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Perishable Pundit
P.O. Box 810425
Boca Raton FL 33481

Ph: 561-994-1118
Fax: 561-994-1610


email:
info@PerishablePundit.com

a

Produce Business

Deli Business

American Food & Ag Exporter

Cheese Connoisseur



New Event Planned for 2014:
The United Kingdom’s Fresh Produce Consortium And PRODUCE BUSINESS Magazine Announce The London Produce Show and Conference

As we head off to our 29th consecutive PMA, we are reminded of the powerful draw of this massive event and of Fruit Logistica in Berlin, the two rivals for largest produce event of the year.  These are incredible events, with scale and resources that can’t be matched. We recommend that anyone who can attend these events do so, learn and network all you can.

Yet no one continental event can meet every need.

It was just over four years ago that we joined hands with our friends at the Eastern Produce Council to bring forth a new industry institution, The New York Produce Show and Conference.

The event has been enormously successful, and that success has come about because it filled a void. There was just nothing like it anywhere near New York. Yet there is more to it than that.

The event has heart, because that is what you get when the people putting it together really care about the industry. We have raised hundreds of thousands of dollars for the Eastern Produce Council to use for scholarships and the betterment of the industry. We have brought several hundred students — both ag economics and culinary — into the event, an investment of more hundreds of thousands of dollars in the future of the trade.

Beyond money, we brought cutting-edge ideas, world-class speakers and a chance for thousands of people, some entry-level, some senior-level to connect with a broader industry and realize they are a part of something grander than they realized.

Now we go to work on creating something grander still. We grew up in New York, great-grandson, grandson and son of produce men, working on the great wholesale markets of the city. Yet the Pundit Poppa, Michael Prevor, was a different kind of wholesaler; he had the vision to get involved in importing and exporting when that insight was rare and the opportunity obscure.

Today the global nature of the produce industry is clear. Import and export are large industries in produce growing and consuming sectors around the globe. Yet we would contend that in this post-industrial economy, the most important exchanges are not necessarily of goods; they are of ideas and competencies.

Food safety, sustainability? They were doing all this in the United Kingdom before it was cool to think about it in the US.

There is injustice here. What has happened is that because the great continental trade show of the produce industry is in far-off Berlin, attention was diverted. Our thought was to right this wrong: To bring attention to an important business partner and thought leader in the industry, to restore the United Kingdom to its rightful place in the councils of the global industry.

The greatest thing about being the Pundit is that we get to know the smartest people in the produce industry around the globe. So we called our old friend Tommy Leighton. He used to run the Fresh Produce Journal in the UK and we found we shared a vision. So he joined on as the Managing Director of our new London-based company.

Then we went to visit our good friends at the Fresh Produce Consortium, the great national association for the produce trade in the United Kingdom. In time, a vision congealed and we decided to work together to build a new industry institution.

Here is the official announcement:

The London Produce Show and Conference, June 4-6, 2014, Brings Global Focus to UK

The Fresh Produce Consortium (FPC) and Produce Business magazine have today announced a collaboration to launch a new annual industry event, The London Produce Show and Conference.

The first edition of The London Produce Show and Conference will be held at Grosvenor House, Park Lane, London on June 4-6, 2014.

The event will kick off with an evening cocktail reception for buyers, exhibitors and their guests on June 4. The next day begins with an opening breakfast session and then moves into the main feature: a boutique exhibition in the hotel’s Great Room, Europe’s largest five-star exhibition space. In conjunction with the trade exhibition, will be a series of seminars, breakout sessions and chef demonstrations running throughout the day on June 5.

The final day of the event, June 6, will then give visitors the opportunity to tour some of the leading fresh produce locations in and around England’s capital city, with hosted tours of wholesale markets, retail stores, production sites and import hubs.

“London is an iconic city for many reasons, not only in the UK and Europe, but in global terms,” said FPC chief executive Nigel Jenney. “As home to around 11 million people and one of the most culturally diverse populations in the world, as well as some of the most widely recognised tourist attractions on the planet, it has a huge year-round demand for the full range of fresh produce.

“The UK fruit, vegetable and flower market has long been perceived as a dynamic thought and practice leader for the fresh produce industry. This event will highlight everything that is still great about the British produce industry, but it is also a brand new trade exhibition, conference, networking event and showcase for the global industry as a whole.

“The show will bring together buyers from the retail, wholesale and foodservice sectors, as well as grower/exporters and suppliers from around the world and put the UK and Europe back in the limelight as a key global destination for high quality fruit and vegetables.”

There will be a limited number of exhibition stands available, as the “boutique” event aims to give both exhibitors and visitors time to see an entire show floor, rather than feeling time-constrained and leaving, having missed possible business opportunities. Jenney added: “There are other exhibitions in Europe, but we feel that the opportunity to be ‘noticed,’ both as an exhibitor and a visitor, is crucial if companies and associations are to get true value for money. We want to help producers and marketers get their messages out to a wider audience and bring them together with the people who matter most to them – their existing and potential customers. At the same time we want to give the buying segment of the trade a convenient venue, right in central London, where buyers can engage with the global supply base.”

Jim Rogers, president of FPC, said: “From a UK industry perspective, this is exactly what we need to give us some much-needed impetus after a few difficult trading years. The show will bring together growers, exporters, importers and buyers from all sectors of the industry, all over the world and highlight the incredible depth of talent and knowledge that we still have in the UK, despite our best efforts to downplay it in recent times.”

And Andrew Garton, category director of produce and horticulture at Wm Morrison and a member of the FPC board, also welcomed news of the event. “Any event that attracts the world’s fresh produce industry to the UK is good news for our domestic industry as a whole and, representing one of the major buyers of fruit and vegetables for the British consumer, my team and I will be at Grosvenor House to engage and connect with our colleagues from all corners of the globe. In my opinion, the UK supermarket sector has led the world in food retail innovation during the past two decades and we’re keen to take advantage of this opportunity to reaffirm our credentials with the industry’s leading suppliers.”

Perhaps the only city that competes with London for iconic status is New York City, and The London Produce Show and Conference is a sister event to the already established New York Produce Show and Conference, which takes place in the Big Apple each December.

Jim Prevor, editor-in-chief of Produce Business and known internationally as The Perishable Pundit, said: “The people of New York and London have always enjoyed a close link. We have had an incredibly uplifting experience introducing a show to New York over the past four years with the Eastern Produce Council. We are delighted to be working with FPC to deliver The London Produce Show and Conference to a city and country that is lacking such an industry event.

“Our aim with The London Produce Show and Conference is to link European buyers with a new global supplier base and allow growers, exporters, importers and suppliers to talk directly with their target audience, while also giving visitors and exhibitors the opportunity to enjoy the magnificent city of London,” said Prevor.

To exhibit, attend or for additional information please go to LondonProduceShow.co.uk

So the vision expands. We are going to begin a Sister City program between the produce trade in New York and London, bringing wholesalers from Hunts Point and other markets in the east to New Covent Garden and other markets in the UK, and we will bring them the other way as well. We are bringing important players from the Fresh Produce Consortium to the New York event and leaders from the Eastern Produce Council to London.

We see two separate events, each serving its unique market, but we also see a great intellectual exchange in which the two great cities of our civilization join hands to exchange ideas, to rise to the highest levels of thought leadership and industry practice.

And guess what? We get to do all this — to make such a difference, to build such a brighter future — in incredible places such as New York and London.

The New York event is coming up in December. If you would like to exhibit, sponsor or attend, just let us know here.

And if you would like to be a Charter participant in this brand new industry event, The London Produce Show and Conference is kicking off in June 2014 so just click one of the options below.

We look forward to seeing everyone in New York and in London!

If you are interested in exhibiting or sponsoring an event at The London Produce Show and Conference, please let us know here.

If you would like information on attending The London Produce Show and Conference, just let us know here.

The event is being held on Park Lane in the historic Mayfair district, convenient to all of London — theater, shopping, museums, landmarks etc. The venue is the five-star Grosvenor House, a JW Marriott Hotel. You can book in our room block right here.




Tommy Leighton Named Managing Director For Pundit Sister Company In The UK — A Triumph Of The ‘Do Stuff’ Philosophy!

As we mentioned in this piece about our collaboration with The Fresh Produce Consortium, we just announced a new world-class industry event, the London Produce Show and Conference.

Now we have written enough about Tesco and its travails in trying to launch Fresh & Easy in America to know that it would be a bad idea to send an American team over to London and do a show in Britain. So we reached out to the Fresh Produce Consortium to work with us and we couldn’t imagine a better comrade-in-arms as we proceed to build this new industry institution.

Yet we would have never gotten very far if not for an old friend, Tommy Leighton. Who is Tommy? Well, here is an excerpt from his bio:

Tommy Leighton is perhaps best known as the ex-Editor of Fresh Produce Journal (FPJ), the UK’s weekly newspaper for the fruit, vegetable and flower industries. He spent 12 years with the paper, a decade as editor and during his last five years with the firm, was managing director of FPJ publisher, Lockwood Press.

During his time as Editor, the FPJ underwent something of a renaissance, and Tommy was also the driving force behind the 2004 launch of Re:fresh, a trade conference and awards evening that brought a sense of unity and fun back to the UK industry.

Around the turn of the Millennium, Tommy also spent two years as European Communications Director for the Chilean Fresh Fruit Association, at a time when Chilean exporters were still beginning to make their presence felt in the old continent.

Since 2009, he has run his own company, Tommy Leighton Communications, worked with and represented a large number of companies and associations across the fresh produce sphere, and built a reputation as a strategic communicator in other sectors including childcare and education.

We set up an affiliate company in the UK, Phoenix Media Network Ltd., to work with the Fresh Produce Consortium and to represent our interests in the United Kingdom, and we worked hard to woo Tommy, who will keep many of his own projects while also taking on the job of Managing Director for our new British entity. We are lucky to have him.

Getting Tommy was crucial. It is very hard in business to find people who are not only competent but also happen to share your ethical values, quality standards and who care about the industry. Add another thing: Life is too short to work with people you don’t like, and Tommy is a genuinely good guy.

What is interesting from a business standpoint is that it is impossible to predict what will ultimately pay off or how it will pay off. We knew Tommy, and when the Pundit took off and we started to appear on TV, radio and in newspapers, Tommy was running the Fresh Produce Journal and he started calling or having his staff call and asking us to do things. We gave interviews, flew to London to speak at the conference he organized, and in fact, years ago, he arranged a lunch with the team at the Fresh Produce Consortium, including its Chief Executive, Nigel Jenney. In retrospect, this was a crucial meeting because it meant that when the opportunity to do this new London event came up, we were not strangers.

We do a lot of work with students, and they are always asking what steps they should take to build a career. Increasingly we have come to think that this is the wrong way to approach the subject of advancement. The secret, as best there is one, is to do stuff. You get a chance at a meeting, you take it. An opportunity to go to a show or conference, get out there. Someone wants to meet you, shake their hand. Invite people to dinner or lunch or breakfast. It is not always possible and everything doesn’t pay off and, of course, there are opportunity costs as when you do one thing, you can’t do another.

Yet most people do much less than they are capable of, so the costs are much lower than we want to admit.

So this note is a thank you to Tommy for joining us in this great adventure and a thought for everyone about how to get ahead and what to tell young people as they strive into the future: Do stuff. One never knows where it will take you or how it will pay off, but the odds are overwhelmingly better for you if you do stuff rather than do nothing at all.




Time Is Ripe For Reaching Consumers:
New Consumer Magazine Solely About Fruits And Vegetables Available Next Year: PRODUCE ENTHUSIAST

How should the produce industry reach consumers?

The method has long been a question.

Indeed, for a very long time the thought was that if one couldn’t afford to spend upwards of $20 million a year on network television advertising, there was no point in trying to reach consumers.

That attitude is gone. With web sites, social media and consumers turning to bloggers for information and the growing use of clamshells and other packaging conducive to labeling, shippers and importers are increasingly recognizing that they have an ability to begin to build brand equity with consumers.

The message has also been uncertain.

The great industry institutions, such as 5 a Day and now, More Matters, have had their hands tied as they often accepted government money, and this restricted their ability to promote produce except in its most austere form, almost as a kind of medicine.

Increasingly, though, there is recognition that this medicinal approach is, at best, inadequate and that though health-oriented promotions may have their place, the industry also needs other vehicles to reach consumers and to tell different stories. That is what we were talking about when we wrote a piece titled Two Cheers for Bacon in our sister publication, PRODUCE BUSINESS.

To help the industry deal with both these methodological and messaging issues, PRODUCE BUSINESS is launching a new magazine. It is a hybrid publication focused on the love of produce. Think of a magazine such as Wine Spectator. Well-read and respected in the trade, but also a must read for those consumers most focused on fine wine.

This new magazine will be published quarterly, in line with the seasons, and from the very first issue it will be available to consumers at every Barnes & Noble and on the newsstands at Hudson News, at airports and commuter terminals across North America. Digital editions will be available for both Apple and Android devices. It will also be available in supermarkets, warehouse clubs and fine food stores everywhere.

The new magazine is named PRODUCE ENTHUSIAST, and its cover will feature major celebrities discussing their love affair with produce. It may be movie stars, celebrity chefs, athletes or politicians, but the magazine won’t hesitate to celebrate produce in all its forms — on the grill or in a Bloody Mary, the star event in Strawberry Shortcake or a supporting role on a sandwich. We will celebrate stir-frys and salads, juicing and baking. We will luxuriate in fruit soaked in cognac and vegetables served with rich specialty cheese.

We will do profiles to introduce consumers to the great personalities of this industry and we will feature ag tourism to attract people to produce growing regions. We will rank restaurants and highlight housewares. We will show how produce fits in fine entertaining and a graceful lifestyle. We will introduce new specialty items, celebrate varieties old and new and provide loads of recipes.

The consumer readers will be a special, self-selected lot. They will be very valuable to the industry because they will be the passionate ones, the opinion leaders.

The readership of Motor Trend or Car & Driver includes a lot of teenage boys. Yet their readership is valuable, not because they buy a lot of cars themselves, but because family and friends respect and listen to their opinions. In our case we will have a cadre of the most committed and engaged “produce enthusiasts.” We will nurture that enthusiasm and, in so doing, give the industry a portal to build demand. These are the Evangelicals who will help the industry tell its story.

The first issue is out in May for the summer of 2014. It is going to be an incredible new point of contact with consumers.

If you are a retailer and would like information on how your store can sell PRODUCE ENTHUSIAST, please let us know here.

If you are interested in our Charter Advertising program, let us know here.

If you would like to get subscription information, just let us know here.




The Rogue Operation At Sysco Of San Francisco Raises The Question: How Can The Industry Use Compensation To Incent For Food Safety?

Sysco got a black eye — and the industry didn’t win any glory — when Sysco of San Francisco was found to be using some outdoor public storage as a kind of improvised warehouse for perishable foods. The hullaballoo has blown over, as it should, since it was clearly an unauthorized departure from Sysco’s quite extensive corporate food safety standards.

Yet, precisely because the whole operation was directly opposite everything Sysco stands for, it raises the question of how all businesses ought to be thinking about food safety.

To this day, one of the most forwarded posts we have published on the Pundit is a piece titled, Tale of Two Buyers:

One of the most difficult things to do is to align corporate culture and compensation programs with the goals of management. When we speak to VPs of Perishables or VPs of Produce at major retailers, all are very focused right now on food safety.

But we are also hearing from shippers about a “disconnect” between the goals that executives are setting for their organizations and the way the actual buyers are reacting.

Here is a fairly common scenario:

A team from a shipper flies into a retail headquarters to do an account review and discuss business concerns. The initial meeting includes high executives who emphasize that the chain wants exemplary food safety practices.

In the past, this chain’s supply might have been met via a hybrid mix of sources. The vendor grew some produce, represented some growers exclusively, bought some product in the field or on the trees that the vendor had packed to the retailer’s specifications, some of the product was bought from other shippers and, when things were tight the vendor might have bought some produce off the terminal markets to keep the retailer well supplied.

The vendor never had an actual contract, but over the years had come to be the primary supplier on his lines.

Well, this mechanism had served the chain well through the years. The stores were rarely if ever short of product and it was always priced competitively for the market.

But this model couldn’t sustain the kind of food safety scrutiny that the VP now is talking about in the meeting.

As we dealt with this before, via a letter we received from a reputable grower/shipper, to provide a certainty of food safety standards, you really need an asset-based solution. The vendor has to either grow it all itself or secure, in advance, certain growing deals that can be done under its control and according to the standards it specifies.

The vendor, being flexible, suggests to the VP that if the chain would contract for its requirements, the contract could specify any food safety standards the chain desires and the vendor would be happy to execute to those standards.

It is not a 100% perfect solution. After all, if a hurricane comes and wipes out a growing region where the contracted product was planted, the chain will still have to make a decision as to whether it is willing to accept product from another growing region that may not have been grown to the retailer’s specifications.

Still, barring natural disasters, if a chain needs ten trailers of product a week, the chain contracts for them and they can be certified to meet any standard the retailer wants.

Heads are nodded in agreement, handshakes are given all around, the VPs leave the room to let the buyers work out the plan and then it happens… The buyer says something like this:

“This is a great plan, we are all on board with this. Just one thing: How are we going to be able to take advantage of markets when the price dips below the contracted price? You know, sometimes the market can get a lot lower than the contract price and our competitors would underprice us and we can’t let that happen.”

Of course, a good vendor will try to come up with creative solutions in terms of how the contract can be structured that might make the buyer feel better. But, basically, the “magic is gone” — the vendor really wants to say “Look, you are getting a fixed price for exactly what you want. Some weeks it may be a bargain and you make extra; other weeks it may be expensive and you have to lose some back. Probably, overall, you will have higher costs than the free market, because you are asking for specially food safety certified product. So the product you will be getting is not comparable to product bought from the cheapest vendor every week.”

Although it is frustrating to hear these stories — and we are hearing them a lot from many vendors — it strikes us that to “blame” the buyers is futile. They are responding to the culture and compensation practices of the organization.

If the VPs are sincere about wanting the buyers to place food safety first, the VPs have the responsibility for changing the culture and the economic incentive systems.

Because, let us talk straight and imagine two buyers:

1. The buyer in the little story above buys into the contracting idea and, as a result, gets the food safety standards the chain wants but, even though the grower worked closely, the contracted price turned out to be higher this season than the market price so, all season long, the chain had to either price higher than its competitors, which reduced sales or had to accept substandard margins or a loss.

2. The buyer in the little story above resists contracting because he wants market-priced produce and as a result his product, though meeting all legal requirements, is produced with no extra food safety protocols. The chain is not always aware of exactly where it is grown and packed, but they deal with a good supplier and they did a field inspection once a year, although the actual crop used may not come from that field. The vendor signs lots of representations and warranties as to the way the product is grown and packed. Fortunately there were no outbreaks and buying at market price, the chain was consistently priced competitively to consumers and made decent margins.

Ok, now here is the test: Which buyer gets a bonus this year? Buyer #1 — who put food safety first, or Buyer #2 — who put profitability first?

If your answer is the same as the Pundits, you realize why solving this problem depends on a lot more than the intentions of retail VPs. Until the culture and compensation systems change, this is a problem that will stay with us.

We wrote that piece to focus on the fact that it is large buyers that set the terms and specifications by which they buy, so if we want food safety, we need the buyers to demand it, and that means we need the compensation programs to reward pursuing food safety.

In reviewing the Sysco situation, we came to see the same dilemma. In every company the impulse to enforce food safety seems to be expressed by hiring food safety experts and, perhaps, even giving them authority. Lots of people lecture on the importance of a food safety culture. But the way we see it, compensation programs top all of this.

We wrote a column in Pundit sister publication, PRODUCE BUSINESS, titled Sysco’s San Francisco Food Safety Failure Reflects on Industry’s Broader Problem With KPI’s. The section on compensation seemed to ring with this bigger issue facing the industry of how to compensate to encourage food safety:

We will probably never know precisely how this policy of renting sub-standard facilities started or why this policy was maintained over the years. Simultaneous with the revelations, it was announced that Bruce Leong, who had been president of Sysco San Francisco, left the company. But whether he was a sacrificial lamb or was actually found to have been implicated in the matter was not announced.

Still, someone implemented this policy, and dozens of Sysco executives had to be aware of it. None of them picked up the phone and called the Quality Assurance Director in Houston. This columnist has had the privilege of addressing Sysco’s annual produce event in which it brings in executives from all over the country to educate, and we feel completely confident in saying no one ever picked up the phone and told Rich Dachman, vice president of produce at Sysco, or any of many other Sysco executives who could have and would have reacted. The management question is why did no one call?

The best answer to this question is that despite the sincere commitment of Sysco to food safety, it has not — as virtually all the industry has not — been able to incorporate safety into its KPIs in a meaningful way. To put it another way, imagine that a new CEO of Sysco San Francisco, let us call him George, had come in. Imagine he noted this practice and decided to not rock any boats. As a result, sales and profits in the division increased 20 percent this year.

Now imagine a new CEO coming in, let us call her Lydia. She started work, noted the problem and decided it had to stop immediately. She ordered the dumping of any product stored in those facilities, recalled any product that might have been stored in those facilities in the past, reported Sysco to the relevant regulatory authorities and publicly apologized for Sysco’s transgression. She fired all Sysco personnel who had known about this problem and hadn’t acted to stop it.

Of course, under Lydia, Sysco had to give up some customers until new facilities could be leased, new employees hired and trained, etc., and as a result of the reputational and operational damage, sales fell 30 percent this year and operations slipped into a loss. A few national accounts left Sysco, thus depressing business nationally.

Now ask this question: Whose salary and bonus is likely to be higher for the year? George, because he made money for the company, or Lydia, because she defended the corporate priority on food safety?

Now ask this: In your own company, if a similar choice had to be made, what would the financial incentives produce?

A question well worth asking. You can read the whole piece right here.




A Challenge To USDA: Bring Good Delivery Standards Into Line With 21st Century Receivers

Our piece, Making Life Tougher For The Little Guy: USDA Good Delivery Standards Have Not Kept Up With Industry Standards, brought a great deal of response from people searching for answers, including this letter from a respected industry member:

Thanks for publicizing Mike Pflueger’s story.

We both have known Mike and his business ethics for many years.

What courage he had to close his longstanding successful business for a principle!

How can PACA let the bad guys win while a well-respected,  honest and fair member of our produce community be forced to close his doors rather than give into an unfair judgment?

PACA rules are outdated and seem to always favor shippers.

I have had to pay for merchandise that made good delivery standard but was rejected by every chain store that received it.

Having been in business for over 70 years with impeccable ratings, our company always has to abide by PACA rulings and absorb many unfair PACA rulings mostly dealing with the tolerances for "good delivery standards" that are way beyond our customers’ tolerances.

Often we experience, as in Mike’s case, overly stringent regulations that won't consider common sense.

Should a re-inspection a few days later on hardware like garlic not count for something?

I am a grower and shipper of Chilean garlic and fruit who appreciates the PACA regulations (those that prevent companies from taking advantage of its members).

Over the years, PACA has saved me from large losses on credit issues and all of us in the produce business rely on that, but Mike and the Pundit are correct: It's time to review many of the antiquated PACA rules….

How can we initiate fair change?

— Zach Schulman
President
New York Export Co Inc.
Nexco Chile S.A.
Isla Produce Inc.

Zach’s letter is thoughtful and it really raises the issue of whether the receiver community has any true representation at all.

United, with its strong terminal market history — the United in its title refers to the union between receiver and shipper organizations — should be the one to represent the concerns of shippers on this matter.

However, United depends heavily on grower-shippers for its financial support, and many of these shippers would perceive a tightening of good delivery standards as not in their interest. So there is a question as to whether, whatever the justice of the cause, United is really going to be willing to spearhead an effort to bring good delivery standards into the 21st century.

There is NAPAR — the North American Perishable Agricultural Receivers — which was founded, specifically, to deal with the fact that United could not always represent receivers when their interests conflicted with shippers. NAPAR is, however, very small with no full time staff, and it would have trouble waging the kind of campaign that is required.

So the wholesaler/distributor sector of the industry is left today, as so often before, without effective representation in Washington. The retailers at PMA don’t care about this issue because they have the market power to establish their own specifications.

The shippers at United don’t see any upside for themselves to stricter good delivery standards so they don’t see this as their issue.

And NAPAR is too small to make things happen on its own.

Is there a way out of the impasse? Perhaps two things could happen:

1) Perhaps an appeal could be made to the institutional integrity at USDA. The people at the department want to be relevant, want to be important, but they don’t work in the produce industry. They may not fully realize how far the department’s good delivery standards have drifted from industry practice.

We have many Pundit readers who work at the USDA. Perhaps to defend the relevancy of the department, one will champion a simple initiative. The goal should be to study the receiving specifications of Wal-Mart, Costco, Kroger, Safeway, Sysco and US Foods and then compare these standards against good delivery standards on each commodity. 

The idea is that these six companies represent contemporary industry standards, and any product that meets good delivery standards should be suitable to sell to these organizations.

Right now, USDA standards say that garlic, with 4% decay and 11% other defects, must be paid for as if perfect but such product is actually unsalable in mainstream commercial channels. Those who care about the long term relevancy and importance of the USDA should be fighting to bring USDA standards into line with commercial expectations. Otherwise, one day, someone will ask what is the purpose of maintaining this whole infrastructure.

2) The grower-shipper community will come to see its interests in a longer term perspective. It may currently seem that lower standards are good for grower-shippers but they rarely are.

This product, in the end, has to be eaten by consumers, and allowing low quality producers to foist such product on the unsuspecting public will not serve to boost consumption.

In addition, disjointed USDA standards increase friction in the market. This adds costs that increase prices and thus depress demand. The whole purpose of USDA grade standards and good delivery standards is to reduce friction in the market by allowing procurement to be done easily.

Most good shippers deal in the commercial world and know they would be bankrupting their customers of they shipped garlic with 4% decay and 11% other defects while insisting the customers pay full price for it, so they don’t really get any protection from this lower standard. Therefore, they would benefit from stricter rules that kept sub-standard players out of the game.

The question is whether they can be brought to see this long term interest.

Many thanks to Zach Shulman for helping us think through this important issue.




Pundit’s Mailbag — Are Farmers Lonely? Or Connected On LinkedIn?

Our piece — The End of the Yeoman Farmer? — brought this poignant note:

One aspect of the small farm situation is that the lifestyle (for want of a better word: a farmer might puke at the idea of being a fashion statement) is so different from practically any other occupation that the coherent, supporting community is disappearing in many locations. So the farmer is lonely: still has the connection to the land, but not the same connection to neighbors. We go to his farm stand to buy corn and then get back in our cars and return to our lives.

Part of this difference is the encyclopedic, unwritten knowledge that a farmer must have. The number of details that exist in the brain of a farmer may be somewhat analogous to the skill-set of a hunter-gatherer. The FSMA approach requires, or moves strongly in the direction of, the development and maintenance of a parallel business that is on paper or in a computer. One critical part of GFSI Certification is having a written procedure for handling any event that is outside the documented control parameters.  HA!  Farmers have to do this instant to instant.

So, a skill-set is vanishing — as has happened countless times throughout history. To oppose the process is to be a "Luddite." On one level, it is simply very painful.

— Bob Sanderson
Owner, President
Jonathan's Sprouts
Rochester, Massachusetts

Some years ago, as the Pundit was introducing his new bride to the produce industry, we went together to an industry event. A particular gentleman came along and introduced himself to Mrs. Pundit and self-identified himself as a farmer. This was not an incorrect assessment. He was deeply involved in farming and had consulted with the Pundit from time to time on his difficulties with selling his crop to Wal-Mart. He knows more than almost anyone about a particular crop. He and his wife are intelligent, hardworking and congenial, and they are known to wear jeans from time to time. They are most definitely farmers.

Yet Mrs. Pundit, who is knowledgeable about many subjects, found herself experiencing a kind of cognitive dissonance as she had observed the farmer’s wife was wearing a particularly beautiful and quite expensive pair of Jimmy Choo shoes.

We doubt farmers, as a class, are lonelier than they used to be. Yes, there are fewer farmers, and the populace is mostly ignorant about farming, so the culture that enveloped farming is not as supportive. But the farmers today generally farm much larger operations and are significantly more successful than farmers in years past.

Technology has opened the world, and rural farmers now e-mail, text, tweet and post on Facebook with the best of them, thus keeping them connected to the world. With Internet and satellite TV, the whole world is brought to the farmer’s living room. Some lonely farmers watch the futures markets update as they drive their tractors. Commercial air travel is now easily affordable and, well, for the large farmers, of which just in produce we do not have enough fingers and toes to count, there is no need to be lonely if you have a private jet!

To put this another way, farming has changed because technology now allows farmers to manage more land, plant and harvest more crops than they ever could before. Some may pine wistfully for a romantic memory of farmers plowing their fields by hand or with a mule, but few who pine are actually farmers who had to work in the hot sun doing these tasks. These people like tractors, preferably air conditioned with GPS.

Few things in life are gained without loss and, indeed, the small farmer, tilling his land, living in a community of other farmers, supported by an infrastructure and a culture so strong we scheduled school around the months that children were needed on the farm, is fading. And in that, there is loss. But in greater scale with more sophistication, there is gain, for a society that gets more plentiful and less expensive food and for the farmer who gets a more expansive life.

Perhaps the FSMA will be one more weight on the scale, a little force that further encourages scale and consolidation. If so, it will be just one of many forces pushing in that direction.

We do not think that those who see value in tradition are Luddites, but it is worth remembering that the Luddites were 19th century English textile workers who were protesting against labor-saving machinery that would take their jobs away. They weren’t fighting for the broader interests of society; they were fighting for their own self-interest.

There are many critiques that can be made of the FSMA and its impact on small farmers. The biggest is that there is no real evidence in which following these procedures actually results in safer food. If it does not, then we are imposing expenses and biasing the system against smaller scale for no reason. That would be “simply very painful” indeed.

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