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Perishable Pundit
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Produce Business

Deli Business

American Food & Ag Exporter

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Dispatches From The Field

Jim Prevor’s Perishable Pundit, December 18, 2008

A lot of the work we undertake to help the industry is not actually represented on the Pundit. In fact sometimes all the travel and time interferes with producing as many Pundits as we might like. We have, however, found that there are many ways to serve. We’ve been asked to provide an update from time to time on some of our activities outside writing the Pundit. Here are a few things we’ve been working on recently:

In early December, we flew up to Grand Rapids to be the luncheon speaker for our friends in the Michigan applee industry. Things aren’t easy for Michigan apple growers right now. The season started off fairly strong but bad weather had posed challenges for the Michigan growers, especially when faced with a massive Washington State crop.

From Left to Right: Denise Donohue of the Michigan Apple Committee, Nancy Foster of the US Apple Association and Julia Baehre Rothwell, board member of both the Michigan Apple Committee and the US Apple Association, with the Pundit at the AmWay Grand Hotel in Grand Rapids, Michigan

The Pundit didn’t bring much holiday joy as the presentation was focused on the impact of the economic crisis on the produce industry. We did, however, try to offer a little hope. The Grand Rapids Press picked up the story: Recession May Provide Silver Lining for Michigan Apple growers, PRODUCE BUSINESS Publisher Says:

…If consumers shy away from buying cars and taking vacations, perhaps they will spend more on items such as fruit, said Jim Prevor, founder and editor of Produce Business magazine.

“It actually has the effect of increasing their disposable income,” Prevor said during a luncheon at Amway Grand Plaza Hotel. “That creates a market opportunity for small indulgences.

“Those who can demonstrate consumer pull for their product, they’re going to do fine in bad times and good times. If you’re just another bag of apples out there, you wind up being a commodity trap.”

…Prevor, also known as the “Perishable Pundit,” was speaking at the annual Great Lakes Expo, a conference of fruit and vegetable industries that concludes today at DeVos Place.

He said if China’s apples do not come to the United States, they may compete with U.S. exports elsewhere. And that could push even more Washington apples toward the Midwest..

Just as food retailers in the current economy are refocusing on price at the expense of food safety and sustainability, consumers are “trading down” from upscale products to generic basics. On the other hand, consumers may spend more money on groceries as they spend less at restaurants, Prevor said.

We flew to Michigan shortly after addressing the board of directors’ meeting for the National Watermelon Promotion Board, speaking about the impact that the economic situation is having on sustainability and food safety standards. Of course, Mark Arney, now the CEO of the National Watermelon Promotion Board, previously headed up the Michigan Apple Committee. In any case, the watermelon growers and importers must be glutons for punishment — this was a return engagement after we presented at the same meeting last year.

We had a lengthy discussion with Jacob Adelman of the Associated Press on the concept of controlled environment agriculture. Although we are big fans of the concept and have often linked to Columbia Professor Dickson Despommier’s Vertical Farms Project, we see some real problems with the economics of urban greenhouses:

Long a niche technology existing in the shadow of conventional growing methods, hydroponics is getting a second look from university researchers and public health advocates.

Supporters point to the environmental cost of trucking produce from farms to cities, the loss of wilderness for farmland to feed a growing world population, and the risk of bacteria along extensive, insecure food chains as reasons for establishing urban hydroponic farms.

However, the expense of setting up the high-tech farms on pricey city land and providing enough year-round heat and light could present some insurmountable obstacles.

“These are university theories,” said Jim Prevor, editor of Produce Business magazine. “They’re not mapped to things that actually exist.”

The piece wound up being titled Urban Growers Go high-Tech To Feed City Dwellers

We discussed the refrigerated fruit segment of the produce department with Elaine Wong of BrandWeek. Particularly focused on the issue of whether Sunkist and its licensee Old World Enterprise Group can break Del Monte’s grip on this market. The conversation reminded us of our discussion of the same issue on the Pundit both here and here. As sometimes happens when one speaks to the media the end article, Del Monte, Sunkist Add Heat To Refrigerated Fruit Segment, did not precisely express the point we had hoped to get across:

There is room for more brands in the category beyond the dominant Del Monte, said Jim Prevor, editor of Perishable Pundit, which tracks the produce industry. The question is whether competitors can successfully introduce meaningful, new innovations. Otherwise, retailers have no incentive to play one up against the other, he said.

Actually, if all the products are parity products, retailers have every incentive to play one against the other. It is only unique attributes that would dissuade a retailer from doing that. The question we were actually asking is whether the Sunkist branded product would be sufficiently different from the established Del Monte line to motivate retailers to switch or, alternatively, was Old World willing and able to spend money on slotting allowances and consumer promotions that might encourage retailers to switch for promotional reasons?

Gave a General Session Presentation to the AgGateway Conference in San Antonio. AgGateway is “the agriculture industry eBusiness standards and implementation organization” The theme this year was “Shrinking World — Growing Markets — Global Business,” and the title of our presentation: “Disruption in the Supply Chain — When Things Go Wrong.” Our appearance was sponsored by John Deere Agri Services — so a big thanks to them.

The Center for Agricultural Business at California State University, Fresno, sponsored its 27th Annual Agribusiness Management Conference in Fresno. We gave a presentation and moderated a panel that included Trevor V. Suslow, Extension Research Specialist for Postharvest Quality and Safety for the University of California, Davis, Ed Beckman, president of California Tomato Farmers and Jim Henry, supervisory Investigator at FDA’s San Francisco district. Our piece was pretty much a focus on the nature of the trade’s food safety dilemmas.

We’ll try and do an update every month or two. If you think we can help your company or organization by providing a keynote, workshops, moderating a panel or other presentation don’t hesitate to click the "Request Speaking Engagement" tab just below the Pundit Logo at the top of the page.

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