Editorial


Petrochemical Industry Concerned over Plastic Waste

04/18/2019

Jim Fitterling, CEO of Dow Chemical recently stated “Plastic waste. I believe, is going to be the sustainability issue of our time.”  Addressing the World Petrochemical Conference in San Antonio in mid-March, he opposed restrictive legislation aimed at reducing plastic waste.  Currently 21 U.S. states are considering 133 bills related to use and disposal of plastic.

Fitterling noted that developing nations including Thailand and China do not have the infrastructure to handle waste.  He characterized the situation as “it is not plastics, the issue is the lack of an effective collaboration, recycling and reuse system. Since China implemented the “National Sword” program exports of plastic waste to that nation has ceased resulting in an accumulation of 450,000 metric tons of material in the U.S. 

Bob Patel, CEO of LyondellBasell Industries cited in the Chemical and Engineering News, April 8th edition, advocated for more extensive recycling.  In the event that waste plastic is not processed into new items, he believes that the growth in the plastics industry will decline from a four percent annual rate to two percent.  He stated, “it may change how we think about capital deployment and drive us to embed circularity in our business models.”  He added, “let’s do more to explain why plastics are good for society and I believe that the time has come to address the issue head-on rather than to advocate for why we are great.”

 

Both Dow and LyondellBasell have committed to the Alliance to end Plastic Waste involving 35 companies that collectively will spend $1.5 billion to reduce waste through promoting infrastructure and recycling, mainly in developing nations.

 

Nina Bellucci Butler, CEO of More Recycling commented on the “tsunami of material coming online compared to a droplet of recycling”.  The problem from her prospective is that it cost more to process post-consumer plastics than it does to buy virgin material.  This is in part due to the low price of shale-derived gas serving as the feedstock for the petrochemical industry.

 

With an increase in projected annual demand in the region of 6 to 7 million tons of ethylene annually, expansion in the U.S. and China will add 10 million tons per annum from 2020 through 2023.  Additional volume will enter the market even though plant capacity will decline to 88 percent. Coal-to-chemical plants manufacturing vinyl chloride and ethylene glycol will be financially non-viable and obsolete ethylene crackers, mainly in China, will probably close.

 

With a narrower focus, the U.S. egg industry uses a large quantity of polystyrene foam cartons.  This material provides excellent protection for eggs, is light in weight and technically can be recycled.  The challenges are establishing collection center and consumer education.  Unfortunately there is a demonization of plastic packaging material promoted by environmental groups and amplified on the web.  The obligation for manufacturers of non landfill-degradable packaging will be to create a chain of recycling which will benefit manufacturers, egg producers and the environment.  From discussions with the allied industry, it is evident that they are aware   of legislative initiatives and consumer resistance and are taking positive steps to resolve the issue.  Time is running out and the longer it takes to develop a solution the more intense will be the need for consumer education.  As it is, children are being taught in schools that plastics are “bad”.  To quote Patel, “If we don’t do something about the waste issue soon then perhaps the teachers are right.”


 

Egg Industry News


WEEKLY COMMODITY REPORT

04/20/2019

The following quotations for May and July as indicated were posted by the CME at close of trading on Friday April 19th together with values for the previous week in parentheses. Last week the commodities market recorded a mild decline in the futures price of corn but a sharper fall in soybeans and soybean meal for May and July. This was attributed to any intimation 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 29 th documenting soybean stocks. The absence of any definitive news regarding negotiations with China and conflicting statements by White House spokespersons is disconcerting to the commodities market and contributes to fluctuation in prices.

COMMODITY

 

Corn (cents per bushel)

May 358 (361)

July 367 (369)

Soybeans (cents per bushel)

May 881 (895)

July 894 (909)

Soybean meal ($ per ton)

May 303 (308)

July 307 (312)

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

COMMODITY CHANGE FROM PAST WEEK

Corn: May quotation down 2 cents per Bu          (-0.6 percent)

Soybeans: May quotation down 14 cents per Bu (-1.6 percent)

Soybean Meal: May quotation down $5 per ton.  (-1.6 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 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. Prices will be influenced by the trend in stock levels, area to be planted in 2019 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.


 

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.


 

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.


 

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.


 

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.


 

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.


 

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

 


 

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.


 

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.


 

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.


 

Commentary


Senator Warren Opposes Agribusiness and Commodity Check Offs

04/12/2019

Senator Elizabeth Warren (D-MA) is taking aim at the entire agribusiness sector in addition to statutory commodity promotion programs. In pre-election rhetoric she has vowed to dismember agribusiness companies including Bayer AG (which is a German company) and Tyson Foods Inc. a domestic entity with international investments.

 

Warren maintains that “check offs” are corrupted and need reform and have been used to squeeze out competition” according to a March 27th posting on Bloomberg.

Warren maintains that check-off payments should be voluntary rather than mandatory.  If in fact check-offs were at the whim of an individual, the U.S. egg-production industry would not have enjoyed the benefit and support of the American Egg Board that successfully defeated the cholesterol myth through supporting responsible scientific research and publicizing results. 

 

The AEB has expanded egg consumption by promoting innovative products and developing new markets both in the U.S. and internationally.  Increased egg production and sales benefit consumers but also generate jobs through the entire supply chain, This extends from operators of farms growing corn and soybeans, plants crushing soybeans, owners and operators of egg-production complexes and farms, the transport industry, manufacturers of equipment, suppliers of pharmaceuticals and biologics, packaging manufacturers and workers in the food industry. 

 

Check-offs are not necessarily corrupt, certainly the AEB is not and one cannot envisage the need for reform.  Senator Warren should spend more time studying her targets and understanding their contribution and role rather than trying to fix something which is not broken. Generating rhetoric to support a quixotic political aspiration will rebound in Iowa wit 50 million hens. 

 


 

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Dr. Simon M. Shane
Simon M. Shane
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