Editorial

 

Is The Sun Setting on Corn-Ethanol?

Feb 5, 2016
    

Two events this past week should give proponents of corn-derived ethanol cause for concern. There are obvious indications that the “third rail” of Midwest politics is no longer electrified and that economic realities are destroying the underpinning of the subsidized biofuels industry.

The first signal of change was the narrow electoral victory of Senator Ted Cruz (R. TX) in the Iowa Caucuses. The general wisdom is that support of the RFS and endorsement of corn-based ethanol is a litmus-test for voter acceptance in the state. Senator John McCain (R. AZ) found this to be a reality for his Presidential bid in 2008 and he ended in 4th place.

In 2016 all the contenders on both sides of the aisle demonstrated their obsequiousness and bowed to the altar of ethanol, save the first and third-placed Republican candidates. Senator Marco Rubio (R. FL) has also supported an end to the mandate by 2022.

Some observers note that there is widespread support for the RFS citing that 72 percent of votes went to candidates supporting corn-ethanol. In effect on the Republican slate, 50 percent of votes were garnered by Cruz and Rubio combined.  These candidates by their showing in Iowa performed the political equivalent of campaigning for mandatory euthanasia for all over 75 in Florida or serving alcohol with school lunches in Tennessee.  Their achievements were even more noteworthy when it is remembered that Gov. Terry Brandstad (R) came out openly in his condemnation of the opposition to the subsidized diversion of corn to an inferior fuel by Cruz and Rubio.

The second and perhaps more telling signal was the quarterly report of Archer-Daniel-Midland Company which registered a decline in contribution margin from their Biofuels sector from $227 million for the fourth quarter of 2014 to $24 million for the corresponding most recent quarter of fiscal 2015.  A giant of domestic and international agribusiness, ADM was rapidly repositioning itself as an energy company, as evidenced by the appointment of Patricia Woertz a 29-year veteran of Chevron as Chairperson and CEO in 2007.  Now her successor Juan Luciano is looking to divest components of the ethanol business.

Since the precipitous slide in the price of crude oil due to an oversupply relative to short and intermediate demand, ethanol as a fuel appears even more infeasible than it was when the RFS was mandated. In mid-December 2015 ethanol traded at $1.50 per gallon in round figures. By mid-January 2016 the price had declined 13 percent to $1.30 followed by a rise at the end of the first week in February to $1.40.

The corresponding wholesale prices for unleaded gasoline for the same periods were $1.40, $1.30 and 1.00 per gallon respectively. It must also be remembered that ethanol has only 65 percent of the energy value of gasoline rated at 117,000 BTU per gallon and that blending 10 percent into gasoline is effectively an expensive dilution at taxpayers’ expense.

Inexorably the message is permeating through the electorate that ethanol will not provide energy independence for our nation and that corn-based fuel is a gigantic boondoggle supported by a lobby represented by row-crop Farmers and refiners. If ethanol does not resonate politically in Iowa it will not play in California and New York.

   

Egg Industry News

 

MPF Convention to Feature Cage-Free Program.

Feb 5, 2016
    

The organizers of the Midwest Poultry Federation will respond to current trends by featuring cage-free production in the annual Simmering Issues Workshop. A panel will review the cage-free movement from several perspectives and will encourage audience participation. The session will take place on Thursday, March 17th from 09h30 to10h30 in Exhibit Hall C. For additional details including panelists access <midwestpoultry.com>

   
 

UNILEVER LAUNCHES EGG-FREE HELLMANN’S MAYONNAISE

Feb 5, 2016
    

Following an abandoned legal dispute with Hampton Creek a public-relations savvy upstart, over Just Mayo®  an egg-free ersatz mayonnaise, Unilever has launched their Carefully Crafted® Hellmann’s Dressing and Sandwich Spread”.  The product is labeled “free from cholesterol, eggs, artificial colors and flavors”.  Given the product attributes, consumer recognition of the Hellmann’s brand together with Unilever marketing clout, Hampton Creek have raised a sleeping giant. Unilever has infinite resources including technical expertise, production capacity and market strength.

Since “Just Mayo®” appears to be the major source of revenue for Hampton Creek to date, their promise to produce a range of vegetable-based egg substitutes needs to be expedited if the company is to achieve prestated growth and to provide a return to investors. EGG-CITE and business publications have commented on claims by co-founder and CEO Josh Tetrick, to disrupt and revolutionize the food industry. 

Many of these statements including the potential to replace hens with peas may appear in retrospect to conform to the legal definition of “puffery”. The real question is how will justify the claimed investment of $100 million in his company, given the limited resources and personnel applied to grandiose-sounding projects when all he has to show is a less than unique re-labeled sandwich spread.

   
 

SALMONELLOSIS ASSOCIATED WITH “NUTRITION SHAKES”

Feb 5, 2016
    

According to a January 30, 2016 ProMED posting, the CDC is investigating an outbreak of Salmonella Virchow attributed to consumption of a nutritional supplement branded as an obvious oxymoron, Garden of Life.  The pathogen has been identified in patients in seven states with eight culture-confirmed cases.  Product manufactured after November 1, 2015 has been recalled. 

This case demonstrates the risk associated with consumption of nutritional supplements manufactured by small companies and distributed nationwide through health food stores and “natural” grocers.

   
 

U.S. ORIGIN TRYPTOPHAN TO BECOME AVAILABLE

Feb 5, 2016
    

Ajinomoto Heartland Inc., has announced that production of feed-grade tryptophan will commence from a plant to be erected in Eddyville, IA.  Currently this amino acid is imported from Asia or the EU.  According to a February 2nd press release, the plant will be completed in May 2017 and will have a capacity of 3,000 tons per year.

   
 

ORKA INTRODUCES THE WIRELESS EGG NODE™

Feb 4, 2016
    

Orka, manufacturers of a comprehensive range of egg testing equipment introduced the Wireless Egg Node™ at 2016 IPPE.

This electronic egg has the equivalent shape and weight of an extra-large size egg but is filled with electronic sensors.  The tri-axis high-speed accelerometer measures G-force in three planes.   A temperature sensor is located in the center of the unit. 

The egg is designed to record vibrations, tilt, shock, and acceleration in addition to temperature when passing through a collecting system extending from the egg-belt to point of sale. 

The electronic egg operates in three modes:

  • Continuous sampling
  • Periodic burst sampling
  • Data logging
         

The forces exerted on the electronic egg can be observed in real time as the egg transmits data which is viewed using a laptop offering 200 ft. to 1 mile line of sight reception. Multiple eggs can be deployed, with simultaneous wireless reception using the network support. 

The electronic egg us compatible with U.S. FCC and Canadian IC regulations.

The standard Egg Node set includes a carrying case, base station and antenna, USB communication cable, Node Commander software and AC charger.

The Orka Wireless Egg Node™ is ideal for evaluating the integrity of conveying systems, ascertaining the effect of accumulators, grading and post-pack handling.  The electronic egg can be used for routine quality control for in-line complexes and packing plants, for diagnostic examinations and as an aid in the design and calibration of conveyors and graders.

For further information access the Orka Food Technology website www.eggtester.com or Katz Yoshida CEO yoshida@orkatech.com

      

 

   
 

VAL-CO® INTRODUCE HYPERMAX™ FAN

Feb 4, 2016
    

Val-Co® introduced the HyperMAX™ 54 inch fiberglass fan at the 2016 IPPE.  The model with an aluminum blade displaces 30,500 CFM at a static water pressure of 0.15 inches powered by a 2HP motor moving air with an efficiency of 16 CFM/watt.  The steel blade model is fractionally less efficient with a displacement of 15.9 CFM/watt.

The motor mount and drive assembly incorporate a box-frame design to increase the life span of the motor.  Pillow block bearings are self-aligning and are pre-lubricated.  The fan is supplied with a compatible fiberglass cone and PVC shutters with a stay-put feature are available.

For further information access www.vil-co.com or phone (800) 998-2526.

   
 

Eggs Cargo System® Displayed at IPPE

Feb 4, 2016
    

Twin Pack® Special Products demonstrated the Eggs Cargo System® which has been used in Europe for 15 years.  The system comprises pallets which have a capacity of 12,960 eggs equipped with a micro-chip for tracking and tracing. 

The trays are compatible with all de-palletizers and dividers lock the trays in position to reduce breakage.  All plastic material is completely recyclable and the plastic is compatible with commercial cleaning equipment.

Given the potential for reintroduction of avian influenza to the U.S. on a seasonal basis, the use of wooden pallets and plywood dividers is no longer acceptable from the perspective of biosecurity. Biological material including egg remnants can harbor pathogens including Salmonella and influenza virus. 

Many companies sourcing eggs from contractors have replaced conventional racks with cargo systems which can be decontaminated at the plant before return to supply farms.

      
   
 

Egg Industry Center to Present 8th Annual Issues Forum

Feb 4, 2016
    

The 8th Annual Egg Industry Issues Forum will take place at the Embassy Suites, Chicago Downtown Hotel on Wednesday April 20th through April 21st 2016. 

The Wednesday program will commence at 13H00 with the Don Bell Memorial Lecture entitled Global Protein Uptake delivered by Brett Stewart, Global AgriTrends. 

Other significant presentations will include:

  • Vision for the Future by the newly appointed AEB president, Anne Alonzo
  • Lessons Learned from Moving an Industry to Cage-Free Production by Rudy Preisinger, Lohmann
  • Considerations in Building the Facilities of the Future, Tom Lohr, Henning Companies
  • The Egg Industry- A Lender’s Perspective, Jeff Coit, Farm Credit Services of America

The afternoon session on Thursday April 21st will include a post-forum workshop on Best Management Practices for Biosecurity.

For further information regarding registration access www.eggindustrycenter.org

   
 

Alltech Reveals Speakers for Ideas Conference

Feb 4, 2016
    

The 2016 Alltech Conference will embrace the theme of One In A Million.  The event will take place in Lexington, KY from May 22nd through May 25th 2016. 

Featured speakers will include:-

  • Steve Wozniak, Co-Founder, Apple Computer Inc. and Chief Scientist at Primary Data
  • Allen Mulallay, Retired president and CEO, Ford Motor Company 2006-2014
  • John Calipari, Head Coach of the University of Kentucky Men’s Basketball Team
  • Seth Siegel, Activist for water issues and a prominent author.

Topics to be considered at the event will include:-

  • Entrepreneurship
  •  Disrupting through innovation
  • Antibiotic free production
  • Finding and keeping talent

The 2016 One In A Million Alltech Conference will be a forum for world-changing ideas, global networking and will include a blend of science, agriculture, business, marketing information and entrepreneurship.

To quote Alltech Founder and President Dr. Pearse Lyons, “ONE will challenge you to seek out one-in-a-million ideas that will change the way you do business.”

   
 

HumaneWatch Places Anti-HSUS Advertisements

Feb 4, 2016
    

On Wednesday January 27th USA Today (and presumably other media) ran a full page advertisement headed “Everything You Should Know About the Humane Society of the United States”.

The text noted that 85 percent of HSU fundraising appeals on TV feature cats and dogs.  It is ironic that the organization does not operate a single shelter and disburses approximately one percent of its revenue to pet shelters.

The advertisement also claims that 80 percent of HSUS donors considered that the organization is “misleading people” in their claims regarding pet shelters. HumaneWatch considers that if facts relating to HSUS financial policy were to be made public there would be less support for the organization.

HumaneWatch claims that between 2012 and 2014 HSUS placed over $100 million in short-term investments in offshore financial institutions and increased the pension plan for executives and employees by $10 million. This assertion was based on available tax returns.

A note at the foot of the advertisement states that the advertisement was “paid for by the Center for Organizational Research and Education”.

   
 

USDA Projection of 2016 Egg Production

Feb 4, 2016
    

The USDA-ERS has issued an updated projection of egg production in 2016 compared to 2015 which was impacted by the Spring outbreak of HPAI in the upper-Midwest.

Parameter                                              2015          2016 (projected)         Difference (%)

EGGS

Production      ( m. dozen)                      6,793*                 7,045                           +3.7           

Consumption   (eggs per capita)              250*                       257                            +2.8

Source: Livestock, Dairy and Poultry Outlook – January 19th 2016

*Depressed by Spring HPAI outbreaks.

Subscribers to EGG-CITE are referred to the postings depicting weekly prices, volumes and trends and the monthly review of prices and related industry statistics.

 

   
 

2016 IPPE Attracted 30,000 Attendees and 1,300 Exhibitors

Feb 4, 2016
    

 According to a January 27th press release from USPOULTRY the 2016 International Production & Processing Expo (IPPE) attracted an estimated 30,000 poultry, meat and feed industry representatives from all over the world. In addition, the show had a record 1,301 exhibitors, with more than 465,000 square feet of exhibit space in Halls A and B of the Georgia World Conference Center. Final numbers will be released after the registration database has been audited to remove duplications. Sponsored by the U.S. Poultry & Egg Association, American Feed Industry Association and North American Meat Institute, IPPE is the world's largest annual poultry, meat and feed industry event of its kind.

In a joint statement the three sponsoring organizations noted “This year’s tremendous exhibitor and attendance numbers are a tribute to IPPE’s unparalleled education sessions, abundant networking opportunities and distinctive exhibits. The enthusiasm and energy displayed by this year’s attendees and exhibitors will only ensure the success and growth of future Expos” 

Features of the 2016 Expo included a comprehensive series of educational and informational sessions,  the Poultry Scientific Forum, the Tech XChange Program and a production seminar delivered in Spanish. 

Attendance was noteworthy in view of the recent limited outbreak of H7 avian influenza in turkeys in Indiana and the disruptions in air travel over the days preceding the EXPO.   

   
 

Dr. Michael Lilburn Receives 2016 Charles Beard Research Excellence Award

Feb 4, 2016
    

Dr. Michael Lilburn is the recipient of the 2016 USPOULTRY and the USPOULTRY Foundation Charles Beard Research Excellence Award. Dr. Lilburn is a Professor in the Department of Animal Sciences at the Ohio State University and is located at the Research Development Center in Wooster, OH.

Dr. Lilburn has a distinguished record or research in nutrition and in addition to his teaching and investigational work has travelled widely and has consulted with primary breeders and producers in both broiler and turkey segments of our industry.

The award recognizes his scientific accomplishments, willingness to interact and advise colleagues and his mentoring of students.

 

Dr. Michael Lilburn (left) receives his award from Dr Charles Beard

   
 

Two Serious Foodborne Outbreaks Investigated by CDC

Feb 4, 2016
    

An outbreak of listeriosis which has lingered since September 2015 is still under active investigation by the Centers for Disease Control and Prevention (CDC) and the Food and Drug Administration (FDA).  To date, 12 cases have been confirmed from six states with one fatality.

An initial investigation implicates packaged salads produced at a Dole processing plant in Springfield, OH. Subsequently Listeria was isolated from a package of Dole Brand Field Greens from the plant.  Genome sequencing demonstrated homology with isolates from patients. Effective January 21st, Dole ceased production at the plant and all products emanating from the facility are subject to a recall.

In the second case, the FDA is investigating a multistate outbreak of Salmonella Poona linked to cucumbers produced in Baja, Mexico, distributed by Andrew and Williamson Fresh Produce.  As of January 26th 2016, 888 cases have been identified from 39 states.  Six deaths have been reported and 28 percent of the cases have required hospitalization.  The implicated produce is subject to a voluntary recall extending from August 1st through September 3rd

The FDA release of January 26, 2016 indicates that a number of cases are still being reported although the incidence rate has declined substantially since August although additional epidemiologic investigations are in progress. These cases illustrate the growing significance of produce as a vehicle of foodborne Salmonella and Listeria infection compared to the egg and poultry meat segments of the poultry industry where appropriate control measures have been introduced.

   
 

Response to the Editorial on Egg-borne Salmonellosis in Australia.

Feb 4, 2016
    

The Friday January 30th editorial commented on the incidence rate of egg-borne salmonellosis in Australia. The editorial was based on the presumption that the pathogen was S. Enteritidis but in fact the problem relates to S Typhimurium. EGG-CITE is indebted to my knowledgeable colleague in Australia Dr. David Timworth for the following clarification:-

In the interests of accuracy you may wish to modify the content as you have made an incorrect assumption that SE is the strain affecting table eggs in Australia. The Australian egg industry (and the meat chicken industry as well) is free of type D Salmonella, including SE. The table egg Salmonella outbreaks in Australia are caused by Salmonella Typhimurium and other B and C serovars. As you are aware these primarily contaminate the egg shell but on occasion the ST’s are also egg transmitted.

Our egg and meat breeders are and have for decades been extensively Salmonella surveilled and have world-class preventive programs including very effective vaccination. However it is only of relatively recent times that much of the layer industry has more fully employed vaccination of the layer type birds and adopted best practices in Salmonella prevention. There are good sero- and culture surveillance programs at all the larger egg operations.

The smaller “organic” type operations, where much of the contaminated eggs arise, have been the most resistant to adopting vaccination and other proven Salmonella controls. There is a very high percentage of free-range and non-caged operations in Australia leading to a greater number of eggs with micro cracking allowing Salmonella such as ST to penetrate the egg shell. This makes refrigeration a key Salmonella outbreak reduction method in the Australian table egg industry particularly in cage- free systems.

David Tinworth
Managing Director
Bioproperties P/L

   
 

USDA Price and Inventory Report, January 25th 2015.

Feb 3, 2016
    

Midwest wholesale prices for Extra Large and Large sizes increased appreciably by 43 percent and 39 percent respectively this past week after a 3 percent increase last week and preceded by stabilization and successive double digit percentage drops over the preceding four weeks. The increased demand may be attributed to colder weather and increased purchases of eggs by chains to fill their pipelines in anticipation of possible spread of the Indiana outbreak of AI which in the event appears to have been eradicated.

The USDA Combined Region Regular Large value for commodity eggs which lags the Midwest quotation by one week rose by 3 cents to $1.04 per dozen, compared to the peak price of $2.77 in mid-August.  The three-week trend suggests higher prices through the remainder of January 2016 after the premature and sharp mid-December swoon. The marked week-to-week fluctuation in shell egg inventory is of concern with considerable weekly oscillation. This past week the stock of generic eggs declined by 4.6 percent following the 7.1 percent decrease recorded during the previous week. Although this is consistent with seasonal trends, prices will be weighted by volume produced in the Midwest relative to regional demand.

The price-range for Large in the four USDA regions increased by 3 cents to $0.97 per dozen in the Midwest to $1.09 per dozen in the South Central Region. At present the Combined Regional price continues at about 10 cents per dozen BELOW the 3-year average which is weighted by the post Proposition #2 increase in early January 2015.

 

   

Shane Commentary

 

Consumer Responses to Surveys Are Influenced by How Questions are Phrased

Feb 4, 2016
    

Dr. William Hallman, Professor and Chairman of the Department of Human Ecology at Rutgers University has conducted research on consumer preferences with respect to labels.  When his survey subjects were asked to specify what label information they desired, seven percent noted GMOs, six percent wanted information on where food was grown or produced and two percent were concerned over chemicals or pesticides.  This data was validated by a survey conducted by the International Food Information Council in 2014.

When consumers were asked whether specific ingredients or additives should be noted on labels, 80 percent said it was “somewhat” or “extremely important” that GMO content be declared.

Hallman clearly demonstrated that responses can be elicited by how questions are phrased.

Food evangelists as defined by public relations group Ketchum, appear to be increasing in the population and as a group are leading consumers of USDA Certified Organic foods.  Despite the large year-on-year increases in sales of organic products, this category currently represents five percent of the total food market.  Purchasing food which is locally produced also comprises a small proportion of total purchases amounting to about one percent or $6 billion annually.  Sales of produce and locally-grown items at farmers’ markets attained a plateau in 2007 despite USDA incentives and support. According to a report in the Washington Post on January 26th, local producers are now channeling products through high-end restaurants and specialty retail stores.

If investigators wish to evaluate the motivation to purchase foods with specific attributes, simple questionnaires provide misleading data.  Conjoint analysis must be used to evaluate the trade-offs applied by consumers in deciding to purchase an item.  Applying this technique, it is possible to characterize and assign levels of importance in the buying decision. Consumers consciously or otherwise take into account price, nutritional attributes, prejudices for and against production systems, packaging, and labels in their purchase decisions.

   

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Dr. Simon M. Shane
Simon M. Shane
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Industry Prices: Tue Feb 9
 Corn3.61 $/bu
 Soybeans8.63 $/bu
 Soybean Meal263.10 $/ton
 Eggs, Producer130  ¢/doz
 Eggs, Warehouse 155-158 ¢/doz