2011 Year in Review: Stepping Up in Fresh Foods

2011 Year in Review: Stepping Up in Fresh Foods

The return of food price inflation was a key challenge in 2011, but progress was made on several important initiatives

For many purveyors of fresh foods, 2011 was a two steps forward, one step back type of year. Progress is being made on goals including enhanced food safety systems, seafood sustainability and better nutrition programs for kids and adults, but, there were also setbacks.

Supermarkets have continued to find new ways to offer their customers ideas that help them save money by cooking at home. Unfortunately, after two years of calm, 2011 saw the return of significant food price inflation, pushing up the cost of meat, poultry, dairy, eggs, seafood, fruits, vegetables and other foods.

In January, President Obama signed the Food Safety Modernization Act into law, paving the way for sweeping changes in the way the U.S. Food and Drug Administration oversees the safety of foods and production facilities in the U.S. Progress has already been made toward implementing a system focused on prevention, but these newly appointed powers could not prevent the country’s most fatal foodborne illness outbreak in a quarter century from claiming 31 lives.

And, the launch of the U.S. Department of Agriculture’s new “MyPlate” icon has given nutritionists and educators a great new tool to explain healthy diets in simple terms, but there’s still a long road ahead for those working to turn the tide in the fight against childhood obesity.

These challenges will demand continued attention in the coming year, but the future is bright for an industry whose goal is a healthy, safe, sustainable food supply.

FDA Implements Food Safety Modernization Act

By ROSEANNE HARPER

Since President Obama signed the Food Safety Modernization Act of 2011 on January 4 this year, the U.S. Food and Drug Administration has increased its communication with other agencies and stakeholders, in an attempt to prevent foodborne illness, and to stop an outbreak quickly if one should occur.

FDA Commissioner Hamburg told SN in an earlier interview that communication and transparency are top priorities.

“First under FSMA, FDA was required to provide a consumer-friendly recall search engine within 90 days after the law went into effect,” Hamburg said.

“In April, we launched a new consumer-friendly web search for recall information. Now, recall information is displayed in a table format instead of a text format. The table organizes information from news releases on recalls since 2009 by date, product brand name, product description, reason for the recall, and the recalling firm.”

Hamburg also underscored the fact that “FSMA is based on a vision of food safety as a system of prevention which requires integration of federal, state, tribal, and local food safety agencies,” adding that FDA has been at work on those goals.

“We have regular calls with state agencies in all 50 states to share information,” she said. “When our own FDA scientists did ground-breaking work that showed an animal drug left a carcinogenic residue in chicken meat, we shared that information with our partners at the [U.S.] Centers for Disease Control and Prevention and the U.S. Department of Agriculture so we could all work together with the company involved and the chicken industry to stop the sale of the product from the marketplace in a timely but responsible way.”

Hamburg said the close and quick communication between agencies right down to county and municipal health departments is crucial in preventing an outbreak of food borne illness.

The agency’s response this fall in the wake of a listeria outbreak caused by contaminated cantaloupes is an example of how inter-agency cooperation will work.

Speaking this fall at the 14th annual National Food Policy Conference, Hamburg told her audience how very important the cooperation between agencies was in trace-back and response during the recent outbreak.

“We’ve been collaborating closely with the CDC, along with our local and state partners in Colorado. Once the bacteria was linked with whole cantaloupes in early September, we worked to conduct a product trace back, and very quickly identified the matching outbreak strains in samples collected at Jensen Farms in Colorado. Then, in concert with the company, a voluntary recall was quickly instituted,” Hamburg told the conference attendees.

Even as she spoke, FDA had pre-emptive measures underway elsewhere.

In random checks, FDA had found listeria in bagged chopped romaine from California ranch, which resulted in prompt removal of the contaminated products from the market and launched an investigation.

Part of FDA’s responsibility, too, is making sure foreign imports of food are safe, Hamburg emphasized in an earlier interview with SN.

With that responsibility high on her to-do list, she has met with food safety counterparts from China and other key countries.

Most recently FDA has struck up a partnership with Canada to modernize food safety. Michael Taylor, FDA deputy commissioner for foods, led a delegation to Ottawa this fall to meet with officials from the Canadian Food Inspection Agency and Health Canada.

“We discussed how to best cooperate on our efforts to modernize our respective food safety systems,” Taylor wrote this month in an FDA blog.

Per FSMA requirements, FDA is currently developing regulations geared toward minimizing risk at farms growing and harvesting fruit and vegetables.

“FDA continues to work diligently to implement FSMA. The agency has published reports, guidance documents, interim final rules, strategy papers, deployed a consumer-friendly recall search engine, and more,” said Sebastian Cianci, an FDA spokesperson. “In early 2012, FDA intends to publish proposed rules addressing produce safety, preventive controls for food and animal feed, and a foreign supplier verification program that is being developed.”

Food Price Inflation Comes Roaring Back

By MATTHEW ENIS

Last month, the price of a classic Thanksgiving dinner with turkey, stuffing, cranberries, pumpkin pie and all the basic trimmings was up 13%, according to the American Farm Bureau Federation’s 26th annual price survey. Average retail prices for whole turkeys drove most of that increase — prices for a 16-pound bird were up almost $4 compared with Thanksgiving 2010, according to AFBF estimates.

“Turkey prices are higher this year primarily due to strong consumer demand both here in the U.S. and globally,” John Anderson, an AFBF senior economist, said in a release. “The era of grocers holding the line on retail food cost increases is basically over,” he added. “Retailers are being more aggressive about passing on higher costs for shipping, processing and storing food to consumers, although turkeys may still be featured in special sales and promotions close to Thanksgiving.”

Of course, food price inflation hasn’t been limited to turkeys. In a recent report, the U.S. Department of Agriculture’s Economic Research Service wrote that at the end of the third quarter, beef prices were up more than 10%, pork prices had risen 7.5% and poultry was up 3% compared with September of 2010. During that same period, fresh fruit prices were up almost 9% and fresh vegetable prices rose 6.5%.

Rising global demand, increased exports and rising input costs, led by higher fuel and animal feed prices, have all played a role.

The situation in 2011 was reminiscent of 2008, when a spike in animal feed prices — driven by ethanol mandates and non-commercial commodities market speculation — caused meat prices to rise, even as shoppers struggled through the beginning of a recession.

2008 was followed by two successive years of very low price inflation. It returned in force this year. By the conclusion of 2011, the average consumer price index for food purchased at supermarkets will have risen between 4% and 5%, the USDA estimates. And, while the agency believes that inflationary pressures will ease in 2012, it still expects prices to rise faster than historical norms.

High corn prices will likely remain a culprit. In a report this month, USDA estimated that U.S. farmers would only have 848 million bushels of corn on hand by the end of next summer, and that the small surplus would keep corn prices high. Partly as a result, food prices are expected to rise between 2.5% and 3.5%.

Fresh food categories will once again bear the brunt. Meat and poultry prices — which in aggregate rose about 7% this year — are expected to increase between 3.5% and 4.5% in 2012. Prices for fruits and vegetables are also expected to increase between 3.5% and 4.5%, while egg and dairy prices will rise between 5% and 6%, according to USDA estimates.

More Retailers Make Sustainable Seafood Commitments

By JENNA TELESCA

2011 was a banner year for seafood sustainability. A product line in Germany became The Marine Stewardship Council’s 10,000th ecolabelled seafood item available in the global market. And, over the past 12 months, several major retailers made progress on recently established sustainability goals, announced plans to expand their sustainable offerings or made new commitments to evaluate their current sourcing in partnership with nonprofit organizations.

Quite a few of these sustainability plans have come with specific, measurable goals. While each retailer’s plan differs in scope, each has shown significant movement toward a more eco-friendly supply chain.

For instance, Safeway and Target, working with the nonprofit FishWise, have both made a commitment to entirely transition all fresh and frozen seafood offerings to sustainable varieties by 2015. Giant Eagle announced it would be entering a planning and evaluation stage, working with the Sustainable Fisheries Partnership to evaluate suppliers and develop a sustainable seafood plan for wild and farmed seafood.

As to why retailers have decided right now to revamp seafood offerings, MSC Regional Director of the Americas Kerry Coughlin suggested supply is a major factor.

At MSC, a nonprofit that promotes sustainable fishing practices and works with retailers like Kroger, Shaw’s and Supervalu, Coughlin said, the “supply of certified sustainable in seafood has increased substantially to the point where retailers feel that they can make a commitment to sourcing MSC certified seafood without seriously curtailing or jeopardizing supplies of seafood.”

While Coughlin thinks consumer demand will strengthen, she said the movement has been largely retailer and supply chain driven so far. “To the credit of the seafood supply chain members of the industry, they’ve really done a great deal to progress the sustainability of fisheries.”

The movement toward more sustainably sourced seafood has not been limited to retailers, either. Foodservice, food programs at universities, and the pharmaceutical industry (fish oil) have all been making commitments to source certified sustainable products as well, Coughlin said.

USDA Unveils New MyPlate Nutritional Campaign

By MATTHEW ENIS

In Uune, the U.S. department of Agriculture introduced a much-heralded new educational tool to encourage healthy eating. The new “MyPlate” icon, featuring a dinner plate divided into four segments representing fruits, vegetables, proteins and grains, is intended to be “a simple, visual icon that sends a message about what should be on people’s plates,” USDA Secretary Tom Vilsack explained during a press conference held to announce the new icon and its related programs.

The new icon was designed to replace the USDA’s Food Guide Pyramid, and its later iteration MyPyramid.gov. Echoing a common criticism of the USDA’s old guides, Vilsack said that the Pyramid systems were “too complex to serve as a quick and easy guide for busy families.”

A key message conveyed by the icon is that half of each well-balanced meal should consist of fruits and vegetables. Nutritionists, of course, have been giving patients and shoppers variations on this advice for years, and many agreed with Vilsack. The new graphic makes that message very easy to understand.

“I think the Pyramid was not relatable to a meal like the plate is. We eat off of a plate, and we all know what a plate is,” Kim Kirchherr, a corporate dietitian for Supervalu who works with the company’s Jewel-Osco division, said shortly after MyPlate was launched.

Kirchherr, along with several other supermarket nutritionists that SN spoke with, were already using social media tools such as Twitter and Facebook to direct shoppers to the tools and advice available on the USDA’s related consumer website ChooseMyPlate.gov. Some stores had even begun incorporating the icon into circulars and point-of-sale materials.

The graphic also drew rave reviews from the produce industry.

“They took what was a confusing, seldom read and barely understood graphic [the Food Guide Pyramid] and turned it into something that is instantly recognizable, immediately understood, and really, hugely beneficial to the fruit and vegetable industry in my opinion,” Bryan Silbermann, president and chief executive officer of the Produce Marketing Association told SN this fall.

Since the icon may have its biggest influence in programs for children, it will take some time to see how much of an impact MyPlate will have over U.S. eating habits in the long run.

Just last week, The NPD group released a study indicating that the MyPlate suggestions are generally ignored. Using its National Eating Trends research database to compare current habits with the new guidelines, NPD deduced that the average consumer achieves at least 70% of MyPlate’s recommendations for fruits, vegetables, grains, proteins and dairy only seven days every year. In light of the country’s ongoing problem with high rates of childhood obesity, that’s not an encouraging sign.

Whole Foods Market Introduces Animal Welfare Index

By JENNA TELESCA

Whole Foods Market offered shoppers a deeper look into the supply chain with the introduction of a detailed five-step animal welfare rating system to the meat department last winter.

Developed by the animal agriculture nonprofit Global Animal Partnership, the program’s first step requires animals to be raised with without crates, cages or crowding. Each step — indicated by color-coded stickers on products — meets a new requirement, up to the fifth, strictest step, where animals are born and raised on the same farm.

These steps build on the retailer’s base requirement that all meat sold be from animals fed a vegetarian diet and not given antibiotics or hormones.

Certainly, Whole Foods is not the first retailer to communicate with customers about animal welfare. Retailers have partnered with programs such as Humane Farm Animal Care’s certified humane raised and handled certification and labeling program to ensure standards for animal care.

But, Whole Foods’ index builds off these past efforts, offering its program on a new scale with great influence.

The “level of detail disclosed about the standards” is a distinguishing factor, said Jay Jacobowitz, president of natural product industry consulting group Retail Insights, Brattleboro, Vt.. “It’s not just a seal. Or what’s apparent to the consumer is more than just a seal.”

The scale shows customers precisely what they are paying for. Whole Foods has gone to great efforts to market the program to shoppers, from in-store shelf markers to videos and explanations on Whole Foods’ blog, website and meat department Facebook page.

“This is just another feather in their cap. It’s not an easily replicable one by the competition because it does involve supply chain alteration,” Jacobowitz added.

The index may lead some shoppers to ask more questions about animal treatment, which could in turn encourage other retailers to provide additional information.

“The price of entry to be a quality retailer is increasing, and so therefore, over time, we should see those interested in … a quality market position, adopting measures like this,” Jacobowitz said, adding these quality measures will trickle down to midmarket operators.