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Perishable Pundit
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Produce Business

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Do We Really Want This Farm Bill To Pass?

With the whole industry enthused about the Farm Bill due to its allocation for produce programs, it is worthwhile to note that the President may veto the bill as a budget-buster. It also seems to be filled with a lot of questionable items that are just starting to come to light.

The Pundit has long held the editors of The Wall Street Journal editorial page in high esteem, an esteem only enhanced by their decision to publish the Pundit’s recent article on Editorial Independence.

And the WSJ editorial page editors recently ferreted out this tidbit from the Farm Bill:

DAVIS-BACON ON THE FARM

The overstuffed farm bill now waddling through Congress — toward a possible veto by President Bush — has attracted so much waste that everyone with a genuine interest in agriculture is feeling disheartened. Yet the bill has earned unlikely support from the labor union lobby.

Hmmm. Could this be at all related to a new and unprecedented Davis-Bacon requirement for ethanol construction? Davis-Bacon is the Depression-era holdover that forces federal construction contracts to pay a “prevailing union wage” — determined by the Department of Labor — rather than a market wage. This anachronism was attached to the bill last week by House Democrats; a staffer tells us he’s never before seen Davis-Bacon in a farm bill.

The bill is flush with subsidies to produce ethanol, the corn-based alternative fuel that still can’t compete on a free-market basis. More ethanol requires more biorefineries. Democrats plan to mandate Davis-Bacon wages for workers building those refineries. With nonunion builders unable to compete on price, each new refinery could cost as much as 35% more. In many rural areas with little or no union activity, this artificially high labor cost could even make the prospect of building an ethanol plant a net loss.

Because ethanol production would be significantly more expensive under Davis-Bacon — and because the government requires ethanol in gasoline — ordinary Americans would foot the bill for this union handout in the form of higher prices at the gas pump. That veto is looking more attractive by the moment.

Corn based ethanol itself seems to be a loser. Why we should subsidize it is unclear. But if we are going to subsidize it, why should we give a sop to the labor unions designed, specifically, to increase the cost of ethanol?

One wonders if it will be effectual to ask produce executives to urge their representatives to pass a Farm Bill that contains this kind of stuff?




Anti-organic Article Raises Points About Animal Cruelty And Efficiency

This piece, written by Jackie Avner and published in the Denver Post, is going to have organic advocates steaming:

REASONS YOU SHOULD BUY REGULAR GOODS

I don’t like to buy organic food products, and avoid them at all cost. It is a principled decision reached through careful consideration of effects of organic production practices on animal welfare and the environment. I buy regular food, rather than organic, for the benefit of my family.

I care deeply about food being plentiful, affordable and safe. I grew up on a dairy farm, where my chores included caring for the calves and scrubbing the milking facilities. As a teenager, I was active in Future Farmers of America, and after college I took a job in Washington, D.C., on the Senate Agriculture, Nutrition, and Forestry Committee staff.

But America no longer has an agrarian economy, and now it is rare for people to have firsthand experience with agricultural production and regulation. This makes the general public highly susceptible to rumors and myths about food, and vulnerable to misleading marketing tactics designed not to improve the safety of the food supply, but to increase retail profits. Companies marketing organic products, and your local grocery chain, want you to think organic food is safer and healthier, because their profit margins are vastly higher on organic foods.

The USDA Organic label does not mean that there is any difference between organic and regular food products. Organic farms simply employ different methods of food production. For example, organic dairy farms are not permitted to administer antibiotics to their sick or injured cows, and do not give them milk-stimulating hormone supplements (also known as rbGH or rBST). The end product is exactly the same — all milk, regular and organic, is completely antibiotic-free, and all milk, regular and organic, has the same trace amounts of rbGH (since rbGH is a protein naturally present in all cows, including organic herds). Try as they may, proponents of organic foods have not been able to produce evidence that the food produced by conventional farms is anything but safe.

Do organic production practices benefit animals? Dr. Chuck Guard, professor of veterinary medicine at Cornell University, told me that it pains him that many technological advancements in animal medicine are prohibited for use on organic farms. He described how organic farms don’t use drugs to control parasites, worms, infections and illness in their herds. “Drugs take away pain and suffering,” he said. “Proponents of organic food production have thrown away these medical tools, and the result is unnecessary pain and suffering for the animals.”

In order for milk and meat to qualify as USDA Organic, the animals must never be given antibiotics when they are sick or injured. On organic farms, animals with treatable illnesses such as infections and pneumonia are left to suffer, or given ineffective homeopathic treatments, in the hope that they will eventually get better on their own. If recovery without medication seems unlikely, a dairy cow with a simple respiratory infection will be slaughtered for its meat, or sold to a traditional farm where she can get the medicine she needs. I don’t buy organic milk because this system is cruel to animals, and I know that every load of regular milk is tested for antibiotics to ensure that it is antibiotic-free.

Organic milk certainly is not fresher than regular milk. Regular milk is pasteurized and has a shelf life of about 20 days. Organic milk is ultrapasteurized, a process that is more forgiving of poor quality milk, and that increases the shelf life of milk to about 90 days. Some of the Horizon organic milk boxes I’ve seen at Costco have expiration dates in 2008! There is a powerful incentive for retailers to put the ultrapasteurized organic milk on the shelf just before the expiration date, so consumers will think the organic milk is as fresh as the regular milk. After all, consumers are paying twice as much for the organic product.

Do organic production practices benefit the environment? In many cases, they do the opposite. Recently, Starbucks proudly informed their customers that they would no longer be buying milk from farms that use rbGH, the supplemental hormone administered to cows to increase milk production (even though the extra hormones stay in the cow, and the resulting milk is the same). The problem with this policy is that Starbucks will now be buying milk from farms that are far less efficient at making milk. Without the use of the latest technology for making milk, many more cows must be milked to produce the same number of café lattes for Starbucks’ customers. More cows being milked means more cows to feed, and therefore more land must be cultivated with fossil-fuel-burning tractors. More cows means many more tons of manure produced, and more methane, a greenhouse gas, released into the atmosphere.

I see Starbucks’ policy as environmentally irresponsible. When a farmer gives a cow a shot of rbGH, the only environmental cost is the disposal of the small plastic container it came in. But the environmental benefits of using this technology are enormous.

Attention all shoppers: Safeway is adopting the same misdirected policy as Starbucks, judging from the prominent labeling of milk at my local Safeway store: “Milk from cows not treated with rBST.” When I’m feeling particularly green, I drive past Safeway and shop at another grocery store in protest.

Consumers assume that organic crops are environmentally friendly. However, organic production methods are far less efficient than the modern methods used by conventional farmers, so organic farmers must consume more natural and man-made resources (such as land and fuel) to produce their crops.

Cornell Professor Guard told me about neighboring wheat farms he observed during a visit to Alberta, Canada: one organic and one conventional. The organic farm consumes six times as much diesel fuel per bushel of wheat produced.

Socially conscious consumers have a right to know that “organic” doesn’t mean what it did 20 years ago. According to the Oct. 16, 2006, cover story in Business Week, when you eat Stonyfield Farms yogurt, you are often consuming dried organic milk flown all the way from New Zealand and reconstituted here in the U.S. The apple puree used to sweeten the yogurt sometimes comes from Turkey, and the strawberries from China. Importation of organic products raises troubling questions about food safety, labor standards, and the fossil fuels burned in the transportation of these foods.

Does buying organic really benefit your family? Remember, there is no real difference in the food itself. At my local Safeway store, organic milk is 85 percent more expensive, eggs 138 percent higher, yogurt 50 percent, chicken thighs 80 percent, and broccoli 20 percent. If the only organic product you buy for your family is milk, then you are spending an extra $200 on milk each year. If you buy 5-10 other organic products each week, such as fruits, vegetables, eggs, yogurt and meat, then you could easily approach $1,000 in extra food costs per year. Families would receive a more direct health benefit from spending that money on a gym membership, a treadmill, or new bikes.

When I share this information with friends who buy organic, I get one of two responses: they either stop buying it, or they continue to buy organic based on a strong gut feeling that food grown without the assistance of man- made technology has to be healthier.

I don’t push it, but I wonder: Why do people apply that logic to agricultural products, but not to every other product we use in our daily lives? There are either no chemicals, or the minutest trace of chemicals in some of our foods. But other everyday products are full of chemical ingredients. Read the label on your artificial sweetener, antiperspirant, sun lotion, toothpaste, household cleaning products, soda, shampoo, and disposable diapers, for example. The medicines we administer to our children when they are sick are man-made substances. Chemicals aren’t just used to make these products; they are still in these products in significant amounts. It just doesn’t make sense to focus fear of technology on milk and fresh produce.

I say, bypass the expensive organic products in the grocery store. Buy the regular milk, meat and fresh produce. It is the right choice for the family, animal welfare and the environment.

The newspaper made a decision to not identify the author in any way other than by city of residence and allow her argument to stand on its own, but the family business is bound to cause more controversy:

In 1995, after several years of research in allergy and immunology, Dr. David Avner developed the idea of creating “allergen-free” pets through genetic engineering. Dr. Avner proposed to use gene and gene product targeting to “knock-out” or “suppress” known allergens at the cellular level. The resulting animals no longer produce or secrete the functional allergen.

Shortly thereafter, Dr. Avner submitted a patent application to the U.S. Patent and Trade Office, which has been “cleared of all prior art” and paved the way for the development of allergen-free pets.

Transgenic Pets, LLC, was created in 2000 to explore the development of hypo-allergenic pets and other therapeutic applications of gene targeting in animals. Felix Pets, LLC, a division of Transgenic Pets, was incorporated in 2004 for the specific purpose of developing and selling allergen-free cats.

Controversy aside, the article makes a couple of interesting points:

First, when it comes to modern medicine, nobody would consider it being less cruel to a child to not give them the benefits of our medical knowledge. We should be careful about imagining nature as some kind of idyll, and withholding the benefit of modern medicine from animals is more likely to be cruel than to be kind.

Second, it is impossible to determine the environmental impact of organic growing techniques without also knowing the yield that will actually be produced. Nothing is likely to be “environmentally friendly” if we have to use a lot more land, water, etc. to produce the same quantity.

What organic advocates will hate about this piece is that most objections voiced to organic are pragmatic — too expensive — or neutral — a valid consumer choice. This author comes out and offers a substantive and moral objection to organics. That will be more than many advocates will be able to tolerate.




Students Lodge Letter-Writing Campaign To Change Cafeteria Food

Sometimes articles that seem simply cute or endearing at first glance actually suggest a stronger point. For example, The Associated Press produced this piece, which tells the story of how some elementary school kids in Las Vegas who didn’t like green beans — frozen — began a polite letter-writing campaign to change the status quo in their school cafeteria:

THEY FOUGHT THE LUNCH LADY — AND WON

LAS VEGAS (July 31) — Even someone who believes you can fight city hall might think twice before taking on the lunch lady. But some second-graders who raised their voices over reheated frozen green beans are being rewarded with tastier vegetables.

The menu at William V. Wright Elementary School is getting a makeover after Constantine Christopulos’ class went on a poignantly polite letter-writing campaign aiming to see less of that particular vegetable in the cafeteria.

“A little boy said, ‘Anything, anything, I’ll even eat broccoli’,” said Connie Duits, the lunch lady. “So that one touched my heart.”

The children were careful to offer praise as they expressed their concerns.

”Dear Mrs. Duits, the food is so yummy and yummy. But there are one proplem. It is the green beans,” wrote Zhong Lei.

”We love the rest but we hate the green beans,” wrote Viviann Palacios.

The Las Vegas students undertook the exercise in mini-democracy after the class read a book called “Frindle,” in which a boy contemplates organizing a boycott of the cafeteria.

”I asked the kids, ‘Is that a respectful way of doing it?’” Christopulos said. “And they said, ‘Oh, not at all.’”

As a result of the students’ campaign, the food service department of the Clark County School District sent staff to the school to see what alternatives they preferred.

With a handful of reporters watching, two dozen students sat down Monday to a veritable salad bar of cooked, frozen and canned vegetables, from baby corn to cherry tomatoes, and filled out a survey.

Because of cost restrictions, the children’s only real choices were between canned and frozen green beans, corn, cooked or raw carrots and cooked or cold peas.

Corn and carrots were popular; cooked peas, not so much.

”The cooked peas, it’s warm and all, but inside of it, it’s all soft and stuff and I don’t like it,” said MacKenzie Rangel.

Brenden Lucas said he liked the raw carrots, “Because it’s hard and crunchy.”

Some children got downright prolific when asked to write what other foods they would like for lunch or breakfast. Viviann requested “stake” and lobster, while Logan Strong wanted “chocolate filled panda cookies” and “chicken cordon blue.”

While not all the requests would be accepted — and green beans would still occasionally be served — district supervisor Sue Hoggan said the survey will help district dietitians “tweak” the menu.

”They were so excited to get a response back,” Christopulos said. “I taught them the pen is mightier than the sword, and hopefully they remember that forever.”

The headline seems a little overstated to us as the school still intends to serve the supposedly hated green beans — if a bit less frequently.

The school also seems to limit itself on a basis we are not certain is correct: Because of cost restrictions, the children’s only real choices were between canned and frozen green beans, corn, cooked or raw carrots and cooked or cold peas.

It seems odd that green beans, corn, carrots and peas are the only items that can come in at the price point needed. And then, it appears that raw carrots are the only fresh item under consideration. This all seems odd and, perhaps, the procurement operation is out of touch.

Yet the bigger problem with this whole effort is that it is run the way a cafeteria in Moscow at the height of Communist orthodoxy might be run.

Why should the children have to write letters about what they enjoy? Shouldn’t the school know from sales statistics? Well, no, actually, since it seems that the school only serves one choice and doesn’t sell a la carte.

Dealing with children and the school lunch program, we can understand that it can be important to sell children a complete lunch, but surely we can still offer children a few options. If the green beans are truly disliked, they will be left over and the better tasting item, say carrots, will sell out. Then the cafeteria will be able to ascertain what items should be phased out and what should be offered more frequently.

In addition, this budget number that, supposedly, has to be met may not have to be. If broccoli costs a bit more, it can be offered as an upgrade for an additional fee — maybe enough kids will want to pay it to merit offering it.

The point is that although petitioning may be good for the kids’ education as they learn they have to write letters to air their grievances, what children buy is a better clue to what they want than waiting for letters.

We would go one step further and offer everything on an a la carte basis because it would give schools a better indication of what the children actually intend to eat. And to the extent we care about childhood nutrition, we have to care about what children eat, not what is put on their cafeteria trays.




Hold The Train… 12-Hour Test May Not Be Best Answer

In our piece, Church Brothers/True Leaf Recalls, Then ‘Unrecalls’ Spring Mix/Arugula After Testing Mishap, we urged the end to “test and release” in favor of “test and hold” in this paragraph:

…this business of testing finished product and releasing the product before the test result is back is a disaster waiting to happen. There are new 12-hour salmonella tests being required by McDonald’s and already in use by companies such as Earthbound Farms. They should become the industry standard, and the practice should be test and hold — release only after the results are in. Most product doesn’t ship out the instant it comes off the line, so this 12-hour test is not going to pose many problems.

We may have jumped the gun a bit. In theory it is a good idea but there are some unanswered questions on the matter. One processor sent us this note:

After reading the Pundit on True Leaf and the false positives, I couldn’t help but think there may be an issue regarding the effectiveness of the 12-hour PCR based tests on the market. Many in the industry, us included, are using it based on pressure from accounts and not necessarily based on scientific accuracy. The PCR is a presence / absence test, that looks for genetic material of e-coli and salmonella. It does not tell you if the cells are dead or alive, if it was one or one million cells, or if the genetic material was from a current or past event (i.e., a bird strike on the ground 12 months ago).

The developer stands behind the results and is very reputable so there is no issue from that standpoint. However, no one seems to have the scientific data (at least it’s not shared) that helps us determine the true accuracy. We all know painfully well the rate of false positives with the conventional testing methods. There was also a symposium held May 31, in Chicago, in which FDA and CA Dept of Health participated. One concern raised was the accuracy of the PCR test based on the very limited data complied and the speed at which the industry is ramping it up.

Albert Einstein is said to have said that “Everything should be made as simple as possible, but not simpler.” Equally, food safety efforts need to move ahead as fast as possible, but not faster.

Without good data on false positives and false negatives we just don’t know what our test results will mean. Maybe this piece can elicit some input from someone with access to more information on the PCR test. The industry needs to know where this train is going before we buy our ticket.




Pundit’s Mailbag — Growers Need State And Regional Representation

After PMA and United acknowledged talks regarding a possible merger or other forms of cooperation, we tried to analyze why this time such talks might end up with some such cooperation or merger when all previous talks came to naught.

We felt that the opening of a WGA office in D.C., which we dealt with both here and here, might be one reason to think that this time will be different. Christian Schlect, President of the Northwest Horticultural Council, sent us a letter in which he pointed out that the WGA office might be a good thing.

It may wind up being a good thing for the industry — but almost certainly is a bad thing for United.

This letter, from one of the largest shippers in the country, explains why we think that way:

A few years ago, when United changed its dues structure, our company did not renew our membership with United. We happened to be very involved with other associations and United tried to ascertain whether we were attempting to make a ”statement” or “side with” a particular organization with which it felt itself competing. We were not… this was a financial-decision based on a substantial dues increase.

United tried to make us feel that we had a responsibility to pay for its government affairs efforts as, supposedly, we were benefiting from these efforts. We countered with the explanation that we paid Western Growers to represent us and that WGA was doing a fine job representing us in both Sacramento and D.C.

Even before it had a physical office there, WGA has retained lobbyists in the nation’s capital for decades.

Besides, we didn’t feel confident that we could count on United to represent us and our interests. What if an issue arises that pits California growers against Florida growers? How could a national trade association take a position?

United, as a national trade association, might help facilitate (though PMA presumably has a conference room and could help facilitate too) but, bottom line, as long as growers are state and regionally based, growers will always need state and regional representation.

The question that may decide the future of our national trade associations is simply this: Was our correspondent ahead of the curve or an aberration? Our sense is that in those states that have strong regionals, California and Arizona especially, this correspondent is increasingly in sync with grower/shipper views.

This is also why WGA’s Washington office is really a dagger pointing at the heart of United. As our correspondent notes, WGA has always worked D.C. but, up to the point of this new office being opened, United could distinguish itself by offering something unique: “feet on the ground” in our nation’s capital.

Technology, from the jet plane to video conferencing, to the Internet, has been gradually undermining this distinction for decades. Now WGA just delivered the coupe de grace to this argument.

This year’s United Chairman, Emanuel Lazopolous, is from Del Monte Fresh, and it strikes us that it is companies such as Del Monte, Dole and Chiquita — diverse companies that operate across the country and do extensive international work — that most need an organization such as United.

This is good for United as these are also the organizations with the best ability to support such an organization. The question is this: Do any of these large, diversified companies value United enough to pay, say, a million dollars a year in dues and sponsorships to the Association?

If not, how much are they willing to pay? One suspects that in this discussion, we will likely find the answer to the long term arrangements between produce trade associations.

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