NATIONAL MEAT ASSOCIATION h 1970 Broadway, Suite 825, Oakland, CA 94612

(510) 763-1533 Fax (510) 763-6186 h Email Address: [email protected] h http://www.nmaonline.org

Edited by Jeremy Russell

January 16. 2001

PLEASE BE AWARE THE E-MAIL ADDRESS [email protected] IS NO LONGER VALID. WE WILL NOW USE [email protected] IN ITS PLACE. WE APLOGIZE FOR ANY LOST MESSAGES.

NOT ANOTHER RECOUNT

Just when you thought it was safe to check the results of a vote, the Pork Checkoff Referendum has come home to roost with just a 1,555 vote spread (from a pool of 45,298). While this is not quite as close as the presidential election, the vote was plagued with enough divisiveness that the results have spawned challenges and once again the search for voting irregularities begins. (For complete coverage of the Pork Checkoff Results see this week’s Herd on the Hill).

COMPREHENSIVE COVERAGE OF THE TEXAS LITIGATION

Twice now at the Dallas Observer, Charles Siderius has told it like it is in articles about the Texas Litigation. On January 11, in an article titled “Off the Killing Floor” he wrote: “The ruling is the latest blow to the USDA's effort to enforce its microbial-testing standard, which many in the beef industry say produces results that are arbitrary and misleading to consumers.” A December 21 Dallas Observer cover story, ‘Slaughterhouse Jive,’ described how Supreme Beef's decision to fight the new Salmonella-testing standard eventually forced the company into bankruptcy. You can read these articles online at http://www.dallasobserver.com/– both articles are linked from NMAonline.org) or send a self-addressed, stamped (55¢) envelope to Jeremy Russell at NMA-West.

NMA CONVENTION ROUND TABLES

Some years ago, NMA determined that the most effective way to give information to conventioneers was to invite knowledgeable individuals to participate in a roundtable. A moderator ensures that everyone is heard; the invitees know that the larger audience is informed about the subject, and they know they have only five minutes; then they discuss the subject with each other and accept questions from the audience. It is an immediate, interactive process. And , of course, everyone has the opportunity follow-up in more detail later during the event.

This year’s Round Tables are no exception. The invited participants are the best in their respective fields. A bright and talented group of NMA’s younger members have assisted the staff to identify both the subject issues and the participants; they are also serving as moderators and participants. The current schedule is available at NMAonline.org and, because the subject matter is on the cutting edge, minor adjustments and additions may be made right up until the eve of the convention.

Remember that the Round Tables are run on four concurrent themes: They’re a great opportunity to pick up new information that can be really productive for people at all levels of management.

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SAUSAGEFEST 2001

It’s time to separate the sausage from the weiners. NMA’s Annual Gourmet Sausagefest is the premier specialty meats competition held at the Annual Convention and we’re looking for a few good sausages. You’ll laugh, you’ll cry, you’re salivating already. If you want to run for the Hold the Mustard award at MEATXPO’01 in Las Vegas, Nevada, February 16-19, contact NMA Communications Manager Jeremy Russell at 510-763-1533 for an entry form so that you can send in your sausage.

THIS LITTLE PIGGY WENT TO MARKET, AND THIS LITTLE PIGGY GOT CLONED

Two separate teams of researchers have managed in 2000 to clone pigs, an accomplishment that opens the door to breeding herds of genetically engineered pigs to farm for organ transplants to people. In general the idea behind agricultural cloning is to breed genetically identical farm animals that can produce human products such as proteins for use in medicines. Another is the production of prime meat. But pigs offer another prospect. Because they are similar in size and other aspects of biology to humans, they have been seen as a potential source of organs and tissue for transplant into people. Not that this will necessarily come easy. Researchers hope they can genetically engineer pigs in the future so that their organs and tissues are easier to transplant into human beings. The main target will be a sugar which pigs and many other animals have on their cells but which humans do not have. The sugar causes an extreme rejection of animal tissues by the human immune system. Getting rid of this sugar may may clear the way to a supply of compatible pig organs for human transplantation.

There is another tough barrier, however, human cells have been shown to be infected with potentially dangerous viruses from pigs. But scientists at BioTransplant, a Boston biotechnology company, say they have bred a line of miniature pigs that don’t transmit potentially harmful viruses to human cells. BioTransplant believes its pigs will be the ones. It could be a great boon if it were so, as 6,000 Americans died in 1999 alone waiting for transplants.

Researchers January 10 unveiled the first cow genetically altered with a gene for an agricultural application. This clone of a purebred Jersey cow has cells that may offer a biotechnological defense against mastitis disease. “Resistance would lessen mastitis's financial drain, and provide the added public health benefit of reduced antibiotic usage,” said research leader Vernon Pursel in a statement. It will be at least another year before the cow, born in March 2000, begins producing milk, and scientists can begin testing for mastitis resistance.

Once the medical implications of cloning are ironed out, more or less, do not doubt that cloning will move in the direction of making better and safer meat. That may bring more profits, but it will likely also bring the unwanted attention of the anti-biotechnology crusade.

USMEF JAPAN PROCESSED MEAT AND GIFT PROJECT

The U.S. Meat Export Federation is offering a unique marketing opportunity for processed meat products in the Japan market. Ham, sausage and Japanese fruits are the second most common gifts given during Japan’s two gift-giving seasons, Ochugan (in the summer) and Oseibo (in the winter). While 90% of the gifts are produced domestically, there are opportunities to supply Japanese gift boxes with U.S. produced processed meats and pork items. The USMEF will conduct a Sample Display and Selection Session on February 7 in Denver, CO. During the session U.S. manufacturers will have an opportunity to present their gift item potentials to buyers. To find out more about this session visit the USMEF website (linked from NMAonline.org) or contact Paul Clayton at (303) 623-3366.

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THE SAFETY OF U.S. BEEF

Ante-mortem is not some distant relative of the Secretary of Agriculture. It is a latin term meaning “before death” and it is sufficiently important within the meaning of the Federal Meat Inspection Act (FMIA) to occupy the entire part 309 of the Code of Federal Regulations chapter III. Regulations are “near” law, meaning that they are the basis on which the government can take enforcement action against citizens for their failure to comply. In the case of the FMIA, such action would be criminal.

Part 309.1 provides that all livestock offered for slaughter in an official establishment shall be examined and inspected on the day of and before slaughter unless there are some specified reasons otherwise. This is one of the oldest and most stringent requirements faced by commercial slaughterers. If by some chance ante-mortem is not conducted, it is usual and customary that carcasses are condemned. There is no substitute for ante-mortem inspection.

Part 309.4 states that “all livestock showing, on ante mortem inspection, symptoms of … encephalomyelitis … shall be identified as U.S. Condemned.…” The changeover to HACCP has in no way modified the requirements for both Ante-Mortem and Post-Mortem (CFR Part 310) inspection by USDA officials of livestock and carcasses to be sure that they are wholesome and fit for the food supply. These are cardinal regulatory requirements in the United States, and must be met by equivalent standards in those countries that export their meat to the U.S. In fact, the critical parts of any livestock that are condemned for suspected neurological disease are sent to the USDA’s laboratory in Ames, IA where extensive testing is done to see whether there is evidence of bovine spongiforpm encephalopathy (BSE). To date, no such evidence has been found in the thousands of bovines tested by the Animal & Plant Health Inspection Service (APHIS).

To the fullest extent possible, the U.S. meat industry has cooperated with the U.S. Department of Agriculture to assure the safety and wholesomeness of the meat supply. As President Thomas Jefferson said, “Every difference of opinion is not a difference of principle.” The industry may have different opinions than the government about how to best assure the wholesomeness and safety of meat, but the principle of meat safety is unanimous.

MCDONALD’S EUROPEAN MEAT SUPPLY SCRUTINIZED

The first suspected case of Bovine Spongiform Encephalopathy (BSE) in an animal at an Italian plant that supplies meat to McDonald’s restaurants in Europe was discovered in Italy. This would also be the first case of BSE in Italy. McDonald’s acted quickly to reassure its customers about the safety of its product; it also stood by its Italian supplier, assuring the “quality, traceability and safety” of its beef. In the U.S. McDonald’s uses nothing but domestically raised cattle. Nevertheless, the linking of McDonald’s to BSE is a blow, although perhaps more to the European market than anything else. Beef sales have plunged over the past few months in much of Europe. Making matters worse, a report by the European Commission last year criticized Italy’s veterinary surveillance and a Wall Street Journal report today criticized Italy for not having adequate inspection. Meanwhile, a report in the New York Times said that “the United States' ban on risky British meat products, adopted in 1991 and extended to imports from other countries, contains many loopholes and exceptions that could leave the door open to infected products, says a report by a scientific advisory panel to the European Union on the risk of mad cow disease in America.” Furthermore, Dr. Maura Ricketts of the World Health Organization's animal- and food-related health risks unit was quoted as warning that missteps by European governments have made the United States more vulnerable to the disease. However, proper inspection, as described in the regulations outlined above, goes a long way to assure confidence in the meat supply.

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FSIS ACCEPTS RESIDUE PROGRAM

USDA/FSIS Deputy Administrator Phil Derfler indicated that the Agency was responding positively to the NMA and other trade associations’ request to examine the use of veterinary drugs. In particular, the industry is seeking to deter residue violators. “We have examined your suggested program and I believe that it has considerable merit and may afford better consumer protection than our current procedures. Thus, we intend to make changes consistent with your suggestion in our current program.” This will mean the termination of the 5/15 policy in favor of a more meaningful cooperative program with the Food and Drug Administration. A copy of the correspondance is available, send a self-addressed, stamped (34¢) envelope to Jeremy Russell at NMA-West.

MANDATORY PRICE REPORTING INCHES NEARER

Mandatory price reporting is approaching its implementation date of January 30. Its proponents, livestock organizations, have failed to prepare the users of the current Market News system that, when implemented, the reports that are produced from the existing voluntary system will simply disappear. The voluntary system which has had huge industry support will not have any information available. Confusion and the lack of vital pricing information, as the industry knows it today, will become a reality if the mandated system which has not been beta-tested, doesn’t work perfectly on the first day, or the 2^nd or the 3^rd et al days. If you’re concerned, call the livestock organizations that forced this issue with prescriptive law and regulations. The government is trying hard to put it together, but no business in its right mind would expect a new computerized system to work without beta testing and it’s hard to believe that the United States government won’t have some unforeseen computer glitches.

BEEF WARS

The current issue of Washington Monthly includes an item by Dr. Winkler Weinberg that condemns the USDA’s policy on handling E. coli O157:H7. More next week.

PORK REFERENDUM LAWSUIT

Apparently a group representing pork producers filed in Michinigan last Friday a request for a temporary restraining order and an injunction against the USDA’s decision to drop the pork checkoff.

ROOM RATES

The special room rate of $130 will end on January 26, so make your Rio Suite & Casino Resort reservation ASAP. Call (702) 252-7777.

NATIONAL MEAT ASSOCIATION

NMA - East: 1400 - 16th St. N.W., Suite 400, Washington D.C. 20036 Ph. (202) 667-2108

NMA - West: 1970 Broadway, Suite 825, Oakland, CA 94612 Ph. (510) 763-1533 Fax (510) 763-6186

Edited by Jeremy Russell

January 16. 2001

WHAT THE PORK CHECKOFF RESULT REALLY MEANS

On January 11, Ag Secretary Dan Glickman announced that the results of the pork checkoff referendum conducted last summer were 14,396 in favor of continuing the checkoff, and 15,951 against continuing it. In announcing these results for a program which has been heralded as highly successful in positioning pork as the “other white meat” and assisting in building the growing market for pork, the Secretary said: “This outcome demonstrates that the program does not have the support of the producers it serves and therefore cannot fulfill its stated purpose.” The Secretary further stated that the result, in addition to upholding the bedrock democratic principle of the right to vote, is appropriate and necessary to determine whether a majority of pork producers do, in fact, continue to support the checkoff.

Leaders of the pork industry have been quick to suggest that there were serious flaws in the referendum and it appears clear that there will be challenges to the decision by the Secretary ordering preparation and issuance of a final rule terminating the order and the program conducted under it.

Glickman opines that as a matter of basic fairness, producers deserve the opportunity to vote on the checkoff program. He sees it as a mandatory assessment, like a tax, that all producers must pay even if they disagree with it. This is the first vote since it was developed in 1988.

It is interesting to note that the Beef Checkoff program is facing similar challenges and a referendum is imminent. The sheep industry’s programs were funded by the Wool Act until that arrangement was terminated by Congressional action in the mid-1990s. Industry groups have had discussions with the Department about conducting a referendum, but the most difficult issues about voting have no unanimous support. Earlier referendums went down to defeat because of what was perceived as a lack of fairness among those who own large numbers of livestock compared with those who own just a few sheep.

It is even more interesting to note that this division between large and small producers doesn't appear to exist in the promotion and research by producers of poultry where producers, packers and processors are often vertically integrated. They’ve achieved huge success in true demand for their product, as demand for red meat dropped year after year in the past decade.

As pork producers seek checkoff resurrection in the face of the Secretary’s announcement to terminate the program, and the debate rhetoric heightens, the issues of vote discrepancies are likely to rival those that surrounded the election of President-elect George W. Bush. Fairness of voting procedures will be front and center in the debate. And the winners will be those vertically-integrated firms (red meat and poultry) that have sufficient market power to stay out of the fracas and get on with the end game of meeting consumer needs and expectations.

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AMS User-Fee Certification Program for Processing Equipment

The Agricultural Marketing Service (AMS) has published a final rule implementing a voluntary, user-fee-funded program to inspect and certify equipment and utensils used in processing of livestock and poultry products. 66 Fed. Reg. 1190 (January 5, 2001). By certifying equipment, the AMS will provide third party assurance to manufacturers of new, modified, or reconditioned equipment and utensils who want to have the equipment and utensils they manufacture officially inspected and accepted as meeting the NSF/3-A standards. The program is intended to fill the void in third party certification that was created after USDA’s Food Safety and Inspection Service (FSIS) discontinued its mandatory prior approval program for equipment and utensils in 1997.

The standards adopted by the AMS program will be different from those used by the old FSIS program, therefore, equipment approved under the FSIS prior approval program will not be automatically considered approved under the AMS program. 66 Fed. Reg. 1194.

The Dairy Grading Branch within AMS is responsible for the certification process. For certification, applications must be submitted to the Branch Chief. Finally, AMS stressed that this program is a voluntary program and that equipment fabricators and users are free to use other third party certification services or self-certify equipment.

If you would like a copy of the final rule please send a self-addressed, stamped (34¢) envelope to Ira Perez at NMA-West.

NEW LABELS FOR MEAT AND POULTRY

Agriculture Secretary Dan Glickman announced January 12 a proposed expansion of the nutrition labeling requirements for meat and poultry. Under the expanded regulations, raw meat and poultry will carry nutrition labels similar to those already required on soup cans, cereal boxes and other processed-food packages. Nutrition information for major cuts such as chicken breast, whole turkeys, and steaks would be required either on their labels or at their point of purchase. Nutrition information for ground or chopped products such as ground beef, pork, and turkey would be required on package labels. USDA will take public comments on the labeling rules until April 18 before they are made final. Glickman leaves office in a week so the final decision on the rules will be up to the incoming Bush administration. These mandatory labels will replace a system of voluntary labeling. Under government regulations, the Agriculture Department said it had to require nutrition labeling if fewer than 60% of companies were doing it voluntarily. About 55% of stores currently post nutrition information for meat, the Associated Press reported. FSIS has made a backgrounder available on the meat labeling proposal; backgrounders can be viewed at the Agency’s website (linked from NMAonline.org). You may also send a self-addressed, stamped (34¢) envelope to Jeremy Russell at NMA-West for a copy.

MISSOURI STATE INSPECTION APPROVED

USDA/FSIS announced on January 11 that Missouri had successfully established a state meat and poultry inspection program. This program will exist simultaneously with the Federal program, and is expected to receive requests for inspection primarily from small businesses. During the last session of Congress, USDA forwarded a bill to Congress that would provide for interstate shipment of state-inspected meat and poultry. In November 1999, Senators Tom Daschle (D-SD) and Orrin Hatch (R-UT) introduced legislation, the “New Markets for State-Inspected Meat Act of 1999.” National Meat Association supports the idea of having one uniform standard for all meat produced or sold in the United States.