity of the antibody can differentiate among strains of E. coli.  Under laboratory conditions, it was possible to distinguish between E. coli O26 and E. coli O157 when these pathogens were added to decomposing meat.

 

Dr. Shiigi noted, “We aim to establish new detection principles and testing methods through the development of unique nano-biomaterials that will contribute to food safety and security.”

 

*So, T. et al Simultaneous optical detection of multiple bacterial species using nano meter-scaled metal-organic hybrids. Analytical Chemistry. doi: 10.1021/acs.analchem.2c01188 (2022).


 

Chobani Withdraws IPO Documentation

09/07/2022

On September 2nd Chobani LLC. requested the Securities and Exchange Commission to withdraw the Registration Statement submitted previously in November 2021. The Company was valued at $10 billion at this time based on annual revenue of $1,400 million in 2020. Chobani is currently non-profitable with a loss of $59 million in 2020 due to plough-back of  operating margin into broadening the product line and gaining market share

 

The Company was founded in upstate New York by Hamdi Ulukaya an immigrant from Turkey, but now is headquartered in Twin Falls ID where it operates one of the largest yoghurt plants in the World. Chobani is noted for generous employee benefits and providing a haven for refugee immigrants who comprise 35 percent of the workforce.

 

A spokesperson noted that current market conditions have led to the decision with the focus of the company to remain on execution and profitable growth.

 

Chobani continues to expand their product line and it is inevitable that when market conditions improve that the company will reinstate the S-1 Registration Statement for CHO.


 

OVO-Vision Upgrades Software

09/07/2022

OVO-Vision has upgraded software to provide a seamless information system integrated with production data.

 

In an inflationary and volatile environment, profitability is based on appropriate marketing decisions that require precise control of flocks and packing plants. Monitoring the level of production, size and grade of eggs and downgrades provides information required for pricing and contract negotiations.

 

The OVO-Vision system interfaces with production data from layer houses and is compatible with PMSI (Prism) and Hotraco installations.  Data is reported in a consistent and standardized format to compare and evaluate flock performance.  OVO-Vision depicts data in a dashboard that displays a range of critical parameters, including inventory, production level, feed consumption, grade-out and yield. 

 

The integrated OVO-Vision system allows data to be applied to decision-making to optimize return from all components of an enterprise extending from production through delivery.

 

 For additional information and a demonstration, access <OVO-Vision.com> or click onto the OVO-Vision logo on the right side of the Welcome page.


 

Saudi Arabia Gets “Sweet Deal” on Scarce Water Resources in Arizona

09/07/2022

In June The Arizona Republic conducted an investigation that disclosed that the Arizona Land Department had extended a lease to Fondomonte, a company owned by investors in Saudi Arabia to grow alfalfa under irrigation.  The product is shipped to Saudi Arabia to feed dairy cattle.  Fondomonte is paying $86,000 annually to lease land in the Butler Valley at a rate of approximately $25 per acre.  This figure according to The Arizona Republic is considerably lower than market value.  The water that is abstracted from an aquifer is required as a backup for both urban consumption and livestock.  The current lease is considered disadvantageous to the citizens and State of Arizona since knowledgeable agriculture economists consider the value of water and land used by Fondomonte to be worth $4 to 5 billion annually.

 

Kris Mayes candidate for State Attorney General is calling for a moratorium on the lease pending investigation as to the circumstances of the payment consideration and whether the lease was granted in conflict with the state constitution. Mayes stated, “I think most Arizonians find it shocking that our government has given the state’s water away to a Saudi corporation at a time of extreme drought.”   He added, “This Saudi water lease is a flat-out scandal, and our current Governor and Attorney General allowed it to happen on their watch.” 

 

Mayes is joined in his opposition to the lease by gubernatorial candidate Kari Lake (R) and by her opponent Katie Hobbs (D).  The Republican candidate for Attorney General, Abe Hamadeh appears to be in concert with his opponent Kris Mayes in stating, “Government should not be subsidizing private industry, especially when it involves private or foreign entities freely accessing and capitalizing from our natural resources.”  He added, “I have a growing concern that the Agency tasked to care for our state land has been involved in recent controversy relating to underdeveloped public land auctions.” 

 

Given the unanimity of both Democratic and Republican candidate for major state offices, it would appear that the lease will have to be amended if not cancelled.  More importantly an investigation should determine whether there were any irregularities in negotiations leading to what may be regarded as an extremely beneficial deal for Fondomonte.


 

West Coast Port Congestion Diverts Vessels to Gulf and East Coast Destinations

09/06/2022

According to the September 5th edition of the USAPEEC MondayLine, ports along the Gulf and East Coast, including Savannah, Charleston and Houston, are gaining volume at the expense of Los Angeles and Long Beach, California.

 

According to the American Journal of Transportation, East Coast port volume was up nine percent during the first half of 2022 compared to the corresponding period in 2021, Houston was up 22 percent and West Coast ports were lower by 0.1 percent.

 

It is evident that incremental import volume during the first half of 2022 represented an increase in traffic, given the almost constant volume to major West Coast ports. Increased channel depth, installations to handle containers, cold storage facilities and improved road and rail access at the ports of Houston, Charleston and Savannah have contributed to the increase in contrast to New Orleans, which has not benefitted from diversion from the West Coast.  An added advantage for Gulf and East Coast ports has been the widening of the Panama Canal to accommodate very large container vessels making these ports more attractive to ocean freight operators.


 

Federal Court Upholds State Public Health Order on Mandatory COVID Vaccination

09/06/2022

The United States District Court for the District of New Mexico has ruled against a registered nurse who claimed that she had the right to treat patients without receiving a COVID vaccination series, contrary to a public health order.  In Valdes v. Grisham, the Court rejected a series of claims that are frequently raised by litigants opposing mandatory vaccination orders:

 

  • The Court ruled that the public health order did not violate the Food, Drug and Cosmetic Act since the two mRNA vaccines were assigned emergency use approval.  The Court also maintained that states or other entities are not prevented by the FDCA from requiring vaccination for specific individuals.
  • The Court rejected the due process claim since the right to work in a hospital is not a “fundamental right deeply rooted in this Nation’s history and tradition”.  The Court ruled that the requirement For vaccination was rationally related to a legitimate government interest.
  • The Court rejected the plaintiff’s claim relating to depravation of bodily integrity.  The Court held that the public health order did not require anyone to be vaccinated but mandated that anyone serving patients should receive a COVID vaccine.
  • The claim of equal protection was rejected since the right to reject a vaccine is not regarded as a fundamental right and case law recognized the legitimate government interest in vaccinating health care providers, resulting in a justifiable difference in treatment between vaccinated and unvaccinated individuals.

 

Compulsory vaccination was considered by SCOTUS in Jacobson v. Massachusetts in 1905 resulting in a ruling that schoolteachers were obliged to be vaccinated against smallpox.

 

The review of the case, written by Andrew Tauber of Winston and Strawn, LLP, relates to a state order.  Obviously, different situations would apply to hospitals, processing plants and other employment situations depending on justification and locality.                                        .


 

Foodborne Disease Outbreak Follows Baltimore Social Event

09/06/2022

ProMED reported that at least 20 people reported clinical symptoms consistent with a bacterial food infection after attending a sponsored promotional party at the American Visionary Arts Museum in Baltimore, MD. on August 18th, 2022.

 

Food samples were offered to attendees by as many as 25 restaurants, complicating the process of identifying the source and vehicle of infection.  One patient yielded Campylobacter consistent with symptoms on presentation for treatment.

 

The Baltimore Department of Health has contacted attendees, requesting that those developing clinical symptoms following the event, to submit answers to a questionnaire.


 

Swine Influenza Case In Ohio

09/06/2022

A patient described as  “under 18 years of age” developed influenza strain H1N2 variant after visiting an agricultural fair.  There was no evidence of contact transmission within the patient’s family. Year-to-date, five infections with variant influenza A viruses have been diagnosed in the U.S., with three in West Virginia involving H3N2v and two H1N2v cases in Ohio and Oregon, respectively.  Variant H1 and H3 infections acquired from hogs are not generally transmissible among humans.  The Center for Disease Control has issued recommendations to prevent infection, including minimizing close contact with pigs in show barns, hand washing and avoiding live animals if immune-compromised or pregnant.


 

H5N1 AI Isolated from Dead Porpoises in Sweden and Florida

09/06/2022

ProMed reported on a case of highly pathogenic avian influenza strain H5N1 apparently responsible for meningitis in a stranded porpoise near Kampersvik in Vastra Gotaland during late June.

 

Postmortem examination yielded H5N1 from numerous organs with meningitis as the significant lesion presumably leading to stranding and death.

 

Seals have been infected with H5N1 in Northern Europe and along the New England coast of the U.S. and also the Maritime provinces of Canada.  In addition, other mammals shown to be susceptible to H5N1 include foxes in both the EU and the U.S. and skunks and raccoons that may disseminate virus during transitory infection, even without serving as long-term reservoirs.

 

Wildlife specialists in Sweden presume that the porpoise was infected through contact with sea birds shedding H5N1 strain AI virus.

A similar case was docmented in Florida with isolation of H5N1 HPAI virus with a Eurasian genome  from a dead porpoise


 

USAPEEC Presented Promotional Seminar for Egg Products in Japan

09/06/2022

The Japan Office of USAPEEC recently presented a seminar in Sapporo to promote U.S. dried whole egg and egg yolk products.  Forty students participated in the program funded by the Iowa Soybean Association.  Chef Yutaka Yamasaki demonstrated recipes using U.S. egg products in baking.

 

Egg-NewsFor the first half of 2022 Japan was the leading importer of U.S. egg products with a volume of 4,721 metric tons valued at $21.5 million. Volume and value were down 23 and 3 percent respectively from the first six months of 2021. Unit value was up 35 percent to $4,554.

 


 




































































































































































































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