Inside this Food Report


August 1, 2012

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Hello everyone!  Here in the Northwest we are lucky to be enjoying pleasant summer weather, not too hot, not too cold, beautiful sunny skies just right for a brisk walk around the neighborhood.  However many of our friends in the Midwest region of the United States are not so lucky.  As we all have heard severe drought and scorching temperatures have not let up in regions of the Midwest.
The conditions are hurting farmers, ranchers, processors, and pretty soon we all will be feeling the pinch in our wallets.  Livestock producers are culling their herds and initially meat will see a glut in the market.  It is expected that meat prices in the long term will rise by 4 – 5%.    This historic drought is spread over 80% of the Midwest region.   It will be difficult to know the breath of the damage Mother Nature has done to soybean and corn crops until well into the harvest later this month.   Until then let’s pray for some moisture.   We see globally many areas that are also suffering from adverse weather conditions causing havoc on crops and as world demand for food is rising the next few years will prove to be difficult ones indeed.

On the lighter side it has been a normal growing season to date in the Northwest.  Green pea crop has been completed with good yields and quality.  Corn is just beginning and should prove to be a first-rate season as well.

Noon team members are looking forward to receiving all of our visitors this summer and of course we hope to get in a Mariner game, although without Ichiro it will not be the same.   I cannot believe The Yankees took another one!  (And this being said by a native New Yorker).

 At the peak of our harvest season Noon members would like to say “thank you” to all the farmers and processors who work so diligently to bring quality and safe food to our tables.

Betty Johnson and the Noon International Team.

CropVeggiesUnited States: Unlike much of the world the Northwest area of the United States, including Washington and Oregon is experiencing a normal season.   To date there have been no adverse weather conditions and crops are proceeding as normal.   Green Pea season is completed and yield and quality are good.   There was a bit of a warm spell in July, which caused some of the peas to come in as B grade, however overall it was a good quality pack this season.    Corn processing is now underway and to date it is anticipated that no major issues will arise and the crop should come in on budget.    Potatoes are also being harvested and we expect a larger than average potato harvest due to favorable weather conditions and increased acreage this season in Washington and Oregon.

Northwest raspberry harvest should be completed by end August.   Meeker variety has been a struggle due to initial wet and cold weather and then warm temperatures, which has caused some of the fruit to become soft.   Other later varieties are fairing a bit better.

map of china
Ready to harvest delicious
Washington Blueberries

Northwest blueberry season will commence in Washington around August 6th with the first pick of Duke variety.   Reka variety will follow.   To date weather was good for pollination and the current weather has been sizing up the berries nicely.  Blueberry market will remain tight with prices high as Michigan suffers from drought and experiences a difficult blueberry season.   Michigan’s pack of blueberries is usually around 100 million pounds and expected projection is now at 58 million.  Along with a robust fresh market, this will certainly affect blueberry prices this season.

The Midwest area of the United States is suffering due to extreme heat and drought.  Corn production will commence 2 to 3 weeks earlier than usual due to the heat, which is bringing on the crop growth quickly.  However it is anticipated that the crop will be down by 20% depending on whether or not areas receive rain. Processors in the Midwest will not know the extent of the damage caused by drought and heat until harvesting is well underway. Some areas have already begun processing while others will begin in the next few days. The drought is affecting all Midwest crops such as soybean, corn, peas, and potatoes. Many processors are looking to the Northwest processors to fill the void, which most probably will bring vegetable prices from the Northwest area up.

Mexico: The rainy season continues in Mexico and rains are falling more consistently compared to last month.  Yields of excellent quality cauliflower and broccoli for export markets are being accumulated a bit more slowly causing slight shipment delays.

Guatemala: It is now peak season in Guatemala for broccoli harvest and reports are that yields and quality are excellent.

Ecuador: Light rain was received in July, however overall temperatures and precipitation has been average.  Good yields and quality of broccoli is being reported.

Peru: Sufficient water is coming from the highlands, while some other South American countries are facing possible drought conditions.   Some small volumes of green asparagus are being harvested, although primarily for the fresh market.   The primary green asparagus season is estimated to start in Peru in September/October.  Avocados are currently being harvested and reports indicate that volumes are lower than usual.

Costa Rica: Mango season, typically running through June, ended early this year, with lower yields received due to cool and wet weather.   Processing of pineapple and papaya is now underway with good quality being reported.

Argentina: Argentina suffered a drought back in December and January, which struck during the most important stage of flowering for soybean and corn crops.   The heavy rains in May then hindered harvesting equipment forcing farmers to leave much of the soy and corn crop in the fields.   We can see the effects of this with many South American countries inquiring for corn recently.

Europe: Much of Europe has been experiencing a cool and wet summer, which has negatively affected many crops.   Planting of green beans has been delayed due to cooler and wet weather.   The rain kept the seeding machines from entering the fields.   Usually all plantings are completed by the end of June, although as of mid July only 60% of beans were planted in the main growing regions of Belgium, south of the Netherlands and north of France.  Because the harvest will now be delayed it is imperative that the weather remain favorable in order to receive a budget crop on green beans.

Hungry has experienced lack of rain and extremely high temperatures over the last few weeks, which is likely to have an impact on their sweet corn crop.   50 pct of the total sweet corn crop in Hungry is not irrigated so it is imperative to receive rain and it has been reported that recent rain has somewhat relieved the stress on crops in Hungry.

China: Flooding across eastern, southern and southwestern China has caused significant damage to vegetable crops and has added to upward pressure on food prices.    The flooding has reduced vegetable output by about 20% from levels a year earlier, particularly in Zhejiang province.   China goes through cycles of flood and drought and both have been extremely severe over the last few years.

Edamame harvest is completed and quality and yields are normal (better than last season) and prices remain stable.  Seeding for autumn season edamame is expected to begin around July 23rd.

Due to increased precipitation yellow peach variety “83” has experienced soft flesh and other varieties as well have had quality issues which has increased pricing.

Heavy rain during the growth cycle has led to loss of white gourd plants, which has resulted in a price spiral upward of 30 – 40 pct.

To date the lotus crop is reported to be doing well with no major issues.   The harvest is expected to begin next month.

The autumn broccoli is expected to begin seeding in middle August.

New Solutions For China’s Food Safety

map of china

Its rapidly growing economy and dominant role in global politics notwithstanding, China has constantly been confronted with issues regarding food quality and safe manufacturing processes.  The past few years have witnessed several food scandals in the country − the most notorious being the case of melamine-tainted baby formula, that was reported in 2008. The tainted baby formula resulted in several thousands infants being poisoned and six babies succumbing to kidney-related complications.

Recent news reports have also highlighted that cancer-causing toxins such as Alfatoxin have been found in Nanshan Bywise brand baby formula.  The alfatoxin originated from infected cattle that had consumed mildewed cattle feed. The fungus, while not dangerous in small doses, can be highly toxic and cause liver cancer, when consumed in high doses. Recently, Yili Industrial Group, a leading player in the Chinese dairy industry also announced a recall of its infant milk formula due to "unusual" levels of mercury.  Besides dairy products, contaminated tea is an oft-cited food threat in the country.   When tested, several popular tea brands manufactured in China revealed the presence of highly dangerous pesticides such as Methomyl.

In the wake of the these food safety scandals, the Chinese administration is working on finding long-term solutions to its food safety issues, and developing measures to improve accountability, regulation and monitoring of its food manufacturing processes.

Presently, China does not have an exclusive body to record and monitor national food safety standards. This leads to inconsistency in food standards and irregularities in implementation and monitoring.  Also a key challenge limiting China’s efforts in driving food safety is the incongruence between the food standards and the rate of development of its food industry. Some of the food standards are not easily scalable and therefore do not provide sufficient risk assessment capacity.  In addition, food safety standards in the country are not adequately evolved to match with international standards in detecting food contaminants or monitor safety of food packaging.

In its recently drafted “The Twelfth Five-Year Plan on National Food Safety Standards” the country’s administration has committed to initiating several moves including formulating and revising steps for testing food additives, pesticides, pollutants, toxins and residual veterinary medicines across all food products. China’s Ministry of Health is also developing integrated food standards that will help monitoring all naturally derived foods such as beverages, cereals, grains, meat, milk and dairy products, spices and vegetable oils

 China is also preparing to play a more active role in the Codex Committee on Food, and to closely understand the food standards and food safety implementation mechanisms of other major trading members in the World Trade Organisation.  The government is presently launching several initiatives in order to successfully drive these objectives by 2015.  It is also driving sufficient knowledge and training in the area, and fostering talent development, to help drive its food safety initiatives. 

Food safety is a critical issue for China and its government will need to ensure that definitive steps are initiated to provide safely manufactured food not only for its citizens, but also help build the country’s reputation as a reliable and competent player in the global food industry. 

Disney’s Attempt at Reducing Obesity

mickey mouse

Walt Disney Company’s recent announcement that it plans to curtail junk food advertisements across its children’s entertainment channels has received wide support from families and health professionals.  The company is currently working to remove all junk food advertising across all its stations by 2015 – setting the tone for a wider movement on driving healthy eating habits among children. 

In the United States childhood obesity is a cause of great concern for parents and health professionals. Highlighting the enormity of the childhood obesity epidemic, Dr. Catherine Musemeche, pediatric surgeon, explains − “Child-directed advertising is fueling the obesity epidemic.”  To emphasize further on her point, she cites a recently published University of British Columbia study whose findings suggest that banning fast-food advertising aimed at children can greatly help to curtail obesity.

 Findings from the study revealed that banning fast-food advertising in electronic and print media has helped develop a generation of healthy children with good eating habits.  The study established that a 32-year ban on fast-food advertising targeted at kids aided a “13 percent reduction in fast-food expenditures and an estimated 2 billion to 4 billion fewer calories consumed” among children in the province of Quebec.  Not surprisingly, the province also has the least childhood obesity rate in Canada.

Despite the raging childhood obesity epidemic, and several health experts demanding greater responsibility and ownership in creating healthy and nutritious foods for children, children’s food manufacturers have hardly initiated any concrete action. Fast food advertising directed at children continues unabated in our electronic and print media, and barring a marginal improvement in the overall nutritional quality of children’s foods, products such as cereals continue to be loaded with disproportionately high amounts of sugar and unhealthy calories. A recent report released by the Yale Rudd Center for Food Policy and Obesity highlights that children are still consuming “one spoonful of sugar in every three spoonful’s of cereal”.

Family eating habits aside, the media has a huge influence on our nutritional choices.  Sadly, despite several findings that link fast food advertisements and consumption of unhealthy calorie-laden foods and sugary drinks, food companies continue to drive their television advertisements on younger audiences aggressively.  Further, they also market their sugary, high calorie-laden foods to children, in extremely appealing ways. 

Supermarket shelves today abound with dinosaur-shaped cereals and plenty of attractively packaged unhealthy food. Children are constantly exposed to food advertisements, which they cannot evaluate. As a result parents end up giving in to relentless requests for ‘popular’ but unhealthy food.

The unfortunate truth is, many of us have come to accept the irresponsible advertising and aggressive marketing that encourage unhealthy food. One way parents and health professionals can counter the influence is by driving a community of support and awareness, and demanding stronger state legislation.   However in the end it is the parents who should be setting good examples for their young children by offering them healthy food choices and fostering a healthy lifestyle.

Drought Conditions Continue to Plague the Mid West Region of America

Drought stricken corn

The worst drought in decades and scorching heat continues to plague the Mid West region of America. Conditions have been rapidly spreading across several crop-growing states in the Mid-West and although some rain has fallen in some areas it has proven insufficient for soil moisture and comes too late to help early-planted corn and soybeans.  Bloomberg news reports “that corn and soybeans are in their worst state since 1988 as drought covers 56 % of the contiguous 48 U.S. states.   As of July 22, 26 % of US corn and 31 % of soybeans were in good to excellent condition”

 The United States has declared 1,300 counties in 29 states as natural disaster areas. Shoppers will soon be hit by record increases in prices of food products and industry experts are worried over the impact on crop production and the effect it will have on food prices here in the United States and globally. Food and agriculture industry advisors agree that the impact on corn and soybean crops will increase the cost of all food products on the store shelf.  Consumers will soon be paying much more for meat, dairy products, cooking oil and nearly all processed foods, as they rely heavily on corn and soy as their basic ingredient. Dairy products, which were expected to stay flat or decline this year, will also cost more, as cattle feed becomes more expensive for farmers.

As Corinne Alexander, agricultural economist at Purdue University explains - “Food price inflation in 2011 was well above normal”. With food inflation rising to 4.8 percent, 2011 was difficult on shoppers and expectations for 2012 were set around 2 percent. However economists are now certain about a definite increase.  They are uncertain about the volume in price increase, or how much more shoppers will need to pay for their monthly grocery supplies, but do warn that households gear up for a tough 2012 and 2013.

As the present drought conditions continue, tough choices wait ahead for both shoppers and farmers.

Farmers across the Corn Belt, which include the states of Minnesota, Illinois, Indiana, Iowa and Nebraska, had expanded the acreage of corn, last year, to cater to growing global demand for the crop. However, with no rain and hot weather impacting production, many are losing on their crop investment.  The Department of Agriculture had initially estimated national average corn yields of 166 bushels per acre, but has now revised it down to 146, and expects more downward reductions if conditions worsen.

With farms running dry, and supply of corn and soy low, farmers are now paying more for cattle feed. This will lead many of them to choose to slaughter their livestock.

For the shoppers, increased slaughter of livestock will mean discounts on meat but only for a short while.  As supply wanes, farmers will be unable to deliver enough replacement stocks of their meat and dairy produce to super markets. This will lead to a situation where demand outstrips supply, and that’s when food prices will begin to spiral up significantly.  

Corn and soy are essentials in almost 75 % of all foods sold in grocery stores– and a rise in their price will impact all households. The next few weeks will show some significant pointers on what’s in store for our wallets and the global food supply …until then, let’s pray for some rain!

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