Fresh Produce Discussion Blog

Created by The Packer's National Editor Tom Karst

Monday, September 29, 2008

Michigan E. coli Web news

A few headlines from the Web Monday night about the E. coli outbreak in Michigan and Illinois. As a dad of a freshman at K-State University, I can only imagine my reaction if my daughter were to be sickened by lettuce in a university dining center. I assume the FDA traceback investigation is in full swing, but when will the answers come?

Michigan E. coli count continues to rise

Local person involved in E. coli outbreak

E. coli linked to iceberg lettuce (The Packer)

E. coli takes over campuses

Ill. warns of E. coli in iceberg lettuce

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Putnam: financial hurricane demands answer

From the office of Rep. Adam Putnam:

The House of Representatives today failed to pass the economic rescue legislation. Prior to the vote, Congressman Putnam spoke on the Floor of the House on why he felt this legislation needed to be passed. The complete text of his remarks is below.

PUTNAM: Thank you, Madam Speaker. I thank the gentleman from Alabama for yielding. There's an old Chinese proverb: ‘may you live in interesting times.’ These are interesting and remarkable times. The past two weeks we’ve seen the five largest investment banks in the United States be reduced to two. Last week the largest bank in the United States failed. Over 2,000 branches spread out across this country, retail outlets, where ordinary Americans, downtown merchants, farmers, students, seniors, savers relied on that bank to meet their needs. It failed last week.

This morning another major bank on the brink of collapse was purchased for $1 a share. Last week, a money market fund announced that for the first time they had broken the buck, they could not guarantee that every dollar that you put into that money market account would be retrievable on your request. And a second major money market account announced they were closing and not accepting any new deposits for fear of the same thing happening to them.

Now, when you get beyond credit swaps and derivatives and all these complicated things that obviously not even the Wall Street traders who were engaging in them understood, and start talking about the bank on the corner failing, and the money market funds where every small business holds their payroll, where every saver is trying to ring out an extra half a point of interest, you have reached main street.

You are now standing at the brink of a financial collapse that is well beyond the financial capitals of the world. And I also failed to mention, since we are not just talking about an American problem, that this weekend alone three of the largest banks in Europe either failed or were nationalized. So we live in interesting times.

And we are watching one domino after another fall that are the pillars of our financial system here in the United States.

Now, I tried to think of the right analogy and it dawned on me that, you know, being from Florida we get a lot of hurricanes. And in 2004 we had three hurricanes come across central Florida, my home. In nine weeks. Bam-bam-bam. And then a year later we watched a storm come across Florida and build in the Gulf and it got bigger and bigger and moved faster and faster and had a bull's-eye on New Orleans. And I, like a lot of Americans, wondered why more people weren't leaving? Why more people weren't heeding the warnings that were so obvious from the weather map of what was building into a monster in the Gulf of Mexico. If you ever wondered why people don't get out of the way of an oncoming storm, a hurricane that is barreling down on top of you, despite days of notice, despite satellite imagery, despite all of the best advancements in communications, then you have to apply that same analogy to what we are seeing now.

One bank after another failing, rolling out of New York, rolling out of Brussels, out of London, out of these places that seem so foreign into our Main Streets, into our merchant associations, into our farmer cooperatives. You're watching this happen, so how could you as a Member of Congress in seeing that roll across the countryside, not do everything in your power to prevent it?

Now, the previous speaker made an outstanding reference to the fact that congress is known for producing fairly bad legislation in the aftermath of a crisis. What we have before us today is an attempt to avert that crisis and all of the rushed legislation that would follow a collapse, the likes of which we have not seen in this country since the 1930s.

This bill is a substantially different bill than what Secretary Paulson and the president sent up here a week ago.

It is a better bill than what they sent up here, and it is a bipartisan bill. We talked about how remarkable these times are.

Last week, two candidates who have spent two years, two difficult, hard fought years, looking for a way to beat the other one to become the next President of the United states, both hit the pause button and released a joint statement of principles in agreement that Congress needs to act to avert a financial collapse.

This body has come together to produce a bill that is distasteful to most. That required both sides to give up many of the individual items that they thought would be helpful: pro-growth capital gains policies that Republicans thought would be helpful. Affordable housing trust funds issues that the Democrats thought would be helpful. Both gone from the draft of this bill.

And instead focusing on the central goal which is to avert the financial collapse that all of the experts and all of the evidence and all of the bank failures and all of the money market closings indicate is very possible if Congress doesn't act.

So by virtue of Congress coming together and improving the Paulson plan, by virtue of the people's elected representatives having the opportunity to weigh in on this issue, and to hash out these problems and to work around the clock on the weekends, to make this a better bill, it will not cost $700 billion as has been widely reported in the original draft, for a variety of reasons: the potential upside of the assets that the government is buying. The insurance program. The most recent intervention that this Congress passed in the GSEs was estimated at $300 billion in costs. It was actually scored at $25 billion in cost. So it's important that the taxpayers understand that because the Congress has moved forward on this issue, it will be a smaller tab for the taxpayer. But it will be an effective intervention to restore the confidence necessary to avoid the kind of panic that we haven't seen in generations in this country.

This is no longer the Paulson-President's plan. Because of the work that Chairman Frank and the Republican negotiators have done, this is a better bill. Better for the taxpayer. No golden parachutes for CEOs who drive their companies into the ground and walk away with millions. None of the special interest projects that concerned so many people on our side. But most importantly the evidence is overwhelming that we must act.

It is always difficult to compile legislation this complex under such a short time frame. We are up against a short time frame because of the markets, because of the holidays, because of the natural calendar and our political cycle. The only thing worse than that is the kind of legislation that will result in the aftermath of the debris that remains after a financial collapse.

And so I stand here today willing to support this bipartisan compromise that has been hashed out over these last several days, that is such an improvement over what we began a week ago, but is so important to the financial architecture – not just of investment firms and speculators and people who got too-cute-by-half with someone else's money, but someone who is willing to support this bill because it is so important to the seniors, the savers, the merchants, and the farmers who need to understand that the confidence will be there in their banking system, that they don't have to withdraw their funds and stick them under the mattress. That our country's free market system is still the greatest in the world and that this intervention will allow those credit markets to unlock, and we'll be able to unwind and deleverage this marketplace and move forward together.

So I compliment my Chairman. I compliment our Republican negotiators, Mr. Blunt and Mr. Cantor, and I urge my colleagues to support this bill. I yield back my time.

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Leonardo Academy: First steps toward national consensus on sustainable agriculture have been taken

From the Leonardo Academy this afternoon. If the Leonardo Academy can effectively sell the process, it will be able to market the end result. Thus, a beginning:




Madison, WI (September 29, 2008) — The first successful steps toward developing a national consensus standard for sustainable agriculture in the United States have now been taken by a diverse, multi-stakeholder committee selected to lead this endeavor.

At an unprecedented opening session, more than 50 representatives of U.S. agricultural production, food and clothing manufacturing, retail, government, environmental and labor organizations, academia and certification launched historic negotiations over what should be considered “sustainable agriculture”. The representatives were selected from a pool of nearly 200 individuals who applied to serve on the Standards Committee, the guiding body for development of the standard.

During the meeting held last week, committee members identified some of the difficult issues that are likely to dominate the discussions to come, such as: 1) the relationship between organic, mainstream and sustainable agriculture; 2) the place of genetically engineered crops in sustainable agriculture; 3) the degree to which sustainable agriculture standards should establish a path for continuous improvement; 4) inclusiveness of small and mid-size farms, as well as mainstream and conventional agriculture; 5) the sequestration of carbon in soils and the role of agriculture in the global fight against climate change; 6) the strength of labor protections; 7) the intersection of product safety and sustainability; and 8) whether the scope of the standard should extend beyond plant agriculture to include livestock and other sectors of agriculture.

“The issues involved in sustainable agriculture are complex,” said Dr. James Barrett, Environmental Horticulture Department professor at the University of Florida, who served as interim chairman at the Standards Committee’s inaugural meeting. “As a result, there are many diverse, valid points of view that will need to be articulated and considered as this process unfolds.”

The entire standard setting process is being conducted under the rules of the American National Standards Institute (ANSI), the national voluntary standards body that has overseen the development of thousands of guidelines in nearly every business sector. Leonardo Academy, a non-profit organization that specializes in using market-based incentives to advance sustainability and improve the environment, is facilitating the current process as an ANSI accredited standard developer.

“We were impressed not only by the depth of knowledge and understanding reflected in the thoughtful comments and deliberations of the Committee but also by the level of respect for one another’s viewpoints and concerns, and the willingness at this early stage to seek common ground,” said Michael Arny, Leonardo Academy president. “The tone set here in Madison bodes well for the success of the process moving forward.”

Among the actions taken by the Standards Committee was an agreement to form work groups charged with the following tasks:

      1. Conduct a needs assessment for the sustainability standard, including potential market and agricultural applications

      2. Review and articulate the mission, principles and scope of work ahead
      3. Collect reference documents to inform the standard setting process
      4. Report on potential methodologies and indicators for measuring various aspects of environmental, social and economic sustainability;

      5. Identify potential funding sources to support full stakeholder participation in the process

      6. Outline outreach opportunities for soliciting involvement from all affected stakeholders

In addition, the Standards Committee acknowledged “the extensive effort and hard work of SCS to initiate the discussion on sustainability.” The Committee further agreed to recognize and set aside the Draft Standard for Trial Use (SCS-001), published by Scientific Certification Systems (SCS) as a vehicle for initiating the broader standard-setting dialogue, as one of several reference documents expected to be used in its future standards development deliberations,

“We appreciate the acknowledgement of the Committee and are delighted that the draft standard has helped to stimulate this national dialogue and to get the ball rolling toward the development of a consensus standard,” said Linda Brown, Executive Vice President of Scientific Certification Systems and Standards Committee member. “Looking ahead, the draft standard will continue to inform the process, both as a reference document and through real world examples of companies who are already meeting its requirements and adopting new sustainability practices in accordance with its provisions.”

According to Michael Arny, ANSI rules allow all interested stakeholders to participate in subcommittee deliberations as the standard development process moves forward. In addition, ANSI gives the public an opportunity to weigh in through a formal public review process before the draft final standard is submitted to ANSI for promulgation as an American National Standard.

Leonardo Academy is currently seeking charitable contributions to fund its work on this standard development initiative and to support active participation by the full range of stakeholders in the process. For more information, please contact Amanda Raster at Leonardo Academy (608-280-0255, amanda@leonardoacademy.org).

For more information on the first Standards Committee meeting, including the approved motions and a list of Standards Committee members, visit: http://www.leonardoacademy.org/Projects/SustainAgStdDevelopment.htm.

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Largest drop ever

There is no "sugar coating" this, right? What does this mean for the operations and strategic planning for produce industry companies that rely on the credit markets, whether multi-national grower shipper or national and international retailer? Here's a nugget to grab hold of: it is always darkest before the dawn. From the AP:


NEW YORK (AP) -- Wall Street's worst fears came to pass Monday, when the government's financial bailout plan failed in Congress and stocks plunged precipitously -- hurtling the Dow Jones industrials down nearly 780 points in their largest one-day point drop ever. Credit markets, whose turmoil helped feed the stock market's angst, froze up further amid the growing belief that the country is headed into a spreading credit and economic crisis.

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Stock market swoon and consumer behavior

USA Today's coverage of the failed vote on the bailout is here. Meanwhile, Retail Week has this coverage about impact of a slowing economy in the UK on consumers there. Is 2009 the year of the hard discounter? It would appear to be so:


The survey by Mintel found that in the past 12 months, 41 per cent of shoppers have switched to cheaper brands and three in 10 (34 per cent) have cut down on buying from premium ranges, such as Tesco Finest and Sainsbury's Taste the Difference.

"It is clear that shoppers are now really feeling the pinch and beginning to trade down when buying food," said Mintel director of retail research Richard Perks. "During the recent years of unprecedented prosperity in Britain, we saw a very noticeable shift towards premium, upmarket food, with shoppers buying more luxurious ready meals and exotic produce. But in the space of just a few months, this trend has already started to be reversed."

The survey also found that two thirds (66 per cent) of shoppers now look for promotions more often than they did a year ago, while 29 per cent spend more time comparing prices in the supermarket.

The rise of discounters such as Aldi and Lidl is also apparent, with 31 per cent of shoppers using the value supermarkets more than they used to.

"The major battle of this recession will be the fight between the hard discounters and the market leading superstores," said Perks. "Asda is focusing on its entry level prices and Tesco has just launched an ultra low priced range called Market Value. With this shift they are making it very clear that they will not just lie back and watch their market share being whittled away by the likes of Lidl and Aldi."

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Sweet tango and the Retail Report - Sept. 26

I had a pleasant surprise this morning when I found a small box of Sweet Tango apples on my chair. As recent coverage in The Packer indicates the variety - a progeny of the Honeycrisp - is being highly touted for its full flavor and attractive appearance. From David Mitchell's story:

SweeTango, a cross of Honeycrisp and Zestar, will be available in limited quantities starting in late August 2009, said Tim Byrne, vice president of sales and marketing for Lake City, Minn.-based Pepin Heights Orchards Inc. and president of Next Big Thing, a cooperative of 45 growers also based in Lake City.Byrne said the new variety has higher brix levels and more acidity than Honeycrisp, giving it a more complex flavor profile. He said the SweeTango is more of a deep, rich red color compared to the mottled Honeycrisp, which is red and yellow.

Meanwhile, here is the summary from the Sept. 26 National Retail Report from the USDA:

Fruit Ads Decline Significantly, Apples and Pears Featured Widely
Fall themed ads were seen throughout the country this week with an emphasis on items to celebrate Halloween. In addition to the typical candy promotions, most retailers heavily featured a variety of apples, carving pumpkins, other decorative pumpkins, a variety of squash, and potted mums. A few ads highlighting Rosh Hashanah and Hispanic Heritage Month were also noted. Many retailers also used “10 for $10” promotions quite often this week. Overall, fresh produce ads were down more than 8%. Fruit ad activity declined more than 21% this week and vegetable activity increased roughly 9%. Despite the decline in fruit ads, the top 5 featured items were predominantly fruits. The top 5 included: Pears, grapes, tomatoes on the vine, peaches, and strawberries. The majority of fruit ads continued to be concentrated on a few items and vegetable ads continued to be distributed widely across the reported items. Pears alone made up 19% of all fruit items. Pears, grapes, peaches and strawberries comprised about 55% of total fruit ads. Retailers featured an abundance of seasonally available produce in addition to the items in this report. A variety of apple features were noted with the most prevalent being Galas. Squash were also noted quite often and the most featured varieties were butternut, acorn, and spaghetti.

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Support for Chilean orange and grapefruit imports

The USDA's proposed rule that would allow imports of Chilean oranges and grapefruit under a "systems" approach brought support in this letter published recently on the federal docket. Comments for the proposed rule, published Aug. 28, are due Oct. 27.




September 22, 2008

Regulatory Analysis and Development

PPD, APHIS, Station 3A-03.8, 4700

River Road Unit 118, Riverdale, MD

20737-1238

RE: Docket No APHIS-2007-0115

We are writing to express our strong support for the Animal and Plant Health Inspection Service (APHIS) proposed rule Docket No. APHIS-2007-0115 to allow for the importation of oranges and grapefruits from Chile into the United States under certain conditions as outlined in the docket.

Safco of America LLC is an importer of Chilean products, to include lemons and Clementines. These products have been favorably ordered and accepted by our retail customers, some of the top supermarket chains in the country. The imports of Chilean oranges and grapefruits would further enhance our business with our current customer base. Additionally this would provide our employees more activity during the offseason months and provide Safco the basis to consider expanding our staffing, a result we imagine would permeate through the entire industry from port operations, to storages, to trucking.

Chile has one of the strictest Phytosanitary conditions in the world for their fruits and this proposed rule is based on sound science. The proposed rule is also complementary in nature since it will allow Chile to export oranges and grapefruits during the summer months – a period when U.S. production is at its lowest.

The rule is based on a “systems approach” which APHIS already uses successfully with imports of Clementines from Chile and other fruits from around the world. APHIS also uses similar “systems approaches” to ensure that Florida and California citrus products meet the requirements of our trading partners from around the globe.

Consumers, grocery stores and restaurants will benefit from this proposed rule since they will have another source for quality oranges and grapefruits during the summer months.

Thanks to the Chile-U.S. Free Trade Agreement, Chile is now one of our largest trading partners in South America and this proposed rule is a good example of our bilateral trade relationship.

We petition APHIS to adopt this proposed rule as soon as possible.

Thank you and best regards.

Dirk Winkelmann

General Manager

Safco of America LLC

1150 Chinowth Street, Suite A

Visalia, CA 93291


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Outbreaks associated with produce 1996-2007

Publishing supporting documentation to rulemaking relating to revision of the 1998 good agricultural practices for fresh produce, the FDA added to the docket the history of produce related outbreaks that have documented since 1996. Find it here in the Fresh Produce Discussion Group. This lists all outbreaks, not just those related to leafy greens that food safety lawyer Bill Marler shared earlier.

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TARP - a perfect acronym

The Dow Jones Industrial Average is off by several hundred points again today as investors wait on news from Washington on the bailout plan. At the Fresh Produce Industry Discussion Group this morning, Luis posts this story from The Telegraph in the UK that describes the bailout effort.

At least Washington's Troubled Assets Relief Program to help struggling banks and save us all from ruin has been blessed with the perfect acronym; as TARP, it does indeed resemble an enormous canvas sheet thrown over a whole load of problems which we'll weigh down with tyres and leave to fester at the bottom of the yard.


TK: What did I read on Drudge the other day? Failure to pass the package could result in the broader stock market losing 25% of its value? Put in those terms, the bailout has to pass. By the way, check out this Youtube video on failed earlier attempts to reign in Fannie Mae and Freddie Mac. Go here for the CBO report on the bailout effort. From that report, the very large costs and the hopeful (doubtful) upside to the deal:


CBO expects that the Treasury would use most or all of the $700 billion in purchase authority within two years (after which the authority to enter into agreements to purchase various troubled assets would expire). To finance those purchases, the Treasury would have to sell debt to the public. Federal debt held by the public would therefore rise by about $700 billion, although the government would also acquire valuable financial assets in the process. As noted above, CBO expects that since the acquired assets would have some value, the net budget impact would be substantially less than $700 billion; similarly, net cash disbursements under the program would also be substantially less than $700 billion over time because, ultimately, the government would sell the acquired assets and thus generate income that would offset much of the initial expenditures.

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Lettuce and E. coli - the headlines

Where to from here? That's the big question; here is a roundup of what is on the Web about the E. coli outbreak in Michigan:


Michigan company linked to E. coli outbreak


Lettuce laced with E. coli

MSU, regional E. coli outbreak linked to Michigan lettuce vendor


Iceberg lettuce: another E. coli risk


Illinois warns of E. coli risk from lettuce


Lettuce tied to recent E. coli cases

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