National Retail Report - March 21

Here is the summary graph from the USDA's National Retail Report of March 21:

Advertised Prices for Fruits & Vegetables at Major Retail Supermarket Outlets - 03/15 to 03/27
Retailers Focus Almost Exclusively on Easter Holiday
Nearly all retailers this week were vying for Easter shoppers with ads on a wide variety of items to celebrate the holiday. The most widely promoted items were hams and produce for dinner, candies, Easter lilies and a wide variety of baskets and gifts. In addition, several ads continued to promote March as National Frozen Food Month and some ads were taking the opportunity during the last days of the Lenten season to promote fish and seafood. Vegetables were featured heavily this week and accounted for over 55 percent of the total ads. This is in contrast to recent weeks in which fruits were more prominently featured. The top 5 featured items were: asparagus, pineapple, grapes, strawberries, and sweet potatoes. The most notable increases on the vegetable ads were for asparagus, green beans, celery, mushrooms, and sweet potatoes. As expected, there was a sharp decline on cabbage ads after the St. Patrick’s Day holiday.Overall, special weekly price ads on the fruits were down more than 10 percent when compared to last week. However, many ads featured “buy-one-get-one-free” promotions for a variety of fruits and were especially noted on strawberries and other berries.

Fruits as Percentage of Total Fruit Ads March 21, 2008
Limes 0%
Mangoes 1%
Lemons 1%
Honeydew 0%
Nectarines, yellow flesh 6%
Peaches 6%
Pears, bartlett 2%
Oranges, navel 4%
Grapefruit, red 1%
Grapes, green/red 17%
Cantaloupe 8%
Blueberries 4%
Avocadoes, hass 5%
Bananas 0%
Apples, red delicious 3%
Watermelon, seedless 1%
Watermelon, mini 1%
Strawberries 15%
Plums 4%
Pineapple 21%



Vegetables as Percentage of Total Vegetable Ads - March 21, 2008
Asparagus 19%
Beans, round green 8%
Broccoli 3%
Broccoli, organic 2%
Cabbage 2%
Carrots, baby 7%
Carrots, baby organic 2%
Celery 4%
Cucumbers 2%
Corn 1%
Lettuce, iceberg 1%
Tomatoes, Organic 0%
Tomatoes, grape 6%
Tomatoes on the vine 5%
Squash, zucchini 3%
Tomatoes 1%
Mushrooms, white 7%
Sweet Potatoes 10%
Peppers, bell green 1%
Peppers, bell red 1%
Onions, sweet 4%
Onions, yellow 2%
Potatoes, russet 7%
Lettuce, romaine 1%
Tomatoes, grape organic 2%

Japan's cherry blossom time

Here is a link to the USDA FAS report on Japan's cherry market. Cherry production is growing, but imports from the U.S. are a big part of the market.


Unlike most other crops in Japan, the production area for cherries has been expanding. Farmers converted their land to cherries expecting better returns for their investments. Unfortunately, cold weather hit the region in the spring of 2007, and resulted in a 20 percent reduction in nation's outputs. Farmers expect that this season's crop will be average since no major weather problems have been reported. Japan imported 9,288 metric tons of U.S. cherries in 2007, valued at $65 million on a CIF basis. Good quality fruit is an essential marketing factor in Japan, but lately Japanese traders and wholesalers ha e become more cost conscious, since major Japanese supermarkets aim to sell U.S. cherries at 98 yen (90 cents) per 100 grams. There were no shipments of U.S. nectarines to Japan in 2007 and none are expected in 2008.

Currently, Japan allows the United States to ship the following 12 varieties of fresh cherries to Japan with methyl bromide fumigation: Early Garnet, Garnet, Sweetheart, Chelen, Tulare, Van, Bing, Broox, Lapin, Lambert, Ranier and Royal Ranier. New Zealand Develops a Good Reputation for High Quality Cherries in Japan Sales of New Zealand cherries are still limited in Japan and it sold approximately 22 metric tons in 2007, valued at $261,000 on a CIF basis. ew Zealand was granted a cherry export protocol with no fumigation requirement; therefore, fruit quality was significantly better when it arrived in Japan compared with cherries that have been treated with methyl bromide, according to Tokyo traders. New Zealand fruit was imported in December and January and it did not directly compete with U.S. products. New Zealand cherries that were imported into Japan were all extra large sized fruit and packaged in 5 or 2 kilogram cartons. Bing, Stella, Lapin and Raneir are key varieties sold in Japan. New Zealand cherries were trading at premium prices of $83.14 (9,000 yen) for a 5-kilogram carton and $50.80 (5,500 yen) for a 2-kilogram carton at Tokyo Ohta Wholesale Market in January 2008.

Currently, the government of Japan does not allow the importation of U.S. fresh peaches due to phytosanitary concerns. No Shipments of U.S. Nectarines to Japan in 2007 U.S. nectarines were marketed in Japan from 2000 through 2005 with sales volume between 9 - 51 metric tons annually, and there were no shipments to Japan in the last 2 seasons. According to Japanese traders, it is not economical to ship only small volume s, particularly with fumigation requirements. All U.S. nectarines are subject to methyl bromide fumigation before entering to Japan due to codling moth concerns. Currently, Japan allows the United States to ship the following 10 varieties with methyl bromide fumigation: Summer Grand, Spring Red, Firebrite, Fantasia, May Grand, Mayglo, May Diamond, Mayfire, Red Diamond and Royal Giant. According to Industry sources, it is expected there will be no shipments of U.S. nectarines to Japan in 2008.

Don't hold your breath - Stone fruit to Down Under

Here is a link to a report about Australia's consideration of an import risk assessment for U.S. stone fruit. From the report:

Report Highlights:
Biosecurity Australia has announced the commencement of the Import Risk Analysis (IRA) for the importation of U.S. stone fruit into Australia. The IRA on stone fruit from the USA had previously been announced as a review of existing biosecurity policy. This analysis will be undertaken as a standard IRA, requiring completion within 24 months from announcement. Below is the text of a March 13, 2008 notice from Biosecurity Australia announcing the commencement of the Import Risk Analysis (IRA) for the importation of U.S. stone fruit into Australia. In March 2006, in response to a market access request from the USA for the importation of stone fruit (nectarines, peaches and plums) from California and the Pacific North West States (Idaho, Oregon and Washington) of the USA, Biosecurity Australia announced that it would consider this access request as a review of existing biosecurity policy, based on the policies for the importation of cherries from California, Idaho, Oregon and Washington and stone fruit from New Zealand.

Mexican "hot bite" - Redo NAFTA and recession impact on exports

If Clinton or Obama wins, will the U.S. renegotiate NAFTA? Perhaps so. Will the U.S. recession hurt Mexican exporters? Most assuredly. Here is a link to a summary of Mexican press reports from the USDA FAS office in Mexico City. From Hot Bites:

Jack Sweney, the former Vice-president of the American Chamber of Commerce (AmCham), recently said that the agricultural sectors did not make any changes to increase their productivity during the 14 years that NAFTA has been in effect. Beginning this year, the tariff rate quotas (TRQ) were eliminated so Mexico could import yellow corn from the United States with no restrictions. Sweney, who participated in the NAFTA negotiations in 1993, onfirmed that legally Mexico, the United States and Canada can renegotiate the agreement. However, commercially it is not convenient. The three countries recently formed a group to renegotiate NAFTA, and they are confident they can do so as long as a democratic candidate wins the U.S. presidency. Sweney commented that a renegotiation would have to start at the top with each President. “The arguments against the treaty, which have been exposed by the legislators, are the same arguments they used during the negotiation in 1993,” said Welcome to Hot Bites from Mexico, a weekly review of issues of interest to the U.S. agricultural community. The topics covered in this report reflect developments in Mexico that have been garnered during travel around the country, reported in the media, or offered by host country officials and agricultural analysts. Readers should understand that press articles are included in this report to provide insights into the Mexican "mood" facing U.S. agricultural exporters. Significant issues will be expanded upon in subsequent reports from this office. DISCLAIMER: Any press summary contained herein does NOT reflect USDA’s, the U.S. Embassy’s, or another U.S. Government agency’s point of view or official policy. “Th e legislators can review the NAFTA agreement, but I doubt that they will try to renegotiate it,” said Sweney. (Source: El Universal; 03/12/2008).

Members of the Mexican Lower House requested a series of hearings with the Secretaries of Agriculture and Economy, so that they can explain the impact of NAFTA’s full implementation on Mexico’s agricultural sector. Representative Hector Padilla, President of the Agriculture Committee, explained that the hearings may take up to three days in order to define and, hopefully, implement adequate policies to alleviate the problems faced by agricultural workers. He added that during the hearings they will invite state government officials, agricultural workers’ associations and related industry members. (Source: El Sol De Mexico, 3/10/08).

Jaime Yesaki, President of the National Agricultural Council (CNA), said that the economic slow down in the U.S. could impact the Mexican agricultural sector with a reduction in exports to the U.S. and Canada. CNA’s President stated that 85 percent of Mexico’s exports go to the U.S., which is why a change in the economy and incomes of the Americans would impact the Mexican agricultural sector. “With the economic slow down, we will be affected in two ways: with exports and from investment,” said Yesaki. “There would be less investment and less credits; therefore, we have to look for new markets because we depend on the United States too much.” Yesaki said that the impact of the economic slow down will be felt during the middle of the year. (Source: Reforma ; 03/13/2008)

Rutgers report on food imports

Doug Powell of the Food Safety Network noted this Rutgers report today: The US Food Import System: Issues, Processes and Proposals; The 44 page pdf offers an examination of current rules and proposed changes to the food import system. From the report's conclusion:

As a result of the well-publicized recalls of both domestic and imported foods, issues of food safety have risen on the public agenda. Increased scrutiny by members of the press, Congress, and consumer groups have revealed a regulatory and inspection system that appears to many to be an underfunded, piecemeal approach to ensuring the safety of the American food supply. Detractors point to an apparently increasing number of food recalls in recent years, the decline in inspections of foods produced both domestically and abroad, and the lack of resources devoted to keeping up with explosive growth of food imports as evidence of a food safety system that is badly in need of reform.
In contrast, supporters of the current system argue that the number of recalls and the amount of food recalled because of contamination is miniscule relative to the total volume of food produced, imported, and consumed in the United States. This, they suggest, is evidence that the current system works well, and that an increasing number of recalls is largely due to a system that has improved through the use of better science, technology, and information sharing. Indeed, they argue that the United States has “the safest food system in the world.” Opponents to the proposed changes, especially from the global forum, see these changes as protectionist tariffs and strategies masked behind the concern of safe food.
While both sides argue over the state of the current system, it is clear that the demands of a globalizing economy and the increasing expectations of consumers worldwide will continue to place new and increasing pressures on both producers and governments to better ensure the safety of foods coming into and leaving the United States. Indeed, a recent survey suggests that American’s overwhelming (“very confident”) confidence in the food supply has dropped considerably (International Food Information Council, 2007).
As with much of the history of food safety laws, regulations, and procedures promulgated in the United States and abroad, change is likely to arise as the result of consumer demands for “the government to do something.” As such, ultimately it is the pressure of consumer confidence (or lack of confidence) in the safety of the food that is likely to drive any reforms in the current system. The question is whether such reforms will be as the result of a rational reconsideration and reorganization of the entire food safety system, or as the consequence of a more incremental approach to improving the existing system.

TK: How much consumers are plugged into the issue of fresh produce safety may be one big factor in how ambitious Congress is in tinkering with the U.S. food safety system. Sadly, consumer confidence and interest in this issue may hinge on whether there are any recalls of leafy greens or other produce items in the next few months. In both respects, we must stay tuned...

Curse you light brown apple moth

Here is coverage noted by Big Apple of the discussion group this morning from The Monterey Herald about trade fallout from the light brown apple moth.

A small pest delivered a hefty blow to Central Coast strawberry growers Wednesday, as growers learned of the Mexican government's decision to refuse all crops that are planted, refrigerated or packed within a 1.9-mile radius of a reported light brown apple moth.

If the ban stays in effect through this year's strawberry season, it could cost Santa Cruz County growers about $1.9 million in lost revenue, according to local estimates. Virtually no Santa Cruz County strawberries — by far the county's largest crop — would be allowed across the border.

TK: How wide and deep will the damage caused by the light brown apple moth extend? That's a big question for 2008 and beyond.

Defending the Senate farm bill

From The Wall Street Journal this morning, a defense of the Senate farm bill:

Regarding "Amber Waves of Green," Review & Outlook, March 13: The bipartisan Senate bill won one of the highest votes in Senate history on a farm bill precisely because it reforms farm programs, invests in national priorities and does not raise taxes.

First, even after accounting for our new, fiscally responsible approach of pre-funding agriculture disaster assistance rather than relying on emergency spending, the Farm Bill -- contrary to the impression left by your editorial -- actually reduces spending on disaster assistance, commodity programs and crop insurance, both in dollar terms and as a percentage of total Farm Bill spending. The savings from reforming farm programs are used to feed the hungry, conserve our natural resources and boost bioenergy production so that we are less reliant on foreign oil.

Second, as Senate members of the conference committee negotiating the final Farm Bill, we think any new spending must be fully paid for without raising taxes. That's why we, along with our colleagues from the Senate Finance Committee, are proposing a number of spending cuts that are acceptable to the administration. In addition, we are looking at proposals from the president's own budget plan to collect a very small amount of taxes that are already owed but are not being paid. Since the president is opposed to tax increases, it follows that non-controversial loophole closers from the administration's budget are not tax increases.

Our goal is a workable Farm Bill that can win passage through the Congress. It will take compromise. The bill that passed the Senate contained the start of important reform, and it was a fiscally responsible bill that invested not just in America's food and fiber, but also in energy, nutrition and conservation. We hope the final Farm Bill mirrors the sensible, bipartisan legislation that passed the Senate.

Sen. Kent Conrad (D., N.D.)
Sen. Saxby Chambliss (R., Ga.)
Washington

(The writers are, respectively, chairman of the Senate Budget Committee and ranking member of the Senate Agriculture Committee)