SUPPLY WOES, NEW LAWS TOP SHOW ISSUES

NEW ORLEANS -- Growing demand for fresh produce hasn't kept the supply side of the business from being hit with extremes, ranging from oversupply to drought and deep freezes. The continuing effort to bring both ends closer together will be a featured topic of discussion in the aisles during the Produce Marketing Association's upcoming Fresh Summit, scheduled for Oct. 13-15 at the Ernest N. Morial

NEW ORLEANS -- Growing demand for fresh produce hasn't kept the supply side of the business from being hit with extremes, ranging from oversupply to drought and deep freezes. The continuing effort to bring both ends closer together will be a featured topic of discussion in the aisles during the Produce Marketing Association's upcoming Fresh Summit, scheduled for Oct. 13-15 at the Ernest N. Morial Convention Center here.

Government activity is also capturing attention at all levels of the industry. The federal government has committed millions of dollars to help boost demand of produce through the Produce for Better Health Foundation and its annual 5 A Day campaign. Meanwhile, it has issued new rules to protect the nation against bioterrorism, mandated country-of-origin labeling for fresh produce, and is ready to implement the new National Organic Standard on Oct. 21.

It's a full plate of issues for attendees, who come from more than 70 countries from around the world, according to PMA's president, Bryan Silbermann. He noted that it's been a tough year for an industry that nevertheless continues to forge ahead as produce has become an integral part of both retailer selling strategies and consumer diets.

"There's certainly not an across-the-board positive impact. It depends on who you talk to," Silbermann told SN. "Some parts are still hurting. There's overproduction in certain areas, and returns to growers are still not where they should be because of that. On the demand side, we're delighted with the increased government support for 5 A Day."

The show's busy agenda reflects the fast-changing field the industry is playing in these days. Indeed, the show was shortened by a half day and condensed to accommodate busier schedules. The content of workshops cover the pertinent issues -- technology/supply chain; merchandising/marketing; management/leadership; and labor -- but also devote more time to the subjects, he said.

One area in particular that is due to receive more attention in coming years is floral, Silbermann added. A seminar focusing on the department is on this year's schedule, and an expanded floral educational forum is on the docket for next year's show in Orlando, Fla.

There are changes going on outside the convention hall, too. A host of new rules about to take effect, or are on the horizon, has retailers wondering just how much of the law they'll be responsible for. Regarding the new bioterrorism legislation passed recently by Congress, Silbermann noted everyone is waiting to hear about retailers' obligations.

"That's been on the mind of the whole industry -- where do the new regulations come down?" he said. "There are a lot of unanswered questions on this. The issue now is how regulatory agencies will implement the law."

The long-awaited National Organic Standard is also top of mind, with the new rules going into effect just after the close of the convention. Silbermann said the big issue for retailers lies in deciding whether to integrate or segregate when it comes to handling, storage and merchandising at store level.

"Some retailers are very concerned about the commingling issue -- how can you prevent organic from getting mixed with conventional produce in bulk displays? Even if you put up protective barriers in between the displays, a customer can still pick up an organic item and drop it in the conventional bin," he said.

A recent audio conference hosted by the Newark, Del.-based organization found that a majority of participating retailers has already decided that segregating organic produce from its conventional counterpart will initially, at least, ease minds concerned about violating the law and damaging customer trust. Silbermann said segregation might be seen as a safe solution, though it may undo years of progress in introducing consumers to organic produce by merchandising it with conventional product.

"The lesson of the past 10 years has seemed to be that sales go up when product is integrated alongside conventional," he said. "And it would be very unfortunate that the implementation of the new regulations leads to exactly the opposite of what was intended by the law."

Further down the road, retailers will have to tackle the issue of country-of-origin labeling, which was included as a component of this year's farm bill. Silbermann said even though there is a three-year phase-in period, the industry is jumping ahead to discuss the options available, with retailers supporting anything that would satisfy the law without adding labor or cost. A consensus seems to be building to add the country identification to price look-up stickers already affixed to individual pieces of produce. Not only would it satisfy the mandate, but it would also solve the challenge presented by mixing multiple pieces of identical fruit that may have been sourced from different countries.

As part of the consolidated schedule, one of the more popular features of the annual gathering -- a guided supermarket tour -- has been moved forward to the Tuesday afternoon close of the show. This year's trip includes visits to units operated by Wal-Mart, Rouses Supermarkets and Sav-A-Center, a division of A&P.