Currently browsing posts about: Food-industry

The Task Force on Hunger, Nutrition, and Health released its comprehensive report yesterday.

The report’s purpose is to inform the upcoming White House Conference on Hunger, Nutrition, and Health.  If so, it’s going to leave the White House in a quandary.

The report has lots of useful information, beautifully presented, and does all it should on adddressing hunger.

But as I read it, the report, titled Ambitious, Actionable Recommendations to End Hunger, Advance Nutrition, and Improve Health in the United States,” is not nearly ambitious enough when it comes to nutrition and health.

It makes far too many recommendations—30.  That’s always a bad sign (too many to do).  .

Really, only 2 recommendations are needed.  These should establish or expand federal agriculture, food, and nutrition policies to ensure:

1.  Adequate, affordable food and nutrition for everyone.
2.  Healthy diets for everyone, meaning those that follow Dietary Guidelines and are largely plant-based, balanced in calories, and low in undesirable fats, sugars, and salt (i.e., ultra-processed foods).

The hunger recommendations do the job: they call for ensuring benefits sufficient to meet households’ basic needs.

But the second?  A mess.

Here is the most obvious example [my comments follow] .

Recommendation #9: “Reduce the marketing of foods that do not align with the latest DGA and increase the marketing of foods that align with the latest DGA to children and populations with disproportionate rates of diet-related chronic conditions” [Good! But not through the recommended voluntary methods by industry.  That won’t work; it requires legislation]

But here’s Recommendation #25: “Increase the ability of food companies to communicate with consumers about the evidence for healthfulness of certain food products and nutrients.”  [Uh oh]

This comes with three action items:

1. FDA should expeditiously update its definition of the word “healthy” [good] and incentivize food companies to use the terminology and/or associated symbol in their food packaging and marketing [Yikes!] and increase the proportion of products on the market that meet the “healthy” definition [OK, as long as they are not gaming the system].
2. Congress and/or FDA should improve and streamline the process for application, review, approval, and use of health claims and qualified health claims on food packages. [No!  If it’s one thing we don’t need, it’s more misleading health claims]. 
3. Congress and/or FDA should create a new process for communicating about foods, nutrients, and other bioactive ingredients that may prevent or treat disease through label claims. [No!  We do not need more claims for the benefits of ultra-processed food products].

What’s missing from this report?

• Anything about ultra-processed foods and their effects on calorie intake and overall health.  The term is mentioned once, but only in the context of ‘more research needed’ (Recommendation #19).
• A clear statement of the benefits of soda taxes in reducing consumption of sugar-sweetened beverages.  Why isn’t there one?  A box explains: “Task Force members voiced diverse perspectives on this topic.”
• A clear statement about making SNAP align with Dietary Guidelines.  This is mentioned, but only in the context of pilot research (recommendation #2), and therefore contradicts recommendations #3 and #5.  #3:  Increase nutrition security by promoting dietary patterns that align with the latest Dietary Guidelines for Americans (DGA) through federal nutrition programs.  #5:  Leverage the federal nutrition programs’ power in economic stimulus to support food systems that promote foods that align with the latest DGA.”
• Firm calls on Congress to pass legislation to do what is needed.

What happened?  One member of the committee explained to me that its membership included everyone from anti-hunger advocates to food industry representatives, and too many vested interests were at stake.  Members could not agree on anything that would make a real difference to policy.  Anything substantive met strong resistance.

When it comes to public health policy, which this most definitely is, the food industry has no business being at the table.

This was a recommendation of the 2019 Lancet Commission on the Global Syndemic of Obesity, Undernutrition, and Climate Change.  Read that report.  It explains why including the food industry in policy recommendations that might reduce sales is not a good idea.

If I had been a member of this Task Force, I would have called for a minority report on policies for reducing consumption of sugary drinks and ultra-processed foods.  But that, of course, is why I’m no longer appointed to such committees.

• Read the Executive Summary
• Read the Full Report
• Read the Press Release
• Register here for the Webinar hosted by the co-chairs: Wednesday, Aug. 31 at 2:00 p.m. ET.

USDA has finally proposed new rules to try to make the current poultry farming system a bit more fair to the people who actually raise the chickens.

Under the current system, the big poultry producers get the benefits while the chicken farmers take all the risks.  The companies supply the chicks; the farmers pay for the houses, equipment, and management—and take on immense debt to do so.

They are paid according to a tournament system.  Farmers who produce the most amount of chicken using the least amount of feed are paid the most; others get less.  But the farmers do not control the quality of the chicks they receive.  They also sell to only one buyer, a system with its own name, monopsony.

John Oliver did a synopsis of the tournaent system in 2015.

Hence the new rule: Transparency in Poultry Grower Contracting and Tournaments.  This does not get rid of the tournament system, unfortunately, but it does require poultry companies to disclose key information to growers about realistic outcomes before making important contracting decisions such as capital investments, and about key inputs.

The point is to enable growers to understand the terms of their contracts so as to have a better chance to compete.

• USDA is seeking comments on this proposed rule and also on additional steps it could take to enhance fairness and address concerns about the tournament system.  Poultry Growing Tournament Systems: Fairness and Related Concerns is available for comment until Sept. 6, 2022, at www.regulations.gov.
• For more information, see Agricultural Competition: A Plan in Support of Fair and Competitive Markets.

Also see:

• Government Accountability Project whistleblower complaints against the tournament system
• Johns Hopkins Center for a Livable Future — Letter to State Attorneys General on Protecting Contract Chicken Farmers from Unfair Business Practices.
• Survey Results: Marylanders Support a Fair Poultry Industry and Stronger Government Oversight
• Civil Eats op-ed on ending the tournament system

According to Politico, advocates for a fairer system are complaining that the largest poultry companies are pressuring farmers to oppose the USDA’s proposed rule and providing them with form letters to send in.

The USDA acknowledged these complaints when it announced an extension of the public comment period.

USDA is taking these steps to help ensure the integrity of the Federal rulemaking process and to ensure all parties have the opportunity to fully comment.

“There is fear throughout the meat and poultry industry as we saw earlier this year at two separate Congressional hearings where witnesses did not testify due to concerns of retaliation,” Vilsack said. “But it is still critical that we hear the full story, so we are highlighting the option for comments to be provided anonymously.”

Politico says that as of Aug. 18, the USDA had received at least 350 public comments.  According to its analysis, at least 200 of public comments support the rule, though some supporters have significant reservations and are imploring USDA to go further.

Last week, the Biden-Harris Administration Announced “New Actions to Strengthen Food Supply Chains, Level the Playing Field for Growers, and Lower Prices for American Consumers.”

These follow up on promises made in July 2021 and January 2022 (I’ve written about these previously), so it’s not as if the meat and poultry producers haven’t been warned.

The new announcement specifically addresses the unfairness of current poultry production: Transparency in poultry grower contracting and tournaments.

I consider the system for raising chickens in this country an astonishing example of a monopoly-controlled business model.  In this model—brilliant from a business standpoint—big  poultry producers set all the rules and take most of the profits, leaving all the risks to the farmers who actually raise the chickens.

Even worse, this business model forces chicken farmers to compete against each other.  In what is called a “tournament” system, the farmers whose chickens gain the most weight get paid the most.  But which chicks they get to raise is determined by the producers.

As to how all this works and why it is so deeply unfair, it’s worth reading Leah Douglas’s Is the US chicken industry cheating its farmers?

The companies own and operate all the means of production, including the feed mills, slaughterhouses, trucking lines and even the hatcheries that develop the best strains of chickens.

Farms are the only part of the market these big companies don’t own. Independent farmers borrow millions of dollars to build sophisticated warehouses, where they raise hundreds of thousands of chickens at a time…Farmers raise the birds under contract with an integrated company, giving firms strict control over operations. The poultry companies own the chickens, the feed, and even control the chickens’ medical care. All farmers can do is try to raise the birds as efficiently as possible, even though most of the business is out of their hands.

The administration’s proposed rule is designed to increase transparency and accountability in this system.  Also,

USDA is opening an inquiry into whether some practices of processors in the tournament system are so unfair that they should be banned or otherwise regulated.

It’s about time.  I hope the administration moves quickly on the new rules.

The American Journal of Public Health has just published a first look—ahead of its print in June—at my most recent article, Regulating the Food Industry: An Aspirational Agenda [if you are not a member of the American Public Health Association, this will be behind a paywall, alas].

It begins:

I end it with policy recommendations for:

• Dietary guidelines
• Mass media campaigns
• Taxes
• Warning labels
• Marketing restrictions
• Portion size restrictions
• Farm subsidies

Hence, aspirational.

And, I say,

While we are thinking in aspirational terms, let us not forget root causes. We must also demand policies that link agriculture to public health, keep corporate money out of politics, reduce corporate concentration, and require Wall Street evaluate corporations on the basis of social as well as fiscal responsibility.  In comparison with those challenges, takin gon the food industry should be easy.

Let’s get to work.

The tragedy of the Ukraine War is beyond comprehension.  Like everything else, it affects food systems, and not just for the people caught up in it.

I’ve been collecting items, starting with Jose Andres @chefJoseAndres and World Central Kitchen @WCKitchen who are providing hundreds of thousands of meals to people fleeing from the Ukraine.

And then this one:

• Fast-food chains and food producers stay open in Russia, and mostly quiet about Ukraine. While technology giants like Apple and luxury retailers like Hermès have quickly moved to pause sales or shutter stores in Russia over the invasion of Ukraine, most U.S. food companies and fast-food chains have remained open — and largely silent.

Why the silence?

• “Unlike other chains, McDonald’s owns the vast majority of its 847 restaurants in Russia. According to a page for investors, Russia accounts for 9 percent of the company’s total revenues and 3 percent of its operating income.”
• “Last year, Russia accounted for $3.4 billion, or more than 4 percent, of PepsiCo’s $79.4 billion in revenues.”

Other items are about what this war means for agricultural trade, food prices, and specific food businesses—especially pet food.

• The Field Report: What the Invasion of Ukraine Means for the Food Supply: From the challenge of feeding millions of refugees to rising food prices and disrupted wheat crops, the war could have an outsized impact on the food system.
• Russian invasion of Ukraine: Implications for EU agriculture and dairy:   The Russian invasion of Ukraine has already led to massive destruction, loss of life, sanctions, and ramped up rhetoric on both sides…. Read more
• Russian invasion of Ukraine threatens food commodity prices, supply chains & consumer confidence: The food industry, already grappling with high inflation, supply chain constraints and transportation challenges related to the pandemic, could see surging prices of key commodities, fuel and energy following what chief of the NATO alliance described as Russia’s “brutal act of war” against Ukraine across three main fronts this week…. Read more
• Why the Ukraine conflict could spark ‘dangerous times’ for food prices and food security.  Producers in Europe fear the Ukraine crisis may result in rising prices of items such as bread, baked goods and beer that may be passed on to end consumers…. Read more
• Food and beverage companies suspend operations in Ukraine:  Several international food and beverage companies have temporarily shut down operations in Ukraine following Russia’s invasion to ensure the safety of employees while bracing for the long-term economic impact that skyrocketing commodity prices and potential sanctions will have on their businesses…. Read more
• Food Security (Even Beer) Will Suffer from Ukraine:  The stupid, senseless war in Ukraine is causing massive suffering. For anyone who is paying attention, that much is perfectly clear. Stepping back from the dire, immediate humanitarian crisis, economists are fretting about the shocks coming from oil prices. But the shock to the global food supply will also be huge.
• Nestle ‘tentatively’ reopens Ukrainian factories to restock empty food shelvesThe Swiss food giant is restarting some of its operations in Ukraine in order to support the delivery of essential food and beverages to those who remain in the country…. Read more
• War in Ukraine is ‘a huge tragedy for European confectionery family’, says BDSI: The Association of the German Confectionery Industry (BDSI) has welcomed tough sanctions imposed by the European Union on Russia, following its invasion of Ukraine, saying that the speed they were introduced shows the basic principles of the region are alive…. Read more
• What are dairy companies saying – and doing – on the war in Ukraine?  Following Russia’s invasion of Ukraine, and the subsequent sanctions imposed upon Russia, doing business with the world’s largest country is becoming increasingly complicated…. Read more
• P&G aids Ukrainian employees, curtails Russian operations:  Procter & Gamble is helping its Ukrainian employees evacuate while providing them food, shelter and financial support, P&G CEO Jon Moeller wrote in a company letter. P&G has stopped all media campaigns and capital investments in Russia and has trimmed its Russian portfolio to offer primarily health, hygiene and personal care products, added Moeller.
• Coca-Cola withdraws business from Russia while other companies remainCoca-Cola is the latest major global food and beverage giant to suspend operations in Russia as an act of protest against the Russian invasion and continued attack on Ukraine and follows similar announcements made by PepsiCo, Starbucks, and McDonald’s…. Read more 
• Abbott Condemns the War and Violence in Ukraine and Pledges $2 Million to Support Humanitarian Efforts.  Abbott stands with the international community condemning the war and the violence in Ukraine against its people, and calls for peace.  Our top priority is supporting the safety and wellbeing of our Ukrainian employees and we are taking all steps we can to assist them.  [Comment: Would this have anything to do with deflecting attention from the food safety recall of its infant formula?]

Here are the pet food items:

• Blog: Pet food not immune to global crises and issues: Debbie Phillips-Donaldson: As a consumer good that’s popular the world over (and becoming more so), pet food is as enmeshed in the global economy as any other product or consumer category.Read more
• Ukraine wheat, oil disruptions may hit US pet foodAny problems with Ukrainian commodity supplies could exacerbate existing supply chain problems. The Russian market was already unavailable to U.S. pet food exporters, so nothing will change.Read more
• Ukraine pet food company keeps producing, starts charityAmid the Russian invasion, Kormotech pet food in western Ukraine continues production and opens a new pet charity.Read more 

Four items about the Big Four meat companies that collectively control 85% of the beef market.

I.  Reuters reports that JBS, the Brazilian meat giant, has settled claims that it engaged in price fixing for—gasp—$52.5 million.

JBS, its U.S. affiliates, and the other three of the Big Meat companies—Cargill Inc, National Beef Packing Co and Tyson Foods—have been accused of conspiring to limit supply iin order to raise prices and boost profits.

In a statement, JBS said it did not admit liability but that settling was in its best interest. It also said it will defend against beef price-fixing claims by other plaintiffs.

The settlement still requires approval from the courts.

JBS settled one month after U.S. President Joe Biden announced a plan here for new rules to bolster competition and stop “exploitation” in the meat sector.

Comment: I’ve written about the President’s executive order on the meat industry here, his challenge to consolidation here, and his concern about lack of competition here.  $52.5 million sure looks like guilty as charged, no matter what JBS says.

II.  The National Cattlemen’s Beef Association issued a statement on the settlement.

The announcement that JBS USA has decided on a $52.5 million settlement over allegations of beef price fixing is deeply disturbing to the National Cattlemen’s Beef Association (NCBA). NCBA was the first national organization to request a government investigation of beef markets in 2019. Now there are settlements occurring without Department of Justice (DOJ) having released findings or even providing cattle producers with an update on progress.

Comment: The NCBS is disturbed?  I’ll bet.

III.  The American Enterprise Institute has released three articles on food price inflation, meat prices and pork prices.

• AEI – Food price spikes temporary, inflation likely to fall in 2022
• Where’s the pork in the surge in recent pork prices?  Maybe nowhere, and not in the meatpacking industry 
• Subsidized beef packing expansion unlikely sustainable

IV.  Tyson Foods, one of the other defendents in the price-fixing case, is #1 on Fortune’s World’s most admired companies list for food producction, and for the sixth straight year, no less.

Comment: You can’t make this stuff up.

Paco Underhill.  How We Eat: The Brave New World of Food and Drink.  Simon & Schuster, 2022.

What to say about this book.

For one thing, Underhill is a supermarket consultant, whose job it is to tell supermarkets how to sell more food.

For another (full disclosure), chapter nine is titled “Shopping with Marion,” and that would be me.

I met Underhill and his collaborator, Bill Tonelli, at the amazing Sunrise Asian supermarket upstairs from the corner of 9^th Street and 3^rd Avenue in Manhattan.  We wandered around the store for a bit, collected another shopper, and went out for coffee.  The result is presented largely in the form of a conversation.  Here’s a sample from page 157 that starts with Underhill explaining why he loves visiting Hollywood (he lives in New York):

“…And going to L.A. is so refreshing.  Partially because I got sick of eating here—I live by eating according to the season, and it’s so easy to do in L.A., but back here I’m like, cabbage and apples and potatoes, again?”

“Carrots,” Marion says.

“Carrots.  ‘Oh look, we have rutabaga.  Yay!’  So yeah, I’m a jerk.  I’m one of those people who want to be completely seasonal and local but can’t hack it everywhere.”

“Ithaca has a rutabaga roll every year just before Christmas,” Marion says.  “It’s a bowling contest at the farmers market.  You bowl with rutabagas.”

This is a chatty book with lots of Underhill’s insights into how supermarkets work, starting with parking lots, and what he thinks stores ought to do to face the retail future.

He also went to farmers’ markets, this time with Nina (Planck) Kaufelt.  That chapter is titled “The citified get countrified (and vice versa.”

It’s a chattier and unreferenced version of my 2006 book, What to Eat—the one I am currently updating—but I did take some notes.

I enjoyed reading it, but I’m not exactly an unbiased critic.

I am on the mailing list for the North American Meat Institute (NAMI) the trade association for Big Beef, and I like knowing what it has to say.

Right now, it is in defensive mode.  The industry must be—and ought to be—concerned about White House interest in making the beef industry more competitive.

But wait, says NAMI, there’s nothing new here.  Four beef processors have held 80% of the market since 1994.

And, it says, the meat industry is not responsible for the inflationary cost of meat.

It also denies anti-trust allegations.

In testimony to the House Judiciary Subcommittee on Antitrust, Commercial, and Administrative Law on “reviving competition,” NAMI said the meat industry is not to blame:

The administration will be surprised to learn that economic fundamentals have led to inflation. Labor shortages. Transportation and supply chain challenges. Regulatory policies. And all of those input challenges were coupled with record meat demand.
Collectively, these factors drove up prices for wholesale and retail beef…The discussion above demonstrates that free market fundamentals drive the cattle and beef markets and that what we have seen before and during the course of the pandemic was to be expected.

The testimony, which is well worth reading, makes this case.  It does not discuss the behavior of the big four meat processors during the pandemic: forcing sick people to come to work, inducing the President to sign an executive order to keep plants open, squeezing ranchers so they can’t make a living, and demanding higher prices at the store.

NAMI may be right that consolidation in this industry happened a long time ago, but the pandemic revealed its exercise of power in a way that had not been previously so visible.

Let’s hope the Justice Department gets to work on this.