BEEF bits

Nov 5, 2010
by WLJ

Korea trade agreement still possible

South Korea’s president expressed confidence last week that South Korea and the U.S. might still final- ize a long-stalled free trade agreement, but didn’t offer any clues about how they could narrow differences on autos and beef ahead of a meeting with President Barack Obama. The two countries, key security allies for decades, concluded 10 months of negotiations in April 2007 for a landmark deal to slash tariffs and other barriers to commerce and signed it three months later. However, the agreement has been stalled since then over concerns about autos and beef. In Washington, the White House said that Obama told President Lee Myung-bak that if Seoul and Washington “can reach a satisfactory agreement on the key issues for American workers, we will have a deal.” The U.S. has said that the agreement cannot go forward without addressing South Korea’s overwhelm ing surplus in auto trade and a further loosening of restrictions on imports of American beef.

FSIS looks to lower contamination

Food Safety and Inspection Service (FSIS) will be taking a closer look at how slaughter operators are controlling pathogenic contamination on beef carcass- es in the year ahead. Dan Engeljohn, FSIS’s chief pol- icy writer, told attendees at the North American Meat Processors Association’s annual outlook conference that there will be a regulatory shift toward ensuring meatpackers are preventing contamination on beef carcasses. “The [current] regulations identify that there should be a minimization of contamination, and we check that by zero tolerance for E. coli,” he said. “But what that really says is we’re allowing contamination so long as you clean it off. We’re looking at changing that in a regulatory structure such that it’s mandatory to prevent contamination in the first place.” FSIS is in the final stages of publishing a draft protocol to design a nationwide baseline study on contamination levels on beef carcasses intended to establish new performance standards that would apply to the carcass immediately after hide removal and prior to downstream interventions, Engeljohn said.

CWT will no longer pay to cull

Members of Cooperatives Working Together (CWT) voted last week to focus exclusively on building export markets and no longer fund herd retirement programs. CWT conducted its 10th and final herd retirement this past summer through which it paid farmers to slaughter 34,442 cows. The decision was voted on at the National Milk Producers Federation annual meeting in Nevada. A presentation there by Scott Brown of the University of Missouri showed that for every one dollar spent assisting CWT member cooperatives in making export sales, U.S. dairy farmers received $15.53 in additional revenue. CWT’s export activity in 2010 has returned 18 cents per hundredweight, according to Brown’s analysis.

Restaurant sales improve

The National Restaurant Association’s Restaurant Performance Index (RPI) improved in September, rising 0.8 percent from August to 100.3. The updated figure puts the index above 100 for the first time in five months. Scores above 100 signify expansion in key industry indicators, while scores below 100 indicate contraction in key industry indicators. The RPI comprises a Current Situation Index, measuring current trends in same-store sales, traffic, labor and capital expenditures, and an Expectations Index, which gauges restaurant operators’ outlooks for same-store sales, staffing, capital expenditures and business conditions over the next six months. September’s Current Situation Index rose 0.5 percent from August to 99.4. The Expectations Index also hit a five-month high, up 1 percent from August to 101.1. Restaurant operators seem to think the economy is on the upswing, with 38 percent of them saying they expect economic condi- tions to improve in six months—up from 25 percent in August.

Pilgrim’s Pride plans expansion

Pilgrim’s Pride Corp., which is owned by Brazilian beef firm JBS, reported recently that with its betterthan-expected quarterly profit, it will revive plans to open idled plants and boost production over the next two years. With restaurant business improving and predictions of increasing beef and pork prices, the company says it is optimistic that chicken prices and demand will improve as consumers seek cheaper alternatives at the meat case. Nationwide chicken production is also expanding this year and while poultry producers are likewise concerned about higher grain prices, the outlook for poultry looks encouraging. Pilgrim’s Pride will resume processing at its idled Douglas, GA, plant and continues to target further expansion in 2011 and 2012 at the plant which will boost the company’s output by about 3 percent.