Poultry Industry News

Dr. James Stanton of the University of Georgia recently completed Project #730 funded by USPOULTRY Foundation.  The project entitled “Increasing the Efficiency of Avian Reovirus Characterization by Real-Time Sequencing” advanced laboratory technology and established the validity of new procedures to diagnose avian reovirus infections. 

The research conducted by Dr. Stanton and his team enabled characterization of avian reovirus isolates by applying random sequencing.  In addition, the technology was able to identify multiple virus strains in a single assay. His techniques confirmed high sensitivity by detecting avian reovirus in samples that previously failed to disclose the presence of viruses. A range of reovirus strains are responsible for various syndromes in commercial poultry including malabsorption and runting in broilers in addition to tendonitis and arthritis in chickens and turkeys.

Gilberto Tomazoni recently pushed back on environmental regulations at an international business forum.  He expressed concern that pressure to conform to sustainability rules will increase costs of production that are passed down to consumers.

Tomazoni noted, “ We need to increase productivity to lower the cost of food and make it more accessible.”  He added, “We cannot assume that consumers will pay the bill for sustainable production practices.”

JBS is facing criminal lawsuits in Brazil alleging that the company knowingly processed cattle raised on deforested Amazon rainforest in Rondonia State.  The Company is the target of multinational criticism for contributing to deforestation and environmental contamination. In response JBS has mounted a sustained campaign to convince regulators and consumers of a corporate commitment to sustainability.

A lawsuit filed in 2022 resulted in the award of class-action status to Union employees of major meat packers. Workers alleged that their employers shared wage rates and manipulated compensation at 140 packing plants.

In the latest round of settlements, Cargill will pay $30 million, National Beef Packers, $14 million and Hormel Foods, $13 million.  Previously Tyson Foods settled for $72 million and JBS, $55 million.  Total settlements to date amount to $200 million.

In company statements, the defendants all denied wrongdoing and generally conceded that settlements were negotiated to avoid extended litigation costs and distractions.

Judge Gregory Frizzell for the U.S. District Court for Northern Oklahoma ruled for the State on January 23rd concerning pollution of the Illinois River watershed by poultry litter.  Defendants in the case included Tyson Foods, Cargill, Culp-Vantress, Aviagen, Cal-Maine Foods, Simmons Foods and George’s among others.  Mediation that concluded in November 2023 failed to produce a settlement.  Accordingly, Judge Frizzell is now intending to impose penalties.

Secretary of Agriculture, Blayne Arthur, petitioned the court for leniency noting, “Respectfully, judicial adjustment of standards and requirements applicable to the poultry industry may circumvent the law making process which is best left to elected legislators and officials in the Executive Branch.”  Secretary Arthur is concerned that an adverse ruling and penalties would result in “unintended consequences”. 

Based on the submission of the petition Judge Frizzell has provided an opportunity for the parties to submit any new evidence relating to the responsibility of poultry producers for damage to the ecosystem.

Since the case that was filed in 2003 is of importance to both poultry producers and farmers using litter as a fertilizer and soil amendment, new standards for disposal and use of litter are required. Recent court rulings have emphasized the deleterious impact on local communities from inappropriate disposal of waste. In contrast decades of stewardship by chicken producers on the Delmarva Peninsula have improved the quality of water in the Chesapeake Bay.

According to USDA-FAS GAIN Report KS2024-19 released on September 12th, domestic broiler production in Korea will increase by one percent to 945,000 metric tons in 2025. This projection  is based on the volume of breeding stock placed. Imports will rise by 2.5 percent over 2024 to 200,000 metric tons.  Exports of 65,000 metric tons are nominal representing 5.6 percent of total supply.  Given a population of 56 million per capita consumption will attain 19.3 kg (42.4 lbs.) in 2025. 

Highly pathogenic avian influenza is currently under control after 3.6 million chickens were depopulated on 32 farms during the 2023-2024 outbreak.  Of this quantity, 201,000 broiler parent flocks were lost on two farms. Depletion in the broiler segment of the poultry industry was limited to 80,000 commercial growing birds.  Egg- producing flocks on fifteen farms represented 88 percent of birds depopulated.

Consumption of broiler meat in South Korea is moving towards small packs of portions, meal kits and convenience items given the preponderance of single and two working-member households.

Imports by country of origin in 2023 confirmed the dominance of Brazil at 72 percent of volume, with Thailand the second largest supplier.  The U.S. held one percent of the market in 2023 mainly due to cost and product considerations but was limited by unresolved trade policy.

Dr. Owen Willems has been appointed as Global Director, Research and Development for Hendrix Genetics.  In his new role, he will be responsible for all species within the Hendrix Genetrics portfolio.  Willems is a 12-year veteran with Hendrix joining after completing his doctoral studies at the University of Guelph, Ontario.

Dr. Willems has gained considerable experience both in North America and Europe applying creative and innovative solutions for the benefit of the industry. In his new position, Dr. Willems will be located at Hendrix-Genetics Global Headquarters in the Netherlands.

Blair McCorriston has been promoted to Director, Sales and Commercial Excellence, replacing Dr. Owen Willems. In her new position, Ms. McCorriston will report to Trevor Aitchison, General Manager, Americas.  Blair will become a member of the National Turkey Federation Executive Committee replacing Dr. Willems. She has served in various positions at Hybrid Turkeys over 12 years and has gained experience with Internal Operations, R&D, Sales, Technical and Marketing teams.

Her appointment supports a strengthened connection among sales, product management, technical service and marketing.  In commenting on the promotion, Trevor Aitchison, General Manager, noted that Blair has “demonstrated her commitment to excellence in the turkey industry and her leadership will support the Company dedication to delivering high-quality products and services”.

USPOULTRY in conjunction with the National Chicken Council, the Turkey Federation and United Egg Producers will present the 2024 Live Production, Welfare and Biosecurity seminar October 3-4 at the Embassy Suites by Hilton, Downtown in Nashville, TN.

This event is usually well attended based on the topicality of the program and the quality of speakers representing academia and industry.

The Professional Animal Auditors Certification Organization will assign CE credit hours for attendance.

For additional information and registration contact USPOULTRY at <info@uspoultry.org>

Representatives Steve Womack (R-AR) and Jim Costa (D-CA) have requested a 180-day extension to the contentious rule proposed by USDA entitled Salmonella Framework for Raw Poultry Products.

The request is based on “the complexity and length of the proposed rule and the fact that nearly all chicken marketed in the United States will be impacted”.  The letter noted that the rule raises questions of clarity requiring explanations to present a comprehensive response.

Gary Kushner, interim president of the NCC stated, “The industry attempt to engage with FSIS for the past two years during the formulation of this proposed rule and unfortunately our input was largely disregarded”. He added, “NCC and our member companies have invested hundreds of millions of dollars and have worked for decades to develop and refine best practices to reduce Salmonella and protect public health.”

Despite two webinars presented by USDA the industry was not provided with clarity concerning technical and practical issues relating to implementation.

The letter noted that if the Rule if implemented it would result in condemnation of a considerable proportion of chicken output with prepared product sent to landfills at a time when over 40 million Americans are food insecure.

The NCC position is that the proposed rule is unnecessary, will raise cost to producers and consumers alike and will lead to food waste without necessarily reducing the incidence of chicken-borne salmonellosis.

Long-running litigation between Impossible Foods and Motif FoodWorks over inclusion of heme protein in plant-based meat substitutes has been resolved.  Impossible Foods includes soy leghemoglobin produced by a genetically engineered strain of yeast to simulate the color of their product.  Motif uses a yeast-derived version of myoglobin in their product apparently representing an infringement of patents held by Impossible Foods.

Under the agreement, Impossible Foods will assume the heme-related activities conducted by Motif FoodWorks and the case will be dismissed with each party responsible for their respective legal fees and expenses.

The settlement agreement recognizes that the parties will continue advancing plant-based meat alternatives through innovation, collaboration and fair competition.

The U.S. Patent Appeal Board recently invalidated one patent awarded to Impossible Foods but sustained six other patents that were pivotal to litigation.

The annual Poultry Health Day will take place on November 15, 2024, as an in-person event at the Rollins Laboratory of the Department of Agriculture and Consumer Affairs.

Registration is free and the event is sponsored by Zoetis.  The program will include a review of HPAI in domestic animals, avian metapneumovirus, Enterococcus infection in broilers and Marek’s vaccination.  For additional details contact Rocio Crespo at rcrespo@ncsu.edu

The U.S. Food and Drug Administration has granted Generally Recognized as Safe (GRAS) status to Innodal Inc. to market Inneo® in the U.S.  The product has been available in Canada for five years and has proven successful in suppressing Listeria contamination.  The product incorporates bacterial peptides as the active ingredients.

Since the product is GRAS certified, no specific label changes are required for existing products manufactured with Inneo®.

Given the significant of listeriosis and the recent upsurge in incident cases from a variety of products including processed meat, cantaloupes and dairy products resulting in numerous and extensive recalls. Food manufacturers may benefit from using Inneo® as an adjunct to existing programs to decontaminate plant and equipment.

According to USDA FAS GAIN Report TC2024-07 released on September 4th, production in the United Arab Emirates will increase by 16.7 percent from 2024 to attain 70,000 metric tons.  The Nation is dependent on imports with 400,000 tons representing 85.1 percent of consumption. Domestic consumption will increase by 5.6 percent in 2025 attaining 50 kg per capita (110 lbs.) assuming a population of 9.4 million comprising Emiratis and expatriates and including foreign manual workers in construction. Domestic broiler production is supported by government feed subsidies and other concessions.

The UAE market is dominated by Brazil exporting set-weight whole frozen chicken from 900 g to 1,200 g in addition to portions and further-processed items.  Brazil operates plants capable of satisfying UAE Halal and labeling requirements for a wide range of products in demand.

During the first half of 2024 UAE was ranked 9th in volume among importers from the U.S. with 51,973 metric tons valued at $56.7 million.  Compared to the first half of 2023, volume and value were higher by 59 percent and 83 percent respectively.  Over the first half of 2024, UAE represented 3.2 percent of export volume and 2.5 percent of value.  Over the six-month period average unit value was $1,091 per metric ton, below the average for the period that attained $1,366 per metric ton.  U.S. leg quarters exported to the UAE are mainly consumed by foreign contract laborers.

According to USDA-FAS GAIN Report MX2024-40 released on September 4th, Mexico will post a 2.5 percent increase in domestic production to 4.09 million metric tons in 2025.  This volume will be supplemented by 970,000 metric tons of imported RTC chicken, a one percent increase over the previous year.  Total exports are inconsequential amounting to 5,000 metric tons.  Domestic consumption, assuming a population of 128 million will attain 39.5 kg per capita (86.8 lbs.).

The current disease situation in Mexico contributes to acceptable livability and growth rate. In recent years regional outbreaks of HPAI have occurred but these were suppressed by application of vaccination.  Biosecurity is constantly improved with a trend towards separation of breeders and grow-out operations.  Approximately 85 percent of poultry, predominately chickens are processed in federally inspected establishments with 121 in operation.  Expansion in 2025 is driven by lower feed prices, improvements in the economy resulting in increased demand and a higher level of integration.

For the first half of 2024, Mexico received 358,912 metric tons of chicken products from the U.S. valued a $455 million representing stability in volume but with a 14 percent increase in total value attributable to a unit price of $1,265 per metric ton compared to $1,110 for the corresponding first half of 2023. During the first six months of 2024, Mexico represented 21.8 percent of U.S. export volume and 20.3 percent of export value for chicken.

According to a USDA-FAS-GAIN Report dated September 6th, broiler production in Angola will remain fairly static at 52,000 metric tons in 2025, up four percent from the preceding year.  Most of the domestic production is derived from small rural units, and a limited number of commercial operations.  The major restraint to domestic production is the cost of ingredients with an unjustified restriction that all imports should be from non-GM cultivars. 

Imports of chicken will be unchanged for 2025 at 190,000 metric tons representing 78.5 percent of domestic consumption.  Assuming a population of 36 million, per capita consumption will be 6.7 kg (14.8 lbs.) in 2025.  It is recognized that due to the wide disparity in income between high and low earnings demographic, consumption in urban areas will be higher than the national average.

For the first half of 2024, Angola was ranked 10th among importers from the U.S. with 50,395 metric tons representing approximately half of the volume imported by Angola with the remainder supplied by Brazil.  For the first half of 2024 Angola represented 3.1 percent of volume and 2.4 percent of U.S. export value at an average unit price of $1,078 per metric ton.

A USDA-FAS-GAIN Report released on September 4th, predicts a 3.5 percent increase in broiler production to 1.645 million metric tons in 2025.  This quantity will be supplemented by importation of 300,000 metric tons, down 6.3 percent from 2024. Approximately half of imports will in the form of mechanically deboned meat, principally supplied by Brazil.  Exports are nominal at 70,000 metric tons mainly to neighboring nations. Assuming a population of 60 million, per capita consumption is 31.3 kg (69 lbs.) although due to the disparity in income consumption is substantially higher than the national average in urban areas and among higher income demographics.

During 2023 the broiler industry was impacted by HPAI with a number of breeder farms affected.  Hatching eggs were imported from Brazil and Turkey with production of day-old chicks now restored.

The broiler industry in South Africa is challenged by high feed prices, power brown-outs and high labor costs and inefficiency. The U.S. and Brazil are able to land chicken into South Africa at prices lower than the cost of domestic production. Accordingly the industry is protected by antidumping duties, tariffs and contrived restrictions based on HPAI.  During the first half of 2024 Brazil supplied 81 percent of imports of chicken meat mainly in the form of MDM, Argentine, eight percent and the European Union and the U.S. five percent each.  Over the first half of 2024 the U.S. contribution to imports declined by 63 percent compared to the corresponding half of 2023. In 2023 South Africa was ranked 18th among importing nations  from the U.S. with 44,324 metric tons shipped valued at $42.4 million with a low average unit price of $957 per metric ton.

Over the past decade, the state of Rondonia in Brazil has experienced extensive illegal deforestation in sections of the Amazon Rainforest to allow raising of cattle.

According to the Associated Press, a state judge in Rondonia has fined two packing plant and three ranchers $750,000 as a result of illegal deforestation to raise cattle. Funds from the collective penalty will be used in part to remediate degraded areas by replanting trees.

Cases against additional packing plants including one owned and operated by JBS SA have yet to be heard. Environmental issues faced by JBS are now being used to oppose the proposed listing of the Company on the NYSE.

Apart from ethical and business concerns, opponents of the JBS listing, including Senator Cory Booker (D-NJ), have cited failure to comply with international and Brazilian requirements regarding deforestation.

According to USDA-FAS-GAIN Report TH2024-54 released on September 4th, Thailand will  increase production of broiler meat by 2.6 percent to 3.58 million metric tons. Of this volume 33.2 percent will be exported, up 3.5 percent from 2024 and amounting to 1.19 million metric tons. Exports are mainly destined for Japan and the E.U.

Domestic consumption, assuming a population of 72 million plus a vibrant tourist industry that has recovered since the COVID years will attain 33.1 kg (72.8 lbs.) per capita.

Producers in Thailand have benefited from declining feed costs. Available labor at relatively low rates is especially beneficial for manual further-processing for specialty markets.

Production in Thailand is challenged by periodic resurgence of HPAI. The industry has now recovered from severe losses in 2023.  

The broiler industry in Turkiye continues to expand with an eight percent projected increase in domestic production to 2.6 million metric tons.  According to a USDA-FAS-GAIN Report TU2024-41 released on September 4th, exports will increase by 14.4 percent in 2025 over 2024 to 374,000 metric tons. This quantity was down from 445,000 metric tons in 2023.  Domestic consumption will increase to 2.23 million metric tons, an eight percent increase over 2024 representing a per capita consumption of 26.2 kg (56.7 lbs.) assuming a population of 85 million.

Turkiye has encountered competition from Ukraine and Russia in their traditional Eurasian markets.

During the week of September 30th, a delegation of importers from Singapore will be hosted by USAPEEC in a program intended to demonstrate U.S. broiler production practices with an emphasis on biosecurity and prevention of disease.  Visits will be made to production facilities and slaughter plants in Georgia, Indiana and Minnesota.

USAPEEC has also arranged a trade reception to link prospective importers with U.S. producers.

Hosting trade missions is an important activity conducted by USAPEEC and contributes to establishing confidence in U.S. production practices, certification, food safety and quality.

Singapore with a population of 5.6 million imported approximately 220,000 metric tons of chicken in 2022 representing 86 lbs. per capita. Singapore is not currently among the top 15 importers from the U.S. with product valued at $26 million consigned in 2022 representing eight percent of imports. Singapore sources chicken from Brazil (48%), neighboring Malaysia (34%) and the remainder fro various nations in Asia including Thailand. Although Singapore represents a potential market supplies must be certified Halal and predominantly small whole chicken and portions. Feet would be in demand by ethnic Chinese representing 75 percent of the population.

According to USDA-FAS GAIN Report JA2024-43 released on September 4th, broiler production in Japan will increase by 1.7 percent in 2025 from the previous year to 1.75 million metric tons. Domestic consumption should increase by 0.7 percent to 2.85 million metric tons in 2025. 

Concurrently, imports will decline by 0.5 percent to 1.1 million metric tons representing 37 percent of total availability.  Major suppliers to Japan in 2022 comprised Brazil ($950 million); Thailand ($440 million); U.S. ($25 million) and the E.U. ($12 million). Imports from joint-venture operations in mainland China comprise specialty products requiring a high level of manual handling and preparation.

Demand during the first half of 2024 was driven by increased tourism, and high prices for imported beef and pork as a result of the progressive depreciation of the yen.  Feed prices are disproportionately high compared to other major world producers due to a reliance on imported ingredients, despite feed stabilization subsidies.  Japan has enhanced biosecurity following successive annual losses to HPAI, mainly affecting the egg-production sector.

The Nebraska Department of Agriculture has been directed by Governor Jim Pillen to develop rules restricting cell-cultured meat.  It is intended that cell-cultured meat should be clearly labeled and separated at point of sale from natural meat derived from livestock.

In establishing the policy, Governor Jim Pillen, himself a Veterinarian and hog producer, stated at an event, “Nebraska farmers and ranchers like those here today are committed to producing the best food products anywhere.  We feed the world, and we save the planet more effectively and more efficiently than anybody else and I will defend those practices.”

A number of states with beef and pork production have introduced or are intending to pass legislation banning or restricting the manufacture or sale of cell-cultured meat including Florida and Alabama. The constitutionality of legislation directed against cell-cultured meat will be challenged in court following filings by Upside Foods and the Institute for Justice.

States with livestock production are pressing ahead with restrictions on sale and labeling despite the fact that none of the startups or established cell-cultured meat companies has been able to produce commercial quantities of product or will be likely to do so in the foreseeable future. This situation follows a decade of “almost there” optimism that has swallowed up almost $2 billion in venture capital worldwide. Restrictive legislation at this time is essentially political theatre to engender and solidify support from livestock producers. It may also be coupled with a twinge of Luddite opposition to innovative technology.

The USDA has published a projection of meat and chicken consumption for Mexico extending through 2033. It is estimated that broiler consumption will increase from 84 pounds to 96 pounds per capita over the coming ten years. Pork consumption will increase from 44 to 50 pounds per capita and beef consumption will increase from 35 pounds to 36 pounds. 

Domestic consumption increased in Mexico after implementation of the NAFTA agreement in January 1994.  Integrating the market among  Mexico, the U.S. and Canada allowed for quota-free trade in grains, oilseeds, livestock, animal products and other agricultural goods. Improvements in consumption and agricultural trade continued after NAFTA was replaced with the USMCA Agreement.  To support higher consumption, Mexico increased imports of corn and soybeans with a fourfold increased in soybeans and corn imports over the period 1993 through 2023.

It is estimated that Mexico will attain a 31 percent growth in chicken imports over the next ten years concurrent with a 22 percent increase in domestic production.

In 2023 1st-ranked Mexico imported 721,342 metric tons of broiler parts from the U.S. valued at $810 million and 150,510 metric tons of turkey valued at $425 million. For the first half of 2024 Mexico received from the U.S. 358,912 metric tons of broiler products valued at $454 million and 79,055 metric tons of turkey products valued at $225 million.

It is important that all parties to the USMCA adhere to the agreement that functions to the mutual benefit of the three nations.

Seventeen months ago, Perdue Farms submitted a petition to the USDA-FSIS requesting modified labeling regulations with respect to a “pasture-raised” chicken claim in accordance with the Poultry Products Inspection Act.

FSIS has updated guidelines to define “pasture-raised” as “Chickens spending the majority of their lives on pasture with rooted-in-soil vegetative cover”.  FSIS is encouraging producers to obtain third-party substantiation of any “pasture-raised” claim.

The Agency declined to codify specific definitions for “pasture-raised” and “free-range” in the form of a regulation based on the spurious concern of “stifling innovation”.

The definition of “pasture-raised” can now be applied but USDA stressed that the definition and claim are independent of regulations governing the National Organic Program.

In a continuation of services to the poultry industry, USPOULTRY is making available an applications guide to assist companies to develop statistical process control programs. This technology is a valuable aid in managing processing operations to optimize efficiency and quality.  The Guide will provide a framework to understand process control and to adapt general principles to implement a program for specific applications.

For additional information, contact Benjamin Starkey bstarkey@USPOULTRY.org.

George’s, Inc. has filed a civil lawsuit against Thomas Miller, previously employed as a Director of Corporate Engineering and two contractors.  The company alleges that Miller fraudulently processed documentation for work performed on his private property that was charged to the Company.  The lawsuit alleges civil conspiracy, fraud and breach of fiduciary duty.  The alleged fraud commenced in 2022 and was facilitated by assigning sole signing authorization to the Defendant.

Perdue Farms has filed a complaint against the Department of Labor and Craig Watts of Fairmont, NC.  Watts has engaged in a series of actions bordering on barratry in his private capacity, to deprecate the image of Perdue Farms and to question the integrity of marketing claims relating to “humanely raised”.
 

The Department of Labor previously rejected Watts’ claims relating to compensation since he was not an employee but was an independent contractor raising broilers for Perdue Farms Inc.

Perdue Farms, forced to defend a number of actions filed by Watts, is now seeking declaratory relief to restrain the Department of Labor from pursuing administrative proceedings.  Perdue claims actions by the Department of Labor are unconstitutional since it has deprived the company of the right to a jury trial.

Curt Calaway, serving as interim CFO, has been confirmed as the new Chief Financial Officer for Tyson Foods. In announcing the appointment, Donnie King, president and CEO stated, “Curt is a proven leader with deep industry knowledge and a wealth of experience in financial strategy and reporting.”  He has served as CFO for the Prepared Food Business segment and was involved in various mergers and acquisitions as Senior Vice President of Finance and Treasurer since 2021. 

Previous to joining Tyson Foods, Calaway occupied positions of responsibility with PriceWaterhouseCoopers LLP for over eleven years.

The interesting question is why Calaway was not appointed to the position of CFO and was passed over for John R. Tyson who is currently on health-related leave. Although John Tyson has attained technical and professional qualification, the questions of maturity, experience and management acumen should have predicated a less stellar advance in the Company.  Tyson Foods is a publicly quoted enterprise, and the initial appointment should have raised questions with a Board less subservient to a dynastic culture with overtones of nepotism. Given the circumstances shareholders deserved better.

State Rep. Chris Miller has filed House Bill 5872, designated the Illinois Cultivated Meat Act.  This intended legislation would ban production and sale of cultivated meat in Illinois. This initiative follows a similar law enacted in Florida and other under consideration in beef-producing states.

Rep. Miller stated, “We don’t need fake meat laboratories creating a highly expensive product that tries to replicate real meat.”  While these sentiments are well supported by his constituency and have technical and financial validity the question of outright bans appears to be an overreach.  At this time, no potential manufacturer has been able to produce cell-cultured meat in commercial quantities despite multi-millions of support from venture capital funds.

The most optimistic projections place the price of cultivated product far above animal-derived meat.  It is acknowledged that environmental claims for cultivated meat are overstated but there does not appear to be a problem of safety.  Notwithstanding the pros and cons of cultivated meat, the reality is that there is no immediate prospect of a product entering the market and that preemptive “feel good”, token bans are intended to placate constituents in farming communities rather than an attempt to serve producers, the food industry and consumers.

Chipotle is currently evaluating Honey Chicken in 80 restaurants in Nashville, TN. and Sacramento, CA.  Field trials followed successful taste tests using trained panels.  Chris Brandt, Chief Brand Officer for Chipotle stated, “Consumers have clearly shown their enthusiasm for sweet-heat combinations, and we believe Chipotle Honey Chicken will capture fans with a high level of excitement.”

As with many QSRs and casual dining restaurants chains, there is an evident transition to more chicken-based menu offerings.  Apart from the popularity of chicken, displacing beef enhances margins and allows greater flexibility in menu options compared to alternative proteins.

On May 8th, Central Valley Meat purchased the Cargill slaughter plant in Fresno that processes approximately 300,000 head of culled dairy cows annually. Central Valley operates their major facility in Hanford, CA.  As a component of the transaction, Cargill will continue to operate under lease a ground beef plant contiguous with their previous Fresno facility.

In accordance with the agreement between Central Valley Meat and Cargill, approximately 700 workers would remain employed with wages and benefits equal to or better than those provided by Cargill.

Amid concerns over possible cutbacks, California Attorney General Rob Bonta has intervened to ensure that the conditions of purchase are maintained for at least twelve months through the second quarter of 2025.

Bonta stated, “For dairy farmers the loss of the Fresno Cargill plant could have meant lower cattle prices and fewer options when selling their animals.”  He added, “The Central Valley has fed California and the U.S. for decades and today I am proud to have secured the continued operation of an important processing plant and protection of 700 jobs for at least a year.”

Intervention by the Office of the Attorney General was considered necessary to prevent losses by dairy farmers from depressed prices for their culled cows in the event of cutbacks or even closure of the plant.

USAPEEC in conjunction with the USDA-APHIS organized a hybrid in-person and video remote seminar in Mexico City dealing with control and prevention of HPAI. The program was in part sponsored by the Nebraska Soybean Board.

Speakers included representatives of SENASICA (counterpart of the U.S. APHIS), and USAPEEC Mexico, Dr. Fidelis Hegngi, USDA and Dr. John Clifford, USAPEEC Consultant.

USDA-APHIS promotes biosecurity as a preventive measure notwithstanding the fact that this modality however strictly enforced does not provide absolute protection against infection especially in the turkey and egg production segments of the U.S. industry.  APHIS stresses depopulation of flocks within 24 to 48 hours, a goal that has yet to be achieved in large egg production complexes.  Based on limited cases of mild H5N1v infection among workers depopulating farms in Weld County, CO. there is now greater emphasis on personal protection equipment (PPE) since recent poultry outbreaks have been attributed to the mammal-adapted B3-13 variant of avian H5N1.

It is hoped that Dr. Clifford through his extensive experience with avian influenza as the previous Chief Veterinary Officer for the USDA is actively promoting protective vaccination with monitoring and surveillance as an adjunct to biosecurity among existing and prospective importers of U.S. broiler, turkey and egg products.

According to USDA-FAS GAIN report UP2024-15 released on August 20th, Ukraine will produce 1.33 million metric tons of RTC broiler meat in 2025.  This is 0.8 percent above the volume in 2024.  Exports will attain 0.45 million metric tons representing 30 percent of production, emphasizing the disparity between output and domestic consumption.  Based on a population of 38 million, per capita, consumption is projected at 24kg (53.2 lb.),

Since most broiler production facilities are in central and western Ukraine, damage associated with the invasion of the nation by the Russian Federation has not been as severe as with the egg industry.  Support from the European Union in the form of reduced tariffs has maintained broiler production.

The industry is dominated by MHP with this integrator representing 70 percent of national output.  Four other producers Agrol, Agro Oven, Dniprovskiy and ULAR are responsible for the remainder. Despite ongoing hostilities and damage to warehouses and coldrooms, MHP has expanded and has achieved full utilization of facilities. 

Challenges facing the industry include population outflow with at least six million residents displaced westward to the E.U., disruption of the transport infrastructure, currency devaluation and conscription of employees.  Electricity supply is variable and may deteriorate in 2025 since Russia is intensifying missile and drone attacks on the power grid.  On the credit side feed ingredients are both available and inexpensive now representing 55 percent of live weight cost according to the GAIN report followed by day-old chicks at 20 percent.

Currently, broiler producers in the Ukraine function with an export limit of 133,283 metric tons per year for the E.U. representing 30 percent of shipments.  Other nations receiving broiler products from the Ukraine include the U.K., the Middle East and Eurasian regions in addition to  feet to Hong Kong and China.

On August 2nd and 9th, USAPEEC Mexico conducted online workshops to promote value-added products prepared with U.S. turkey meat. Approximately 150 hotel restaurant and institutional professionals participated in the workshops that featured turkey thigh fajitas. These are marketed under the Dos Familias brand, produced by Proboca a prominent further-processor of poultry, pork and beef for the market in Mexico. Programs were sponsored by the Indiana Soybean Alliance. 

During 2023, Mexico was the major importer of turkey product from the U.S. receiving 150,510 metric tons valued at $425 million representing 68 percent of volume and 66 percent of value, respectively, with a unit price of $2,740 per ton.

Over the first half of 2024, Mexico imported 79,055 metric tons of turkey meat valued at $225 million representing a 27 percent increase in volume and 12 percent in value compared to the corresponding first half of 2023.

California Proposition #12 banned the sale of pork derived from sows held in gestation crates effective 2024. This 2018 legislation and the CADFA regulations has had minimal effect on price and consumption in California.  Despite the dire predictions of unavailability and high prices as a result of implementation, prices of pork products including bacon are only slightly higher than in the rest of the U.S. 

The small but real increases in the prices of bacon, ribs and loin cuts were predicted to depress consumption.  Prior to introduction of Proposition #12, California accounted for 9 to 12 percent of pork consumption consistent with a population of 40 million in the state.  Current pork consumption has fallen to approximately 8 percent of national demand suggesting a 20 percent reduction in pork eaten, favoring chicken and possibly turkey.

Economists at the University of California at Davis calculated that at the time of implementing Proposition #12 that there was an adequate supply of product from sows held under group housing and that no incremental investment was necessary to comply with Proposition #12.

As experienced with eggs, ballot initiatives intended to improve flock and herd welfare have financial implications for consumers, a reality that is generally underplayed by proponents who emphasize the appeal to emotion and conveniently omit the quantifiable implications of passage of ballot initiatives dealing with welfare.

Hormel Foods, Rochelle Foods and Quality Pork Processors have agreed to a settlement of $13 million over wage claims.  This action follows the capitulation of Tyson Foods and JBS USA, respectively paying $72 million and $55 million as settlement to a class of workers claiming underpayment of wages.  The allegations arose from disclosures that the defendant companies apparently colluded in setting wage rates based on claimed in-person meetings and indirectly through participation in the AgriStats benchmark costing system.  All companies that have settled deny wrongdoing. Hormel Foods, in a statement, noted that the settlement was negotiated “to avoid the uncertainty, risk, expense and distraction of continued litigation”.

Lawsuits alleging collusion to establish wage rates for plant workers or in separate cases, compensation paid to contractors appear to have as a common basis subscription to AgriStats.  Irrespective of the benefits from comparing costs and efficiency factors, it would appear that the service has emerged as a very expensive component of management of livestock operations confirming the Law of Unintended Consequences.

According to USDA-FAS GAIN Report CH2024-108, released on August 19th, The People’s Republic of China (China) will increase 2025 chicken production by two percent to 15.3 million metric tons. During 2025 imports are projected to fall by 33 percent to 0.3 million metric tons.  Since China will export 0.67 million metric tons in 2005 the nation will be a net exporter with major destinations comprising Japan, from joint venture operations and to the Autonomous Region of Hong Kong, each to receive approximately 80,000 metric tons.  China exported quantities of processed chicken to 11 Asian and E.U. Nations ranging from 5,000 to 10,000 metric tons over the first half of 2024.  During the first half of 2023, Russia emerged as a recipient nation with 30,000 metric tons. 

For the first half of 2024 China received 72 percent of imports from Brazil with 10 percent from the U.S.  The other major supplier was Thailand with 11 percent of imports.  There was a temporary pause in exports of chicken products from Brazil in July due to an alleged outbreak of Newcastle disease although exports have since resumed.  In contrast the U.S. is subject to prolonged and extensive embargos as a result of HPAI in other than broiler operations.  China selectively ignores World Organization of Animal Health guidelines regarding zoning or resumption of imports after expiry of the statutory 28-day period following completion of decontamination.  China continues to impose unjust HPAI restrictions on exporters despite the reality that a variety of H5 and H7 strains of avian influenza are endemic, and the nation deploys vaccines of various types against avian influenza.  Currently restrictions are imposed on Argentina, Turkey and Chile that previously accounted for eight percent of the share of the import market despite completion of the statutory post-decontamination period.

Domestic consumption in China will amount to 14.93 million metric tons during 2025.  Accepting a population of 1.43 billion, per capita consumption will be 10.4 kg (23 lbs.). Demand is divided among conventional white-strain broilers and either traditional yellow birds or hybrids between yellow and white-feathered stock. Although yellow-feathered birds and hybrids are still popular among the older demographic and for restaurants, broiler meat from white feathered birds are consumed in QSRs based on price, value and convenience.

Currently the national average retail price for pork, the major animal protein is $1.86/lb. compared to chicken at $1.50/lb.  During the second quarter of 2024, the price of pork has increased reflecting lower availability, making chicken more affordable.

Following a Government policy decision approximately ten years ago, China has embarked on a program of producing domestic broiler breeding stock and is moving toward self-sufficiency, sacrificing a potential gain in production parameters including feed conversion and growth rate for advantages relating to security, conserving foreign exchange and national pride (or alternatively xenophobia).  Ultimately based on international consultants, domestic knowledge of genetics and associated breeding technology and existing volume of production, China will soon be in a competitive position to export broiler-breeding stock to “friendly” nations in Asia and Africa.

Monthly Broiler Production and Prices, August 23rd 2024.

Broiler Chick Placements.

According to the August 21st 2024 USDA Broiler Hatchery Reports, 1,244.5 million eggs were set over five weeks extending from the week ending July 20th 2024 through August 17th 2024 inclusive. This was four percent higher compared to the corresponding period in 2023.

Total chick placements for the U.S. over the four-week period amounted to 959.2 million chicks. Claimed hatchability for the period averaged 79.4 percent for eggs set three weeks earlier, unchanged from the preceding four-week period. Each 1.0 percent change in hatchability represents approximately 1.92 million chicks placed per week and 1.82 million broilers processed, assuming five percent culls and mortality and with the current range of weekly settings.

Cumulative chick placements for the period January 7th through December 30th 2023 amounted to 9.67 billion chicks. For January 6th through August 7th 2024 chick placements attained 6.23 billion, up one percent from the corresponding week in 2023.

According to the August 23rd 2024 edition of the USDA Chickens and Eggs pullet breeder chicks hatched and intended for U.S. placement during July 2024 amounted to 8.32 million, down 2.3 percent (200,000 pullet chicks) from June 2023 and 18.8 percent (1.55 million pullet chicks) less than the previous month of June 2024. Broiler breeder hen complement attained 62.9 million on August 1st 2024, 1.9 percent more (1.2 million hens) than on August 1st 2023.

Broiler Production

As documented in the August 22nd 2024 USDA Broiler Market News Reports for the processing week ending August 17th 2024, 167.5 million broilers were processed at 6.49 lbs. live. This was 0.6 percent more than the 166.5 million broilers processed during the corresponding week in the previous month of July 2024 and 1.1 percent less than the 169.4 million processed during the corresponding week in August 2023. Broilers processed in 2024 to date amounted to 5,380 million, 1.8 percent lower than for the corresponding period in 2023.

Ready to cook (RTC) weight for the most recent week in August was 826.2 million lbs. (375.5 metric tons). This was 1.1 percent more than the 817.4 million lbs. processed during the corresponding week in July 2024 and 1.1 percent more than the 817.5 million lbs. during the corresponding week in August 2023. Dressing percentage was a nominal 76.0 percent. For 2024 to date RTC broiler production attained 26,451 million lbs. (12.02 million metric tons). This quantity was less than 0.1 percent than for the corresponding period in 2023.

Broiler Prices

The USDA National Composite Weighted Wholesale price for the week ending August 23rd 2024 was down 6.5 cents per lb. to 124.7 cents per lb. from the corresponding week in July 2024. The attached USDA figures denote average prices over three-years.

Leading QSRs are using increasing quantities of breast meat for sandwiches, strips and nuggets. Inflation is increasing consumer awareness of value with chicken benefitting at the expense of beef and pork

 

Under pressure over ethical and environmental issues, JBS SA released a comprehensive environmental and sustainability report. At issue is concerted opposition to a listing by the company on the New York Stock Exchange. Following the announcement of the intention to file for an IPO, bipartisan condemnation of past practices and actions by the Batista brothers emerged and is gaining in intensity.

The JBS report indicates investments of more than $150 million across all operations to reduce Scope 1 and 2 greenhouse gas emissions with a claimed reduction in intensity of emissions by 17 percent over the past five years. The major allegation relating to JBS is indirect or direct deforestation of the Amazon Rain Forest. This issue that is vigorously denied by JBS.

For Q2 FY 2024, JBS SA posted net earnings of $328 million on revenue of $19,284 million. Comparable figures for Q2 2023 were a net loss of $53 million on revenue of $18,052 million. 

Among the six operating segments, the proportion of total revenue and the adjusted EBITDA were:-

	Percent of revenue	EBITDA (US$ millions)
Seara	11.4	$387
JBS Brazil	15.2	$226
JBS Beef US	30.6	$16
JBS Australia	8.4	$202
JBS Pork US	11.0	$273
Pilgrim’s Pride	23.2	$656

Net export revenue amounted to $4,910 million from all operations.

Following settlements by Tyson Foods, Sanderson Farms, Koch Foods and Perdue Foods, for a collective amount of $70 million, Pilgrim’s Pride, the final holdout, agreed to pay $100 million to settle claims. As with other Defendants, Pilgrim’s Pride did not admit to wrongdoing.

The case filed in the U.S. District Court for the Eastern District of Oklahoma captioned Broiler Chicken Grower Antitrust Litigation alleged collusion among integrators to constrain grower payments through exchange of information and entering into “no poach” agreements.  It is striking that Pilgrim’s Pride agreed to a $100 million settlement compared to the quantum for four other Defendants ranging from $14 to $21 million.

The settlement will require the approval of U.S. District Judge, Robert Shelby.

Perdue Foods, LLC is recalling 83 tons of frozen, ready-to-eat chicken nuggets and tenders.  The recall was a result of potential contamination with metallic fragments.  Products were processed on March 23rd by the company plant in Perry, GA.

According to the Food Safety and Inspection Service, there have been no reports of injuries, but the extensive recall was issued as a precaution.

It is highly likely that a large proportion of the batch has been consumed given the date of processing but some product may be in storage in home freezers.

Susannah Frost has been promoted to the position of president of Chick-fil-A.  In her role, Ms. Frost will provide coordination with a focus on maintaining the growth of the company and sustaining market leadership as Chair the Executive Committee.  Andrew T. Cathy, CEO of Chick-fil-A, noted, “Having served as a CEO for three years, the timing is right to expand our leadership capabilities to include a president who will work closely with me and our Executive Committee to steward our domestic and global expansion.”

Ms. Frost joined Chick-fil-A in 2007 from Troutman Sanders, a real estate law firm. She earned a baccalaureate degree in mathematics from the University of Georgia and a law degree from Emory University.  She has completed executive programs at Columbia and Harvard Universities.

In accepting the position, Ms. Frost noted, “We have the opportunity to scale care with excellence across 3,000-plus restaurants and international markets.  I look forward to working alongside Andrew, our leaders, operators and staff to provide support for our customers in the communities we serve.”

Conagra Brands has announced acquisition of privately held Sweetwood Smoke, the manufacturer of FATTY™ brand of meat sticks.  Terms of the transaction were not disclosed but it is understood that Conagra will position the large meat sticks as a premium brand as they are almost seven times the size of market leader Slim Jim’s.

Swan Connolly CEO of Conagra Brands noted “The acquisition of FATTY Smoked Meat Sticks is another step in reshaping our portfolio for faster growth. Adding a premium brand to our growing, ‘better-for-you’ snack portfolio is consistent with our strategic focus on snacking and frozen categories.”

USDA-FSIS will initiate a structured sampling program following the demonstration of viable H5N1 strain B3.13 bovine-modified avian influenza virus in beef in May. At this time the virus was detected in one out of 109 samples from culled dairy cows, Currently, dairy farmers are submitting milk samples for assay in the event that lactating cows are to be moved interstate.  Colorado has introduced a mandatory, weekly testing of milk from all dairies within the state.

It is emphasized that monitoring and control of H5N1 virus in the dairy industry is fragmented with state departments of agriculture and health involved and cooperating in varying degrees with federal agencies including USDA-APHIS and the Centers for Disease Control and Prevention. 

Clearly, there is a need for a federal coordinator with authority to introduce programs of surveillance and to ensure that preventive programs are implemented for the benefit of producers, consumers and other stakeholders. The risk of infection of consumers remains exceptionally low especially with milk that is pasteurized and beef that should be thoroughly cooked. 

Following a decline in profitability, privately held Cargill Inc. is apparently to undergo structural changes.  Informed observers have noted that a high proportion of Cargill businesses failed to meet earnings goals during fiscal 2024.

The Company will consolidate operations into three units:

• Food to be led by Jon Nash

• Ag and Trading to be managed by Roger Watchorn

• The Specialized portfolio including Animal Nutrition and Health guided by David Webster

Concurrent with these changes in operations, a number of executives will retire including Julian Chase Head of Business Operations and Supply Chain.  The Company has also embarked on a program of reducing costs to increase return on capital.

Changes at Cargill parallel the consolidation of facilities and programs to reduce

Brian Niccol, previously CEO and Chairman of Chipotle Mexican Grill, (CMG) announced his resignation to become CEO of Starbucks.  Niccol, who joined Chipotle from the Taco Bell Division of YUM! brands was instrumental in expanding the company to over 3,500 restaurants, revamping menus, introducing drive-thru lanes and achieving exceptional financial results reflected in the share price of the company.  

Niccol will be succeeded at Chipotle by Scott Boatwright, Chief Operating Officer as the interim CEO. He is a seven-year veteran of the company and was a close collaborator with Niccol in implementing necessary changes to restore profitability and achieve expansion both in the U.S. and internationally.

In announcing his departure, Niccol stated, “I am incredibly proud of the work that has been accomplished since I joined Chipotle in 2018.”  He added, “The strategic priorities this team has put in place has positioned Chipotle to win today and enable future growth.  I depart knowing the business is in great shape and poised for growth with a strong, experienced leadership team.

Chris Schutte, who has served as the CEO of Astral Foods for 16 years has announced his retirement effective January 30th, 2025.  He will reach the mandatory retirement age and will accordingly step down although he will serve in a consulting position as the new CEO transitions to the role.

Schutte joined the predecessor of Astral Foods in 2002 as Retail Sales Manager for the Meadow Feeds Division, subsequently attaining the position of CEO of the holding company in 2009.

Astral Foods processes 5.5 million broilers each week and is the largest poultry producer in Africa.  The second largest broiler producer in South Africa is Rainbow Chicken, processing approximately 5 million broilers each week and recently the subject of an IPO.

USAPEEC recently conducted two seminars for importers in Columbia on technical issues relating to maintaining a cold chain.  Attendees included representatives of the National Institute of Medicine and Food Surveillance and the Columbian Agricultural Institute together with representatives of food operations. Events were held in  in Cartagena and  Buenaventura.

Dr. Amit Morey of Auburn University was the principal speaker, with the programs including meat quality and safety, maintaining a cold chain, freezing and refrigeration equipment and issues relating to shipment of refrigerated cargo.

The seminars attracted over 100 attendees, divided among importers, regulatory agencies and the hotel and food service sectors.  The program received sponsorship from the United Soybean Board.

Following an announcement in October 2023 that Tyson Foods would layoff 250 employees on the second shift at the Wilkesboro, NC. Complex, the Company has indicated that a further cutback affecting 500 employees will take place.  According to Tyson Foods, an adjustment in production was required in the fresh poultry operation.

It is a matter of record that Tyson Foods has closed four small chicken plants located in North Little Rock, AR., Dexter and Noel, MO. and Corydon, IN. involving termination of 3,000 employees.

The third quarter financial results for Tyson Foods are posted in this edition.  The program of consolidation and reducing production costs initiated in 2023 is obviously having a beneficial effect.  It is evident that Tyson Foods has operated with inherent inefficiency until it became obvious that rationalization of production and facilities is necessary for the Company to operate in a competitive environment.

OVERVIEW

The USDA provided updated projections for the production of corn and soybeans in the August 12thWorld Agriculture Supply and Demand Estimates (WASDE) #651, reflecting the anticipated 2024 crop. Production values for corn and soybeans were updated from the July edition since they were based on actual field data. Projections of crop size and ending stocks are based on acreage planted, yield, carry-forward levels from 2023, and with the latest assumptions of domestic use and exports.

The August 12th WASDE report predicted that corn would be harvested from 82.7 million acres, down 0.8 percent from the July projection. The soybean crop will be harvested from 86.3 million acres, up 1.2 percent from the July report.

The August WASDE increased the yield value for the 2024 corn crop by 1.2 percent to 183.1 bushels per acre. By comparison yield was 174.9 bushels per acre in 2023. The July soybean yield was increased by 2.3 percent to 53.2 bushels per acre compared to 49.9 bushels per acre in 2023.

The August USDA projection for the ending stocks of corn was down 1.1 percent to 2,073 million bushels. The August USDA projection for the ending stock of soybeans was raised 23.1 percent to 560 million bushels.

The August 2024 WASDE reduced the projection of corn price by 10 cents to 420 cents per bushel. The projected average season price for soybeans was lowered 30 cents to 1,080 cents per bushel. The price of soybean meal was reduced by $10 per ton to $320 per ton. Projected commodity prices suggest stable to lower feed costs for livestock and poultry producers. Row crop farmers will experience lower margins given higher production costs. This situation has contributed to an impasse in the decisions of the respective House and Senate Agriculture Committees regarding allocation of funding for the combination of nutrition support and conservation over farm commodity price supports in the delayed Farm Bill.

Projections for world output included in the August 2024 WASDE report reflect the most recent estimates for the production and export of commodities especially in the Southern Hemisphere with an emphasis on Argentine and Brazil. Economists also evaluated the likely impacts from ongoing hostilities in Ukraine following extensive destruction of agricultural infrastructure by the Russian Federation. It is evident that production and hence exports of wheat, corn and sunflower from Ukraine will be reduced compared to pre-war averages.

 

On August 8th, the USDA Agricultural Marketing Service announced purchase of chicken products for child nutrition and related food assistance programs to be delivered over the second quarter of 2024.

Purchases included:

• 36,800 cases of pouched boned chicken at an average of $49 per case
• 945 tons of canned boned chicken at an average of $2.35 per lb.

The total value of the purchase was $6,201,175

Agricon Buildings LLC has appointed Jeremy Houdek as Global Sales Director responsible for acquiring new business in the international market.

On his appointment Jeremy noted, “I am dedicated to driving product innovation through experience and team collaboration, with a customer centric focus.”  Jeremy joined the poultry industry in 2009 working for Big Dutchman in the Latin America Division supporting sales.  After 14 years with the company, Houdek joined Munters a multinational ventilation equipment supplier in 2022, focusing on the Americas region.

Information on Agricon and examples of completed projects can be obtained from the Company website accessed by clicking on to the Agricon logo on the right side of the Welcome page.

Jeremy can be contacted at JHoudek@Agricon-Buildings.com.

The 2025 IPPE will take place January 28th through January 30th, 2025, at the Georgia World Conference Center.  Organized jointly by USPOULTRY, the American Feed Industry Association and the American Meat Institute, the event is ranked highly among U.S. trade shows and is the leading venue for the poultry industry worldwide.

In 2025, exhibits will cover 557,000 square feet and will feature technology, equipment and services for livestock and poultry production.

• Green Hall A will feature animal feed ingredients, health and related exhibitors.
• Red Hall B will feature egg production and processing, incubation and live production.
• Blue C will cluster meat and poultry processing and packaging, rendering food and worker safety.

In addition to the major halls, the organizers have arranged for a food safety pavilion in Red Hall B, featuring exhibitors catering to this important aspect of production.

It is expected that there will be 1,300 interactive exhibits among the three halls and the BC connector, with an attendance exceeding 30,000.

Statistics from the 2024 IPPE included an 80 percent satisfaction rate and an equal number of attendees regarding the IPPE as “important for their business”.  Among the 1,432 exhibitors, 268 were first-time participants as were 40 percent of the attendees.

Educational sessions will include education programs for the feed and meat industries, the Market Intelligence Forum and the Animal Agriculture Sustainability Summit.  Programs incurring a charge include the Petfood Conference, the International Scientific Forum and the Latin American Poultry Summit.

College student and doctoral level career placement will take place during the 2025 IPPE with expanded opportunities for interviews.

Registration and housing will open on October 7th.

For information on the 2025 IPPE, access info@IPPEXPO.org or contact Gwen Venable, Vice-President, USPOULTRY, 1 (678) 514-1971.

Over the period May 20th through July 26th, Aviagen hosted 15 students from U.S. and E.U. universities for a summer internship program.  Following an orientation program rotating through various Aviagen facilities, the students embarked on a ten-week program gaining exposure to company operations including veterinary service, quality assurance, hatcheries and management functions including planning and business analysis. Students were mentored by Aviagen technicians and specialists under real world conditions.

Dr. Marc de Beer president of Aviagen North America commented, “We are committed to equipping the next generation with the skills and knowledge necessary for a successful career in poultry breeding and production.”  He added, “Aviagen is dedicated to fostering a drive for excellence and we are proud of this year’s interns who have shown remarkable initiative and passion for contributing to the global food supply.”

Ancera has adapted CRISPR-SeroSeq technology to conduct ‘deep serotyping’ to identify the prevalence of specific Salmonella serotypes in environmental and product samples. This is critical to mounting an effective program of suppression since efforts should be directed against high-virulence serotypes including S. Enteritidis, S. Infantis and S. Typhimurium1. Knowing which serotypes are present is an essential component of an investigation to determine the source of Salmonella contamination in the production cycle within a complex and to implement corrective action.  

Frequently complexes are faced with a high rate of recovery of a specific Salmonella serotype on carcass wash samples but have difficulty in identifying the source.  Sampling of replacement pullets, breeder hens, hatcheries and broilers during grow-out may yield different serotypes to those isolated on carcasses after processing.  This apparent inconsistency confounds an understanding of the dynamics of Salmonella infection through stages of production extending from the parent generation through to processing. 

Failure to identify the predominant serotypes arises from the inherent differences associated with conventional enrichment. Using in vitro culture and conventional bacteriologic procedures, Salmonella serotypes demonstrate variability in growth rate influenced by enrichment media.  The lag phase may vary widely extending from four to nine hours especially with a low quantum of organisms in a starting inoculum.  The potential for multiplication using conventional microbiology is measured by the doubling time that differs according to serotype and strain.  According to Dr. Margaret Kiss, director of R&D at Ancera, differences in lag times influence the rate of multiplication.  Examining field strains, Ancera has determined that after nine hours of incubation, an isolate of Salmonella Kentucky would have completed six doubling cycles compared to a field strain of Salmonella Infantis that would have remained in the lag phase over a similar period. Conventional Salmonella culture of a sample containing both serotypes would erroneously reflect Salmonella Kentucky as the only contaminant and would fail to reveal the presence of Salmonella Infantis, an important pathogen.  According to Dr. Kiss, “The culture media can influence the Salmonella-growth kinetics depending on the composition of the media and characteristics of the Salmonella strains present in the sample.”

Recognizing the inherent difficulty in determining the identity of Salmonella serotypes in samples when conducting an epidemiologic evaluation, Ancera has commercialized ‘deep serotyping’.  This technology, developed at the University of Georgia, applies CRISPR-SeroSeq analysis.  The technique refined by Ancera will identify Salmonella serotypes present in a sample based on the ability of PCR to identify conserved regions in the Salmonella genome.  The technology effectively eliminates confounding caused by the kinetics of bacterial growth during enrichment. The Ancera approach yields an accurate catalog of Salmonella serotypes present at each stage of the production cycle.

Ancera has developed expertise in designing and implementing epidemiologic evaluation of the Salmonella status of a complex, identifying specific serotypes. This is a necessary precursor to developing an effective and comprehensive program to suppress contamination.  Based on training and experience, Ancera can develop a sampling protocol specific for a complex, conduct deep serotyping and identify specific serotypes. Ancera can interpret laboratory findings based on the presence, level of contamination and biochemical characteristics of Salmonella that are present.  According to Dr. James Barton, awareness of the specific Salmonella serotypes present at stages in the production cycle through applying deep serotyping is critical to developing an appropriate program to suppress infection and ultimately to reduce contamination of product. 

Deep serotyping can be applied to confirm the effectiveness of control measures including chemical rinses such as peracetic acid. Laboratory assay has demonstrated wide differences in the ability of Salmonella serotypes to resume multiplication after exposure to peracetic acid.  In a specific study, Salmonella Kentucky was effectively suppressed for 12 hours compared to Salmonella Infantis that resumed growth after 4 hours and Salmonella Enteritidis that was intermediate in recovery after exposure to the antibacterial compound.

Precise knowledge of the identity and prevalence of specific Salmonella serotypes at locations within the production cycle and their susceptibility to antibacterials is essential to an effective program of pathogen suppression. Combining a field presence with a laboratory capability to apply deep serology and quantitative analysis, Ancera provides food safety professionals with comprehensive and accurate data to reduce contamination of carcasses, parts, and in ground chicken and turkey products.

1. Kim, M. et al. Risk assessment predicts most of the salmonellosis risk in raw chicken parts is concentrated in those few products with high levels of high-virulence serotypes of Salmonella. J. Food Protection. doi.org/10.1016/j.jfp.2024.100304. 

Press reports indicate that Tyson Foods will sell its stake in joint venture Godrej Tyson Foods to the holding company, Godrej Agrovet.  Neither party has commented on the transaction.  Godrej Tyson was a leading producer of processed chicken in India marketing under the Real Good and Yummiez brands.

Agricultural and QSR JVs have a decidedly rocky tenure in India. This must be attributed to differences in business culture, the appallingly inefficient and byzantine legal system and failure to recognize the intent and strictures of legal agreements. Indian JV partners seem to end up with the assets including technology and proprietary information and the foreign partner departs with experience and frequently a figurative or literal pain in the gut.

Seaboard Foods will settle Consumer Indirect Purchaser claims that it allegedly conspired with other producers to manipulate pork prices.  They will pay Plaintiffs (and their lawyers) close to $15 million.  This follows a $5 million settlement with the Commercial and Institutional Indirect Purchaser Plaintiffs.

To date the class of Consumer Indirect Purchaser plaintiffs have agreed to settle against payment of $100 million following settlement agreements with Hormel Foods, JBS USA Food Company and Smithfield Foods.

The plaintiffs claim that the price of pork was maintained at an artificially high level as a result of alleged collusion among producers to limit production based on data available through the AgriStats reporting system.

As a component of the settlement agreement, Seaboard Foods will make available documentation and will provide testimony of benefit to plaintiffs.

Following release of the proposed Fair and Competitive Livestock and Poultry Markets Rule, the Meat Institute issued a strong letter of disapproval stating, “Contrary to USDA assertions the required changes would introduce uncertainty into the market and decouple the demand signals producers receive from beef consumers and their willingness to pay for value-added attributes.”  The Meat Institute also observed that with a small cattleherd as at present, the proposed rule would undermine the benefits from growing beef in a market with increased demand.

The National Cattlemen's Beef Association is also opposed to the proposed rule noting, “cattle markets are complicated, and the rule will have a overarching impact on the cattle industry.  It is a direct attack on producer profitability.”

The USDA has extended the comment period from August 27th to September 11th but this concession over time of submission is regarded by producers, packers and processors as being inadequate.  The USDA is obviously expediting the legal procedures before the rule can be finalized. This is in anticipation of failure to complete the process before a possible change to an alternative administration in January 2025.

A recent publication* documents the beneficial effect of including supplemental alpha-linolenic acid (ALA) in the form of LinPRO™ in breeder diets. The treatment resulted in improved growth rate, feed conversion and breast yield in broiler progeny.  Supplemental ALA was provided to broiler breeders and progeny as a 3.0 percent inclusion of a co-extruded flaxseed and pulse mixture available commercially as LinPRO™. This patented omega-3 fatty acid  (α-Linolenic Acid; ALA) is a feed ingredient that is patented, dry-extruded and made from land-based ingredients.

Eggs were collected from breeders at 34, 44 and 54 weeks for incubation.  Broiler progeny were reared to 42 days in cages.  A comparison was made between a conventional corn soybean meal diet and the ALA supplemented experimental diet containing LinPRO™.  The control broiler progeny from breeders fed a conventional diet and provided with a non-supplemented starter and grower diet weighed 2,630g at 42 days. This compares to broilers derived from breeders receiving the supplemented ALA diet, but fed the control starter and grower diets, attaining 2,807g body weight. Broilers from breeders receiving the ALA-supplemented diet and in addition, ALA in starter and grower diets weighed 2,793g. The respective breast weights expressed as g. per kg body weight were 226g. and 209g. For the broilers derived from breeders supplemented with ALA and receiving ALA in their starter and grower diets, breasts weighed 239g/kg body weight.  Breast weight in the broilers receiving LinPRO™ in their starter and grower diets were significantly higher than controls, demonstrating the benefit of supplementation.

*Thanabalan, A., Dreger, R. and Kiarie, E.   Significance of successive feeding of sources of n-3 fatty acids to broiler breeders and their progeny on growth performance, intestinal lesions scores, lymphoid organ weights and plasma immunoglobulin-A in broiler chickens. Poultry Science 103 doi.org./10/1016/j. psj.2024.103796

In a press release dated August 7th Beyond Meat Inc. (BYND) announced results for Q2 ending June 29th 2024. The Company incurred a higher EPS loss than consensus ($0.46) but beat the Zack’s revenue projection by 4.4 percent. BYND rose fractionally on the August 8th post-release market open but finished up 24.6 percent on a decidedly up-day for the market.

The following table summarizes the results for the period compared with the values for the corresponding quarter of the previous fiscal year (Values expressed as US$ x 1,000 except EPS)

* ‘+’ denotes improvement (or ‘less bad’)

NOTES:

R&D expenditure declined 37 percent from Q2 2023 to $5.4 million or 5.9 percent of revenue

S&G expenditure declined 11 percent from Q2 2023 to $42.2 million or 45.2 percent of revenue

For Q2 FY 2024:-

52-Week Range in Share Price: $13.10 down to $5.13 50-day Moving average $6.66

Forward P/E: Neg.

Insiders hold 4.9 percent of equity (was 9.2, Q1 2024), Institutions 47.9 percent (was 37.3 percent, Q1 2024).

Comments for Q2 2024:-

U.S. sales represented 59.3 percent and International 40.7 percent

Of U.S sales 81.3 percent were through retail channels, compared to 70.2 percent in Q2 2023

Of International sales 46.3 percent were through retail channels, down from 48.9 percent in Q2 2023

Average unit revenue in Q2 2024 for all sales attained $4.73/lb. compared to $4.46/lb.

during the corresponding quarter of 2023.

Guidance for FY 2024 included:

Net revenue of between $320 and $340 million.

Gross margin in mid-‘teens’.

Operating expenses $180 to $190 million

Capital expenditure $15 to $20 million

Continued negative cash flow

In commenting on results Ethan Brown president and CEO stated:- “We are pleased to report a strong quarter of progress against our 2024 plan, a pivotal year on our path to sustainable operations and profitability. Key proof points include exceeding our Q2 revenue guidance; continued reduction in operating expenses and cash consumption; and our best quarterly gross margin since Q3 2021.

He added "Further, we firmly reiterated our center-of-the-plate position in the global health and wellness trend with the launch of our Beyond IV platform. Developed in collaboration with leading medical and nutrition experts, and recognized by the nation’s leading health organizations, we are thrilled to see consumer, media, and nutritionist enthusiasm for this latest, important, renovation.”

Brown concluded, “Finally, alongside the strengthening of our operations and product portfolio, we are working on bolstering our balance sheet.”

Despite this optimistic commentary the reality includes:-

• An accumulated deficit of $1,170,093 million.
• An 8.8 percent decline in revenue for Q2
• Trailing 12-month negative operating cash flow of $67.3 million
• Inventory of $119,532 represents 1.3 times Q2 FY 2024 sales
• Effective July 15th 38 percent of float was short
• Share price of $5.57 on May 8th open, 57 percent off 12-month high of $13.10

The USDA-FSIS proposed rule “Salmonella Framework for Raw Poultry Products” published on August 7th established a comment period ending on October 7th.  The proposed rule covers a complex issue and represents a radical departure from existing approaches to suppressing Salmonella. Accordingly poultry associations including the National Chicken Council and the National Turkey Federation requested an extension to frame a response.  Accordingly, USDA has granted an additional month to receive comments by November 7th.

In a press release dated July 31st Pilgrim’s Pride Corp. (PPC) announced results for the 2nd Quarter FY 2024 ending June 30th. The quarterly figures showed positive earnings for all three segments with higher revenue and operating profit across all three geographic areas. Earnings were appreciably above Q2 2023 and exceeded consensus estimates on non-GAAP by 29 percent but fell short of consensus revenue of $4,620 million by 1.3 percent.

The following table summarizes the results for Q2 2024 derived from the SEC 10-Q form and the Company release. Values are compared with the corresponding Q2 FY 2023 (Values expressed as US$ x 103 except EPS)

Notes.

   1. June 30th 2024/ December 31st 2023.

• Q2 2024, $15.9 million investment loss (Q2 2023, $7.6 million gain)
• Q2 2024  $0.5 million miscellaneous income (Q2 2023, $1.3 million loss)
• Q2 2024  $2.2 million gain in foreign currency transactions (Q2 2023 $16.4 million loss)

Operating income and sales posted by the three business segments during Q2 2024 were:-

      U.S.      69.9 percent of company operating income on 58.3 percent of sales

      Europe   5.4 percent of company operating income on 28.6 percent of sales

      Mexico 24.7 percent of company operating income on 13.1 percent of sales

52-Week Range in Share Price of PPC:  $22.33 to $44.62.  50-day Moving average,  $37.64

Market Close: July 31st pre-release    $41.71.

             Open: August 1st post-release $43.35.

Current Forward P/E 13.3    Beta 0.8  

Equity held by insiders and holding Company: 82.6 percent, Institutions, 16.4 percent

In commenting on Q2 results Fabio Sandri, CEO stated, “Our global portfolio delivered significant year-over-year profitability growth. We remained disciplined in the execution of our strategies, focusing on what we can control and continuing to expand our relationships with Key Customers, elevating our performance as market fundamentals became increasingly attractive,”

Sandri continued “In the U.S., Big Bird realized benefits from enhanced commodity cutout values, further production efficiencies and lower input costs; Case Ready and Small Bird delivered above market growth with Key Customers through differentiated and customized offerings; and Prepared Foods increased its marketplace presence through innovation of branded, value-added items across retail and food service. Our diversified U.S. portfolio enabled our business to capture market upside as conditions evolved in the commodity market. At the same time, we also worked in partnership with our Key Customers to cultivate demand through promotional activity and innovation, further creating value for our customers and consumers alike. We also continued to strengthen our quality and service through operational excellence,” remarked Sandri.

Addressing Europe, Sandri stated, “Consumer sentiment improved as wage growth surpassed inflation. Given this environment, the team optimized mix with Key Customers and drove branded offerings. Additionally, the team identified and implemented our plan to optimize our manufacturing network and increase efficiencies. Europe’s performance demonstrates the robust nature of our strategies and agility of our team. Our diversified portfolio allowed us to rapidly adjust to consumer preferences and meet Key Customer needs. These efforts were further amplified by continued operational excellence to improve production efficiencies,”

In relation to Mexico Sandri observed, “ We improved given continued balance in supply and demand fundamentals in the commodity market, growth with Key Customers across retail and foodservice, and increased momentum of branded offerings in both Fresh and Prepared. Investments in operational excellence to enhance biosecurity in live operations and build capacity also remained on schedule. Mexico continues to drive growth above market for our Key Customers and branded offerings. Given our investments to expand production, we have an opportunity to further develop our marketplace presence and diversify our portfolio,”

Sandri concluded, “The ramp up of our recently completed protein conversion plant in South Georgia remains on schedule and continues to cultivate additional business from Key Customers. Our investment in protein conversion reinforces our strategies to drive profitable growth and mitigates our operational risk. We will continue to explore opportunities to strengthen our business and further diversify our portfolio,”

BioChek has introduced a Pneumovirus (aMPV) indirect ELISA test kit to detect antibodies against aMPV subtypes A, B and C.  The test kits can be used to assay both turkey and chicken sera.

With the advent of aMPV infection in broilers, commercial laying flocks, and growing turkeys in North America, there is a need to identify the presence of antibodies to differentiate among respiratory viral infections.

Applying the BioChek ART (aMPV) ELISA is a convenient and effective technique for monitoring flocks, although as yet no approved vaccine is currently available in the U.S. as in Europe.

To obtain registration for the test kit, BioChek demonstrated high specificity with negative results on 80 sera derived from SPF chickens. Negative titers were obtained when assaying sera with diagnostic levels of antibody against a range of avian pathogens, including adenovirus, IBV, IBD, AI, ILT, NDV, and EDS denoting high specificity. Assayed ELISA Titers ranged from non-detectable to 800 units, with a 1,600-unit cutoff denoting infection.

With respect to assays on field samples, sensitivity was confirmed by quantitative antibody detection with either field strains of aMPV, yielding ELISA values over 15,000 in chickens  vaccinated with Nemovac™ (Boehringer-Ingelheim) PL21 type B. Applying the BioChek system, ELISA values in the range of 6,600 were measured 48 days after vaccination.

The BioChek ART (aMPV) ELISA test kit is a highly effective addition to the range of antibody detection kits supplied by the Company for diagnostic laboratories. The availability of a sensitive but specific aMPV antibody assay will allow poultry health professionals to confirm exposure of chicken and turkey flocks to the pathogen. Structured programs of assay can define the epidemiology of infection and lead to appropriate preventive strategies before and after vaccines become available.

For technical specifications for the aMPV ELISA kit activate https://www.biochek.com/poultry-elisa/avian-rhinotracheitis-antibody-test-kit/

Additional information on the BioChek range of diagnostic kits click on to the Company logo on the right side of the welcome page

In a press release dated August 8th Maple Leaf Foods Inc. (MFI-TO) announced results for Q2 FY 2024 ended June 30th 2024.

The following table summarizes the results for the period compared with the values for the corresponding quarter of the previous fiscal year (Values expressed as US$ x 1,000 except EPS (conversion: CAN$1=US$0.73)

* Indicates positive value or “less bad”

52-Week Range in Share Price: $15.80 to $21.89 50-day Moving average $17.26

Forward P/E 32.6 Beta 0.5

Insider shareholding 40.0%. Institutional shareholding 26.5%

In commenting on Q4 results Curtis Frank president and CEO stated “In the second quarter of 2024, we made excellent progress in executing our strategic playbook, delivering Adjusted EBITDA of $141 million, 37% growth over the second quarter of last year, and 11.2% Adjusted EBITDA Margin, a 310 basis point improvement year over year. "Several key elements contributed to our performance, including 3.2% year-over-year sales growth in our prepared meats business, improved pork market conditions, growth in our sustainable meats portfolio, better overall sales mix, and contributions from our large capital projects."

He added "We remain laser-focused on executing our priorities for 2024, and we are not taking our eye off the longer-term goals we have set for ourselves" continued Mr. Frank. "We are harvesting the benefits from our London poultry plant and Bacon Centre of

Excellence, driving cost out of the business, deleveraging our balance sheet, and drawing on our team's proven ability to demonstrate agility in a challenging consumer demand environment."

Frank concluded "Looking ahead, we are on a clear path to unleashing the potential of our business by separating into two independent public companies, each primed for growth and positioned to be a leader in its field," stated Mr. Frank. "I am confident, that these two companies - Maple Leaf Foods and the new Pork Company - will unlock the value of their respective organizations for the benefit of all stakeholders, with dedicated management teams and the financial independence to pursue their own value-creation strategies. This will be the next exciting milestone step in executing the Maple Leaf playbook."

Given restructuring, it will no longer be able to evaluate the plant-protein business or to confirm that this previous segment achieved profitability as projected. It appears that Maple Leaf Foods has followed the expedient of “if you can’t fix it, bury it”!

The 2024 Environmental Management Seminar organized by USPOULTRY will take place September 19-20th at the Hilton Sandestin Beach Golf Resort in Destin, FL.

The program will cover a variety of relevant topics that will include:

• Review of federal regulations
• Dissolved air flotation operation
• Chemical treatment and residual management
• Effluent limitation guidelines
• Storm water management

For additional information, including registration, access <uspoultry.org>.

In a press release dated August 5th Tyson Foods Inc. (TSN) announced results for the 3rd quarter of FY 2024 ending June 29th 2024. TSN posted higher adjusted earnings ($0.87) than consensus estimates ($0.67)

The following table summarizes the results for the period compared with the values for the corresponding quarter of the previous fiscal year (Values expressed as US$ x 1,000 except EPS)

* Goodwill and intangibles 41.7 percent of total assets

52-Week Range in Share Price of TSN:  $44.94 to $63.87.  50-day Moving average,  $57.73

Market Close: Friday August 2nd $61.24. Monday August 5th Open post release, $62.29.

Forward P/E 16.7                  Beta 0.7

The Chicken Segment attained sales of $4,076 million ($4,212 million in Q3 FY 2023) representing 30.5 percent of Company revenue. GAAP operating income attained $244 million in Q3 representing 71.5 percent of net Company operating income. Operating loss in Q2 FY 2023 was $(314) million.  For the Chicken Segment the report stated:- “The USDA projects chicken production will be flat in FY 2024”. Anticipated adjusted operating income for the segment was forecast at $850 to $950 million for FY 2024. Improvement in the Chicken Segment is attributed to lower feed cost and reduced operating expenses with consolidation following closure of six plants in four states.

For comparison among Tyson Foods’ business segments the adjusted operating income (loss) in Q3 2024 were respectively:- Pork, $(62) million; Beef, $(69) million; Prepared Foods $203 million and International & Other $25 million.

In commenting on results Donnie King, president and CEO stated, "Our disciplined actions and focus on the fundamentals have resulted in a positive turnaround of our business," He added "In Q3, we delivered the highest adjusted operating income in the last seven quarters while also generating strong free cash flow. Looking ahead, we will continue to strive to be best-in-class operators, drive efficiencies, value-up our portfolio, win with customers and consumers, and be disciplined in our capital deployment."

Improved Q3 earnings raised TSN on a sharply down market.The investors’ call stressed a ‘positive turnaround’ in Q3.

Guidance for FY 2024 included Revenue unchanged from FY 2023. Adjusted operating income for the Company was increased $100 million to a midpoint of $1.7 million with Prepared Foods contributing $850 to $950 million. Capital expenditure was projected at $1.2 to $1.3 billion.

In the Q2 2013 report Tyson Foods projected $1 billion in savings from the “Productivity Program” by the end of 2024 although this prediction was not confirmed as a quantitative value in the most recent quarterly report.

On July 12th, the USDA Agricultural Marketing Service announced purchase of chicken products for child nutrition and related food assistance programs to be delivered during August 2024.

Purchases included:

• 9,792 tons of chilled large chicken at an average price of $1.61/lb.
• 1,134 tons of chilled chicken legs at an average price of $0.74/lb.

The total value of the purchase was $31.7 million

Following an OSHA review, the Danville, IL plant operated by Viscofan USA, a subsidiary of a company based in Spain, was subjected to a penalty of $200,000.  At issue were both repeat and serious violations.  The initial justification for the OSHA investigation was a serious injury to a    maintenance worker resulting in fractures and lacerations incurred while servicing a machine that was not protected by lockout.  In the process of evaluation of records, a second incident involving chemical burns was disclosed.  As with many investigations of serious injuries, Viscofan failed to train employees in safety procedures and neglected lockout/tag out procedures.

Viscofan manufactures sausage casings at the Danville plant that together with operations in Montgomery, AL and Bridgewater, NJ. Collectively employ 700.  Viscofan also operates in Brazil, Germany, Mexico, Spain, the Czech Republic and Serbia.

Judge William G. Young of the U.S. District Court of Massachusetts ruled against Triumph Foods relating to Massachusetts Question #3 the Act to Prevent Cruelty to Farm Animals passed by ballot initiative in 2016.  Judge Young ruled that “the contention by Triumph that the Federal Meat Inspection Act preempted Question #3 was invalid since the state law had no provision requiring action by a processing plant.”

Triumph Foods intends to appeal the decision and will invoke the Dormant Commerce Clause relating to interstate commerce previously ruled invalid by SCOTUS with respect to California Proposition #12.

Pork producers did however gain some benefit from litigation since in terms of a settlement agreement with the Massachusetts Department of Agriculture ground pork will be excluded from the provisions Question #3.

It is high time that the pork-industry litigants and holdouts accept reality and make the necessary investment in group-housing of sows. Irrespective of state laws or ballots, public sentiment and customers are opposed to gestation crates.

Facing a storm of protest from legislators representing red meat-producing states, the Department of Defense has rescinded a previous decision to support a company developing cell cultured meat for U.S. armed forces.

It is the intent of Representatives and Senators from the involved states to amend the fiscal year 2025, Defense Appropriations Bill, the National Defense Authorization Act and fiscal 2025 Agriculture Appropriations to block funding for or purchase of cell cultured meat.

Circana has compiled sales of fresh meat for the 52 weeks ending June 30, 2024.  The following data was released:

Circana noted that value-added meat sales trailed conventional products suggesting consumer concern over prices.  Combining products within the USDA Certified Organic category, dollar sales were up 9.8% and volume by 8.3%.

Faced with declining liquidity and high debt, Beyond Meat (BYND) negotiated a convertible bond offering in 2021 to survive.  Since then, the company has failed to increase revenue, develop new markets or stem extensive and regular quarterly losses.  The Company is now in discussion with bondholders concerning a restructuring of the balance sheet. Despite tweaking products, packaging and promotion, the reality is that the company is heavily in debt, facing deadlines on $1.1 billion in convertible bonds. Management has lost the confidence of analysts, shareholders, customers, consumers and the financial community. 

Basically, the demand for non-competitively priced plant-based substitutes for meat evaporated after the 2019 IPO with a downhill progression in share price from a July 28 2020 high of $244.  Currently, Beyond Meat convertible notes trade at an 80 percent discount and market capitalization of $397 million on July 22nd is 110 percent lower than the equivalent month in 2023.Twelve month trailing operating and profit margins are respectively -70.7 and -102 percent. The 52-week range in share price is a decline from $17.24 to %5.58 with a 50-day moving average of $7.04. Effective March 30th at the end of Q1 2024 BYND had an accumulated deficit of $1,135 million. 

Basically, Beyond Meat is a company with a great future behind it.

The National Chicken Council (NCC) supported by poultry associations in fourteen states has requested a six-month extension of the period to respond to proposed rules relating to contracts.  The Fair and Competitive Livestock and Poultry Markets Rule and the Poultry Grower Payment Systems and Capital Improvement Systems Rule have profound implications on the relationship between integrators and growers.  Accordingly additional time is required for producers to evaluate the implications of the rules and to respond accordingly.

Tom Vilsack the Secretary of USDA  introduced similar far-reaching changes under the Packers and Stockyards Act during his previous term of office in the Obama Administration.  Through his current tenure, Secretary Vilsack has advanced changes to the structure of U.S. meat and poultry production to the detriment of large packers and integrators. He has expended vast sums of taxpayer money on promoting alternatives including small local processing facilities, favoring tribes and minorities in so-called underserved communities.  It is doubtful whether the request for an extension will be granted since the end of the requested response period will extend to February 2025 at which time it is highly likely that the Secretary will no longer be in office and rules that are implemented may well be rescinded by his successor as occurred in 2017. USDA announced on July 30th that the comment period would be extended to September 11th.

Following acquisition of Sanderson Farms by a consortium comprising Cargill Inc. and Continental Grain restructured as Wayne-Sanderson Farms, inevitable downsizing is taking place.  Press reports note that as many as forty administrative workers at the previous Sanderson Farms headquarters in Laurel, MS. will become redundant.

The benefits of mergers and acquisitions are achieved through combining and consolidating services and administrative functions, thereby reducing costs, necessary in a competitive industry.

Smithfield Foods, a wholly owned subsidiary of WH Group, a public traded company in China is considering an initial public offering.  The Company acquired in 2013, has engaged Goldman Sachs, Morgan Stanley and Bank of America to facilitate the IPO that would raise up to $1 billion.

WH Group led by Chairman Wang Long with 17 percent of the equity, is the largest Pork producer in the World. Smithfield Foods is the leader in volume in the U.S. The Company has responded to declining margins and adverse market conditions by consolidation, closing unprofitable plants and mothballing breeder farms with layoffs of workers and other personnel. 

For Fiscal 2023 the WH Group earned $629 million on revenue of $26,236 million representing a decline in income of 54 percent from FY 2022.

Maple Leaf Foods has announced that the pork business will be spun off, creating two separate public-traded companies. It is presumed that Maple Leaf will continue to operate the chicken business and the previous plant-based segment. Maple Leaf Foods will retain 20 percent of the pork business and will continue to incorporate pork into the company supply chain in accordance with a long-term contract to support the range of value-added, branded products sold in North America.

Curtis Frank, President and CEO of Maple Leaf, noted, “This transaction is the start of a new era to unlock the full potential of two outstanding businesses each with a distinct value proposition and growth opportunities.” The proposed pork company will be led by Dennis Organ as CEO.  He previously served as the President of the company pork operations.

Michael H. McCain, Executive Chair of Maple Leaf Foods, stated, “This is the right transaction at the right time as we move forward with our sustainability vision seeking to create value for all stakeholders.”

The most recent quarterly report for Maple Leaf Foods can be accessed by entering “Maple Leaf” in the SEARCH block.

According to the Industry Meat Export Association, ABPA of Brazil, chicken exports during June were 0.8 percent higher than the 2023 monthly average, attaining 431,400 metric tons.  Increased exports are apparently at the expense of the U.S. according to Luisor Rua, Market Director for ABPA.

Brazil has achieved market penetration in Latin America including Mexico and Chile offsetting the loss to China, with a 29 percent reduction based on domestic oversupply in that nation.

Increased exports have come at a cost with value declining by 10.3 percent over the first half of 2024 compared to the corresponding months in 2023 at $4.64 billion.

According to an FDA release, FGF Brands Inc. has recalled 12,000 cases of chocolate chip muffins supplied to Aldi.  The muffins were distributed nationwide and were packed in four-count containers. The recall was issued following disclosure that walnuts were incorporated in the product without appropriate label disclosure.

In reviewing the causes of recalls, more than half were attributed to mislabeling usually relating to designated allergens.  Collectively these recalls represent a considerable wastage of food and a substantial risk of adverse reaction among those sensitive to allergens including milk, nuts and soybean proteins.  Recalls due to mislabeling and are caused by failures in quality control procedures in food packing plants. Fortunately many recalls are initiated by manufacturers following in-plant recognition of errors. This expedites recall and avoided possible adverse health events.

Failure to regulate and document batch sizes may result in extensive recalls.  This especially the situation with ground meat products including turkey with a failure to identify and isolate production lots.  This is illustrated by the demise of Hudson Foods in 1997 following a ground beef recall of 25 million lbs. and the 2011 recall of 36 million lbs. of ground turkey processed by Cargill.

The current fragmented approach to establishing the epidemiology of bovine influenza-H5N1 is clearly inhibiting progress in gaining an understanding of the disease in order to implement preventive action.  Federal regulators, state departments of agriculture, public health agencies and the dairy industry evidently have divergent objectives. There is clearly no central authority to coordinate surveillance and allocate resources to develop and implement a common response plan. 

Surveillance of herds and workers should be intensified, to determine the extent of infection that may be far broader than currently recognized.  Whole genome sequencing of isolates should be implemented in cooperation with international WHO reference laboratories to monitor for changes that may predict the emergence of a zoonotic strain.  Parallels between the USDA response to bovine influenza-H5N1 is eerily reminiscent of the situation in China regarding COVID in 2019 or the emergence of SARS two decades earlier.  Time is critical in developing a response to an emerging livestock and potentially zoonotic infection.

 Appropriate action taken now will potentially save herds, flocks and lives and the cost of a response should there be changes in the virus that enhance the capacity for human infection and contagion.  Wishful thinking expressed as “If we can stop the movement of cattle and improve biosecurity we can eliminate the virus” appears to characterize the current USDA position. This represents an attitude of institutional self-denial that could have dire consequences for the U.S. milk industry, public health and the economy of the U.S.

Following a “selective role elimination”  (read layoffs) in February, Upside Foods has now terminated an unspecified number of employees at their sole Emeryville, CA. facility.  Since 2015 the company has raised $608 million from venture capital investors.  To date Upside Foods along with competitors has been unable to transition from pilot level cell culture in roller bottles to commercial production in bioreactors.

In a recent presentation, Dr. Uma Valeti trotted out the usual homilies regarding enhanced sustainability and limiting greenhouse gas emissions that are in any event widely disputed, as justification for the future of cell-cultured meat.  Valeti appears to ascribe lack of progress in consumer interest and commercialization to legislative action either as outright banning on sale of cell cultured meat in specific states or onerous labeling requirements.  The problem facing the aspirant manufacturers of cell-cultured meat relate to their collective inability to produce at scale. Projections of cost, failed promises following unsubstantiated hype over availability and questions concerning quality have created skepticism among potential consumers.  Recent studies conducted by Purdue University suggest that consumers are satisfied with their present diets and although there is some curiosity, wide-scale replacement of beef, pork and chicken with cell-cultured alternatives is unlikely even if price and availability were not negative attributes.

Despite previous hype and subsequently proven misinformation, Upside Foods acknowledges that it is not ready for “prime time” and is considering a hybrid product combining some cell cultured meat with plant-based protein.  Dr. Valeti claims that the Company will be adding additional cultivators at the Emeryville plant “for larger and more efficient scale by maintaining the taste, quality and safety that we’ve been able to consistently achieve at the 2,000-liter scale.”  This claim is contradicted by ex-employees who maintain that the company has never achieved consistent production using bioreactors.  Valeti confirmed that Upside Foods is still using 2-liter plastic flasks and has failed to market other than hand-processed product in limited quantities for a gourmet restaurant.

Good Meat, an iteration of entrepreneur Josh Tetrick, is facing large claims for non-payment of debt associated with orders for bioreactors. Companies operated by Tetrick are “developing new cell lines to enable more efficient large-scale production.” This statement suggests that the Company has drawn in its horns and is apparently not contemplating large-scale cultivated meat production, presumably based on an inability to raise funds.

It remains to be seen whether Believer Meats, a company that originated in Israel and is building a production facility in North Carolina will achieve commercial production following anticipated regulatory approval. 

After committing as much as $3 billion to developing cell-cultured meat technology neither venture capitalists nor aspirant producers have anything remotely commercial to show for their investment.  Cell-cultured meat has a great future behind it.

Using funding provided by the Indiana Soybean Alliance, USAPEEC recently conducted a combination in-person and zoom program to promote products using U.S. turkey meat.  This was the fourth in a series of eight workshops and was led by Ruben Mora, Chef Consultant to USAPEEC.  Under his guidance, workshop attendees prepared a turkey sriracha crispy bowl with ingredients provided by Dos Familias.

In 2023, Mexico imported 150,510 metric tons of turkey meat valued at $426 million, up 16 percent in volume from 2022.  For the first four months of 2024, Mexico imported 51,818 metric tons of turkey meat valued at $145 million, with a unit price of $2,798 per metric ton.  Mexico is consistently the leading importer of turkey meat, far exceeding any other nation or region

Concurrent with the Food Taipei Mega Show attended by more than 47,000 visitors, USAPEEC arranged a Gratitude Dinner for members of the Poultry Association of the Republic of China.  The Association, founded in 1993, has more than 200 members throughout Taiwan and is involved in the trade of both domestic and imported chicken.

Taiwan has experienced shortages of chicken due to outbreaks of HPAI in previous years including 2023.  Currently with restocking, there is a temporary over-supply with a sharp decline in wholesale prices expected to persist for many months.

USAPEEC maintains a close relationship with the Poultry Association and the Poultry Sales and Development Association of Taiwan given their respective roles in both production and importation.

During 2023, 3rd-ranked Taiwan imported 272,289 metric tons of U.S. chicken products valued at $352 million, and respectively 16 and 24 percent higher in volume and value compared to 2022.

In their quarterly Global Poultry Review, Rabobank anticipates a 1.5 to 2.0 percent year-over-year expansion in global broiler production.

Consumption will be driven by increased spending power with demand for value-added products.  A decline in feed cost representing more than 65 percent of live bird expenditure is  currently beneficial, but ingredient prices may rise as a result of climatic extremes and freight-related cost influenced by geopolitical events.  Avian influenza is now endemic in many areas of the world and will be an important consideration during the winter seasons in both the northern and southern hemispheres respectively.

Overproduction in China will continue and will constrain imports.  This will result in the U.S., Brazil and possibly Russia searching for other markets for low-priced commodity products including leg quarters and even feet.

Aviagen North America completed the 61st Annual Production Management School on June 27th in Huntsville, AL.  The event was attended by 35 students from 20 nations and extended over a month. The Production Management School included both classroom instruction and practical farm experience. Students visited the Production Development Center in Albertville, AL, the Egg Distribution Center and Veterinary Laboratory in Elkmont, AL and the Pikeville, TN. Feed Mill and the National Poultry Technology Center at Auburn University.

The Aviagen approach is to “train the trainer” providing knowledge and experience that can be shared with colleagues in their home operations Course topics included welfare, biosecurity, compartmentalization, promoting food safety, vaccination and disease management and operation of hatcheries among 35 items covered. The four-week program allowed students to interact and exchange ideas and to establish team-building activities.

Dr. Marc DeBeer president of Aviagen North America stated, “Our goal with the North American School is to give our customers valuable perspectives on effective management techniques that are proven to enhance both broiler and breeder welfare, sustainability and productivity in poultry operations.”

For additional information on the Aviagen Production Management School, access the Aviagen website by clicking onto the Company logo on the right side of the Welcome page.

In 2018, the previous Administration imposed Section 301 tariffs on imports from China.  This resulted in retaliatory tariffs, placing U.S. pork in a non-competitive situation relative to the E.U.  Pork imported from the U.S. carries a 25 percent tariff over and above the most-favored-nation rate of eight percent.

Section 301 tariffs were retained by the current Administration and are regarded by agricultural exporters as onerous.  Despite the Phase One Agreement, China, predictably dragged its feet on establishing an approved establishment list and effectively failed to comply with the Agreement.  China also requires certification that pork is derived from herds fed either ractopamine (justified) or Codex-approved beta agonists (unjustified). 

In a July 1st release, USPOULTRY announced the 2024 National Safety Conference for the Poultry Industry to take place August 19th-21st at the Hilton Sandestin Beach Golf Resort and Spa in Destin, FL.

Topics to be considered include a Washington update; Establishing a culture of safety and health; Onboarding and safety training best-practices; Sanitation safety best practices; Processing hazard analyses; Handling inspections and the new walk-around rule.

The meeting will allow an opportunity for networking and the exchange of knowledge.

The agenda and registration details are available on www.USPOULTRY.org.

According to recent comments by Hormel CEO, James P. Snee, the Company will expand product scope to capture new distribution channels. Hormel will promote products including snacks comprising their Planter’s Nut brand and a range of pork and turkey products through convenience stores that offer potential for increased sales.  Hormel is also promoting Jennie-O ground turkey through retail channels despite indications of oversupply.  Hormel is also accessing the market for pizza toppings and sliced meats.

Initiatives to reduce costs have been implemented through streamlining the supply channel and application of technology. The implied benefits of improved planning and execution will be evident in subsequent quarterly reports according to Snee.

In comments delivered at the Wall Street Journal Global Food Forum, Joe Erlinger, President of McDonald’s U.S., confirmed that his company had no interest in serving plant-based burgers for the U.S. market. He stated, “U.S. consumers aren’t coming to McDonald’s looking for the McPlant or other plant-based proteins.”  This conclusion was based on a one-year test conducted between 2021 and 2022 in both San Francisco and Dallas. In contrast, plant-based meat alternatives are acceptable in the E.U. and U.K.

It is understood that other QSR chains have trialed plant-based burgers without success.  It remains to be seen whether plant-based ersatz chicken nuggets will be more successful.  Given current prices of real and alternative meat products, it is doubtful whether plant-based products will gain traction in mainstream chains.

Authorities in Canada have reported a series of outbreaks of metapneumovirus (AMPV)in turkeys and chickens to the World Organization for Animal Health.  The 10 cases in Ontario involved four commercial chicken farms and the remainder turkeys.  Manitoba has reported one incident case in turkeys.  Isolates from Ontario yielded MPV-B variant from nine farms and one case of MPV-A with this same variant from Manitoba.

In turkeys AMPV is referred to as turkey rhinotracheitis presenting clinically as an upper respiratory infection with swollen heads.  Egg production in mature turkey flocks drops sharply with a deterioration in shell quality.  Broiler chickens demonstrate a similar syndrome to turkeys with pronounced swelling of the subcutaneous tissues of the head.  Laying hens are either asymptomatic or show mild respiratory signs with depressed egg production.

According to the Kazakhstan Investment Agency, a complex planned to produce 240,000 tons of RTC annually will be established near Almaty in Kazakhstan.  The project has a projected price tag of $600 million and will be the largest in the Commonwealth of Independence States comprising eight nations formally part of the Soviet Union.

Given the projected volume corresponding to 2.5 million broilers of 4lb RTC the capital cost is unrealistically low for the stated level. Assuming the need for breeder farms, hatchery, growing houses, feed mill and processing plant following the Eurasian model, either the volume is overstated or the cost as reported is incorrect, even without a provision for land.

Popeyes Louisiana Kitchen has introduced boneless wings as a permanent menu item nationwide.  The product will be available in a range of flavors and prepared from all-white chicken meat coated with a batter.

It is questioned why boneless wings are prepared using white meat. Cost would be reduced and texture improved with incorporation of a high proportion of dark meat

Popeyes has engaged the services of Jimmie O Yang to promote the product.

USAPEEC participated in the 12th edition of the Alimentec Trade Show, held recently in Bogotá, Colombia. This nation is the third-largest economy in Latin America, with a population of 50 million and a growing middle class, representing a large potential market.

Alimentec is the premier platform for the food, beverage, and hospitality industries in the Andean region, the Caribbean, and Latin America and offers an ideal opportunity to showcase food products and services for the HRI, retail, and supermarket sectors of Latin America.

More than 30,000 attended the Show, allowing USAPEEC to expand its network of contacts. From visitors to the USAPEEC booth, 158 contacts were made with companies in the region allowing USAPEEC to provide information about members and their products. Francisco Palmieri the U.S. Embassy Charge D’Affaires to Colombia visited the USAPEEC booth.

In 2023 Central and South America combined with the Caribbean imported 851,326 metric tons of broiler products representing 23.4 percent of exports. Value attained $1,093 million, equivalent to 23.1 percent of the total and with a unit price of $1,284 per metric ton.

Before the Dunlop, ONT strike was settled, The Canadian Cattle Association, the National Cattle Feeders Association and Beef Farmers of Ontario issued a statement urging UFCW and Cargill to resolve issues.  Workers closed the plant on May 27th over  wages, benefits and security.  The plant was responsible for processing over 70 percent of cattle in Ontario and the eastern region of Canada.  The situation was exacerbated by the strike vote taken by workers in Cargill plants in Alberta who have threatened labor action in support of the Ontario UFCW Local 175.

The joint statement issued by the producers’ organizations included “Canadian beef producers rely on a strong and stable supply chain to get beef to Canadian and our global customers as efficiently as possible.”  The statement added, “While we fully respect and support the collective bargaining process we cannot turn a blind eye to the effect this stalemate is having on our beef industry.   Accordingly the UFCW Locals involved reached a tentative agreement  with Cargill that was approved by rank and file over the July 6th weekend.

Following the June 25th announcement of the “Fair and Competitive Livestock and Poultry Markets Rule”, the National Chicken Council and the Meat Institute issued strong objections to what is regarded as a heavy-handed solution to a nonexistent problem.

The interim president of the National Chicken Council, Gary Kushner, himself a veteran member of the bar stated, “Eight different Federal Circuit Courts of Appeal have addressed the key issues under pending the proposed Rule, entitled “The need to establish injury to competition to demonstrate a violation.”  The statement continued, “Rather than accept the Courts’ decisions Secretary Vilsack and this Administration are trying to circumvent Congress, has misused the lawmaking process to achieve what they have not won in court and what Congress has never authorized.”

The NCC correctly maintains that the proposed rule will lead to frivolous lawsuits and expensive litigation.  This consequence is apparently encouraged by Assistant Attorney General Jonathan Kanter who has openly expressed a hope that plaintiffs will file a Packers’ and Stockyards Act claim against broiler integrators.

The NCC characterized the Rule as “ill-advised” and would have unintended consequences including increased costs for consumers.

With the 13th state reporting bovine influenza-H5N1, and with over 170 confirmed herds as of July 24th, USDA is faced with a problem of transparency.  Daily updates of websites should be achievable.  Release of isolates for genome sequencing is essential with participation by WHO influenza reference laboratories in the U.S. and in Europe. Simply beating the drum of improving biosecurity pays lip service to the emerging problem.

It is fortunate that heat treatment inactivates the virus in fluid milk so pasteurized milk and dairy products should be safe to consume.  The question of transmissibility to human contacts appears to be extremely limited at present but it will be critical to continually monitor for mutations that may facilitate infection of human respiratory tissue.  At the present time all three identified patients who contracted H5N1 infection demonstrated conjunctivitis (with only one displaying mild upper respiratory signs).  This is due to the fact that conjunctival tissue along with bovine mammary glands contains sialic receptors to both avian and mammalian strains of H5N1.

In a ProMED posting moderator JH questions whether the USDA will initiate surveillance of beef cattle in feed-lots to establish whether infection has entered these herds.  JH opined “Given the geographic coverage of the USDA map, odds are not in our favor that beef cattle haven’t been infected.  Until a few months ago spill-over of H5N1 into bovines was reviewed as unlikely even though infection with several influenza A variants have occurred on a limited basis previously in cattle.  Even cow-calf operations may be at risk, given that their water may be contaminated by free-living birds excreting H5N1 virus, known to survive for prolonged periods in water containing organic matter. 

Is the reluctance to establish a limited testing problem based on the presumption that it is best  not to turn over rocks unless one knows what might be under them?  Assay of muscle tissue from culled dairy cows subjected to antemortem condemnation has yielded H5N1 virus.  The implications for asymptomatic infection of beef cattle are self-evident.  Fortunately it has been shown that heat treatment adequate to kill foodborne bacteria infection inactivates H5N1 virus.

At the present time the CDC is calling for all milk from herds with cases of bovine influenza-H5N1 to be withheld from market. This recommendation is based on prudence, notwithstanding the effectiveness of pasteurization. If this policy were to be implemented there would be absolutely no voluntary reporting of cases and a call for federal indemnification. Steve Naig, the Iowa Commissioner of Agriculture has called for Federal compensation for herd operators to cover losses. A proportion of affected dairy cows have either died from H5N2 infection or have been culled as a result of chronic low lactation with unsalable milk.

According to an SEC 8-K filing, Tyson Foods announced that Curt Calaway would be appointed as the Interim Chief Executive Officer.  Calaway is an 18-year veteran of the company and has served in numerous corporate positions involving finance.  He was the Senior Vice-president of Finance and Treasurer in 2021 and has participated in M&A, risk finance and related activities.

Previous to his tenure at Tyson Foods, Calaway served in various positions of responsibility with PricewaterhouseCoopers for eleven years.

A case was filed by United Food and Commercial Workers (UFCW) Local 401 concerning he death of three workers from COVID was arbitrated in favor of the employer Cargill Inc.  The Union alleged that Cargill failed to protect their workforce at the High River plant.  During April, Cargill closed the plant for a two-week period since there were insufficient employees to maintain operations.

The UFCW demanded that Cargill pay each employee CAN$10,000 and the Union CAN$100,000 amounting to approximately CAN$20 million The arbitrator, James Casey, noted the limited scientific information available as to the transmissibility and routes of infection of SARS-CoV-19 in April 2020.  Initial advice issued by medical authorities in the U.S. and Canada was based on the assumption that the disease was analogous to seasonal influenza requiring distancing and cleaning of surfaces.  It was not until a few months into the pandemic that scientists were able to demonstrate that the disease was transmitted by airborne droplets.  This route played a role in transmission among workers not only in plants but during commuting, social gatherings and in homes.  Epidemiologic investigations ultimately identified 1,500 cases linked to the outbreak in the plant with 951 employees seroconverting to SARS-CoV-19, representing half of the plant workforce.

James Casey noted, “It is not appropriate to second-guess Cargill’s decision based on current scientific knowledge about COVID-19 and current regulatory advice.”  Casey did criticize Cargill for failing to communicate with the Joint Health and Safety Committee in the plant to address hazards. Damages were not awarded for this failure characterized as a “narrow but important deficiency”. 

The decision by an arbitrator in Canada does not establish case law in either that nation or the U.S.  Courts will, however, follow the same logic in determining that packing plant operators cannot be held responsible for actions taken based on available scientific knowledge and the advice of health authorities.

Following the accidental exposure of two workers to ammonia, the Occupational Safety and Health Administration (OSHA) conducted an intensive evaluation of worker safety during January 2024.  The Agency identified 40 serious violations in addition to other minor problems.  Items noted by OSHA and are possibly common to other packing and processing facilities included: -

• Inadequate lock out/tag out procedures.
• Failure to implement a hazard communication plan.
• Unmarked exits.
• Unsafe electrical equipment and installations.
• Exposure to noise.
• Lack of PPE.
• Unsafe walking surfaces and lack of protection from falls.

HK Cooperative employs 370 workers in the J.H. Routh Packing Company plant in Sandusky, OH. OSHA assessed more than $500,000 in penalties for violations with the amount to be appealed.

Susann Johnsson was appointed to the position of Group Vice-president for Communications and Brand effective July 1st. She joined Munters in 2021serving as Vice-president for Communications. She has extensive experience in communications and marketing.

Kaspar Kirchmann was appointed to the position of Group Vice-president responsible for legal affairs and will also serve on the Executive Management Team. 

Klas Forsstrom, President and CEO of Munters welcomed both Vice-presidents to the Executive Management Team based on their experience and strong personal qualities.

Munters is a major manufacturer of ventilation equipment and installations for agricultural and industrial applications. Their range of products can be reviewed by accessing the company website by clicking on to the Munters logo on the right side of the Welcome page

Faced with a domestic oversupply of pork, officials in China are evaluating whether to impose anti-dumping duties on pork from the E.U.  China has conducted an “investigation” into costs pertaining in Europe. The real issue is the imposition of anti-dumping duties on Chinese electric vehicles (EVs) manufactured with presumed subsidy support from the Government of China. Canada has joined the E.U and the U.S. in excluding EVs from China in their respective markets.

China is extremely sensitive to imposition of duties on their products and invariably retaliates with reciprocal action. Two successive U.S. Administrations have imposed and maintained duties on a range of subsidised imports from China. With the possibility of an intensification of a trade war, producers of soybeans, corn and wheat should prepare for a decline in export volume and value.  Entreaties by the American Soybean Association to keep food out of trade wars will be unlikely to sway China.  This nation is committed to self-benefit and will import U.S. agricultural commodities as and when required. Imports by China take into account prevailing landed prices and there is no sentiment in international trade in commodities. This reality should be factored into consideration with respect to 2025 planting intentions.

Randy Day Chairman of the National Chicken Council (NCC) has announced the retirement of Mike Brown as president.  Day thanked Brown for his work “In building a strong foundation at NCC and for his years of work to promote the chicken industry.”

Gary Jay Kushner has been appointed to serve as Interim president.  He recently retired from Hogan Lovells where he served as the Outside General Counsel for the NCC.  Day observed, “Gary knows the chicken industry inside and out and the issues that will shape our future.  He is a proven leader with a steady hand and the right person to guide NCC as we select our next president.”

A recent press report noted the 23 percent drop in groundwater levels in areas contiguous with the Guymon, OK. pork-packing plant operated by Seaboard Foods.  Although a major local employer and contributor to the regional economy, the consumption of water by the pork plant will have a deleterious effect on the community.  Similar depletion of subterranean water has occurred in areas adjacent to ethanol plants that use a disproportionate quantity of water.  Agricultural enterprises in California including almond groves and even large egg production complexes and dairies compromise local water supplies by abstraction at rates that are not replenished by precipitation and inflow.

In the short term, packing plants and users of large volumes of water should evaluate reduction and reuse.  This will conserve water for future generations.

In 2022, irrigation of alfalfa fields became an issue in the gubernatorial campaign in Arizona.  A company owned by investors in Saudi Arabia was cultivating and packing alfalfa for export while operating under a “sweetheart” lease allowing ground water abstraction at a low price.

In evaluating local conflicts, especially in arid regions, militant activity is less a function of acreage than the availability of water vital to life.

A recent publication* provided evidence of multidrug-resistant Salmonella serotypes from both commercial broiler flocks and backyard farms.  The study was conducted on ten commercial broiler growing farms and an equal number of backyard flocks. Samples including fecal swabs, soil or litter, feeders and waterers were obtained on days 10, 31 and 52 on production units and similar intervals from backyard farms.

A total of 52 percent of commercial farm samples yielded Salmonella compared to 19 percent of samples from backyard flocks.  Salmonella Kentucky was the most common serotype found in samples from both backyard and commercial flocks.  A third of the Salmonella isolates were classified as multidrug-resistant with ciprofloxacin and nalidixic acid resistance. This was compared to backyard samples with one percent multidrug-resistance recorded. 

The conclusion of the investigators was that the role of production practices in driving multiple drug resistance should be investigated in order to to develop appropriate preventive measures

*Parzygnat, J and Crespo, R. (2023). Megaplasmid dissemination of multidrug-resistant Salmonella serotypes from backyard and commercial broiler production systems in the southeastern United States. Foodborne Pathogens and Disease. doi.org/10.1089/fpd.2023.0181.

Ancera, a Branford, CT.-based technology company has introduced the Allied Company Monitoring Program.  Applying advanced biostatistics supported by machine learning, the system will allow integrators and the manufacturers of feed additives and biologics to design and implement field trials that will quantify the production and financial benefits of dietary supplementation. The Ancera program will assist suppliers of biologics, feed additives, alternatives to antibiotics vaccines and other products to demonstrate product efficacy through third-party validation.

Ancera operates with a dedicated team of biostatistics and field personnel including board-certified poultry veterinarians with experience in management, disease prevention and pathology.

The Allied Company Monitoring Program will provide benefits to integrators who are faced with claims by allied manufacturers wishing to evaluate alternative additives, vaccines or anticoccidial programs.  Progressively, profitability is data driven and Ancera provides input on experimental design, collection of data and interpretation of results to make decisions that add to the bottom line.

For further information access the Ancera website by clicking onto the company logo on the right side of the Welcome page.

According to USDA-FAS GAIN Report TU2024-22, released on June 12th, the Government of Turkiye will impose restrictions on the export of poultry meat to reduce cost to domestic consumers.

 Due to high production costs and low margins, output of chicken will decline by 3.1 percent in 2023 to 2.33 million metric tons (RTC) compared to 2022 at 2.4 million metric tons.  Concurrently chicken meat consumption in 2023 increased to 1.86 million metric tons and is anticipated to be higher at 1.9 million metric tons in 2024.  Accordingly, meat exports will decline by at least half to 270,000 metric tons following the 2024 restriction that will extend from May 1st to December 31st, 2024. 

USDA-FAS recorded a 150 percent increase in retail chicken meat prices over the past six months.  Chicken is the leading animal protein consumed and high price and lower availability have become embarrassing the ruling party that was forced to form a coalition government after the most recent general election.

Reduction in exports by Turkiye, principally to central Asian nations creates opportunities for competitors including Russia, Brazil and the U.S.

Recent press reports indicate the difficulties encountered by alt meat startups in attempting to survive during the critical phase of transition from pilot plant to commercial operation.  As yet, no company has successfully negotiated the gulf between laboratory-scale production and marketing a consumer-acceptable product at scale.

Examples include Upside Foods and Eat Just that were following the Silicon Valley dictum of  Fake it ‘till you make it”.  Mycorena has announced that it will not proceed with a large plant intended to produce a fungal-based product to have been erected in Falkenberg in Sweden.

Preparation of alt-meat products using fermentation of fungi represents one of a number of alternatives to real meat.  Blending a fungal-derived product with ground beef does represent a commercial approach as applied by Mush Foods based in Israel.  Essentially, the fungal component serves as a “hamburger helper” with claims that the diluted product is indistinguishable from 100 percent meat.

The situation with cell-cultured meat producers is, however, dire.  Eat Just, an operation conceived and led by Josh Tetrick, has apparently suspended production in Singapore and is embroiled in litigation with ABEC, the supplier of bioreactors who are claiming over $62 million for equipment and services.

SCIFi Foods has ceased operation as venture capital funding has dried up.  Joshua March, CEO of the failed company, noted, “A tight funding and hostile political environment is preventing the company from raising funds to commercialize a cultivated meat burger.” March noted, “It became effectively impossible for us to raise the tens of millions SCIFi needed for a small commercial launch, much less the hundreds of millions needed for full commercialization.”  This comment encapsulates the stumbling advances demonstrated by the cell-cultured segment of alt meat.

Over-optimistic predictions of demand based on environmental and welfare considerations appear naïve in retrospect.  Technical problems in scaling up from pilot plant operation are currently insurmountable.  Legislators in beef-producing states have advanced legislation either banning or severely restricting the labeling of cell-cultured and plant-based alternatives to beef, pork and chicken.  Surveys, including those conducted by Purdue University, have indicated that demand for alt meat is limited as consumers are satisfied with current diets.  The predicted higher cost of alt meat, especially from cell-culture, will be a barrier to adoption.  The leading public quoted plant-based producer, Beyond Meat, has a questionable future based on a history of continued losses and heavy debt.

Venture capital companies have tightened their purse strings and are now questioning the future of alt meat.  They are looking beyond the hype and deception and embracing reality.

Has anyone out there a use for stainless steel containers, piping, pumps and other hardware?  Going for pennies on the dollar!

The National Cattlemen’s Beef Association has condemned a Department of Defense research grant to BioMADE, an aspirant producer of cell-cultivated meat. It is obviously within the remit of the DoD to fund research leading to enhanced nutrition of service members and for convenience in meal preparation and improved food safety.  It is difficult at face value to ascertain the objective or to justify the grant since venture capital funds have supported, albeit without success, the development of cell-cultured meat that has yet to achieve commercial viability.

The purpose of the grant was for BioMADE to address “conversion of waste streams into bio- products using fermentation and cultivation of protein”.  The position of the DoD would be more acceptable if the specific purpose of project were to be explained providing this does not conflict with the national interest.

Ethan Lane, Vice-president of Government Affairs for the National Cattlemen’s Beef Association noted, “This misguided research project is a giant slap in the face to everyone that has served our country.  Our veteran’s and active-duty troop deserve so much better than this.”  It is presumed that Ethan Lane has at his disposal the terms of reference and conditions of the grant and has confirmed that the BioMADE project either does or does not contribute to military readiness or the national interest.

On May 30th ABEC Inc. filed a motion to compel Good Meat operated by entrepreneur Josh Tetrick.  This action follows the failure of Good Meat to respond to requests for admission and accusing the debtor of “choosing gamesmanship over compliance”.  The submission to the Court stated, “Since this litigation began, Defendants have engaged in dilatory tactics related to discovery-responses are evasive, propound bad faith objections and represent the worst aspects of litigation practice.”

According to the Plaintiff, Good Meat owes $62.6 million for work completed against orders for a series of bioreactors to produce cell-cultured meat.  The original order placed in August 2021 would have required ABEC to install numerous 250,000 liter bioreactors over a seven-year period.  Given problems of cash flow in November 2022, Good Meats reduced the order to five 125,000 liter bioreactors.  Payment was not forthcoming and in March 2023, ABEC initiated legal action resulting in a series of claims and counter-claims by the parties.

In March, Tetrick stated  “he is not intending to raise money for a large-scale cultivated meat facility right now”.  The production facility operated by his subsidiary in Singapore is shuttered.

Over the past two decades, Josh Tetrick has raised hundreds of millions for egg replacement products and more recently, cell-cultured meat without establishing significant cash flow.  It is apparent that his sources of venture capital funding in the U.S. and the Middle East have dried up, corroborating the Lincoln adage about not being able to BS all of the people all of the time.

Welfare activists have promoted the Better Chicken Commitment in Europe through exerting pressure on retail chains, food service companies and restaurants. The Better Chicken Commitment requires the use of slow-growing strains, low stocking density and enrichments in growing houses.

At the outset there is no evidence that the requirements imposed under the Better Chicken Commitment standards actually improve welfare over and above the standards adopted by the Association of Poultry Processors and Poultry Trade in the E.U. (AVEC) that approximate NCC standards in the U.S. 

A recent study commissioned by AVEC conducted by RSK ADAS Ltd. an agribusiness consultancy has quantified the impact of the Better Chicken Commitment standards.  This study Cost and Implications of the European Chicken Commitment in the E.U. determined:

• An additional production cost of 37.5 percent per unit of RTC

• A 35.4 percent increase in water consumption

• A 35.5 percent increase in feed consumption requiring an additional 7.3 million tons of feed for E.U. nations.

• A 24.4 rise in greenhouse gas emissions per unit of RTC weight produced.

• A reduction in 44 percent in the total meat produced compared to existing standard production parameters (6.2 lbs./ft2 stocking density).  If the Better Chicken Commitment stocking density were to be applied, to maintain current production, close to 10,000 new broiler houses would be required with an investment of $9 billion.

Dr. Birthe Steenberg, Secretary General of AVEC stated, “The unique aspect of this study lies in the emphasis placed on calculating costs per unit weight of RTC unlike previous research that focus solely on consequences for live birds or live weight that does not acutely reflect market realities since we sell meat not live animals”.

Dr, Jason Gittins, Technical Direct for ADAS stated, “Due to differences in meat yields between current standards and the Better Chicken Commitment earlier studies underestimated the true impact of the requirements of the Better Chicken Commitment.

Gert-Jan Opelaat, president of  AVEC noted, “While the Better Chicken Commitment aims to improve animal welfare it is crucial to recognize that these improvements come with significant economic and environmental implications.”  He added, “Consumers should have the choice to select higher welfare products if they wish but it is crucial that standard, affordable options remain available.

It is axiomatic that opponents of intensive livestock production attempt to impose anthropomorphic parameters on producers that result in increases in cost.  Essentially advocates of systems such as the Better Chicken Commitment gain a sense of self-satisfaction from reducing the potential demand for chicken based on elevated price.  These promoters of “welfare” are not content to suggest adoption of enhanced welfare standards on a voluntary basis but are coercing retailers and the food service and restaurants segments of the distribution industry into adopting standards without considering the cost implications for consumers.  Advocates for systems such as the Better Chicken Commitment ignore the reality that they are spending other people’s money. This is evident in the “Pacelle Tax” paid by California egg consumers following introduction of Proposition #2.

The recent World Pork Expo in Des Monies provided allied industry suppliers with an opportunity to interact with clients and colleagues. Hamlet Protein a manufacturer of a soybean meal-derived ingredient for piglets, chicks and poults arranged a breakfast meeting for producers during the event.  Dr. Steve Mayer an agricultural economist, discussed the business environment for livestock producers with future projections.

Pork and poultry meat are competitors in the domestic and export markets but face common challenges including fluctuation in consumer demand, ongoing escalation in production costs from feed and labor and growing pressure on welfare and management of herds and flocks.

Hamlet Protein included in diets for piglets, poults and broiler chicks provide beneficial growth and feed conversion efficiency by compensating for the inadequacies of the developing neonatal digestive system and anti-nutritional compounds in conventional plant protein ingredients.

For additional information click on to the Hamlet logo on the right side of the Welcome page

The Purdue University, Center for Food Demand Analysis and Sustainability recently released results of surveys with diets currently consumed. Combining the two categories, 55 percent were very satisfied with their current diets with 30 percent “rather satisfied” and 15 percent “non very satisfied”. There was little difference between urban and rural residents.

The report noted that given acceptance of the range of foods consumed, introduction of an innovative source of protein including vegetable based or cell-cultured meat would have to offer distinct advantages for adoption even at price parity.

Advocates of cell cultured meat have posted results of surveys showing that consumers would potentially “try” cell cultured meat if it were commercially available.  Even if large-scale production in bioreactors were to become a reality, product would have to correspond to the current prices for ground beef and be equivalent in texture and taste. 

Despite considerable investment estimated in the low billions in cell-cultured meat over a decade, no recipient of funding has been able to consistently market a product in commercial quantity through supermarket or food service channels.  Venture capital investors are questioning the optimistic projections for the technology and are tightening their purse strings.  This is evident in the failure of start-ups. Companies with high cash burn rates that have been in existence for a number of years and have claimed successful production in pilot-scale production are now laying off staff.  No company has yet transcended the barrier between laboratory scale and commercial production despite unsubstantiated claims intended to generate funding.  Passage of restrictive legislation either as outright bans on sale of cell-cultured meat or onerous labeling requirements have inhibited ongoing investment in the sector.

The Purdue University Center for Food Demand Analysis and Sustainability characterize their consumer research confirming satisfaction with the present range of foods as “if it ain’t broke don’t try and fix it.”

In accordance with a recently enacted Oklahoma law, farmers in the state are protected from civil liability with respect to environmental claims providing they function in accordance with a nutrient management plan.  This includes application of poultry waste on agricultural acreage.  The law was enacted following a ruling of a federal court that the state poultry industry was responsible for pollution of groundwater from run-off from land on which poultry litter was spread as fertilizer. 

The law was actively opposed by the Cherokee Nation. The official statement included “When corporate polluters find safe harbor in this new law, we will all suffer including those who supported this industry-written legislation.  Generations unborn will pay the price”.

In a release dated May 30th Hormel Foods (HRL) reported on Q2 FY 2024 ending April 28th, disappointing on the top line but exceeded consensus on adjusted EPS.  For the quarter the company earned a reported (GAAP) $189.2 million on revenue of $2,887 million (Zack’s consensus of $2,987 million) with a diluted EPS of $0.34.  Comparable values for Q2 FY 2023 ending April 30th were net income of $217.2 million on revenue of $2,978 million with a diluted EPS of $0.40.

Compared to Q2 of FY 2023 sales declined by 3.0 percent, gross margin increased from 16.5 percent to 17.5 percent; operating margin was down from 9.9 percent to 8.7 percent. Profit margin fell from 7.3 percent to 6.5 percent for the most recent quarter.

Effective October 2022, Hormel reorganized their operating divisions into Retail, Food Service and International segments.  The Jennie-O Turkey Store Division was integrated among the three operating divisions.  Accordingly, releases for Fiscal 2023 and thereafter do not disclose either volume or cost data for this subsidiary as in previous years.  In reviewing the release, there was only indirect comment on the turkey business noting lower volume with a reference to the risk of HPAI that has impacted turkey flocks in Minnesota in recent weeks despite implementation of biosecurity. In previous analysts’ calls CEO Jim Snee has expressed ongoing concern over losses during November and December 2023 and more recently for 2024.

Segment performance in both sales and operating profit for the most recent quarter was compared with Q2 FY 2023:-

• Retail Segment volume -5.4%:  sales -6.7%: segment profit -13.6%.
• Food Service Segment volume -2.9%: sales +5.7%: segment profit +2.7%.
• International Segment volume -7.2%: sales -7.3%: segment profit +70.7%

In commenting on Hormel results Jim Snee, Chairman, president and CEO stated "We delivered a strong first half, with consecutive quarters of better-than-expected earnings, a significant improvement in operating cash flows, continued Foodservice strength, recovery in our International business and stable volumes across our business. "He added, "Importantly, we made further progress on our strategic initiatives, and we remain on track to deliver on our commitments to improve our business and drive long-term shareholder returns and growth."

For FY 2024 the company projected a one to three percent increase in net sales growth compared to FY 2023 and an upgraded full year diluted net earnings per share of $1.55 to $1.65.  

Hormel Foods posted total assets of $14,135 million on April 28th 2024 of which $6,677 comprised goodwill and intangibles. Long-term debt was $3,073 against an intraday market capitalization of $16,780 million on June 6th. HRL has traded over the past 52 weeks in a range of $28.81 (an 8-year low) to $41.74 with a 50-day moving average of $34.68.  HRL trades with a forward P/E of 19.1. HRL closed at $34.10 on May 29th pre-release. The share price closed down 9.7 to $30.79 on May 30th post release

The 12-month trailing operating margin is 9.0 percent with a profit margin of 6.4 percent. The Company has returned 4.8 percent on assets and 9.6 percent on equity.

Subscribers can review the financial performance of competitor Butterball by entering “Seaboard” into the SEARCH tab.

The 2024 SIAL Exhibition was held at the Shanghai New International Expo Center over May 28 to 30.  The show attracted more than 5,000 exhibitors and more than 180,000 professionals from 75 countries and regions around the world and extended over two million square feet.

USAPEEC members Globex International, Intervision Foods, Metafoods, and Global Food Solutions USA participated at the USAPEEC booth. Both the USAPEEC China team and participating member companies met with Chinese customers during the three-day event.

U.S. heat-processed poultry products are becoming more popular in China despite weaker demand resulting from the economic situation in the nation. After 18 months of product development and quality improvement, some importers in southwest China are becoming familiar with the product-range while others are learning about it at events such as the SIAL Show.

Alco, a leading Mexican processor featuring high-quality U.S. chicken meat, launched its new line of value-added chicken products at Soriana, a popular retail chain in Mexico City recently, with USAPEEC Mexico hosting a workshop with participation to celebrate the launch.

The workshop attracted 87 attendees, 80 of whom received ingredients kits featuring chicken fillets donated by Alco. USAPEEC Marketing Consultant Carlos Garcia hosted the workshop, which included a live demonstration by chef Ruben Mora who showcased product versatility and taste by preparing chicken fillets stuffed with poblano chili and cheese.

The one-hour workshop was live-streamed on Zoom, allowing viewers to participate in the culinary experience. This workshop was the third of six events planned by USAPEEC Mexico.

For additional details contact Liliana Solis USAPEEC Marketing Manager at <lsolis@usapeec.org.mx>

A study conducted by Dr. Brian G. Fairchild at the University of Georgia challenges the presumption that 23-hour continuous light is required during the first week of brooding broiler chicks.  The investigation was carried out with funding from the USPOULTRY Foundation as Project 732. 

The trial compared four-and six-hour dark periods during brooding.  First week weight was significantly reduced although there was no difference in body weight compared to continuous lighting at the time of harvest denoting compensatory growth.  It is generally accepted that during early brooding, a dark period ranging from 30 minutes to an hour should be allowed each day to prevent piling in the event of power failure.  The results of the trial including data on feed conversion, mortality and the response of flocks with respect to corticosterone, melatonin levels and tibial breaking strength will be published in a peer-reviewed journal. 

The initial conclusion from the evaluation of light duration during brooding was that there was no negative effect on performance at the time of harvest with the potential for improved skeletal development and lower locomotory defects and reduced cost of energy.

In 2001, Mountaire Farms settled a lawsuit with 800 members of a class alleging contamination of subterranean water as a result of inadequate effluent treatment. As a condition of the settlement, Mountaire upgraded water treatment at their Millsboro, DE. plant involving the expenditure of $120 million.  The settlement settled a dispute over a 2017 wastewater permit issued by the Delaware Department of Natural Resources and Environmental Control.

More recently, a family with a child born with developmental defects has claimed that they were improperly advised at the time of the settlement that provided inadequate compensation for the costs that will be incurred.  A Delaware Superior Court judge has ruled that the family was adequately advised concerning their rights to opt out of the settlement and that there is insufficient evidence to implicate the disabilities with alleged contamination by Mountaire Farms.  The case is now being appealed to the Delaware Supreme Court with the family represented by a prominent legal firm with expertise in claiming compensation for environmental contamination.

Should the family be successful in their appeal, and prevail in a subsequent action, the precedent that will be established will have implications for the livestock industry both at the CAFO and processing plant levels.

Judge John R. Tunheim, U.S. District Judge for the District of Minnesota, denied an AgriStats Inc. motion to dismiss a September 2023 lawsuit filed by the U.S. Department of Justice and six states.  The May 28th ruling denied a motion to transfer the litigation to the home state of Indiana.

The Department of Justice and the states claim that AgriStats fostered anticompetitive activity in the meat and poultry sectors.  The benchmark costing system was established in 1985 for broilers and was extended in 2001 for turkeys and during 2007 for pork. Following filing of antitrust litigation, pork and turkey producers withdrew from the AgriStats program in 2019.

AgriStats was established by agricultural economists to provide historical cost data to producers of laying hens as an outgrowth of a Purina division and was then extended to broilers.  The company was purchased by Elanco Animal Health but was subsequently divested to a private investor group.

AgriStats was named as a codefendant in a series of civil actions alleging collusion among pork and broiler producers as a vehicle to either manipulate prices of products to diverse customer segments and also in relation to remuneration of contract growers and wage rates for workers.

America First Legal that includes prominent members of the previous Administration have filed complaints alleging that Tyson Foods has violated Title VII of the Civil Rights Act of 1964 among other transgressions.  The America First Legal Group noted, “There is ample reason to suspect that Tyson prefers hiring aliens and as a “joint employer” alien minors over American citizens through out labor supply chain.”  The allegations probably arise following a policy statement by Tyson Foods that they were willing to employ a limited number of legally admitted refugees from Central America entering the U.S. under existing legislation and rules.  This apparently angered advocates for stricter limits on immigration and rejection of claims for refugee status.

In response to the allegations and legal complaints, a spokesman for Tyson Foods stated, “Any insinuation that we would discriminate against U.S. citizens to hire immigrant workers is completely false.  To date Tyson foods employs 120,000 team members in the U.S. all of whom are required to legally authorized to work in this country.”  Tyson Foods opposes illegal immigration and the employment of minors in all facilities as corporate policy.

During the previous Administration, Tyson Foods was instrumental through its Chairman in motivating the April 29th 2020 Presidential Executive Order relating to ongoing operation of meat packing plants during the pre-vaccination phase of the COVID pandemic and also indemnifying employers from responsibility in the event of infection among workers.

According to press reports, the assets of bankrupt Cooks Venture, comprising a processing plant, feed mill and hatchery were purchased by a subsidiary of Pitman Family Farms for $7.1 million.  The transaction was approved by the U.S. Bankruptcy Court in the district of Delaware.

The enterprise was established in 2019 to produce slow-growing broilers marketed directly to consumers through delivery services. Information on the Company can be retrieved by entering ‘Cooks Venture’ in the SEARCH tab.

Pitman Family Farms has extended its geographic reach from California to incorporate Norbest, a producer of turkeys in Utah, and now will operate on the border between northeast Oklahoma and northwest Arkansas.  Pitman Family Farms is anticipated to apply accepted methods of production using contractors and will market through conventional channels.

Hopefully, creditors will be made whole and contract growers will once more be restored to production but supporting a more substantial business model.

Representative Greg Casar (D-TX) introduced an amendment to the delayed 2023 Farm Bill relating to use of child labor.  The amendment would have banned the USDA from contracting with “meat packing operations found to have serious, repeated or pervasive violations of child labor regulations or other labor law in their facilities or by subcontractors within their plants”.  The measure was defeated in Committee on a party-line vote. 

A vote against this amendment effectively implies support of “serious repeated or pervasive violations of child labor regulations”.  The fact that the vote was along party lines exemplifies the philosophical divisions between the parties and suggests a lack of concern for the welfare of children. Many of those identified as employed underage are immigrants or refugees without documentation who are subject to exploitation.  The proposed amendment would have served as an additional incentive to comply with labor regulations and immigration requirements defining eligibility for employment.

The House Agricultural Committee Chair, Representative Glenn Thompson (R-PA) indicated that a hearing on child labor issues in the meat processing sector would be arranged at a subseqent time. The Committee in its indifference to a pervasive problem failed to put teeth into compliance with current laws that relate to child labor in dangerous situations. Why should members of a party promoting family values be so reluctant to adopt a simple remedy to help eliminate exploitation?

Approximately 1,000 workers have commenced a strike at the Dunlop, Guelph, Ont. beef packing plant.  Workers represented by the United Food and Commercial Workers Union rejected a negotiated settlement by an 82 percent margin resulting in a strike commencing May 27th.

Kelly Tosato president of UFCW Local 175 stated, “The decision to go on strike is never easy, but members are not satisfied with what the Company has brough to the table.”  The Union has called for an increase in wage rates because of higher costs of living and a decrease in income following termination of supplements provided during and after the COVID pandemic.

Cargill noted, “Our proposed agreement which the Union Bargaining Committee unanimously recommended as a comprehensive proposal, honors the tremendous skill and dedication of our Guelph workforce.”  The Company added, “We are concerned about the hardships a labor disruption will pose to our employees and our customers.  We will be working with the Union on next steps once we hear more from them.”  The Company offer, accepted by the Negotiating Committee included a 9.3 percent wage increase and backpay dating to January 1, 2024, together with enhancements of benefits and a signing bonus.

The Guelph workers are supported by UFCW Local 401 in Alberta. It is possible that a strike could also be called in this case-ready plant and in a third location in Calgary.

House of Raeford Farms has awarded 32 college scholarships in their 11th annual program.  This year eligibility was extended to dependent children and grandchildren of company employees and the families of contractors.

Robert Johnson, CEO of House of Raeford noted, “Our company recognizes the importance of providing career development opportunities for our youth, so they become responsible citizens in the community.”  He added, “This educational assistance program for children of our hard-working and dedicated employees and farmers is an investment in their future success.”  Scholarships are valued at $2,500 and are awarded based on academic excellence, leadership qualities and involvement in school and community activities. 

Over the past eleven years, House of Raeford has provided $455,000 to 182 recipients in six states where the company operates.

The U.S. Equal Employment Opportunity Commission (EEOC) has filed a lawsuit alleging that Smithfield Foods illegally fired an employee over the age of 55.  The EEOC alleges that five of six employees older than 55 were terminated. In contrast 14 of 18 salespersons under the age of 55 were retained in a restructuring involving a mandatory relocation to the company headquarters in Smithfield, VA.

The lawsuit was filed following a failure to reach a settlement through structured negotiation.

The 2024 USPOULTRY Financial Management Seminar will take place June 26-28 at the J.W. Marriott, Marco Island Beach Resort, in Florida.  The program will include a Washington Review, tax update, protection from cyber-intrusion, hedging strategies and updates on technology.  Joint sessions will address compliance with Packers and Stockyards Act reporting and tax accrual.

Continuing educational credits will be accepted by some professional associations for attendance at the Seminar. Additional information is available on the USPOULTRY website <www.poultryegg.org>

A study conducted by the USDA Agricultural Research Service has determined that cooking ground beef to a temperature of 145 F is adequate to eliminate the viability of H5N1 influenza virus in patties.

Beef patties of 300 g were spiked with an H5N1 surrogate influenza virus and then were cooked. The study compared temperatures of 120 F, 145 F and 160 F. The lowest temperature of 120 F “substantially inactivated” the virus.  No viable virus was detectable in patties cooked at either145 F or 160 F.  Standard recommendations are to cook patties and chicken products to  165 F to destroy non-spore forming bacterial pathogens including Salmonella. 

The study conducted by USDA-ARS confirmed that existing recommendations should inactivate H5N1 and presumably other influenza A viruses.  The USDA Food Safety and Inspection Service is currently collecting beef muscle from culled dairy cows condemned at ante mortem inspection at plants to determine the prevalence of H5N1 virus. To date one isolate of H5N1 has been obtained. It is noted that culled dairy animals represent approximately six percent of the U.S. beef supply and are mostly processed into ground beef.

According to MUSH Foods, an Israeli food tech company, their 50 CUT™ burger comprises equal proportions of ground beef and mushroom mycelium.  A life cycle assessment analysis conducted by consulting company, Boundless Impact Research and Analytics, demonstrated that the mushroom component generated less than 20g. carbon equivalent per patty, effectively reducing the impact of a conventional burger patty by half.

Mush Foods claim that their hybrid burger is similar in organoleptic properties to a conventional ground beef patty but with environmental benefits.  The 50 CUT product is formulated to achieve a “clean label” as the mushroom derived component is devoid of binding agents, seasonings or preservatives.

There is no indication of price for 50 CUT. Plant-based patties have the disadvantages of higher cost, inferior taste and texture and labels denoting additives, compared to all-beef patties. These are reasons why plant-based meat substitutes have failed to gain market share in the food service and QSR sectors resulting in losses for producers.

Interpreted as a desperation move, Good Meat, an entity controlled by Josh Tetrick has launched a hybrid pseudo-meat product in Singapore.  The ersatz chicken carries a claim of three percent chicken cells and is marketed through a local butchery and priced at over $5 per lb.

The origin of the chicken cells apparently included in the Good Meat product is unknown since news reports confirmed that Tetrick closed his Singapore plant.  The Company is embroiled in litigation with suppliers claiming nonpayment of invoices and breach of contract.

The inclusion of a token three percent of animal-origin cells in a plant-based food product will certainly not move the needle on sustainability nor will it contribute to environmental mediation.

The news report on the product launch suggests yet another publicity initiative by Tetrick in his attempts to raise venture capital funding. He appears to have exhausted sources in the U.S. and from sovereign funds in the Middle East.

An Australian chain of burger restaurants, Grill’d, has limited sales of their Gamechanger burgers. It was claimed that the product was derived from herds fed seaweed pellets to reduce methane emission. Gamechanger burgers were promoted as “the world’s first all-natural sustainable beef burger”.

The burgers carried a premium for claimed sustainability that apparently was an inadequate attribute to justify a differential in price from conventional burgers.

The Grill’d chain with 60 stores has previously played the sustainability card with plant-based meat substitutes and other pseudo-beneficial climate-related claims.