Japanese consumers spurn US beef

Asahi Shimbun, Japan’s leading newspaper, asked its readers for their opinion of the negotiations to resume U.S. beef imports. In a report published June 29, consumers were overwhelmingly in favor of their government’s restrictive stance.

Repudiating the American position, 75% said either trade resumption should happen only with the most severe restrictions or they no longer needed U.S. beef in their diet. Slightly more than 13% expressed an opinion favorable to the U.S. beef interests. 1344 people responded to the survey.

With no pressure coming from their constituents, Japanese negotiators will undoubtedly continue to “hang tough” in their demands for what the general population sees as reasonable restrictions on trade resumption. With the recent mad cow incident fueling the fire, it could mean protracted negotiations.

The survey results:
8.0% - Government should negotiate with U.S. to resume trade immediately.
5.4% - Accept 30 month rule as USA wants.
11.5% - Resume trade with 20 month rule as Government says.
40.4% - Trade only with severe regulations, including 100% testing.
34.6% - I don't need US beef anymore.

Phyllis Fong is my hero

Seven months after the USDA buried critical test results under a bushel of obfuscation and suspicious mismanagement, Phyllis Fong called a foul and tossed a flag in the eye of a blitzing beef industry linebacker. The elaborate defense of the U.S. beef business, protected by a “gold standard” B.S.E. test that has proven to be considerably less, fell apart.

Referring to a mysterious second test that was lost in a bureaucratic mess, the Sunday New York Times reported, “Phyllis K. Fong, the Agriculture Department's inspector general, arranged for further tests on specimens of the same cow. A test known as the Western blot, which is widely used in England and Japan but not in the United States, came up positive.”

“The sequence of events started in November, when an Agriculture Department laboratory in Ames, Iowa, performed two tests on the animal in question. After the "gold standard" test came up negative, the agency announced that the animal had not had mad cow disease. But at the same time, the same lab also conducted the experimental test, with different results.”

Ed Loyd, attempting to clarify the situation on behalf of the USDA, explained it this way: "The laboratory folks just never mentioned it to anyone higher up. They didn't know if it was valid or not, so they didn't report it."

It sounds like a lame attempt at a last ditch cover up to me. But let’s be generous for a moment. Suppose Ed is right. How many people knew about the second test and when did they know it? The lot of them should be lined up and bused to the nearest unemployment office.

Reacting to the Fong ordered retest, the NCBA’s Jim McAdams led a group of industry association officials with a complaint that unexpected testing creates "great anxiety within our industry," and leads to "significant losses."

The anxiety and losses – we’ll call it the Fong effect - weren’t caused by the unexpected test last week but by the unexpected and unreported test last November. If the results had been revealed, an embarrassed Taiwanese government wouldn’t be reinstating an import ban that had been lifted just a few weeks ago and touted with a heavy P.R. blitz orchestrated by the USMEF. Reports that the USDA’s J.B. Penn, exasperated over the slow progress of diplomatic negotiations, threatened a Japanese delegation over the beef issue wouldn’t be making the news, either.

Here is the bottom line: We can no longer use science to defend our practices. The problem we must face now is repairing worldwide confidence in our beef supply. We should open the field to free market forces. Testing of any kind by any part of the beef industry supply chain should be allowed immediately. The choice should be a business decision: Care about international trade? Test every animal if you so desire. Interested only in U.S. consumption? Follow the current governmental edict as prescribed by “sound science.”

Hand-in-hand with those steps, of course, is the rapid implementation of NAIS. Without reliable and quick traceability, there can be no repair to our international standing. We will cede the marketplace to Australia, Argentina and Canada.

Ed Loyd adamantly maintains "There is no scientific basis for doing what Japan and many critics want: testing all animals or all those more than 20 months old.” The basis for testing all animals is one of satisfying the requirements of our international trading partners. The hard facts of science and the soft facts of public opinion often differ. Hanging onto the former in the face of pressure created by the latter is a formula for corporate suicide.

Using our “gold standard” test as the final step is now and forever a dead issue. Even before the current debacle, Dr. Linda Detwiler, who led the USDA mad cow testing program until 2002, said the department should be using the Western blot test.

"You need to put as many tools in your tool kit as possible," she said.

Detwiler also attacks other financially sensible but foolhardy practices such as recycling poultry litter with spilled cattle meal back to cattle, giving calves "milk replacer" made from cattle blood and letting cows eat dried restaurant "plate waste." She also calls for brains and spines of all cattle to be destroyed, not made into feed even for pigs or chickens.

"That's how you keep infectivity out of the food chain," she said. "If a farmer makes a mistake and gives pig feed to cattle by mistake, the feed is safe."

That’s also how you repair a badly damaged international image and prevent it from spilling over into the U.S. marketplace. Forget science for now. If it doesn’t pass the “yuck” test, don’t do it. Science sometimes loses; public opinion always wins.

Whoops, they did it again - USDA tests same animal third time

Here is an unfortunate juxtaposition of headlines on the USDA website:

June 9: Agriculture Secretary Mike Johanns led a roundtable panel discussion entitled, "The Safety of North American Beef and the Economic Effect of BSE on the U.S. Beef Industry," at the University of Minnesota St. Paul Campus.

June 10, 5:00 PM: Transcript of Tele-News Conference with Agriculture Secretary Mike Johanns and Dr. John Clifford, Chief Veterinary Officer, Animal Plant Health Inspection Service Regarding Further Analysis Of BSE Inconclusive Test Results Washington, D.C.

The USDA did an abrupt about face late Friday, creating a Keystone cops scenario with too many organizations suddenly bumping into each other on the most critical issue ever to hit the North America beef industry. Coming the day after their carefully orchestrated St. Paul panel discussion on the safety of North American beef, it raised a lot of questions about the politics of BSE.

Day one: an unapologetic cheer-leading effort attended by most of the stake holders in the beef industry. Johanns hosted a mostly friendly roundtable featuring Carl Kuehne, CEO of American Foods Group who attended on behalf of the American Meat Institute, Mike Johns of the National Cattlemen’s Beef Association and John Nalivka of the National Meat Association.

Day two: an event that should qualify as one of the industries worst nightmares. After long negotiations about resuming trade with the Japanese, it looked like we were finally in step. A government delegation from Tokyo was scheduled to visit plants and feed yards in Colorado within the next two weeks. After a similar visit earlier this year, Taiwan reopened their border, an event trumpeted by Phil Seng and the USMEF staff during their recent Washington Convention. The Middle East was slowly coming around, too, with Egypt leading the way.

Then, after the regular close-of-business on Friday, a time and day infamous inside the beltway as perfect for throwing away news that you don’t particularly care to be published, Johanns and company unleashed the news. The “Texas” cow that had previously been tested as a weak positive then retested at the Ames, Iowa lab and shown to be negative, was tested yet again using the western blot method. And it was positive.

Lest panic ensue immediately, the USDA said a sample was being sent to Weybridge, England for a definitive third party test. Maybe panic would wait the two weeks needed to complete the test.

The immediate question was, “Why did the USDA decide to retest long after the animal was cleared by the Ames lab?” Claiming at least part of the responsibility for pushing the Department of Agriculture to make the politically dangerous decision was Consumers Union, publisher of Consumer Reports, a magazine with over 4 million subscribers. Big numbers always catch the attention of Washingtonians.

C.U. has been pressing the U.S. Department of Agriculture to adopt the Western blot test from the beginning, citing its greater reliability. Consumers Union is also urging the government to rapidly complete the process of tracing the origins of the animal, as well as other animals in the herd. Expect the Union to join a growing list of organizations gathering around the traceability issue, too.

“We have been urging the USDA since February to retest the November suspect animal using the more sensitive Western blot test, and we commend USDA for taking this extra step to protect the safety of America’s beef,” stated Michael Hansen, Ph.D., a biologist and a spokesman for Consumers Union’s www.NotInMyFood.org project.

”This latest U.S. mad cow case demonstrates how the USDA has been effectively covering up the disease by failing to use the Western Blot test and by failing to test millions of cattle a year,” said John Stauber, Executive Director of the Center for Media and Democracy and co-author with Sheldon Hampton of Mad Cow USA, a controversial book published in 1997, that predicted the emergence of the disease in the United States.

Stauber maintains testing less than 375,000 animals out of the giant U.S. herd is simply not enough to safeguard the beef supply, especially if younger animals can carry the disease for years without exhibiting symptoms. In an interview with CattleNetwork on Tuesday, he called for a total ban of all ruminant protein materials, including blood and animal fat, from all feed as a first necessary step in preventing the spread of the disease.

His position is four-square behind the science-based attitude of groups like the American Meat Institute. He wants to take it much further than most people in the cattle industry believe is necessary, dropping the minimum age of tested animals to 20 months and greatly increasing the number of tests, at least until the effects of his more ambitious feed ban are felt.

Stauber said, “The Bush administration is putting the livestock industry’s desire to keep feeding cheap slaughterhouse waste to cattle above the urgent need to protect human health and the human blood supply. All feeding of slaughterhouse waste to livestock must be banned. In addition, the USDA must allow private meat companies and producers to test their cattle for mad cow disease. Private testing would rescue foreign beef sales, give foreign and domestic consumers the choice of buying meat tested free of mad cow disease, and would help determine the real number of U.S. mad cow cases.”

Consumers Union issued a press release that claimed the FDA had “stated more than a year ago that it would prohibit cows’ blood, chicken coop floor wastes, and restaurant plate wastes, in cattle feed but has not done so.” It urged that these materials, as well as pig and chicken slaughterhouse wastes, be eliminated from cattle feed.

Brand loyalty: A marketing rule written by Mother Goose

"Catch ‘em with your brand when they’re young and they’ll stay with you for a lifetime.” There are still too many marketers who believe that hoary old saw. Time to put it on the shelf next to some other old but not-so-bold truths like Milli Vanilli sang their own songs and no one will ever know the true identity of Deep Throat. It’s a fairy tale with just enough truth to it to make it seem plausible.

That branding idea reached it’s zenith at the mid-point of the last century when the size of the baby boomer generation caught the attention of marketing people everywhere. It was the biggest population bubble in history, something that a well-managed brand was supposed to capture and ride to profitability for decades to come.

Except it never worked. If it did, Gerber would own just about every square inch of supermarket shelf space with Gerber-branded baby food, soups, dry cereals, canned vegetables and fresh beef and pork. Cherry Coke would still be a major soft drink, not just something brewed up at a soda fountain as a sixties treat. Pop Rocks would still rule the candy counter. And I would still be driving a Ford product, graduating from that Mustang of my youth to a Lincoln LS in my dotage – maybe with a Bronco and a Mercury Monterey along the way. Mother Goose couldn’t write that fairy tale.

So why am I still watching “smart marketing people” chasing the holy grail of 15-25 year olds? The real money is still with the baby boomers. We’re the folks, after all, that are financing the lifestyles of most of those youngsters. We’re still the biggest population bubble in history and now we have large amounts of disposable cash as we’ve reached our peak earning years. As we’ve aged, we have special dietary needs, a market largely unrecognized by food companies.

So with such a large and financially stable audience, why are so few food processors chasing the market? Many of us have to watch our sodium intake but most prepared foods are saturated with salt. The dietary fat we could burn off when we were active twenty year olds now goes straight to our bellies and backsides.

Care to check the fat and sodium content of most processed foods on the supermarket shelf? It’s almost impossible. The mice type used to print product labels is unintelligible to aging eyes. It doesn’t matter, though; most of the products exceed our daily maximum intake for fat and salt in one small serving.

Here is the real truth in marketing. The consumer is a fickle beast. What’s hot today is tomorrow’s embarrassment. Each generation tends to reject the choices of its predecessors and then change its mind from year-to-year as its needs evolve. I needed a Mustang as a newlywed, a Toyota van as a suburban father of two and a Chevrolet SUV when I moved to a snow belt state.

I was a big fan of Campbell’s tomato soup as a starving student. Can’t stand the stuff now. Like most people, red meat was a favorite for a few decades, carb loading gained my favor for a while and now I’ve gone back to meat. In an unscientific survey of a few friends, my history seems pretty average. In no instance have I discovered an undying, decades-long attachment to a particular brand.

Here’s my suggestion to food marketers everywhere. Dump the single-minded pursuit of the youth market. To make money like you had the keys to the mint, go where the money is – the aging boomer generation. We need lots of stuff, we’ve got the money to buy it and only a few companies have “discovered” us.

Itoham, Staggered by Pork Scandal, Gets after the Beef Business

Itoham Foods Inc., Japan's second-biggest meat processor with over $4 billion in sales, is being investigated on suspicion of imported pork customs-duties evasion estimated at more than 300 million yen ($2.77 million) according to the Nihon Keizai newspaper. A Bloomberg business news service report quoted Itoham president Masami Ito as acknowledging two company officials are under investigation. Reacting to the scandal, the value of company stock has dropped significantly.

Possibly trying to deflect criticism from its pork business, Itoham has just asked the Canadian government to allow Japanese beef importers to jointly and voluntarily screen cattle not covered by proposed mad cow testing according to the Nihon Keizai Shimbun. Japan and Canada are now discussing how to resume partial shipments. The request by a major Japanese meat packer steps outside the delicate government-to-government diplomatic negotiations.

Itoham mailed a letter of request to the Canadian government on June 2, asking for approval of voluntary screening of animals more than 20 months old using a test developed by the Japanese company in cooperation with Prionics AG, a high-tech company in the biotechnology industry specializing in zoonotic disease research. The company claims reliable test results are available in slightly more than an hour. Itoham made a similar request to the U.S. government in April but it was rejected.

Itoham estimates the cost of screening at around $20 per animal, a cost likely to be passed on to consumers.

Itoham America Inc. operates three divisions and one subsidiary in the United States. It’s most well-know division is Ito Cariani Foods in Hayward, California, a suburb of San Francisco. Cariani manufactures Italian specialty meats and processed meat products.
Calco International Division in Denver, Colorado imports and exports meat products. NWIP Division in Sioux City, Iowa, supplies raw meat to Cariani and Calco. Wyoming Premium Farms, LLC, located in Wheatland, Wyoming, raises and develops hogs.

Itoham also founded American Peptide Company, a company with headquarters in Sunnyvale, California. It manufactures peptides and related products in the U.S. and Japan.

Burger King "Superfans" inhale thousands of Whoppers

And just 3 veggie burgers per month

So said Burger King CEO Greg Brenneman when asked about store sales during an NBC Today segment with Lester Holt last Friday. Holt called it “the revenge of the cheeseburgers,” as he described the failure of the health food movement in the fast food industry. Reacting to a question about getting flack from special interest groups who are demanding QSR’s take some responsibility for obese Americans, Brenneman dismissed people that objected to his new high calorie, high fat menu as “nutrition nuts,” bold talk from a man who runs marathons as a hobby.

Almost buried among his shameless product plugs, though, was a basic marketing truth that he had the courage to face when he took over the faltering chain: Success only comes when you cater to your core customer. He spoke of Burger King’s superfans - 18% of the people who walk through their doors who are responsible for half their sales. It’s a target market of young, active men who eat big and shun salads as something for “ladies who lunch.”

What people choose to eat isn’t Burger Kings’ responsibility, Brenneman claimed. He acknowledged the need to have limited-interest items such as their recently introduced veggie burger and “healthy” salads, but he said the real point behind their menu overhaul was giving their Superfans choices. He wants them to have big time, high volume options like their 760 calorie Enormous Omelet Sandwich or the 1060 calorie Original DOUBLE WHOPPER®, a two-fisted, double-mouthful he called his favorite sandwich. The trim Brenneman, a man who looks like he’s never eaten an entire Whopper at one sitting, probably owed that silly comment to his marketing team.