Egg Industry News


Damage from March Flooding now Apparent

04/18/2019

Unprecedented flooding in the upper Midwest has caused $12.5 billion in direct losses, comparable to the aftermath of hurricanes Irene in 2011 and Matthew in 2016.  Flooding affected more one million acres of crop land, breached levees, washed away roads and rivers, saturated stored grain and soybeans, contaminated drinking water wells and damaged homes, vehicles and equipment.  Losses in Nebraska, Wisconsin and Iowa exceeded $2 billion for each state.

 

Saturated fields coupled with the prospect of more rain and snow melt will delay planting of the 2019 crop which will possibly result in additional losses. 

 

The National Oceanic and Atmospheric Administration issued a spring outlook on March 21 indicating major or moderate flooding in 25 states in the upper and middle Mississippi River basins, the eastern Missouri River, the lower Ohio, Columbine and Tennessee River basins.

 


 

U.S. Soybean Crushers Benefit from Lower Prices

04/18/2019

A direct effect of the trade war with China and the consequential reduction in exports of soybeans has boosted crush margins.  Taking advantage of both availability and price, 154.5 million bushels of soybeans were crushed in February according to the National Oilseed Processors Association, constituting a record.


 

Lonza Forms Strategic Partnership with Chr. Hansen on Microbiome Development

04/18/2019

Lonza of Switzerland and Chr. Hansen of Denmark have formed a joint venture to adapt the microbiome for potential biopharmaceutical “bugs as drugs”.  Currently there are at least 60 preclinical trials in progress worldwide to evaluate the potential of beneficial intestinal bacteria.

 

The venture has been capitalized at a level of $50 million with an equivalent sum to be injected in 2022.

 

Chr. Hansen will evaluate and propagate microbial strains using patented fermentation technology.  Lonza will be responsible for ultimately formulating and manufacturing microbial suspensions for commercial application.

 

Lonza developed the enTrinsic technology following the acquisition of Capsugel in 2017.  A structural mesh inside a shell protects microbes from degradation by gastric acid allowing subsequent release in the duodenum and ileum.

 

It is estimated that the anaerobic microbe market will attain $200 million annually by 2025.

Research on pharmaceutical applications of beneficial organisms based on the human microbiome will eventually be extended to livestock, paralleling current developments by suppliers to the intensive livestock industry.

 


 

Commemorative Egg for the Annual White House Easter Egg Roll

04/18/2019

According to the AEB more than 25,000 Washington DC residents and guests will participate in the annual White House Easter Egg Roll on April 22nd

 

Egg farmers will provide 200 cases of eggs to be used for the 141st roll

 

Following precedent a commemorative egg will be presented to the First Lady on behalf of America's egg farmers. The design for the 2019 Commemorative Egg was inspired by suggestions from children of U.S. egg farmers.


 

USDA to Assist Iowa Farmers After Floods

04/18/2019

In an April 15th press release, the USDA announced that Farm Service Agency offices in six affected Iowa counties will receive applications under the Emergency Conservation Program to compensate for damages following Spring flooding. USDA has introduced flexibility in the applications under the ECP to expedite assistance. Normally funding under the ECP requires an environmental assessment. The Conservation Reserve program has been amended to allow emergency grazing by farmers affected by floods. Assistance will also be provided from the Tree Assistance Program to help rehabilitate bushes, vines and trees damaged by floods.


 

FDA Intends to Aggressively Regulate Dietary Supplements

04/18/2019

Frank Yiannas, Deputy Commissioner for Food Policy and Response at the FDA issued a statement on April 16th promising aggressive action over unregulated ingredients in food supplements. According to the release, this industry attracts 170 million consumers annually with sales of $40 billion.

Yiannas noted “While many dietary supplements meet the FDA standards, there are some companies that knowingly distribute and sell dangerous or otherwise illegal products that put consumers at risk.” He added “As the agency entrusted with the oversight of dietary supplements, we will not stand by and allow these companies to compromise the health of the people who are seeking out supplements to aid in their well-being.”

It may be presumed that a more active FDA will also actively evaluate supplements for companion species and food animals.


 

Updated USDA Projections for 2018 and 2019 U.S. Egg Production

04/18/2019

The USDA Economic Research Service issued an updated forecast of egg production on April 16th, following the previous March 14 th report. The volume of eggs produced and per capita consumption in 2019 were increased by 2.2 and 1.1 percent respectively compared to revised 2018 data. Consistent with this disparity, the benchmark New York price was reduced by 23 percent in unit value Production data reflecting 2016 and 2017 should be compared to 2015, impacted by the Spring outbreak of HPAI in the upper-Midwest. The latest data is reflected in the table below.

 

 

Parameter

2015

(actual)

2016

(actual)

2017

(actual)

2018 2019 Difference %

(actual) (forecast) 2018 to 2019

 

EGGS

       
 

Production (m. dozen)

6,938*

7,437

7,755

7,952 8,125 +2.2%

 

Consumption (eggs per capita)

255.8*

272.0

279.9

284.1 287.1 +1.1%

 

New York price (c/doz.)

182*

86

101

138 106 -23.0-%

Source: Livestock, Dairy and Poultry Outlook -March14th 2019

*Impacted by Spring 2015 HPAI outbreaks. Consumption in 2014, 267 eggs per capita

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


 

USDA Weekly Egg Price and Inventory Report, April 18th 2019.

04/17/2019
  • Hen Numbers in Production Down 0.4 million to 330.3 million .
  • Decrease in Shell Inventory a Welcome 12.5 Percent from Past Week Following a 0.4 Percent Reduction in Previous Week.
  • USDA Midwest Benchmark Generic Prices for Extra Large and Large Down 12 Percent Compared to Past Week, Mediums Down 5 Percent. Relatively the Lowest Prices Ever Pre-Easter.
  • Breaking Stock and Check Prices Down 13 Percent; Substantially Below Cost of Production

OVERVIEW

Prices

According to the USDA Egg Market News Reports posted on April 15 th the Midwest wholesale prices for Extra Large and Large were down 12.2 and 12.6 percent respectively compared to the past week. Mediums were 5.2 percent lower but the oversupply in this size is diminishing as young flocks placed for Easter age into laying Large eggs. The progression of prices during 2019 is depicted in the USDA chart reflecting three years of data, updated weekly.

The April 15th USDA Egg Market News Report (Vol. 66: No. 15) documented a USDA Combined Region value rounded to the nearest cent, of $0.80 per dozen delivered to warehouses for the week ending April 7th and reflects the sharply lower prices during that week concurrent with a high stock level. This average price lags current Midwest weekly values by one week. The USDA Combined range for Large in the Midwest was $0.72 per dozen. At the high end of the range, price in the Southeast Region attained $0.85 per dozen. The USDA Combined Price last week was 35 cents per dozen below the three-year average and $1.82 cents per dozen below the corresponding week (pre-Easter) in 2018 which was exceptionally high.


 


HPAI Emerges in Many Nations

04/17/2019

Official reports to the World Organization for Animal Health (OIE) confirm the widespread prevalence of highly pathogenic avian influenza (HPAI). Diverse serotypes are involved with H5N1 recently reported from China, Bulgaria, India, Nepal and Taiwan. Strain H7N3 was diagnosed in a small flock of birds near Mexico City in March. Taiwan is continuing to expend resources to suppress H5N2 in both duck and chicken farms.

Strain H7N9 with human health implications persists in China despite extensive vaccination of commercial poultry. It is possible that cases recently been diagnosed in humans are acquired from small flocks which were either not vaccinated or inadequately immunized. In China the zoonotic potential of H7N9 relates to contact between susceptible consumers and infected birds at wet markets.

It would appear that avian influenza now parallels the situation with Newcastle Disease that resulted in extensive epornitics from the mid-1920’s onwards until controlled by vaccination. Avian influenza may well become the Newcastle Disease of the current century.


 

USDA Reports on Implementation of the 2018 Farm Bill

04/17/2019

In an April 12th press release, the USDA outlined initiatives implemented following enactment of the Agricultural Improvement Act of 2018 (the Farm Bill). Items of relevance to the poultry industry include:

Title VII

On March 28th, nominations were requested for members to serve on the National Agricultural Research, Extension, Education and Economics Advisory Board and the National Genetic Resources Advisory Council. During March, USDA Agricultural Marketing Service issued a call for nominations for the National Organic Standards Board leading to a more diverse candidate pool.

Title XII

The office of Homeland Security has commenced a series of programs to educate the Intelligence Community on Threats to Agriculture.

Title III Trade

The Foreign Agricultural Service allocated $204 million to the Market Access Program and Foreign Market and Development Program. A total of $155 million was assigned to the Food for Progress Program.

Title IV

The USDA is actively implementing provisions of the (Farm Bill) with respect to the Supplemental Nutrition Assistance Program including training and informational memoranda.


 

Campbell Soup Company to Sell Bolthouse Farms

04/17/2019

In a riches to rags story, Bolthouse Farms a processor of carrots and related vegetables, purchased by the Campbell Soup Company in 2012 for $1.6 billion will be sold for $510 million. The transaction is motivated by the need to reduce debt incurred under the presumption by then CEO Denise Morrison, that the future for the company would be in healthy, natural and organic foods. Campbell Soup was abysmally inefficient in execution following the Bolthouse acquisition incurring numerous technical and promotional missteps. It is understood that the company will be purchased by Butterfly Equity of Los Angeles with Jeff Dunn, CEO at the time of the purchase, returning as the leader of the enterprise.

Campbell Soup will also divest a Michigan salsa company for $60 million purchased for $232 million and will sell the Garden Fresh soup plant for $60 million against an initial purchase of $312 million. Under Morrison, the family-dominated Board of Campbell Soup authorized the purchase of diverse businesses valued at $2.4 billion. More than $1.4 billion of this amount has been written down.

In 2018, in an attempt to return to its roots (as opposed to just carrots), Campbell Soup purchased Snyder-Lance, a manufacturer of snacks for $6 billion increasing long-term debt to an unsustainable $9 billion.


 

Whole Foods Market Opens Prestige Midtown Atlanta Store

04/15/2019

The 500th Whole Foods Market store has opened in Midtown, Atlanta. The facility extends over 70,000 square feet and comprises four levels. In addition to a typical Whole Foods Market, the project when completed will include four restaurants to attract patrons to “a place where friends and neighbors can gather”. These locations will include the Canopy Court, the 14th Street Bar, Capital Experience and Farm Burger.

Bobby Turner, president of the South Region for Whole Foods noted that the flagship store will host regular culinary, health and wellness and social community events and will provide an opportunity for local artists to display their work.

Since the acquisition of Whole Foods Market by Amazon Inc., the company no longer posts financial reports and accordingly there is no way to measure same-store sales or profitability associated with investment in combinations of grocery stores and casual dining.


 

Salmonella Carrau Infection Traced to Contaminated Melon

04/15/2019

An outbreak of salmonellosis affecting 93 consumers to date was traced back to Caito Foods LLC a processor of salads and prepared foods, acquired by SpartanNash in 2017.

An epidemiologic investigation was initiated following recognition of the Salmonella Carrau outbreak that commenced on March 4th and extended through the beginning of April.

Caito Foods has recalled fresh cut watermelon, honeydew melon, cantaloupe and mixtures packed in PET clamshell containers over 16 states. Prepacked melon products were sold to Kroger, Walmart, and Trader Joe’s in Indiana and Target and Whole Foods in other states. Indiana, Michigan and Ohio reported the highest proportion of the cases diagnosed to date.

This outbreak illustrates that a combination of state laboratories linked to a central database allows epidemiologists to recognize outbreaks. PCR is used identify pathogens and   whole genome sequencing provides public health authorities with the ability to trace the source of infections and implement recalls and other preventive action.


 

EIC Recognizes ISU President Wendy Wintersteen

04/14/2019

In a private ceremony on March 5, 2019, the Egg Industry Center Advisory Board gave special recognition to Board member, Wendy Wintersteen ISU President.

As Dean of the College of Agricultural and Life Sciences at Iowa State University, Wintersteen was key to the development of the Egg Industry Center (EIC), launched in 2008, and contributed to continued growth over the suceding ten years.

In presenting Dr. Wintersteen with an award Center Director, Dr. Hongwei Xin said "She has been very instrumental in developing the Center to where it is today," He added "the president has really played a key role working with our stakeholders, supporting us financially, and providing her commitment and dedication to developing this magnificent center."

 

Vice Chairman of the EIC Advisory Board, Blair Van Zetten, President of Oskaloosa Food Products Corporation recognized Winterseen's tenacity when it came to starting the center. He stated  "I know at the beginning it was not an easy go – it was a great idea, and it took fortitude and intensity to get it done,"

 

Dr. Wintersteen passed her seat on the EIC board to Daniel J. Robison, the recently appointed Endowed Dean's Chair of the College of Agriculture and Life Sciences at Iowa State University.

Photo Caption: Xin and Van Zetten present Winterseen with a token of appreciation for her service to Egg Industry Center

 


 

Walmart Offering Reusable Bags

04/12/2019

Walmart Stores is now offering a range of reusable bags at checkout counters in an attempt to restrict single-use plastic grocery bags. The company has also committed to reducing plastic and other packaging materials in products marketed with an initial emphasis on Walmart private brands. Their goal is to achieve 100 percent recyclable or compostable material by 2025.

Walmart intends to power half of its operations with renewable energy by the end of 2025. The Company has signed contracts for new solar and wind projects intended to supply 214 billion kilowatt hours of renewable energy annually. Walmart will install electric vehicle charging stations at stores, extending the availability beyond the current 29 states.

Walmart will require suppliers of clothing and home textiles to conform to the Sustainable Apparel Coalition HIGG Index Facility Environmental Module by 2022. It can be logically expected that Walmart will evaluate sustainability and energy use on farms and packing plants supplying products to the company. Aspects of operations that may be evaluated include insulation on houses, conservation of energy and water, disposal of manure and packaging.


 

Vietnam Bans Importation of Glyphosate – Fallout from Lawsuits

04/12/2019

Following the announcement that the Vietnam Ministry of Agriculture and Rural Development will ban the importation of glyphosate, the U.S. Secretary of Agriculture Dr. Sonny Perdue issued a statement expressing disappointment with the action. He commented “The decision to ban glyphosate is a move that will have devastating impacts on global agricultural production.” He added “If we are going to feed 10 billion people by 2050, farmers worldwide will need all the tools and technologies at our disposal.”

USDA has shared scientific studies with the Ministry of Agriculture in Vietnam including an Environmental Protection Agency review concluding that glyphosate is unlikely to pose a carcinogenic hazard to humans. Vietnam has not followed accepted procedures and did not notify the World Trade Organization of their intention.

Dr. Perdue commented that Vietnam should consider the consequences of the ban that will slow development of agricultural production.

It is evident that in the face of a ban, alternative and potentially deleterious herbicides will be used as alternatives. The demand for glyphosate that has been created will result in smuggling. It is hoped that the decision will be rescinded.

The Vietnamese decision to ban glyphosate  was influenced by the consequences of spraying Agent Orange 

 


 

WEEKLY COMMODITY REPORT

04/12/2019

The following quotations for May and July as indicated were posted by the CME at close of trading on Friday April 12th together with values for the previous week in parentheses. Last week the commodities market showed a rise in the futures prices of corn, soybeans and soybean meal for May and July. This was attributed to intimations from the White House regarding a possible settlement of the trade dispute with China. Premature optimism apparently offset the negative effect of the release of the USDA Grain Stocks Report on Friday March 29th documenting soybean stocks. The absence of any definitive news resulted in a mild decline in prices from levels attained last week.

COMMODITY

 

Corn (cents per bushel)

May 361 (362)

July 369 (370)

Soybeans (cents per bushel)

May 895 (899)

July 909 (912)

Soybean meal ($ per ton)

May 308 (308)

July 312 (310)

Changes in the price of corn, soybeans and soybean meal this past week were:-

COMMODITY CHANGE FROM PAST WEEK

Corn: May quotation down 1 cents per Bu        (-0.3 percent)

Soybeans: May quotation down 4 cents per Bu (-0.4 percent)

Soybean Meal: May quotation unchanged         (-)

  • For each 10 cent per bushel change in corn:-

The cost of egg production would change by 0.45 cent per dozen

The cost of broiler production would change by 0.25 cent per pound live weight

  • For each $10 per ton change in the price of soybean meal:-

The cost of egg production would change by 0.40 cent per dozen

The cost of broiler production would change by 0.25 cent per pound live weight

COMMENTS

The March 29th USDA Grain Stocks Report, issued Quarterly confirmed a 3.2 percent decline in corn stocks in all positions to 8.60 billion Bu. compared to the March 2018 report. Farm storage represented 59.6 percent of this total, 2.5 percent higher than for the corresponding period in 2018.

Soybean stocks increased by 28.7 percent from March 2018 to 2.716 billion Bu. in March 2019. On- farm storage attained 1.270 billion Bu. representing 46.7 percent of all stocks. On-farm storage was 48.5 percent higher in March 2019 compared to 2018 reflecting the intent of farmers to hold stocks in anticipation of a rise in price following resumption of exports to China.

There is moderate optimism concerning the outcome of the ongoing negotiations between China and the U.S. An extension of the March 31 st deadline to raise tariffs from ten percent to twenty-five percent on over $200 billion in annual imports from China is now a reality. In return China has agreed to purchase an unspecified quantity of agricultural commodities in addition to energy and heavy equipment from the U.S. to offset the negative balance of payments.

Shipments of soybeans to China resumed in January but at a far lower level for the first two months of 2019 than in 2018 before initiation of the trade conflict. (see report and graphics in the March 27th edition of CHICK-NEWS by entering 'China' in the SEARCH block). China has hinted at a six-year purchase commitment probably due to concern over continuity of supply from Brazil due to uncertainties over drought and deficiencies in inland transport.

Negotiations with China are apparently making progress as denoted by shuttles between Beijing and Washington that will continue this week but without any disclosure of specifics. Some concessions have been made by China on coercive trade practices. And dispute resolution. From an agricultural perspective the question of delays by China in approving new GM cultivars has yet to be settled. No date has been set for a summit to sign a trade deal. Markets are now cautiously responding to conflicting reports from the Administration but prices will be influenced subsequently by current stock levels, area to be planted and early crop progress in the face of possible flooding.

The March 28th USDA projection of plantings based on farmers' intentions suggest that an additional 3.66 million acres will be planted to corn compared to 2018.This increase will be offset by a reduction in soy acreage by 4.58 million acres.

According to the April 9th 2018 WASDE Report #587, 81.7 million acres of corn will be harvested in 2019 to produce 14.42 Billion bushels. The soybean crop is projected to attain 4.54 Billion bushels from 88.1 million acres harvested. The levels of production for the two commodities are based on preliminary pre-planting projections of yield and acreage. Ending stocks were revised based on anticipated domestic use and exports.

See the WASDE posting summarizing the March 8th USDA-WASDE Report #587 under the STATISTICS tab documenting price projections and quantities of commodities to be produced, used and exported from the 2019 harvest.

Unless shipments of corn and soybeans to China resume in volume, as anticipated, the financial future for row-crop farmers appears bleak despite the release of two tranches amounting to $8 billion as "short-term" compensation for producers of commodities. Eligible soybean farmers received $1.61 per bushel. Corn farmers will not be placated by the promise of a year-round E-15 blend since the logistic problems of delivery to consumers and legal challenges will delay any positive price benefit. Oversupply of ethanol with the current 10 percent addition (read BTU dilution) mandate is evident from the April 12th spot price of $1.33 per gallon ($1.38 last week) that has not changed materially in ten weeks compared with a peak in late March 2018 at $1.60. Exports have been constrained by the retaliatory tariffs imposed by China on U.S. ethanol. Some refiners are reducing production and mothballing corn-fermentation plants. Corn farmers can be relieved that overly optimistic and unfounded projections of cellulosic ethanol to be available after 2017 have not materialized, based on technical complications and predicted financial infeasibility.

The loss inflicted on farmers by the trade war with China is a gain for livestock producers who will benefit from lower feed costs. It must be recognized that the hog and poultry industries have experienced higher costs for more than a decade as a result of the RFS, a gift that keeps on giving. The mandate is a boon to Midwest politicians, corn growers and ethanol refiners at the expense of anyone in the U.S. who eats or uses any form of transport.


 

Norovirus Outbreak Investigated and Controlled in Washington State Restaurant

04/12/2019

Seattle-King County public health authorities recently investigated an outbreak of norovirus infection attributed to a single family-oriented restaurant, part of a national chain. The infection may have been introduced by a kitchen employee who apparently worked while sick. Both patrons and employees were affected and the restaurant was closed. Decontamination procedures were upgraded under the guidance of the Health Department and the restaurant reopened after compliance with appropriate food handling procedures was confirmed by audit.


 

Amazon to Consider Shuttered Sears Stores

04/12/2019

On Thursday, April 11th CNBC reported that BMO Capital Markets is proposing the possible conversion of shuttered Sears and K-mart locations to either Whole Foods or the whispered Amazon grocery stores. Apparently Sears has 480 locations still open with 80 scheduled for closure. The company previously closed 430 locations divided among 260 being wound-down and 170 that are vacant.

The viability of the closed department stores would depend on their location. Most of the shuttered Sears stores are in low-income areas and would not be attractive to a high-end chain such as Whole Foods. If Amazon intends to develop a low-price, no-frills chain, up to 300 Sears and K-mart locations could be considered. Since many Sears stores are located in malls, they would be a less convenient option for consumers. Where closed Sears stores were located in strip malls, a supermarket anchor tenant would obviously object to conversion to a competing grocery store. After the acquisition of Whole Foods Market in 2017, Amazon discovered that in many cases, they were restricted with respect to using Whole Foods stores as pick-up points for E-commerce based on lease restrictions limiting the synergy from of the acquired locations.


 

Executive Departures From Lidl.

04/12/2019

Following the recent resignation of Patrick Kaudewitz, CEO of Kaufland, a German affiliate of Lidl, owned by the Schwarz Group, Jesper Hojer announced his resignation as CEO of Lidl with immediate effect.

Claus Gehrig, CEO of Schwarz Group has assumed control of the Kaufland chain pending a replacement for Kaudewitz. The U.S. chief executive of Lidl, Roman Heini previously reported to Hojer. Ignazio Paterno who formerly led the Italian division of Lidl may replace Hojer.

The Schwarz Group, owned and controlled by Dieter Schwarz has witnessed high turnover with three CEOs in five years. There have been no explanations for the abrupt and frequent changes in top management, but possible factors include interpersonal conflicts and the slow rollout of Lidl in the U.S and apparently suboptimal ROI.


 

Bayer Awards Grants for Honeybee Forage

04/12/2019

The Bayer National Pollinator Forage Initiative, Feed a Bee, has completed a recent round of awards supporting retention of flowering plants to support honeybees and other insect pollinators in 50 states.

Dr. Becky Langer, manager of the Bayer North American Bee Care Program stated “We have had tremendous success with this program, selecting a participant in Alaska on December 2018 to complete 50-state participation. We are receiving 70 applications annually to enhance habitat and increase the number and health of insect pollinators.


 

E.U. Bans Single-Use Plastic Items

04/12/2019

On April 3rd, the European Parliament voted 560 to 35 to ban a range of single-use plastic items including polystyrene plates, food and beverage containers. The regulations will take effect in 2021. At least 90 percent of beverage bottles will have to be collected and recycled by 2029.

The European Commission vice president Franz Timmermans stated “Europe is setting new and ambitious standards, paving the way for the rest of the world.”

It is estimated that the E.U. recycles only a quarter of 25 million tons of plastic waste produced each year. The E.U. recognizes the need for effective waste management infrastructure and recycling facilities to achieve optimal reduction of plastic waste in landfills and oceans. Reliance on Asia is no longer a viable alternative to on-Continent conversion and disposal.


 

USDA Food and Nutrient Data System

04/12/2019

On April 3rd, the USDA Agricultural Research Service released FoodData Central, an integrated food and nutrient data system. This will provide information for researchers, healthcare providers, product developers and consumers. The database will be managed by USDA Agricultural Research Service and will be hosted by the National Agricultural Library.

Additional information is available at www.fdc.nal.usda.gov.


 

AEB Releases Easter 2019 Toolkit

04/12/2019

Producers are recommended to access the AEB Easter Toolkit for visuals and downloads suitable  for promotions. The AEB notes that during Easter 2018, 2.9 billion eggs were consumed. It is hoped that consumption will be even higher for 2019 given the levels of stock, low prices and a high flock. The toolkit contains a range of recipes that can be incorporated into publicity, especially at the local level.


 

Orka Updates Wireless Egg Node

04/12/2019

Orka Food Technology has announced a major upgrade for the Wireless Egg Node.  Improvements include:

 

  • Software is able to run multiple eggs simultaneously
     
  • The software incorporates a snapshot capability allowing photography during sampling
     
  • Saved data can be archived in .csv format and can be viewed using Excel for interpretation.

 
For further information access the company website by clicking on to the Orka logo on the left side of the Welcome page. The Orka website includes details on the new multi-node version of the wireless egg and the range of test equipment including the EggAnalyzer, Shell Thickness Gauge, Digital Haugh Instrument and the Egg Force Reader.


 

Maine Recognizes Dangers in Biosoilds

04/12/2019

The May 22nd Edition of the Portland Press Herald reported on the introduction of an extended testing protocol for biosolids, a polite term for processed sewage sludge before application to farmland.

 

The problem arises from contamination of milk with per- and poly-fluoroalkyl compounds (PFAs) identified in sewage sludge.  In 2016 officials of the Wells Water District determined the presence of PFA compounds in water, soil and milk at the Arundel Dairy Farm operated by the Stone family.  Sludge from the Kennebunk and Ogunquit treatment plants was applied to hay fields from the mid 1980’s until 2014.  Subsequently sludge from a waste paper mill was applied to fields in accordance with procedures approved by the Department of Environmental Protection. An environmental toxicologist consulted by EGG-NEWS suggested that given current information that the contamination was most likely from the paper mill in comparison to the sewage plants. Levels of PFAs assayed were not disclosed in the press report.

 

Sludge is currently assayed for heavy metal contamination but inclusion of assays for specific organic chemicals has been introduced to prevent further cases similar to the Arundel Dairy Farm.


 

Influenza Detected in Ohio Swine Herds

04/12/2019

The Ohio Animal Disease Diagnostic Laboratory (OADDL) recently reported on routine isolation of H1N1, H3N2 and H1N2 serotypes of influenza virus from hogs.  In some cases, multiple serotypes were detected from a single farm submission.

 

The OADDL uses rapid polymerase chain reaction assay to screen for influenza A virus followed by subtyping to identify hemagglutinin and neuraminidase genes.

 

H1 influenza A occurs frequently in states with large concentrations of commercial hogs, suggesting the need for epidemiologic separation of commercial or subsistence units from poultry flocks including turkeys, layers and broilers.  In some states with high population of hogs, vaccination of turkeys with an inactivated H1virus is carried out as a routine, based on the high probability of exposure.

 

It is inappropriate to operate hogs and commercial chickens on the same farm.  Special biosecurity precautions should be implemented by feed mills that deliver to a multi-species clientele.


 

USDA Weekly Egg Price and Inventory Report, April 11th 2019.

04/11/2019

 

  • Hen Numbers in Production Down 0.3 million to 330.7 million .
  • Decrease in Shell Inventory 0.4 Percent from Past Week Following a 5.7 Percent Rise in Previous Week.
  • USDA Midwest Benchmark Generic Prices for Extra Large and Large Down 12 Percent Compared to Past Week, Mediums Down 18 Percent.
  • Although Unchanged, Breaking Stock and Check Prices Continue Substantially Below Cost of Production

OVERVIEW


 


Review of March 2019 Production Costs and Statistics.

04/10/2019
  • March 2019 USDA Ex-Farm Benchmark Price Down 13.0 Percent from February 2019, Consistent with Seasonal Trends and Moderate Oversupply.

  • March 2019 USDA Average Nest-run Production Cost 1.1 Percent Higher than February 2019 at 60.7 cents per dozen.

  • March 2019 USDA Benchmark Nest-run Margin Decreased from February 2019 to Breakeven.

INTRODUCTION.

Summary tables for the latest USDA March 2019 prices made available by the EIC on April 9th 2019 are arranged, summarized, tabulated and reviewed in comparison with values from the previous March 12th 2019 posting reflecting February 2019 cost data.

 

COSTS & REVENUE

From January 2019 onwards EIC has used USDA-AMS data for regional corn, soybean and standard feed prices. The basis for corn will be cash payment except for California (10-day delivery) and Louisiana and Oregon (30-day delivery). For soybean meal a similar approach is applied with 20-days for Minnesota. It is noted that January 2019 prices are not directly comparable with December 2018. Month-to-month comparisons in 2019 will be valid.

 


 


Grain Exports From Brazil to be Impacted by Bridge Collapse

04/10/2019

The collision of a barge with a one-half mile span over the Moju River in the Para state of Brazil will impact grain shipments from major export terminal located in the harbor of Belem. The 650 foot section of the bridge collapsed on Saturday, April 7th cutting a major road from grain-producing regions to the port which also serves as the state capital.


 

Telemedicine Results in Over-prescription of Antibiotics for Children

04/10/2019

A recent release by the National Institutes of Health suggest that telemedicine consultations result in children receiving more prescriptions for antibiotics compared to office visits. The study conducted by Dr. Karen Lee, a program director in the National Institute of Child Health and Human Development examined data from 4,600 telemedicine consultations, 38,000 urgent care visits and 485,000 primary care visits for children under 17 years of age presenting with respiratory signs.

The study disclosed that prescriptions were issued for 52 percent of the telemedicine consultations compared to 42 percent of urgent care visits and 31 percent if the patient was examined by a primary-care provider. Clinical guidelines for antibiotic prescriptions were less rigid for telemedicine compared to hands-on alternatives.

The impact of inappropriate prescription administration of antibiotics for viral respiratory infections is regarded as a significant cause of emerging antibiotic drug resistance.

*Ray, K. N. et. al. Antibiotic prescribing during pediatric direct-to-consumer telemedicine visits, Pediatrics, doi 10.1542/peds.2018-2491 (2019)


 

Cargill Appoints Supply Chain and Nutrition Managers

04/10/2019

G. J. Vandenakker recently retired as the Enterprise Leader for the Cargill Agriculture Supply Chain after a 30-year career with the company. Joe Stone, a 34-year veteran of Cargill will assume responsibility for the supply chain and will continue as a member of the Cargill Executive Team.

David Webster will be responsible for Cargill Animal Nutrition replacing Stone. Webster has served Cargill for 27 years in various positions involving sales, purchasing and finance and he most recently led the global edible oils business.

Cargill has a deep bench and a system of cross-training managers and executives. The company is characterized by a low turnover rate with steady advancement as the company expands organically and by acquisition.


 

Winn-Dixie Opens Reconstructed Marathon, FL Store

04/10/2019

The 40-year old Winn Dixie location in Marathon, FL. has withstood many hurricanes, but was ultimately demolished by Irma in September 2017. The replacement was commissioned last week to serve consumers in the area. The reconstruction incorporated features and conveniences consistent with a modern supermarket.


 

FSNS to Offer FDA-Compliance Courses

04/10/2019

Food Safety Net Services (FSNS) will present a series of food safety preventive controls compliance courses in three locations to allow attendees to comply with FDA requirements.

The current Good Manufacturing Practice, Hazard Analysis and Risk-Based Preventive Controls for Human Food Regulation collectively referred to as “Preventive Controls for Human Food Regulation” requires activities in a facility to be supervised by a qualified individual certified in Preventive Controls.

The course developed by FSNS complies with the standardized curriculum approved by the FDA.

Courses will be offered according to the following schedule:

May 15-17, San Antonio, TX

June 5-7, Columbus, OH

July 10-12, Greeley, CO

The attendance fee will be $795, waived for full-time collegiate students. For additional information and registration, access training@fsns.com.


 

USDA-WASDE FORECAST #587 April 9th 2019

04/09/2019

OVERVIEW

The April 9th 2019 USDA WASDE projections for the 2019 corn and soybean harvests are based on historical yield and harvest data. The corn acreage to be harvested was determined from planting intentions to be 81.7 million acres (81.8 million in 2018). In 2019 soybeans will be harvested from 88.1 million acres (88.3 million acres in 2018). There was apparently no change due to recent Midwest flooding or the forecast for wet conditions from snowmelt prior to planting.

The USDA projected corn yield to attain 176.4 bushels per acre, (178.9 bushels in 2017). Soybean yield was projected at 51.6 bushels per acre (52.1 bushels in 2018). These values presume suitable planting conditions, time of sowing and standard rates of germination.

The April USDA projection of ending stock for corn was increased by 10.9 percent to 2,035 million bushels. Ending stock for soybeans will be 0.5 percent lower at 895 million bushels with minimal effect on CME price quotations subsequent to the noon release of the April WASDE.

It is emphasized that projections are based on the presumption of at least a partial settlement of the trade dispute with China followed by restoration of exports to that Nation.


 


Multinational Food Companies Relying on Specialist Suppliers for R&D

04/07/2019

In an April 2nd article by Carol Ryan in The Wall Street Journal, it was noted that multinational food manufacturers are relying on specialist suppliers for research and development and innovation. Nestle and Kraft Heinz are losing market share to upstarts with new products appealing to Millennials.

Ryan attributes the decline to failure to innovate as a result of low R&D expenditure. Package food companies spend between 0.5 to 2 percent of sales on new product development. This expenditure can be compared to R&D invested by pharmaceutical companies in the range of 10 percent of revenue.

Ingredient suppliers such as CHR.Hansen and Barry Callebaud are now relied on to provide formulations and products to enhance flavor and organoleptic attributes to rejuvenate existing product.


 

China Places Large Order for Soybeans

04/07/2019

The USDA announced on April 1st that China had placed a second order amounting to 828,000 tons for soybeans. The order will be shipped within the current marketing year which ends on August 31st.

Trade talks between the U.S. and China continue with apparent progress on both trade and structural issues. In response to the U.S. decision to defer the March 1st imposition of additional tariffs on manufactured goods China, will continue to suspend tariffs on U.S. autos and parts after April 1st.


 

Minor Impact of Potentially Deleterious Article on Egg Consumption

04/07/2019

An article suggesting that egg consumption may be deleterious to cardiovascular health, led to the American Egg Board commissioning a survey of consumers. YouGov conducted the survey with a nationally representative sample of 1,199 U.S. residents from March 20th to 21st. It was possible to compare results with an earlier survey in April 2018 prior to release of the article.

Approximately 27 percent of those surveyed were aware of the news and 82 percent recognized that the press releases related to nutrition and health. A total of 56 percent of respondents stated that the article had no impact on their perception of eggs. A minority of 27 percent believed that publicity following the article had a positive impact (if they actually read and absorbed journalists’ interpretations) and only 17 percent claimed a negative impact. It is believed that this cohort infrequently consumes eggs if at all.

The number of respondents that believe that eggs are safe to eat attained 82 percent of the sample, slightly higher from the April 2018 survey and 77 percent of the respondents are not limiting consumption of eggs because of presumed health effects. Approximately one quarter of consumers believe that eating eggs can increase the risk of cardiovascular disease with 31 percent disagreeing and 42 percent were neutral representing the bulk of responses.

Overwhelmingly respondents accept that eggs are a good source of protein and are otherwise nutritious and are easy to prepare.

The prompt response of the AEB and various authors pointing out technical defects in the meta- study published in the Journal of the American Medical Association diffused the issue and the stone cast into the pond by the article had little ripple effect. It is understandable that only 27 percent of those responding were aware of the publicity following the publication of the article. This is probably because concurrently there was concern over both political and international events that certainly dominated visual news media that along with the internet are now the major sources of information for consumers.

There was concern that the article would resurrect the cholesterol-myth. In the event, positive publicity again sponsored by the AEB from reputable university researchers and dietitians stressed the value of eggs in diets and diverted concern over consumption of eggs to the deleterious effects of sugar, salt and saturated fat.


 

Texas Agricultural Law Blog Reviews California Proposition #12

04/07/2019

A recent edition of Texas Agricultural Law blog, which is highly recommended for content and analysis, referred to an article in the Progressive Cattleman April edition referring to passage of California Proposition #12. The ballot measure was opposed by the National Pork Producers’ Council since gestation crates would obviously be banned, which in 2019 is a moot consideration. Enigmatically the People for the Ethical Treatment of Animals (PETA) on the other side of the equation also opposed the measure maintaining that it was insufficiently rigid in mandating the extent and speed of transition to non-confined systems for hens.

The article referred to the failed attempts to overturn California Proposition #2 enacted in 2008. This was was the forerunner of ballot initiatives initiated by the Humane Society of the United States to outlaw conventional cages.

What is now evident to livestock producers is the fact that pork, veal, beef and eggs produced in any state and sold in California must conform to the conditions mandated by Proposition #12. This reality has influenced adoption of aviary and floor systems in the Midwest and Western states supplying California with eggs.


 

Fire Destroys Barn Under Construction

04/05/2019

Glenn Hickman, president of Hickman's Family Farms advised media and the industry that a barn under construction at the Tonopah Complex was destroyed by fire on April 4th. No injuries were reported and no flocks were affected. Firefighters from Buckeye Valley, Tonopah and Harquala Valley Fire Districts responded to the blaze.

According to Clint Hickman Vice-president of Marketing the event will not affect deliveries.


 

WEEKLY COMMODITY REPORT

04/05/2019

The following quotations for May and July as indicated were posted by the CME at close of trading on Friday April 5th together with values for the previous week in parentheses. The market showed a rise in the futures prices of corn, soybeans and soybean meal for May and July delivery compared to the previous week. This was attributed to messages from the White House regarding a possible settlement of the trade dispute with China. Premature optimism apparently offset the negative effect of the release of the USDA Grain Stocks Report on Friday afternoon March 29 th documenting soybean stocks.

COMMODITY

 

Corn (cents per bushel)

May 362 (357)

July 370 (366)

Soybeans (cents per bushel)

May 899 (884)

July 912 (897)

Soybean meal ($ per ton)

May 308 (302)

July 310 (310)

Changes in the price of corn, soybeans and soybean meal this past week were:-

COMMODITY CHANGE FROM PAST WEEK

Corn: May quotation up 5 cents per Bu          (+1.4 percent)

Soybeans: May quotation up 15 cents per Bu (+1.7 percent)

Soybean Meal: May quotation up $8 per ton   (2.5 percent)

  • For each 10 cent per bushel change in corn:-

The cost of egg production would change by 0.45 cent per dozen

The cost of broiler production would change by 0.25 cent per pound live weight

  • For each $10 per ton change in the price of soybean meal:-

The cost of egg production would change by 0.40 cent per dozen

The cost of broiler production would change by 0.25 cent per pound live weight

COMMENTS

The March 29th USDA Grain Stocks Report, issued Quarterly confirmed a 3.2 percent decline in corn stocks in all positions to 8.60 billion Bu. compared to the March 2018 report. Farm storage represented 59.6 percent of this total, 2.5 percent higher than for the corresponding period in 2018.

Soybean stocks increased by 28.7 percent from March 2018 to 2.716 billion Bu. in March 2019. On- farm storage attained 1.270 billion Bu. representing 46.7 percent of all stocks. On-farm storage was 48.5 percent higher in March 2019 compared to 2018 reflecting the intent of farmers to hold stocks in anticipation of a rise in price following resumption of exports to China.

There is increasing optimism concerning the outcome of the ongoing negotiations between China and the U.S. An extension of the March 31 st deadline to raise tariffs from ten percent to twenty-five percent on over $200 billion in annual imports from China is now a reality. In return China has agreed to purchase an unspecified quantity of agricultural commodities in addition to energy and heavy equipment from the U.S. to offset the negative balance of payments.

Shipments of soybeans to China resumed in January but at a far lower level for the first two months of 2019 than in 2018 before initiation of the trade conflict. (see report and graphics in the March 27th edition of CHICK-NEWS by entering 'China' in the SEARCH block). China has hinted at a six-year purchase commitment probably due to concern over continuity of supply from Brazil due to uncertainties over drought and deficiencies in inland transport.

Negotiations with China are apparently making progress as denoted by shuttles between Beijing and Washington, but without any disclosure of specifics or dates. Some concessions have been made by China on coercive trade practices. From an agricultural perspective the question of delays by China in approving new GM cultivars has yet to be resolved. No date has been set for a summit to sign a trade deal. Markets are now cautiously responding to conflicting reports from the Administration but prices will be influenced subsequently by current stock levels, area to be planted and early crop progress in the face of possible flooding.

The March 28th USDA projection of plantings based on farmers' intentions suggest that an additional 3.66 million acres will be planted to corn compared to 2018.This increase will be offset by a reduction in soy acreage by 4.58 million acres.

According to the March 8th 2018 WASDE Report #586, 81.7 million acres of corn will be harvested in 2019 to produce 14.42 Billion bushels. The soybean crop is projected to attain 4.54 Billion bushels from 88.1 million acres harvested. The levels of production for the two commodities are based on preliminary pre-planting projections of yield and acreage. Ending stocks were revised based on anticipated domestic use and exports.

See the WASDE posting summarizing the March 8th USDA-WASDE Report #586 under the STATISTICS tab documenting price projections and quantities of commodities to be produced, used and exported from the 2019 harvest.

Unless shipments of corn and soybeans to China resume in volume, as anticipated, the financial future for row-crop farmers appears bleak despite the release of two tranches amounting to $8 billion as "short-term" compensation for producers of commodities. Eligible soybean farmers received $1.61 per bushel. Corn farmers will not be placated by the promise of a year-round E-15 blend since the logistic problems of delivery to consumers and legal challenges will delay any positive price benefit. Oversupply of ethanol with the current 10 percent addition (read BTU dilution) mandate is evident from the March 29th spot price of $1.38 per gallon ($1.42 last week) that has not changed materially in ten weeks compared with a peak in late March 2018 at $1.60. Exports have been constrained by the retaliatory tariffs imposed by China on U.S. ethanol. Some refiners are reducing production and mothballing corn-fermentation plants. Corn farmers can be relieved that overly optimistic and unfounded projections of cellulosic ethanol to be available after 2017 have not materialized, based on technical complications and predicted financial infeasibility.

The loss inflicted on farmers by the trade war with China is a gain for livestock producers who will benefit from lower feed costs. It must be recognized that the hog and poultry industries have experienced higher costs for more than a decade as a result of the RFS, a gift that keeps on giving. The mandate is a boon to Midwest politicians, corn growers and ethanol refiners at the expense of anyone in the U.S. who eats or uses any form of transport.


 

Blue Apron Shuffles Management and appoints CEO as a Survival Strategy

04/04/2019

Blue Apron has appointed Linda Findley Kozlowski as CEO, replacing Brad Dickerson who has resigned. She has 25 years experience and was most recently COO of Etsy.

Matthew Wadiak, a co-founder of Blue Apron is stepping down from his role as COO and will become an advisor to the company.

Tim Smith will serve as Senior Vice President and General Manager for consumer products, a newly-created role. Smith is an alumnus of Tyson Foods where he served as General Manager for the emerging brands group.

Pablo Cussati, Senior Vice President of Operations. Cussati has experience at Pinnacle Foods, the Campbell Soup Company and PepsiCo. In announcing the change, Salzberg noted the contribution of Matt Wadiak as a driving force for the Blue Apron mission to make home cooking accessible to everyone.

Ilia Papas, co-founder and chief of technology will also leave the Company.

The 52-week range in share price of Blue Apron is $0.65 to $4.15. At midday following the announcement of management changes, the share price was $1.03 supporting a market capitalization of $200 million. The company posted a 12-month trailing return on assets of -16.1 and -71.2 percent on equity. The 12-month trailing profit margin is -18.3 percent with an operating margin of -16.8 percent. 


 

Aldi Commits to Reducing Plastic Packaging

04/04/2019

In a company press release dated April 3rd, Aldi announced a commitment to reduce plastic waste By 2025 all Aldi packaging including plastic will be reusable, recyclable or compostable. Packing material used for all Aldi-exclusive products will be redesigned to reduce bulk by 15 percent. How2Recycle labels will be applied to all Aldi-exclusive packaging this year. The Company is considering an initiative to recycle packaging of private-label products by 2020.

An Aldi spokesperson noted "Aldi has never offered single-use plastic shopping bags and while we're pleased that we've helped keep billions of grocery bags out of landfills and oceans, we want to do more."

In 2018, Aldi recycled more than 250,000 tons of materials including paper, cardboard, plastic and metal. This represented the greenhouse gas equivalent of eight million gallons of gasoline.


 

Blue Apron Shuffles Management as a Survival Strategy

04/04/2019

Matthew Wadiak, a co-founder of Blue Apron is stepping down from his role as COO and will become an advisor to the company.

Tim Smith will serve as Senior Vice President and General Manager for consumer products, a newly-created role. Smith will report to Matt Salzberg, CEO. Smith is an alumnus of Tyson Foods where he served as General Manager for the emerging brands group.

Pablo Cussati, Senior Vice President of Operations will also report to Salzberg. Cussati has experience at Pinnacle Foods, the Campbell Soup Company and PepsiCo. In announcing the change, Salzberg noted the contribution of Matt Wadiak as a driving force for the Blue Apron mission to make home cooking accessible to everyone.

The 52-week range in share price of Blue Apron is $0.65 to $4.15. At midday following the announcement, the share price was $1.03 supporting a market capitalization of $200 million. The company posted a 12-month trailing return on assets of -16.1 and on equity, -71.2 percent. The 12-month trailing profit margin is -18.3 percent with an operating margin of -16.8 percent.


 

O&T Farms Applying Dry Extrusion for Linpro®

04/04/2019

According to an April press release, O&T Farms uses a dry-extrusion process to produce Linpro, a co-extruded ingredient comprising flaxseed and peas. The process does not require an external heat source since the ingredients are forced through a small aperture which creates heat during extrusion. The processing temperature improves amino acid availability and destroys anti-nutritional compounds.


 

U.S. Poultry Industry Creates 302,515 New Jobs, Economic Output Up 11 Percent in Two Years

04/03/2019

In a release on April 3rd, the U.S. Poultry & Egg Association (USPOULTRY and United Egg Producers released an updated economic impact study that highlights the positive impact of the poultry industry on jobs, wages, and federal and state revenue in the United States. For 2018 the entire U.S. poultry industry provided 1,984,784 jobs, $108.9 billion in wages, $495.1 billion in economic activity and $38.5 billion in government revenue. Since the last study conducted in 2016, the poultry industry has created 302,515 additional jobs, and the economic impact has increased by 11 percent.

 

 

The egg industry provides 112,470 jobs (5.7 percent of entire poultry sector), $6.3 billion in wages (5.7 percent), $29.2 billion in economic activity (5.9 percent) and $2.3 billion in government revenue (6.0 percent).

 


 

Institute of Food Technology 2019 Annual Convention

04/02/2019

The annual convention of the Institute of Food Technology will take place in New Orleans, LA from June 2nd through 5th. The program will include scientific sessions and a food expo. The IFT anticipates 700 research poster presentations, 100 scientific and applied science sessions, a new exhibitor pavilion, a food safety exhibition and a new-products showcase. For further information, access www.ift.org.d


 

Whole Foods Market Opens DailyShop Store

04/02/2019

Whole Foods Market has opened a convenience-like store in Chelsea, NY in a high-density area. The store features self-checkout kiosks, considered faster than full-service grocery stores. The DailyShop concept will include common grocery items and produce, but in addition toiletries and travel-related products will be offered.

Amazon will close all Whole Foods Market 365 stores and then convert them to regular Whole Food Stores by the beginning of 2020.

It appears that Amazon in searching for ideal suburban and urban formats and even intends opening a chain under the Amazon banner separate from their $14 billion Whole Foods acquisition in 2017.


 

U.S. Agricultural Sector Faces Uncertainty

04/02/2019

The CoBank quarterly economic outlook released on March 28th highlights challenging farmers in 2019. These include:

  • Uncertainty over weather, including the possibility of flooding which may delay planting of the 2019 crop in the upper Midwest

  • Reduced demand for corn due to projected lower livestock requirements. The lower demand for ethanol will reduce diversion from feed and food. In past years, the excess production of ethanol over domestic demand was exported, but this market has ‘evaporated’ to a considerable extent.

  • Soybean sales, heavily influenced by purchase by China, have not resumed to 2017 levels. Although optimistic reports of progress in trade talks and orders, the outlook for exports still remains hazy.

  • World economic growth is slowing from 3.8 percent in 2018 expected to fall between 3 and 3.5 percent in 2019. Contraction of the economy in China is a contributor to growth although reduced trade with Asian nations and uncertainties over Brexit in the E.U. are also contributors.

U.S. economic growth in 2019 will reflect the decline recorded in the 4th quarter of 2018, which posted a 2.2 percent annualized rate compared to nearly double the level for the first six months in 2019. Growth in Q1 of 2019 was affected by government shutdown and trade disputes.


 

State of New Jersey Sues Major Chemical Manufacturers

04/02/2019

New Jersey has initiated lawsuits against DuPont, Chemours Company and 3M Company. The claims arise from allegations of environmental contamination with toxic chemicals including polyfluoroalkyl compounds (PFAs). These chemicals were used to coat cookware and as an ingredient in stain repellants but many have been withdrawn as a result of bans imposed by the EPA. All PFA compounds persist in the environment and have been associated with adverse health outcomes including low birthweight, endocrine disruption and elevated cholesterol levels.

Dow DuPont and Chemours are defendants in four complaints, and 3M was named in two lawsuits. Chemours is a spinoff from DuPont following the Dow-DuPont merger. New Jersey Attorney General Gurbir Grewal stated "The companies we are suing today knew full well the risks involved with these harmful chemicals, but chose to foul our soil, waterways and other precious natural resources."

In 2005, DuPont and the New Jersey Department of Environmental Protection entered into an agreement to resolve ground water contamination uncovered at eight DuPont sites. The State maintains that the settlement does not preclude current lawsuits since discharges continued subsequent to 2005. In a statement, 3M maintained "3M acted responsibly in connection with PFAs and will vigorously defend its record of environmental stewardship."

The implication in these lawsuits is that state departments of environmental quality and their attorneys general are becoming more aggressive in demands that chemical companies and other polluters remediate soil and ground water albeit at considerable expense. An example is the estimated $12 billion cost to remove PCB released during the production of Agent Orange, used during the Vietnam War.

If successful in lawsuits against chemical companies states may turn to intensive livestock companies if there is scientific evidence of pollution of soil and groundwater from animal waste.


 

Sugary Drinks Have Become the New Tobacco

04/01/2019

The American Academy of Pediatrics (AAP) and the American Heart Association (AHA) issued a joint statement on March 25th urging measures to reduce consumption of drinks containing sugar.

The 2015-2020 Dietary Guidelines recommend that children consume less than 10 percent of calories from added sugar. Current data shows that sugar provides 17 percent of calories, half of which is derived from sugary drinks. The joint AAP and AHA statement calculates that each child on average consumes 30 gallons of sugar-containing drinks annually.

The Associations recommended the same approach used to reduce use of tobacco by children.

Measures suggested in the statement include:

  • Excise tax on sugary drinks with funds used to improve health.

  • Regulations to limit marketing of sugary drinks to children and teens.

  • Advocating water and milk as alternative drinks for children including limiting placement in vending machines and restrictions under any Federal nutrition assistance program.

  • Hospitals and schools should establish policies to limit purchase of sugary drinks by patients and visitors.

    The AAP and AHA point the success in reducing consumption of sugary drinks in Berkeley, CA. and Philadelphia, PA. following introduction of taxes.


 

Domestic Egg Production and Exports to Mexico

04/01/2019

The most recent USDA-FAS GAIN report on Mexico (MX 9013) documents egg production and consumption in 2018 and projected values for 2019. Domestic production will rise by 2.3 percent from 2018 to 4.14 billion dozen in 2019. Based on a population of 132 million, consumption will be 23.5 kg (51.7 pounds) corresponding to 400 eggs per capita. It is estimated that eggs provide 17 percent of the protein consumed in the Nation. The GAIN report documented an average annual increase in production of 3.3 percent from 2015 through projected 2019.

In 2018 the U.S. supplied 92.1 percent of combined shell and egg product imports to Mexico comprising 46,800 metric tons based on national data. Brazil supplied 6.8 percent of combined shell and egg product imports to Mexico in 2018, up from 3.3 percent in 2017.

According to USDA data, Mexico was third-ranked as an export destination for both shell eggs and egg products in 2018. The USDA documented export of 5.9 million dozen shell eggs (15.1 million dozen in 2017) valued at $5.3 million ($13.3 million in 2017). Exports of shell eggs to Mexico in 2018 represented 4.8 percent of volume and 4.0 percent of value at a unit price of $0.89 per dozen. Mexico imported 4,676 metric tons of egg products from the U.S. in 2018 down 25 percent from 2017. Total value was $12.9 million, down 6 percent from 2017. Unit value increased 25 percent from $2,205 in 2017 to $2,759 in 2018. In the most recent year exports of egg products to Mexico represented 14.6 percent of volume and 11.8 percent of total value.


 

Midwest Poultry Federation Announces New Directors

04/01/2019

In a March 21st release, the Midwest Poultry Federation announced directors appointed by state poultry organizations to serve on the Board of the Federation. Lisa Beohm of the Henning Companies will represent the Iowa Poultry Association and John Burkel will represent the Minnesota Turkey Growers Association. The Executive Members of the Board include Greg Nelson representing the Kansas Poultry Association serving as president; Ben Thompson of Pearl Valley Eggs representing the Illinois Poultry Industries and Scott Waldner of Purina Animal Nutrition representing the Chicken and Egg Association of Minnesota.

The Board meeting took place following the Midwest Poultry Federation Convention. The event held for a second year in Minneapolis hosted 609 exhibitors and recorded a registration exceeding 3,100.


 

Midwest Poultry Federation Recognizes Exhibitors for Longevity

04/01/2019

Moba was award a certificate for ten consecutive years of exhibition at the Midwest Poultry Federation. A five-year award was received by O&T Farms. Both companies are Sponsors of EGG-NEWS.


 

REVIEW - The Battle to Do Good - The Business Journey of Bob Langert

04/01/2019

Bob Langert spent 25 years following an innovative and productive career at McDonald's Corp., retiring in 2015. When he joined the company it suffered from sensory deprivation. Management was blinded by its market share, international reach and market capitalization. Executives concerned with "millions served" were also tone-deaf to emerging consumer concerns including sustainability and welfare.

In 1988 Langert was introduced to the emerging concern over polystyrene clamshell packaging used by McDonald's for sandwiches. He was given the unenviable task of reversing sclerotic reasoning among decision makers in the company who were guided by practicality and profit. Fortunately he had sympathetic mentors and well oriented superiors. They accepted his ideas and recognized his deep-seated desire to do the right thing for consumers, suppliers the environment and his company. After the polystyrene clamshell sandwich-packing situation was resolved, Langert was assigned other responsibilities bearing on the supply chain that directly influenced public perception of the company.

McDonald's suffered a pyrrhic victory in 1990 when it injudiciously prosecuted a case for libel vigorously defended by London Greenpeace. The trial afforded the defense an opportunity to publicize perceived inadequacies in welfare, nutritional content of menus and alleged exploitation of labor. The outstanding revelations that garnered considerable publicity related to flock and herd welfare. The trial at the Old Bailey in London was a classic case of "don't mud wrestle a pig-you both get dirty and the pig enjoys it!" Subsequent to the trial Langert was tasked with developing a company policy and program on livestock welfare in the supply chain. He consulted with available specialists and organized an advisory panel representing the first application of a now accepted system of standards and audit.

Langert recognized the need to effect improvements by working within his organization. The passion emerging in his writing was reflected in persistence and patience, selecting problems with potential solutions and responding in a constructive way. One of the outstanding lessons in The Battle to Do Good is the need to be proactive in recognizing a potential problem and to address and resolve an issue before it emerges as a public relations crisis.

Early in his involvement in promoting welfare Langert recognized the need to develop a dialog with antagonists. He established a functional working relationship with animal rights organizations both with respect to caged hens and gestation crates for sows. His cooperation with the Environmental Defense Fund injected into the culture of McDonald's the reality that promoting a good environment is ultimately beneficial for business.

The Battle to Do Good can be read on two levels, the first is the narrative of a responsible executive promoting somewhat novel concept to staid executives. The second aspect of The Battle to Do Good is a business text comprising a series of case studies on aspects of sustainability, public relations, and societal responsibility.

I have had the pleasure of meeting with Bob and briefly working with him and have attended his presentations on numerous occasions. His book reflects a unique philosophy based on a sincere desire to simultaneously improve company image and profitability through consumer-friendly policies.

The Battle to Do Good should be standard reading material for any manager in the food industry or any aspirant executive pursuing a business degree or those with a career aspiration in any company where welfare, sustainability and public perception are involved.


 

Cal-Maine Foods Reports on Q3 of FY 2019

04/01/2019

  • In a press release dated April 1st Cal-Maine Foods (CALM) announced results for the 3rgd Quarter of Fiscal 2019 ending March 2 nd

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)

CALM achieved lower comparable sales and gross margins for the most recent quarter compared to Q3 2018 due to extraordinary high prices for generic eggs prevailing in that quarter. This was influenced by the early occurrence of Easter in 2018 and the greater availability of eggs relative to demand during 2019 occasioned by higher flock size.

Quarter Ending

March 2nd 2019

March 3rd 2018

Difference (%)

Sales:

$383,992

$435,820

-11.9

Gross profit:

$82,441

$120,098

-31.4

Operating income: *

$38,190

$76,202

-49.8

Pre-tax Income

Net Income

$53,481

$39,777

$76,202

$96,294

-39.3

-58.7

Diluted earnings per share:

$0.82

$1.99

-58.5

Gross Margin (%)

21.5

27.6

-22.1

Operating Margin (%)

9.9

17.5

-43.4

Profit Margin (%)

10.3

22.1

-53.4

Long-term Debt:

$677

$2,554

-73.5

12 Months Trailing:

     

Return on Assets (%)

11.7

   

Return on Equity (%)

22.7

   

Operating Margin (%)

13.2

   

Profit Margin (%)

12.8

   

Total Assets March 2nd '19/ June 2nd 2018

$1,194,455

$1,150,447

+3.6

Market Capitalization

$2,150,000

   

* Includes $758 thousand for loss on sale of fixed assets ($279 thousand Q3 2018)

52-Week Range in Share Price: $ 40.63 to $ 52.30

Market Close March 29th $44.79 11H00 April 1st post release

Forward P/E 28.3 Beta 0.2

In reviewing the CALM 3rd Quarter results the following derived and stated values* represent key data (Q3 2018 data in parentheses).

Egg sales : $376,312,000; ($427,104,000: -11.9%)

  • Dozen shell eggs sold: 271,805,000: (273,209,000: -0.5%)?

  • Average selling price of all shell eggs: $1.38 per dozen; ($1.56 per dozen: -11.5%).?

  • Average selling price of specialty eggs calculated from data released: $1.96 cents per dozen: ($1.94 per dozen; +1.0%).?

  • Average selling price of generic eggs calculated from data released: $1.20 cents per dozen; ($1.44 cents per dozen; -16.7%).?

  • Differential between generic and specialty eggs: $0.76 cents per dozen; ($0.50 per dozen; +52.0%)?

  • Specialty eggs as a proportion of volume sold: 24.7%; (24.3%; +1.7%)?

  • Specialty eggs as a proportion of sales value: 35.0%; (30.2%; +15.8%)?

  • Proportion of eggs sold actually produced by Cal-Maine flocks: 81.8%; (80.9%; +1.1%).?

  • Feed cost: 42.0 cents per dozen (40.0 cents per dozen; +0.5%)?

    *Assumes that 98 percent of sales value was derived from shell eggs
     

    In commenting on Q3 results Dolph Baker, Chairman and CEO of Cal-Maine Foods, Inc., stated, "Cal-Maine Foods had a solid financial and operating performance for the third quarter of fiscal 2019,
     


Prospects for Floods Imperil Spring Planting

03/31/2019

Recent floods along the Mississippi and upper Midwest catchment areas will delay planting. Consulting Company Planalytics estimates that half of the corn and soybean acreage due to be planted this spring is at risk of flooding. The greatest concerns are in Iowa, Minnesota and Nebraska with possible adverse effects in Missouri, North Dakota and Illinois.

Navigability of the Mississippi River and its tributaries will also be impacted by high water levels. This may create difficulties in transport of ingredients from the Midwest to the poultry and swine industries located in the Southeast in addition for export through terminals south of Baton Rouge. Unrestricted navigability is also necessary to transport fertilizer upstream to the Midwest and Northern-tier states.


 

Australia Continues to Encounter SE Outbreaks

03/31/2019

According to health authorities in Australia, Salmonella Enteritidis outbreaks attributed to eggs have been diagnosed in New South Wales, Victoria, Queensland and Tasmania over the past twelve months. Recurrent clusters of cases have been reported since May 2018 with a surge in incident reports in March 2019. An outbreak involving 28 diagnosed cases occurred in September 2018 associated with a producer with multi-state distribution.

Despite the frequency although limited size of outbreaks, it is accepted that SE is not endemic to the industry and that surveillance must be an ongoing preoccupation. As affected farms are identified, product should be and is being recalled.

The past decade, Australia has witnessed a transition from traditional cage housing to both barn and free-range systems motivated by retail chains. Elimination of SE from flocks allowed outside access is well-nigh impossible and the unfortunate combination of flocks colonized with SE and housing which cannot be contaminated will predispose to persistence of infection resulting in recalls.


 

Sewage Samples Used to Confirm Patterns of Antimicrobial Resistance

03/31/2019

In a study organized by the Technical University of Denmark sewage samples from 79 sites in 60 nations were assayed to determine patterns of antimicrobial resistance. Samples were collected by volunteers and were analyzed in Denmark for genes coding for antimicrobial resistance.

Samples from Australia, New Zealand, North America and Western Europe had generally lower levels of antimicrobial resistance. In contrast samples from Asia, Africa and Latin America had higher levels.

The report of the study contained in the March 18th edition of Chemical and Engineering News a weekly periodical circulated by the American Chemical Society quoted the conclusions of the researchers that the most effective strategy to combat antibiotic resistance is to improve sanitary conditions.

Would it not seem logical that misuse of antibiotics especially in the treatment of humans is the driver of antibiotic resistance? The researchers appear to have got the cart before the horse with their surveillance project. Accordingly greater controls over use of antibiotics in both human medicine and livestock production should be adopted. The presence of bacteria carrying genes for antibiotic resistance is an end point in the process. Restricting antibiotics worldwide to the standards imposed in industrialized nations is imperative to suppress the emergence of drug-resistance leading to what the media refer to as "superbugs"


 

Potential to Inactivate Influenza Virus

03/31/2019

Cooperative studies conducted by Jansen Pharmaceuticals and the Scripps Research Institute have demonstrated the beneficial effect of specific small molecules in inhibiting fusion of influenza virus to epithelial cells in the respiratory system of mice.

The approach was based on a study of the mechanism of action of antibodies that prevent hemagglutinin of the virus effecting the conformational changes required for the virus to fuse with host cells.

After screening approximately one-half million small molecules, a few candidates with the required pharmacokinetic profile were identified. A specific compound termed JNC4796 was selected. When ingested, the compound protected mice subjected to 25 times the lethal dose of influenza virus.


 

Yuma Valley Growers Anticipating Season Free of Contamination

03/29/2019

Growers in the Yuma, AZ valley were impacted by two consecutive outbreaks of E. coli O157:H7 during 2017 and 2018. Epidemiologic investigations indicated contamination of irrigation water emanating from concentrated animal feeding operations as the source of the pathogen. 

 

For the 2019 season, organizations in Arizona and California have established guidelines for growers.  The Leafy Greens Marketing Agreement requires buffer zones of 1,200 feet from any CAFO with many growers extending this distance.  A Wellton area feedlot adjacent to a three-mile length of the Wellton canal extending for 20 miles yielded the same E. coli as that isolated from patients applying whole genome sequencing assay.

 

The FDA traceback investigation 36 growing areas involving 23 farms as potential sources of contaminated romaine lettuce.  Although the specimens collected from the Wellton area feedlot in 2018 failed to yield the specific E. coli responsible for infection in consumers, it is acknowledged that excretion of a given strain can be variable. The number of samples collected late in the course of the outbreak was insufficient to establish statistically valid correlations between contamination of lettuce and the feedlots.  During August 2018, water samples from sections of the irrigation canal and from ground water failed to yield the infectious strain. Fields harvested at the end of the 2018 season have been plowed and have been exposed to sun and dry air that would be expected to kill E. coli if present.  


 

AEB Consolidates List of Donations

03/29/2019

The AEB has announced that producers in the U.S. collectively donated 3.3 million dozen eggs to food banks and worthy charities during 2018.

The concept of consolidating the U.S. donations originated with the Colorado Egg Producers' Association. The AEB Consumer Marketing Committee assisted Ashley Richardson, Senior Director for Marketing Communications at the AEB to compile a list

Documenting 1,000 donations to food banks and to support disaster relief in 2018.


 

Sad Passing of Egg Industry Veteran Joe Wyatt

03/28/2019

Joe Wyatt, born August 4th 1939 in Raleigh, MS passed away suddenly on March 18th at the age of 79. Joe earned a baccalaureate degree from Mississippi State University in 1964 and joined Cal-Maine Foods for his productive career of 55 years. As an industry pioneer together with his esteemed colleague Jack Self, Joe developed many of the procedures and systems in use in the industry today. At the time of his passing he was a Vice-president of Cal-Maine Foods with responsibility for feed mills and transport. Joe was an extremely cooperative manager always willing to adapt to new realities and he swiftly upgraded facilities under his control to conform to the needs of the FDA Final Rule on Prevention of Salmonella in the 2000's

EGG-NEWS extends condolences to his family including widow. Ann Wyatt, daughter Stacy, son Marc and their children.


 

Hawaii Considers Extensive State-Wide Ban on Plastic Containers

03/28/2019

Hawaii intends to ban Styrofoam food containers and single-use plastic bags including bin liners in an environmentally friendly initiative. At issue is public concern over marine contamination with plastic as evidenced by the growing gyre of non-degradable waste circulating northeast of the Hawaiian Islands in the Central Pacific Ocean.

The Hawaii Food Industry Association which represents supermarkets and convenience stores now supports a ban on film containers. The Hawaii Restaurant Association, representing 3,500 restaurants is opposed to the ban mainly based on the higher cost of substitute packaging.

It is evident that if plastic bags and food containers are to be banned, alternatives must be available. Recycling of plastic will be necessary to prevent marine contamination and the convenience and economy offered by plastic in comparison to alternatives should be considered in framing legislation. The Hawaii proposal has passed the state Senate, but must be considered by the House before enactment.




 

Unprecedented Flooding in Midwest Affects Livestock and Communities

03/28/2019

Recent flooding affecting Nebraska and Iowa represents a widespread disaster. The U.S. National Oceanic and Atmospheric Administration predicts that as many as 200 million residents of Midwest, Great Plains and Mississippi River Valley states will be at risk of flooding after the Spring snow melt. The immediate impacts on agriculture from the most recent floods include:

  • Cargill closing elevators at Council Bluffs, IA. and Albion, NE.

  • Valero ethanol plant at Albion, NE was closed

  • ADM was forced to close the Columbus, NE corn processing complex

Nebraska governor Pete Ricketts characterized the events of the past week as "The most widespread disaster we have had in our state's history." The Nebraska Farm Bureau estimates losses to crops at over $400 million with an additional $500 million loss to the livestock sector.


 

Walmart Chief Technology Officer Resigns

03/28/2019

Jeremy King, Chief Technology Officer for Walmart is leaving the company after a six-year tenure. King was responsible for innovations in Walmart E-commerce and he led Walmart Labs, an incubator responsible for developing technology to compete with Amazon.com.

Fiona Tan, Senior Vice President of Customer Technology will assume the responsibilities previously undertaken by Jeremy King until a replacement is recruited and appointed.

King is apparently leaving Walmart to an undisclosed "new adventure" according to a release by Greg Foran, CEO of Walmart U.S.


 

AMS Requests Comments on Increased Fees

03/28/2019

On March 25th, AMS published a proposed rule in the Federal Register relating to a new and higher fee structure. In a concurrent announcement, AMS requested written comments before May 24th 2019 addressed to www.regulations.gov or sent directly to Julie Hartley, <Julie.Hartley@ams-usda.gov > Business Operations Branch, Quality Assessment Division, Livestock and Poultry Program, Agricultural Marketing Service, USDA. Comments should refer to docket number AMS-LPE-18-0095.

The proposed amendments will standardize language and update terminology relating to billing services and will adjust holiday rates, excessive billing hours and administrative volume charges.


 

STOP PRESS

03/28/2019

Breaking news to be considered in greater detail in upcoming editions of EGG-NEWS and CHICK-NEWS:-

  • Progress in China Negotiations ? According to observers the bilateral meetings taking place in China today promise some concessions on coercive technology transfer. The tone of discussions is apparently less confrontational. Can commitments by China be accepted?

  • Jury Award in Glyphosate Trial . In the second phase of a trial to determine damages, a California jury awarded Edward Hardeman $80 million as a result of the finding in the first phase that glyphosate in Roundup™ manufactured by acquired Bayer subsidiary Monsanto was responsible for a diagnosis of non-Hodgkin lymphoma. Five more bellwether cases are to be tried in 2019.

  • State of New Jersey Sets Precedent by Suing Chemical Companies for Soil Contamination . DuPont, 3M and Chemours have been named as defendants in a lawsuit brought by the State of New Jersey alleging responsibility for contamination with polyfluoroalkyl (PFA) compounds that persist in the environment resulting in negative health outcomes.


 

Cargill Releases Q3 Financial Data

03/28/2019

In a March 28th release, privately held Cargill Inc. released financial results for the third quarter of Fiscal 2019 ending February 28 th. The Company posted operating earnings of $604 million, higher by 8 percent from the corresponding third quarter of FY 2018. Net earnings on a GAAP basis were up 14 percent to $566 million on revenue of $26.9 billion, down 4 percent from Q3 2017.

The Animal Nutrition and Protein Segment apparently performed well with North American protein in the most recent quarter exceeding Q3 of 2017 with a special mention of "demand for egg products" Cargill is a major processor of egg liquid but as yet has not integrated back into egg production or breaking.

David MacLenan, Chairman and CEO commented on trade tensions and supply chain disruptions including African swine fever in Asia as headwinds. Cargill improved their bottom line by cost reductions and reduced expenditure despite downturns in all four operating segments as compared to Q3 of 2017.


 

NOSB Considering Disqualification of SE and E.coli Vaccines

03/28/2019
Based on the fact that the only available Salmonella Typhimurium and E.coli vaccines are live attenuated gene-deleted variants derived from pathogenic strains, the National Organic Standards Board is considering their removal from the list of approved substances. This would be a profound mistake and reflects a lack of appreciation of science, epidemiology of colibacillosis and salmonellosis. Both vaccines are exceptionally effective and in one case contributes to welfare, sustainability and productivity of organic flocks and in the other protects against egg borne disease. Both considerations are relevant to the well-being of farmers , public health and the image of the organic seal
 
The attached letter was submitted to USDA-AMS as a comment to be considered by the NOSB at their April meeting. Support for retention of the two vaccines is encouraged as it will benefit the organic segment of the egg industry representing 7 percent of a nominal U.S. flock of 225 million hens producing shell eggs.
 

 

Updated USDA Forecast Production

03/28/2019

The March 14th issue of the USDA Livestock, Dairy, and Poultry Outlook confirmed egg production to amount to 7.8 billion dozen, two percent higher than in 2017. Growth was due to both expansion of the national flock and increased egg production per hen placed. The forecast for 2019 was revised upwards to 8.0 billion dozen, approximately 2.5 percent higher than in 2018.

Understandably, increased production without a proportional rise in consumption will depress prices as denoted in both the weekly reports and the monthly summaries posted on EGG-NEWS.

As we move to the end of the first quarter of 2019, late March prices are depressed in comparison to both the March 2018 value that was exceptionally high and the five-year average.

The beneficial effect of exports of both shell eggs and egg products was reduced from 2017 compared to 2018 to 17.8 million dozen equivalents. This amounted to approximately half of the 2017 volume which was inflated by outbreaks of HPAI in the E.U. and Asia.


 

Prospects for 2019-2020 Brazil Soybean Production

03/28/2019

A report from the USDA-FAS attaché in Brazil predicts a harvest of 4,246 million bushels from 89.2 million acres sown for the crop cycle February 2019 through January 2020. This compares with a projected production of 4,544 million bushels from 89.2 million acres planted in the U.S. for the 2019 harvest. On the basis of area planted, yield of soybeans in Brazil will attain 47.6 bushels per acre compared to 50.9 bushels per acre in the U.S. The difference in yield is attributed to early rains that stimulated germination and growth followed by a subsequent dry period that impacted filling of pods.

Brazil will export 60 percent of the 2019-2020 harvest compared to 37.5 percent for the U.S.

The deficiencies in the transport infrastructure in Brazil extending from both the growing areas to ports and the major domestic production regions will become apparent during the coming season although it is unknown whether there will be a reoccurrence of the May 2017 truckers' strike. Concessions including minimum freight rates were imposed but there is still uncertainty regarding the reliability of road transport on which growers, traders and producers are dependent.


 

Dallas TX. Independent School District Increases Egg Servings

03/28/2019

The AEB reports that the Dallas Independent School District with 156,000 students served 1.3 million additional servings of eggs in 2018. The increase is attributed in part to the promotional efforts of the AEB that has focused on school meals during the past two years. Exposing scholars to nutritious and attractive egg dishes will engender an appreciation for eggs that hopefully will encourage consumption in later years.


 

Dollar General Moves to Self-Distribution of Refrigerated Items

03/28/2019

The Dollar General Fresh Initiative currently serves 300 of the company's stores in the Northeast. The program will be extended to 5,000 stores by January 2020 and will encompass the entire chain with four years. Dollar General has introduced fresh, frozen and refrigerated foods to increase sales. The volumes of these items have grown to the point where the company believes that a distribution network is justified. Dollar General currently operates a cold storage distribution center in Pottsville, PA.

Dollar General intends to open ten small-format stores during 2019 in urban areas. The company posted a four percent increase in same store sales during the fourth quarter ending February 1st attributed in part to resumption of parts of the SNAP program on which it is heavily dependent.


 

Japan Declares Gene-Edited Foods as Safe

03/26/2019

Following a review of an advisory panel, the Ministry of Health, Labor and Welfare of the Government of Japan has approved the use of gene editing for foods to be marketed and consumed in the Nation. Disabling or altering genetic expression by using techniques such as CRISPR will therefore be allowed in Japan.

This decision is consistent with U.S. policy but contrary to a ruling by an E.U. court that made no distinction between gene editing and insertion of genes derived from a different species.

The ruling has predictably elicited opposition from the Consumers Union and other groups that are demanding regulation of gene-edited crops and safety reviews of derived foods.

The final report of the advisory panel submitted on March 18th rejected the need for special safety screening since current gene editing techniques did not involve introduction of foreign genes into the target crop or derived food.

Details relating to the editing technique would be disclosed by the applicant but would be subject to restrictions regulating proprietary and intellectual property.

 


 

Target to Introduce Snack Bars in Stores

03/26/2019

In 2015, Target introduce the fast-casual concept from Freshii and D’Amico but the initiative withered in 2017.  Target is now attempting a second act introducing snack bars as a trial in some locations.  These will feature Pizza Hut servings, salads and grab-and-go snacks with customers paying at a self-service kiosk.  The initial response to the test units in Minneapolis have been favorable.  Currently there are 1,300 Starbucks stores operating in Target locations nationwide but the low-volume snack section is expected to benefit Target customers. 

Bryan Gildenberg at Kantar Consulting believes the low cost of the non-staffed kiosks will prove profitable.  He stated, “Practically speaking, if you're a mom with kids, not having to wait in line is a big plus.”  Nick Egelanian, president of SiteWorks considers that the concept is inferior to the Costco iconic food-court which offer hotdog and soda combinations and encourages brand loyalty through value.  Egelanian stated, “It always struck me that Target wasn't terribly organized in terms of their thinking with its cafe concepts. It was always on the low end of offering value and loyalty.”

Similar projects include the Amazon Go convenient stores and 7-Eleven Scan & Pay.  Customers can purchase products using their phone or a self-checkout station.

 

 


 

Forbes Criticizes Recent Article Implicating Eggs in CVD

03/26/2019

Gary Garthwaite writing in Forbes on March 20th criticized the JAMA article that was the subject of the March 22 nd editorial in EGG-NEWS. Forbes correctly alludes to the current trend for epidemiologists in search of a publication conducting meta-studies on available data. This process involves abstracting (or 'cherry-picking") data from previously conducted studies and then performing statistical analyses in an attempt to derive associations between specific foods and health outcomes. These studies are subject to selection bias and at best only indicate an association, not causality.

Unfortunately, studies when published are abstracted by lay-commentators and amplified using social media. Since any distortions in the original paper are further manipulated according to the inclinations of the individual or organization posting the comment, the perception of a food and hence consumption can be adversely impacted.

The article in question showed only a mild statistical association between consumption of eggs and cardiovascular disease. The conclusions were clearly contrary to the wealth of literature accumulated in recent decades showing that consumption of an egg per day is not deleterious to health while providing nutritional benefits.

The outcome that meta-studies with sophisticated statistical analytical techniques may indicate an association is characterized by Garthwaite as "when pushed the authors can always claim: well I didn't say it was a causal relationship" He continued, "invariably these caveats are ignored by the media in favor of attention-grabbing headlines full of causal proclamations. Rinse and repeat."


 

E.U. Trade Talks at a Complete Standstill

03/26/2019

While China dominate trade issues, the E.U. has taken third place after ratification of the USMCA. This is a situation of concern given the size and potential purchasing power of the 28-nation E.U. following on from the July 2018 meeting between the President and E.U. Commissioner Jean-Claude Juncker. In mid-2018, it was agreed that the U.S. would not place tariffs on E.U. vehicles while the two parties worked on improving trade relations.

According to U.S. Trade Representative Robert Lighthizer, discussions with the E.U. are at a "complete stalemate". Although the E.U. has imported some soybeans, based on competitive pricing there has been no progress in establishing a trade deal with the European Commission. The diversity of interest among the 28 nations is regarded as the principle obstruction. Germany with a vested interest in export of vehicles is pressing for resumption of negotiations but France concerned over rural supporters is stalling.

According to comments by Alton Sondand addressing an American Chamber of Business Conference in Brussels, there is unanimity in Congress on reversing the negative trade balance with the E.U. The European Commission has circulated a position paper to the 28 E.U. nations proposing reduced tariffs but accepting a common or unified policy is analagous to herding cats (fat or oterwise).


 

Central Valley Eggs to Commence Second Production Complex in California.

03/24/2019

In a March 24th press release Central Valley Eggs announced the start of their second production complex in Tulare CA. The Wasco complex has been at full capacity since early 2018.

Jeff Peterson the GM commented, “Our concept of cage free, done on an economical scale with careful attention to hen welfare is resonating with the marketplace.” He added, “The mandated changes caused by the passage of Proposition 12 will create additional opportunities as we grow our production.” 

Central Valley Eggs is a partnership among Opal Foods, Western Milling and Hickman’s Egg Ranch, formed to supply California with high-quality cage-free eggs.  For additional information, and employment opportunities contact Jeff Peterson, <jpeterson@cveggs.com>.


 

Engaging Research Chefs

03/22/2019

The AEB met with product development chefs affiliated with food manufacturers and leading QSR chains during the Research Chefs Association (RCA) annual meeting in Louisville in mid-March. This interaction entrenched strategic partnerships and secured invitations to participate in future innovation workshops.

The AEB is a Gold Sponsor of RCA, which enables continued engagement throughout 2019 to educate and promote the functional benefits of eggs to generate innovation in the food industry.


 

Bayer Loses Second Glyphosate Case

03/21/2019

A six-member jury in San Francisco ruled in favor of Plaintiff Edwin Hardeman who alleges that a diagnosis of non-Hodgkin lymphoma was caused by exposure to glyphosate, the active component of Roundup® manufactured by Monsanto, now owned by Bayer AG.

In the first phase of the trial the jury was tasked with weighing epidemiologic and toxicological evidence advanced by experts on both sides to determine whether the compound was carcinogenic. The second phase will involve an assessment of direct and punitive damages and will consider whether Monsanto "adopted a responsible, objective approach to the safety of Roundup" as quoted by Plaintiff's Attorney Aimee Wagstaff.

Three additional bellwether trials will be heard in Federal courts in the next six months. A total of 11,200 claims have been filed with the exposure of Bayer amounting to $5 billion. As a result of the unexpected verdict, shares of Bayer AG fell by nine percent.

Withdrawal of glyphosate from the agricultural market would adversely impact crop yields and would lead to the use of potentially more toxic herbicides. The planting of GM glyphosate-resistant corn, cotton and soybean cultivars would be sharply reduced and cost of production would escalate.


 

FDA Issues Guidance and Standards to Contribute to Wholesomeness of Leafy Products

03/21/2019

On March 15th the U.S. Food and Drug Administration issued a rule to finalize compliance dates for agricultural water requirements arising from the Food Safety and Modernization Act (FSMA) Produce Safety Rule. Large farms will be required to comply by January 2022 with small farms one year later.

Contaminated water was identified as a cause of adulteration of Romaine lettuce in two separate outbreaks investigated by the CDC and FDA.

Over the long term, outbreaks of Listeria, Salmonella and E.coli will inevitably arise as a result of contamination along the chain of production and distribution of green vegetables eaten raw in salads. At the present time, the only certain method of eliminating bacterial contamination is the application of electron beam treatment that would add fractionally to cost but would represent a considerable improvement in safety.


 

Delay in U.S. China Presidential Meeting

03/21/2019

The Presidential meeting to finalize the trade agreement between the U.S. and China will be delayed until at least late April according to International Trade. Although progress has been made in resolving trade issues, there is still concern over intransigence by China to amend structural policy including state subsidies for industry, industrial espionage and coercive practices with regard to intellectual property.

U.S. Trade Representative, Robert Lighthizer emphasized that "major issues" are still unresolved. According to informed observers, officials in China are disinclined to subject President Xi to last minute demands, the embarrassment of a cancelled summit or a walk-away. In a recent statement President Trump noted, "We can have the deal completed and come and sign it or we can get the deal almost completed and negotiate some of the final points. I will prefer that. But it doesn't matter that much."

Herein lies the uncertainty by China according to Dr. Eswar Prasad of Cornell University and an expert on the Chinese economy who stated, "The concern about being snookered by President Trump at the negotiating table is a real risk for Xi."


 

Campaign to Adopt USMCA Intensifies

03/21/2019

During the past week, the Pass the USMCA Coalition, representing trade associations, business and advocacy groups including the USPOULTRY, the National Chicken Council and the National Turkey Federation will be launching TV commercials and digital advertisements to generate support for the USMCA. The first TV ad to run in the Washington DC area promises a "new era of economic and creative prosperity within reach" according to a report in International Trade.

What was originally regarded as a done deal, the USMCA has come under criticism from incoming Democratic freshman to the House together with some Republicans who are defying the presidential call for Congress to support USMCA.

The USMCA must be approved by legislatures of all three signatories to come into effect. The Administration has threatened to withdraw from NAFTA possibly as a tactic to ensure acceptance of the agreement.

The advertisement will claim that the U.S.-Mexico-Canada trade agreement will level the playing field for workers, consumers and farmers with more free markets, fairer trade and robust economic growth.


 

Iowa State Dean Appointed

03/21/2019

According to an Egg Industry Center circular Dr. Dan Robison has been appointed as the Dean of Iowa State University College of Agriculture and Life Sciences effective January 2019.

This new appointment is important for the Egg Industry Center (EIC) as in his position he holds a seat on the EIC Advisory Board. In commenting on his involvement with the EIC, Dr. Robinson stated "I am thrilled to be in this role and to become fully engaged with the EIC.

A search committee will be established to recruit and select the next Egg Industry Center Director following the appointment of Dr.ongwei XinH Hongwei Xin as Dean for Agricultural Research at the University of Tennessee.


 
















































































































































































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