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Perishable Pundit
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Salmonella And Tomatoes
Linked In New Mexico

If, like most of us today, you work 24/7 and, as such, live connected to your Blackberry, iPhone or PDA, the tranquility of your weekend may have been disturbed by an e-mail from PMA, United or both as they dispatched an announcement referencing an Alert issued by the New Mexico Department of Health:

DEPARTMENT OF HEALTH ANNOUNCES
LINK BETWEEN TOMATOES, SALMONELLA

Santa Fe — The New Mexico Department of Health announced today that an outbreak of Salmonella is likely caused by eating uncooked tomatoes. So far, 31 people from seven counties in New Mexico have been sick with a strain of Salmonella called Salmonella St. Paul. Several people have been hospitalized, and no one has died.

The Department of Health’s epidemiologists, Public Health staff and the Scientific Laboratory worked together to interview patients, test samples and conclude that uncooked tomatoes are the likely cause of the outbreak.

New Mexico has been coordinating the investigation between other states, New Mexico Environment Department, the Navajo Nation, Indian Health Service, Centers for Disease Control and Prevention and the Food and Drug Administration. FDA is trying to pinpoint the exact source of the implicated tomatoes.

“We have determined that eating uncooked tomatoes is the likely source of this outbreak, and we hope to provide more specific information about the type of tomatoes as the investigation proceeds,” said Health Secretary Dr. Alfredo Vigil.

Until further information is available, the Department of Health recommends the following:

Individuals and restaurants that bought tomatoes from Walmart in Las Cruces or

Farmington, Lowe’s in Las Cruces, or Bashas’ in Crownpoint since May 3 should not eat them uncooked.

Always wash tomatoes before eating.

Wash hands, kitchen work surfaces and utensils with soap and water immediately after they have been in contact with tomatoes.

Cook food thoroughly to kill Salmonella.

People began to be sick on May 6. The Department of Health continues to identify new infections.

Most people infected with Salmonella develop diarrhea, fever, and abdominal cramps 12 to 72 hours after infection. The illness usually lasts four to seven days, and most persons recover without treatment. Some people may need hospitalization due to severe diarrhea. The elderly, infants, and those with impaired immune systems are more likely to have a severe illness.

The release is somewhat problematic. It says people “began to be sick” on May 6. On the other hand, it says the “Department of Heath continues to identify new infections.” We have gone through many of these outbreaks, and it sometimes seems as if a prerequisite for government office is to graduate from “Cryptic Writing School” — what does “identify new infections” actually mean? Are people still getting sick or is the state laboratory tying in cases of people who got sick weeks ago.

The advice the release gives… not to shop at three particular stores… also seems problematic. Salmonella can be due to one employee with bad health and hygiene practices as we demonstrated in this Wal-Mart story. But if it is three different stores from three different chains, that seems unlikely.

If it is not a store-based issue, then these chains use distribution centers, and surely the tomatoes have been in hundreds of stores. And even with imperfect traceability, it is a pretty simple matter for Wal-Mart, say, to know what DC supplies tomatoes to this store and what other stores it would have supplied.

We communicated with officials at FDA and in New Mexico, but they had little additional information to add. We are still investigating and hoped to know more soon. We also turned to Reggie Brown, manager of the Florida Tomato Committee and Executive Vice President of the Florida Tomato Exchange, Maitland, Florida, with whom we previously discussed food safety and tomatoes here.

We also spoke with Ed Beckman, President of the California Tomato Farmers, Fresno, California, with whom we also discussed tomatoes and food safety here.

Finally, we reached out to Dr. Trevor Suslow, Extension Postharvest Specialist for the Department of Plant Science, UC Davis, California, for a scientific perception on the situation.

Here is the conversation Pundit Investigator and Special Projects Editor Mira Slott had with Ed Beckman:

Ed Beckman
President
California Tomato Farmers
Fresno, CA

Q: What information have you learned about the tomato Salmonella outbreak reported by the New Mexico Department of Health? Could you shed light on the source of the problem?

A: The California Tomato Farmers is monitoring the current Salmonella outbreak with much concern and care for those who have been sickened. It should be noted that there were no tomatoes being harvested and shipped from California during the onset of the confirmed illnesses, and therefore, it is highly unlikely that California is the source of this unfortunate outbreak.

Our production in California started mid-May and the outbreak looks to have started in April. We’ve been working with FDA for some time improving communication. We’ve been in contact with FDA this weekend, helping to express to them production areas currently supplying tomatoes to us and looking at the distribution supply chain models to give them a better understanding of how tomatoes are making their way through the system. Not a lot is understood at this point.

Q: What is the production schedule by region during the timeframe in question? What are the likely and unlikely scenarios?

A: It’s an interesting time, because the industry is somewhat transitioning. Florida is now moving out of production and it’s now significantly more limited. Mexico is transitioning from mainland Mexico to Baja, California. As far as California, we started our season mid-May after the onset of the outbreak. We’ll see increased production from California as we get to the end of June. There are a few pockets of production coming from Canada.

When you look at the time of the outbreak… it’s important to understand when it was first reported and taking that into account. What the New Mexico Department of Public Health reported was the first part of May. There are some conflicting reports that are existing. PMA reported that it may have begun as early as late April. Anytime when something develops over the weekend, you may find conflicting reports.

Q: Have you learned if the outbreak extends outside New Mexico to neighboring states, and if any more retailers or foodservice operators have been linked to the problem?

A: From published reports, obviously the outbreak has affected a number of associations with retail consumption. A lot of this information has come up over the weekend and is still unfolding. FDA will have to do a trace back and determine where the product became contaminated in the system. It is FDA’s responsibility to investigate. We’ve made strides in the food safety programs we’re doing out here, and I can give you an update when things calm down.

Q: I remember when we spoke about food safety in the tomato industry, you mentioned that Salmonella outbreaks connected with tomatoes have been more frequently connected with East Coast production. Is this case in the Western United States unusual?

A: Salmonella issues have not been common to California. I believe this is a rather unique strain of Salmonella, reports say the sixth most common strain, but to my knowledge it hasn’t been associated with other tomato outbreaks. It did catch me off guard. This is a question that is best answered by scientists. Dr. Trevor Suslow, who is on our advisory committee, is a great asset.

While the outbreak does not seem to involve California product, whenever an outbreak occurs, it is a reminder for all of us to continually review and re-examine all food safety standards on farms and at shipping points to ensure we are producing the safest food possible for consumers.

Q: I understand from speaking with Reggie Brown that a new, innovative food safety document for fresh tomato production throughout North America is set to be released imminently. Reggie said the core was completed on Friday and is now just being fine-tuned.

A: California Tomato Farmers (CTF) was an editor of the 2nd Edition of Food Safety Guidance for Fresh Tomato Supply Chain, soon to be published by United Fresh and the North American Tomato Trade Work Group. This is a very comprehensive supply chain document that addresses food safety in a number of modules unique to each step in the tomato supply/distribution chain.

The modules begin with best practices for the field, greenhouse, and packinghouse, repacking, fresh-cut processing, and conclude with retail and foodservice guidance that provides greatly enhanced recommendations for production preparation and display.

It is the most complete document for fresh tomato handling resources, whether you’re a grower/shipper, processor, re-packer, retailer or foodservice operator. Some 40 individuals from a broad spectrum were involved in the review. Our role was that of editor of the packinghouse module. It will be coming out shortly and will be available on download from our website as well as others. It will prove of great value to the industry.

Q: Could a document like this prevent outbreaks like this most recent one in New Mexico from occurring?

A: This is a risk-based approach — the same approach we employ with California tomato farmers. The key is to focus on risk areas and develop protocol to minimize risk.

Q: What makes this second edition so different from the one already out there?

A: What’s important with this document is that the first edition was a best management document very heavily weighted to the grower/shipper. This new edition provides in-depth protocols well beyond that. A lot of food safety problems have been in the midst of distribution, especially in the fresh-cut processing arena. For example, when tomatoes are exposed to water colder than the pulp of the tomato, risk of penetration of microbials is increased. This document provides a lot of answers to food safety problems throughout the supply chain, all in one place. .

Q: How long has this been in development?

A: Many hundreds of hours; about a 10-month process. The first edition was typical to many best practices documents, placing a significant focus on the field and packing shed.

This document gives equal weight to everyone who handles tomatoes, which it should, and specific guidance to each touch point in the process. We just finished final edits on the documents last Friday. Dave Gombas at United is the final editor and could provide a better time line of when it will be released.

Q: How does this relate to the Fresh Standard’s program CTF is employing? What developments have occurred since you launched the program?

A: CTF, a cooperative formed by growers in 2006, is committed to adhere to standards governing a number of areas, including quality, food safety, worker safety and environmental stewardship. In its second year of operation, significant improvements have been made to the Fresh Standard with respect to food safety, mandatory random unannounced government inspections, and worker safety.

We’ve been fortunate to have Dr. Suslow’s input on food safety issues previously. Most recently, he discussed the issue of Salmonella and cantaloupes, which you can read here. He also contributed to a special science related issue we did here.

With little hard evidence regarding this New Mexico outbreak, we again turned to Dr. Suslow for a better understanding of the science regarding Salmonella and tomatoes.

Pundit Investigator and Special Projects Editor Mira Slott spoke with Dr. Suslow:

Trevor Suslow
Ph.D., Extension Research Specialist
Postharvest Quality and Safety
Department of Plant Sciences
University of California, Davis

Q: Ed Beckman mentioned that the strain of Salmonella being linked to the current tomato outbreak is not typically associated with tomatoes. He said you would be able to provide more scientific background on this.

A: You can talk to various sectors of public health and get different information on this. As far as I know, the Salmonella Saintpaul strain is not a subtype associated with tomatoes or other tomato outbreaks in the past. It’s relatively common in salmonella outbreaks in the U.S.

One of the things they’re trying to sort out is the background for this particular type. Is this a normal level of illness or unusual? They started doing epidemiology research to make the link. Salmonella Saintpaul is fairly common; reported to be the sixth most common serovar (subtype) in humans in the U.S. It has a wide host association among humans and animals, including production, recreational and domestic pets. Salmonella Saintpaul has a very broad host range and can be found in many animals; that includes cows and amphibians.

Q: Do you have any scientific assessment of where the contamination occurred?

A: My pure guess would be it’s likely associated with where the tomatoes were originally sourced. Animal vectors or reservoirs for this particular type, whatever factors brought this together; whereas in other areas, the problem is more associated with birds being a primary vector. They often have a more typical host, but can easily pass through many animals including human animals.

We’re all trying to absorb information as it dribbles out to us. I hate to speculate until more information is known about the growing and shipping areas and how they were handled. Salmonella Saintpaul is not a rare strain. Rare strains help the Department of Health more easily identify an outbreak. My understanding is this strain is relatively prevalent, which makes discovering of the source more challenging.

Q: Have you been involved in the new North American food safety guidance for fresh tomatoes? What is your scientific perspective of the document?

A: Certainly there have been a lot of efforts to target more commodity-specific and in this case tomato-specific practices at harvest through processing to retail display. This document is a work in development, but at some point the industry needs to move forward and recognize as more scientific data comes out, we can amend it.

My perspective is that there are areas, as painful as it is to hear, that have to be tightened down more to implement certain practices. It’s a much better document, but still can be much better.

Q: In what ways? Would you point to particular areas in the supply chain that present greater risks?

A: Yes. The industry needs to standardize any post-harvest water use, the levels and monitoring of dose effectiveness to prevent cross-contamination. There are still some difficulties in defining what the appropriate standards are for water treatments, and that is a key area for preventing cross-contamination and broad distribution of microbials if they are introduced into the product. Also, it is critical to try and pinpoint appropriate standards for irrigation water, using available information; there has to be contribution from research, but utilizing knowledge we’re aware of, they might have to tighten things down a bit more.

It is hard to make much of all the reports. In addition to New Mexico, there are people reported sick with Salmonella in Arizona, Colorado, Idaho, Illinois, Texas and Utah, but there is no link established to tomatoes or any other food.

Certainly what this does establish is two things:

One, the industry efforts on traceability, which we have chronicled here and here, cannot relent. We are writing this at almost midnight Monday evening, and these alerts went out on Saturday. That here it is Tuesday morning and the industry cannot definitively reassure consumers and regulators which brands, which geographies, etc., are not implicated is simply unacceptable.

Second, Salmonella in general is a real problem. Because the spinach crisis focused on E. coli 0157:H7, that got all the attention. But salmonella is popping up a great deal. We have had extensive coverage to the issue of the FDA import alert on Honduran cantaloupes, which was prompted by an alleged epidemiological link with Salmonella. And, as we mentioned, Trevor Suslow spoke to us about cantaloupes and Salmonella here.

Yet literally, while we are writing this we get a notice from the Canadian Food Inspection Agency that they call a Health Hazard Alert telling us that Fisher Ranch Corp. cantaloupes imported from Blythe, California, into Canada by Gambles Ontario Produce, may contain Salmonella. We know even less about this than we do about the New Mexico tomatoes, so if, where and how are still to be determined.

But if the tomato industry is going to come out with new food safety guidelines, it is imperative that they have consensus of food safety experts as to the sufficiency of the efforts. Like politics and horseshoes, when it comes to food safety, close doesn’t count.

Many thanks to Ed Beckman and Trevor Suslow for helping the industry understand the situation more completely.




Industry Pro Gives Thoughts/Insights
On Safeway’s Small Format Stores

Our extensive study of Tesco’s journey to America has focused mostly on analysis of the concept behind, and the performance of, its Fresh & Easy division. Ultimately, however, the success of any business depends, at least in part, on the competitive environment in which it operates. Now we have run pieces such as this one discussing how competitors utilize their existing infrastructures to compete with Fresh & Easy. Of great interest, though, is whether other small format stores will become a competitive tool.

Opening a 200,000-square-foot Wal-Mart Supercenter or even a 55,000-square-foot Lifestyle Safeway because Tesco opens a 10,000-square-foot Fresh & Easy superette is a little like trying to crush an ant with an elephant. However, if competitors such as Wal-Mart and Safeway develop viable small format stores, it would change the competitive environment in two important ways:

First, the rollout of such stores nationally — and surely they would be quickly duplicated by other chains if they were successful — would serve to cap the upside for Tesco’s Fresh & Easy venture. It is one thing to quickly lease 300 stores that are of a size nobody wants. It is a completely different issue to go to, say, Boston and roll out such a concept after local retailers have had their pick of real estate.

Second, a successful small store format would add a new arrow to the quiver of competitors — and one that could be realistically used. If Fresh & Easy has a particularly successful store, you can expect the Safeway concept and the Wal-Mart concept to look to open nearby — and Kroger, Supervalu and others won’t be far behind. This type of direct competition that can basically preclude Fresh & Easy from having any very successful stores, yet with the vagaries of real estate, Tesco will need super successful stores to offset its losers.

The importance of this issue: the future of small footprint grocery stores means that Safeway’s opening of its new “the Market by Vons” has attracted great attention. We ran a piece on it, and we have begun receiving feedback from the Pundit Intelligence Network of readers — including this thoughtful letter from a very prominent industry consultant:

The Pundit piece, Safeway’s Small Footprint Store Distinguished By High Service, Upscale Look And Offerings, led me to make a point of adding a visit to “the Market by Vons” to a retail tour we were scheduled to conduct in southern California. It was a little “déjà vue all over again” as I had visited the location on vacation-time beach trips many times over the years.

Everything your Pundit article pointed out is very true, as was the information in the Los Angeles Times article the Pundit linked to in the course of its piece.

The store has now been open for almost a month and the following are some additions to what has already been written… some points peculiar to this store, others germane to the larger question of the future of this format and small format stores in general.

The store only has 35 parking spots in the parking lot, and the beach is in walking distance… in the past I remember that beach goers have used the parking lot, thus severely restricting parking for shoppers. The store currently has a guard policing the lot, but I don’t know if that will continue forever as it is very expensive.

The concept offers seven outdoor tables with a 28-person capacity to sit and eat. If Safeway makes an eating area, indoors or out a feature in future stores, it creates a significant point of differentiation with Fresh & Easy.

The store had two displays outside currently being used by produce with a display of sweet corn and mini watermelon — two great items and at great promotional prices.

At 2:00 PM on a weekday, the store had 34 active customers shopping.

The store has more than the usual field management in the store to work it and “baby sit” it, as this is the first of what Safeway hopes will be many of this new small format concept. The staffing level indicated a high priority project.

As the Pundit mentioned in its piece, Fresh & Easy Loses Price/Assortment War To Wal-Mart In Los Angeles, the Pundit sister publication PRODUCE BUSINESS had recently done a piece entitled Wal-Mart Pricing Study Round XVII: In LA, Wal-Mart Out-Prices Fresh & Easy And Others. This piece included an SKU count for a Vons in Glendora, which we would say is a fairly typical Vons.

Between what information is published in the article and some details the Pundit shared on the phone, we put together a rough count and used this fairly typical Glendora Vons as a benchmark to compare produce SKUs with Vons’ new small footprint store. This is what we came up with:

“the market”Vons
Fresh fruits and veg300346
Value added salads and veg 55102
Juices 7088
Cut fruit 448
Soy products 1736
Dressings and dips 2468
TOTAL490688

We did not include the dry items, dried fruits, nuts, etc.

For a 15,000 sq. ft. store to have the space and design to stock over 70% of a normal 50,000 sq ft Vons is a great accomplishment.

Much of what the store stocks in produce is organic, high end and often packaged, but they still create a bulk, select-your-own, fresh image.

In reviewing the 70% of produce SKU’s that they maintained from a normal Vons, we would say they did a stellar job of selection. They certainly had the ability to review the Vons scan file before the store closed, so they know what did and did not sell in that location in its previous incarnation.

Management told us that they are adjusting the produce and total store mix as they see what the customers ask for and what they are buying or are not buying.

This store was a little run down Safeway when Vons bought the Southern CA Safeway Division, and it became a little Vons with hardly any investment in the 18 years in has been a Vons.

As the Pundit mentioned in its article, the store’s wine selection was outstanding prior to closing. It is now even more extensive.

With the SKU count down significantly in the “center store,” the store will lose some customers looking for center-store basics, but it should pick up new customers who will be buying the higher priced and higher margin products on the perimeter.

The “center store” aisles are only five foot wide, but with the use of hand baskets and the very small shopping baskets — yet ideally sized for the concept and the type of shopper likely to be attracted to the concept — the aisles are ample.

The “center store” gondolas are 76 inches high with seven shelves and this is a bit high for the average customer, but it didn’t look out of scale so one suspects customers will get used to it. And it was a necessity in order to have room for the SKU count and thus the assortment the store was looking to provide.

Our estimate is the store, prior to closing, was doing a bit less than $200,000 per week and now is probably doing in excess of $325,000. With that, we estimate sales as running no less than $21 per square foot per week and perhaps as high as $25 per sq ft per week.

Our judgment is that the produce department is doing over 20% and may be hitting 25% of total store sales.

We estimate that the other perishable departments are running roughly double the normal percent to total of the typical Vons. We would say that the “center store” is doing less than 30% of the total with the wine department doing in excess of 10%.

This kind of mix is essential in order to maintain their service levels in the perishable departments and to get the turnover to keep the shrink under control. Safeway management has transformed the store from a low payroll store to a very high one.

They have four service and four self-service check outs.

As a chain, Safeway has been slow to embrace the self-service checkouts, and I did check out using one. In the area Albertsons, Fresh & Easy, and Ralphs also offer self-checkout, but Safeway’s system is not very customer-friendly and management has a lot of work to do to make them comparable to the self-checkout systems offered by competitors..

When comparing “the Market by Vons” and Fresh & Easy, we would say the following:

Fresh & Easy has:

  • Better prices
  • Better self-service check out
  • More parking

“the Market by Vons” has:

  • 5,000 more sq ft to work with but they have a significantly better selection in all departments, including the center store. Our off-the-cuff guess is they have a total of three or even four times the SKU’s of a Fresh & Easy. Produce alone has 2½ the SKU’s verses Fresh & Easy despite Fresh & Easy constantly touting its produce variety.

The concept makes better use of space and will achieve a much higher inventory turnover.

  • The store has a better fresh image with the ability to select what you want
  • Better decor
  • Better perishables
  • Better service
  • Sampling throughout the store and not in just one area. The items selected for sampling are all from the perishable departments and were all very good.

There is little question that this is a high-priority project for Safeway and so Safeway will continue to improve this store and any others they role out. The big handicap at this particular store is parking and the parking will always be better in future stores than it is at this store.

Summary judgment: If there was a “the market by Vons” and a Fresh & Easy across the street from one another, I believe “the market” would blow away the Fresh & Easy despite the differences in retails.

We are always deeply appreciative for the efforts of Pundit readers to share their insights with the industry. We are truly blessed with readers both knowledgeable and insightful as this letter amply demonstrates.

To us, this Safeway concept is so service-oriented and so up-market that it leads to one of three possibilities. Either A) There is another shoe to drop, and Safeway will at some point unveil a very different small format store to serve a more modest demographic. B) Safeway does not believe the Fresh & Easy concept is viable except in more affluent areas. We know that much of Safeway’s marketing response has centered on its “O" brand organic line and Crusty Breads — both upscale lines. If Safeway thought it was losing business based on price, we would expect to see promotion of its cheaper private label product. C) Whether Tesco can be successful or not in poor neighborhoods, that is not where Safeway sees its future.

Our guess is a bit of B combined with a lot of C.

Although Safeway may open some small format stores, we see no indications of massive 300-store rollouts any time soon.

What Safeway may be more concerned about is finding an alternative to closing the 500-odd stores it has right now that are 25,000 square feet or smaller. Now that the Lifestyle rollout is coming to an end, this may provide the next generation lift in sales and profits.

If this happens to hurt Tesco, it is purely coincidental; we would think Safeways’ goal is to maximize the return on its own assets.

Many thanks to our correspondent for his generosity in sharing his time and insights with us all.




Future Labor Shortage
Poses Problems For Industry

Want to know the justifications for the PMA Education Foundation? Look to Iowa! When the foundation launched, Pundit sister publication, PRODUCE BUSINESS, ran a series of columns explaining the rationale of the foundation:

May You Live In Interesting Times

Workplace Disconnects

Finding — And Keeping — Talent

Early Exposure Breeds Success

Supporting The Foundation

This piece from The New York Times, As Iowa Job Surplus Grows, Workers Call the Shots, seemed an important early warning of what may lie ahead for the industry:

…As rising unemployment and layoffs beset workers around the country, Iowa faces a different problem: a surplus of jobs. Or to put it another way: a shortage of workers. A survey of companies by Iowa Workforce Development, a state agency, found as many as 48,000 job vacancies, in industries including financial services — Des Moines trails only Hartford as the nation’s insurance capital — health care and skilled manufacturing. One estimate projects the job surplus to reach 198,000 by 2014, with vacancies increasingly in professional positions. Greater Des Moines alone faces a shortfall of 60,000 workers in the next decade.

The state provides a small, advance view of what some economists predict will be a broader shortage of skilled workers in the next 20 or 30 years, as tens of millions of baby boomers retire from the workplace, and the economy produces more new jobs than workers. Potential consequences include slower economic growth and competitiveness, as well as higher wages for skilled workers and greater inequality.

Estimates of the national shortage run as high as 14 million skilled workers by 2020, according to widely cited projections by the labor economists Anthony P. Carnevale and Donna M. Desrochers….

Of course, industry efforts to recruit and retain people in our industry can help. The industry, collectively, however, cannot do any better than the sum total of how the individual companies fare.

So the challenges of attracting and retaining talent, and the changing expectations that tight labor markets bring, are going to be very much issues that individual firms have to face:

…For workers like Brando Guerrero, 25, a sales analyst at Nationwide Insurance in Des Moines, the jobs shortage means companies “have to sell themselves to potential employees, because there are so many opportunities here.”

“Do they have a free gym, dry cleaning, Starbucks on site?” he said. “What are they doing to make the community better? And once you’re there, companies know they have to promote you to keep you. We’re a little spoiled in our opportunities here.”…

It will certainly take effort:

…he said it was difficult to hire people for advanced technical positions. “I plan a certain amount of my time during the week, 5 to 10 hours, recruiting. You’ve got to work at it. They’re not just going to come to you.”

Like many executives here, he has adopted programs to lure recent retirees back to work part time.

To retain staff, he provides stock options, flex time and short Fridays in the summer. And he has had to be flexible on salary. “People who have a real marketable skill, they know they can call their shots,” he said….

Much of the issue is expected to revolve not around a shortage of people, but a shortage of people with the appropriate skills:

…Several companies are starting to reach into the high schools, identifying students and promising to pay their community college costs, with the guarantee of a job after graduation. Others are looking to the prison system. Forty employers recently participated in a job fair for about 300 inmates in the downtown convention center.

The community college system is at the center of many efforts to address the jobs surplus. The state and private employers like Wells Fargo and Principal Financial, which are both based in Des Moines, have made $23 million available for students to take courses to prepare them for specific jobs, with promises at the end of tuition reimbursement and positions starting at $30,000 to $40,000 for graduates with a two-year degree.

But programs for the jobs in highest demand, including nurses and welders, have long waiting lists. “Employers come to us, asking, ‘Do you have any graduates coming up in this field?’ ” said Scott Ocken, dean of industry and technology. “A lot of times we have to say, ‘We do, but they’re already hired.’ ”

Robert Anderson, executive chef at the college’s culinary institute, said he had two or three job offers for every student…

With a family business on the Hunts Point market, we saw the dilemma first hand. If you thought of the product and the industry, wholesale markets should always be night markets, but it is hard to staff a night market with good people.

For a time the difficult working conditions, high stress and marginal location led the children of many of the wholesalers to go into medicine, law, engineering, teaching, etc. The future was uncertain.

Yet, in time, many of those same children drifted back into the business. Mostly, it was because they couldn’t make the same income, even as a professional, that they could make back in the produce industry.

Industry efforts can help by raising the saliency of the concept of working in the industry, and various company efforts to make working in the industry more pleasant can help. We wonder if the PMAEF shouldn’t look at these community college programs as some kind of direct link — if you finish this program and work for the industry X years, we will reimburse you — might be more effective than simple recruiting.

In any case, all these initiatives should not be underrated. Bryan Silbermann, President of the Produce Marketing Association, and the Pundit had an exchange in PRODUCE BUSINESS when PMA came out with its report, Truck Transportation Best Practices for the Produce Industry. Most of the report dealt with issues such as being polite and considerate as prerequisites for making the produce industry the customer of choice for truckers.

But whatever efforts the industry may launch and however much having a gym on the premises may appeal, we have to believe that substantial shortages in qualified labor will ultimately result in substantial increases in wages and benefits for employees. The challenge to get labor will be real. Figuring out how to pay for it is likely to be an even more difficult problem for the industry and the companies that compose it.




Donohue To Lead Grower-Shipper
Association Of Central California

It seems as if just the other day, we were trumpeting the induction of the first woman to head this important regional association with our piece, Filice Takes Helm On Grower-Shipper Association of Central California.

It seems, though, as if a full year has passed and the association has news:

GROWER-SHIPPER ASSOCIATION INAUGURATES
MAYOR OF SALINAS AS NEW CHAIRMAN,
HONORS FIRST CHAIRWOMAN

Salinas, CA — The Grower-Shipper Association of Central California (GSA) reflected on a year of positive change under the leadership of its first female Chairperson and inaugurated the Mayor of Salinas as its new Chairman at its annual meeting yesterday. This marked a historical day in the organization’s 78-year history as the first time a current city mayor held the organization’s top position.

Kay Filice began the meeting with reflections on her year as the association’s first Chairwoman. She highlighted the organization’s new website, logo and increased communications with members, and partnerships with educational institutions, public service groups and legislators. She said her role with GSA was that of an educator, stating, “We must continue to take responsibility for informing the people in our community and the nation’s consumers about the tremendous health benefits of eating fruits and vegetables.”

A San Benito County grower, mother and businesswoman, Filice brought a unique perspective to the Chairperson’s role. She also spoke of her vision for GSA’s future. “It is my hope that one day the Grower-Shipper Association will join with our trade partners across all commodities to create a national campaign where doctors, dieticians and nutritionists join together to verify the health benefits of fruits and vegetables.” Filice focused on nutrition education and public outreach during her year as Chairwoman and will remain a member of the board for one more year, during which she will aid the board’s transition and continue to focus on outreach projects.

Incoming Chairman Dennis Donohue lauded Filice’s leadership, saying that she was the right leader at the right time, and the perfect person to step into the Chairperson role, stating, “I truly believe if Kay didn’t exist in our industry, we would need to invent her!”

Donohue is both the Mayor of Salinas and President of Royal Rose, LLC, a local grower-shipper specializing in radicchio. He spoke of Salinas as the world’s biggest fresh garden, and a driving force behind the local economic engine. He also touched on the idea of Salinas Valley Agriculture as the fresh laboratory of the world, tying into Dan Dooley’s keynote address at the event. Dooley is the Vice President of Agriculture and National Resources at the University of California and spoke about the importance of industry and university collaboration to further research for the benefit of the entire community.

Jim LuggScience and technology innovations in the industry were highlighted by Donohue throughout his speech and fittingly, Jim Lugg of Fresh Express was awarded the annual E.E. “Gene” Harden Award for lifetime achievement at the end of the event in recognition of his 45-year career and contributions to ag research, science, and technology.

Donohue also challenged the audience to think of the central coast as a fresh lifestyle destination, a community of glorious landscapes and rich history as well as the fresh produce capital of the world.

As the mayor of Salinas, Donohue has focused much of his time on crime and violence prevention. He said that there is a role for the agricultural community in this fight, adding, “Salinas needs your help along with the entire business community. The generosity of the local agricultural industry is unmatched, however we need something else from our local growers and shippers. Schools have the kids, but work has the parents. We need more companies to invite the Gang Task Force to make educational presentations and hold public health fairs for their employees. We need everybody on board to be effective in our effort to squelch violence in our community.”

Lorri KosterDonohue will lead the organization as its Chairman until May 2009. Lorri Koster of Mann Packing Company is the Chairwoman-elect for the 2009-2010 year.

Many times the national and large regional associations get credit for accomplishing things. This is often well deserved, but it is also true that small groups, such as the Grower-Shipper Association of Central California, achieve a great deal and don’t get credit for it as they don’t have the national PR apparatus to let everyone know of their accomplishments.

That doesn’t lessen the accomplishments and only makes service on their boards more admirable.

Best of luck to all involved.




Pundit’s Mailbag — Food Prices
And Free Markets

Our piece entitled, Food Shortages? Blame Governments, focused on an article in The Wall Street Journal revealing that efforts to maintain small landholdings in the Ukraine were having an impact on food production in this country that was once the bread basket of the Soviet Union.

The gist of the piece was that laws precluding individuals from selling their land were also precluding the development of modern, efficient farming — and thus contributing to high food prices around the world.

The piece brought several letters including this one:

The capitalism vs. socialism discussion is easily polarizing, no? Using the Ukraine situation to explain the global food crisis, and to argue for free enterprise as the solution, does not convince me.

No free market advocate would argue that social and economic Darwinism is without pain and suffering; but staunch free market advocates would insist (perhaps correctly) that in spite of the hardships, the free market system is the best we’ve got.

If wealthy people can pay more for food to put in their cars than poor people can pay for food for their bellies, isn’t this just an example of market adjustments that happen to be very difficult and painful for some people?

I am horrified by this, as I think all of us are. But from my limited understanding, I see the free market being as much the cause as the possible solution.

— Bob Sanderson
President
Jonathan’s Sprouts

We’ve been fortunate to gain Bob’s perspective on several issues. Among the pieces Bob has contributed to here at the Pundit are these:

Pundit’s Mailbag — The Acceptance Of Risk

Pundit’s Mailbag — Sprout Lessons Echo Food Safety Dilemma

Pundit’s Mailbag — More On Manure

Pundit’s Mailbag — The Tyranny Of Economics And The Goals Of Fairtrade

Pundit’s Mailbag — Can Irradiation Follow The Path Of Pasteurization?

Pundit’s Mailbag — A Look At Organic Versus Conventional Yields

Pundit’s Mailbag — Irradiation, Pasteurization and Labeling

Pundit’s Mailbag — Pesticides And Cancer

Bob always looks at the big picture and often comes from a different perspective — which makes us think more broadly and makes Bob a valuable friend.

In this case, however, we think the issue is less capitalism vs. socialism than a need to be aware of the law of unintended consequences or, even, the basic necessity of thinking through one’s priorities.

After all, in the Ukraine, the divvying up of old collective farms into small, private plots was a pro-capitalist measure. Restricting the sale of the land was an attempt to maintain a diversity of ownership as a counter balance to a resurgent state at some future date.

At the time, the incentives of small plot ownership were also seen as such that small plots could out-produce the large communal farms. That there was another option of large landholdings combining efficient production with capitalist incentives wasn’t really recognized.

This particular article really just pointed out that an unintended consequence of the law restricting the sale of land was a difficulty in achieving maximally efficient food production.

It should be noted that this does not mean the law is wrong. It just means that one of the costs of the law is higher food prices.

We face similar issues every day. Ought we to drill for oil in Alaska or off our Atlantic and Pacific coasts or should we forgo that oil in order to maintain a more pristine environment? These questions, by their nature, are value questions without obviously correct or incorrect answers.

Yet, logic still rules. If one says the top priority is lowering the price of crude, you have to be in favor of exploring in these places. Otherwise your top priority is maintaining a pristine environment.

These basic rules would apply whatever political or economic system one is functioning under.

Bob’s point about the stomachs of poor people vs. the gas tanks of rich people is certainly emotive, but we think it sets up a false dichotomy. The world does not have some fixed amount of food that must be divvied up according to some system of justice.

The amount of food is dynamic and responds quite well to price signals. Surely those of us in the produce trade can attest to that. The implication that if affluent people will only sacrifice and do without, then the poor would have plenty, just isn’t true.

People grow, say, sprouts in New England because there are people ready, willing and able to pay for them. If they suddenly decided to abstain, it is highly unlikely that this production would be on the next flight to Myanmar. Most likely the sprouts wouldn’t be produced at all.

In this whole debate over food policy, it is easy to inadvertently adopt a stilted view of man as some sort of drain on resources. Such a view is impoverishing to the dignity of humanity. For although people consume resources, they create them as well. Petroleum, for example, is not a naturally useable resource; it is only when combined with the ingenuity of man that a worthless, sticky annoyance becomes fertilizer, pharmaceuticals, containers, clothing, etc

Perhaps the prospect of a life rich in so much drives the creativity that creates resources each day. So if we put moral opprobrium on those who are able and motivated to produce by the prospect of providing an easier life for their loved ones, we may turn off the spigots of innovation that fuel the future and in so doing condemn countless people to lives poorer than they needed to be.

The horror Bob feels at human suffering is noble and can be an important motivator for positive change. But the Ukraine story was telling us of how easily and inadvertently public policy can lead to outcomes no one intended. If this is not precisely an argument for capitalism, it is surely an argument for humility in interfering with the operations of markets.

Markets encapsulate the collective wisdom of players across the globe, each expert in his own sphere. If it is impoverishing to think of men as only consumers of resources, it is arrogant to think that a few men, of noble or ignoble motive, are knowledgeable enough to allocate resources more aptly than the market will.

Many thanks to Bob Sanderson of Jonathan’s Sprouts for his thought-provoking letter.

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