Edited by Kiran Kernellu
September 2, 2003
THE CIRCLE OF SUCCESSFUL CHANGE!
In the January 22, 2002 Lean Trimmings, NMA described the process by which industrial change occurs. NMA Executive Director Rosemary Mucklow, like a few other people in the industry today, has observed change over about four decades. There is no question that the meatpacking and processing industry has changed in that time. The Labor Day holiday merits a revisiting of that process, the Circle of Successful Change.
Some changes have a greater industrial impact than others, but we suggest that there is a fundamental concept behind how an industry makes change and it can all be summed up in the following Circle of Successful Change. It’s a circle, because it’s hard to define the starting point!
There are five equally crucial points on the circle. Technology, which literally describes hundreds of innovations, contributes to Productivity. Productivity is an essential ingredient for efficiency in the work place and leads to Profitability. Only when a company makes money does it have the ability to make Reinvestment in its business advancement. Reinvestment is not merely buying new equipment and building larger facilities but also investigating and testing new ideas. This is called Research & Development. There are many other practices that businesses must do to be successful, including strong financial management, assuring a safe workplace, marketing and sales efforts, and so on. These are tangential activities, but the Circle of Successful Change has been fundamental to the structural change in the meatpacking and processing industry in the past four decades.
Today the U.S. is reportedly the most productive country in the world. The application of technology has and will continue to improve our productivity and keep our nation on the cutting edge of the future.
FISCAL YEAR 2004 AGRICULTURE APPROPRIATIONS AND COOL
And they are back. Congress that is, is back in action. After a month-long recess it is time to get back to the work our tax dollars pay them to do. The most important issue on our congressional radar is the passing of the agriculture appropriations bill in the Senate for Fiscal Year 2004. There is a provision within this bill that does not fund Country of Origin Labeling for meat and meat products in the next fiscal year. NMA, along with other groups, is working to make sure this provision is not amended out of the Senate version of the appropriations bill, but we need the grassroots support of NMA members to make this happen. We are challenging our many members to draft letters to their Senators in support of the no funding provision. Government Relations Liaison Shawna Thomas will help any of our members draft letters and make sure they get to the proper people and offices. Please contact her as soon as possible at [email protected] or (202) 518-6383.
While NMA can provide a constant voice to the powers that be in Washington DC, it is the individual’s voice that can make a deeper impact on a specific Senator from a specific state. The voice of a constituent is also the voice of a voter. Do it! Do it now!
ILC STUDENT TRAVEL FELLOWSHIPS
Applications for the International Livestock Congress (ILC) Student Travel Fellowships are now available on the ILC website, www.livestockcongress.com. Funded by the International Stockmen’s Educational Foundation (ISEF) through a grant provided by the Vivian L. Smith Foundation, the Fellowships provide students both in the U.S. and internationally with an opportunity to interact with leaders throughout the beef industry. Students are provided with airfare, ground transportation, hotel accommodations, most meals and a complimentary registration to the Congress.
The ISEF awards travel fellowships each year for the ILC held in Houston, TX, March 2-4, 2004 to senior level and graduate students of accredited colleges or universities. Travel fellowship recipients must participate in all activities of the Congress, develop a professional paper based on their experiences, and will also be required to make a presentation to a breed association or a similar group in their area about their experiences at the ILC.
The deadline for applications is November 1. Completed applications, along with college transcripts, three letters of reference and a head/shoulders photograph, should be sent to Julie J. Kimball, Executive Director, International Stockmen’s Educational Foundation, P.O. Box 150128, Fort Worth, TX 76108. For more information, contact Julie Kimball at [email protected] or 817-367-6563.
NMA is a strong supporter of the ILC. NMA Executive Director Rosemary Mucklow is a Director of the ISEF. The ILC provided the meat industry representatives with a “think tank” environment invaluable to the development of the future.
CANADIAN MEAT INSPECTION
A recent Wall Street Journal article discussed a probe by the Canadian government of a meatpacking operation allegedly illegally butchering cattle that had died before reaching the slaughterhouse. The company, Aylmer Meat Packers, Inc., allegedly bypassed meat inspectors by processing such cattle for human consumption after hours. Canada’s Food Inspection Agency issued a mandatory recall last week of all the plant’s beef and beef products, and suspended the company’s license. “This is an isolated, local incident. If the allegations are true, it’s an outrageous incident and not reflective at all of the majority of the industry,” said Canadian Cattlemen’s Association spokeswoman Cindy McCreath in the report. NMA Executive Director Rosemary Mucklow said, “Canada’s Food Inspection Agency and USDA have historically taken strong and immediate action to prevent unfit product from entering the food supply.”
Lean Trimmings and Herd on the Hill are offered electronically. If you’d like to receive the newsletter via e-mail, please contact Kiran Kernellu at [email protected] or 510-763-1533. Receive the latest news every Monday afternoon in your inbox instead of waiting for it in the mail!
NMA reports news items that are of special interest to its readers, and provides information that they may want to be able to access. Below are links to the Federal Register, AMS, APHIS, and FSIS, respectively:
NMA RESOURCE NOW AVAILABLE
NMA’s resource, “The Role of Microbiological Testing in Beef Safety Systems,” which was offered in the May 27, 2003 Lean Trimmings, has been revised and is now available for dissemination. NMA members who would like a copy of the resource should contact Julie Ramsey at 510-763-1533 or [email protected].
UPCOMING NMA SEMINARS
September 18-20 - Basic HACCP -- San Francisco, CA
October 1-2 - Beyond Basics (HACCP) -- College Station, TX
Contact NMA at (510) 763-1533 for more information and registration materials.
BEV PROGRAM UPDATE
AMS has posted a notice entitled “USDA Beef Export Verification Program for Processed Products,” and Appendix A of the USDA Beef Export Verification Program (Processed Beef Products) on its website. These documents are available at http://www.ams.usda.gov/lsg/arc/bev.htm or by clicking on these links:
· Notice: USDA Beef Export Verification Program for Processed Products - PDF File
· USDA Beef Export Verification (BEV) Program, Appendix A, Processed Beef Products - PDF File
NMA understands that processed products will be required to comply with this BEV program for shipment on October 1. AMS, working with USMEF, arranged two teleconferences with accompanying PowerPoint display for processed meat producers this Thursday, September 4 at 3:00 p.m. EST and Friday, September 5 at 11:00 a.m. EST. A presentation will be given by AMS along with a conference call to allow individuals to ask questions. Dial 1-888-206-0109 and enter participant code 414258 for the conference call. Log onto http://www.premconf.com/us/readycast.asp, click on “Join the meeting,” then “USMEF-BEV,” and enter meeting password “usmef-bev” for the Web portion of the conference.
NMA COMMENTS ON MERC’S COOL REQUEST
As reported in the August 11, 2003 Lean Trimmings, on July 15, 2003 the Commodity Futures Trading Commission published a notice of availability for public comment of the proposed amendments to the Chicago Mercantile Exchange’s (CME) live cattle futures contract, entitled “Chicago Mercantile Exchange: Proposed Amendments to the Live Cattle Futures Contract Restricting Delivery to Cattle Born and Raised in the United States.” The CME requested that the Commission approve the subject proposed amendments for the live cattle futures contract. The proposals will require that all cattle delivered on the futures contract must be born and raised exclusively in the United States, and the seller must provide supporting documentation that conforms to industry standards at the time of delivery. The amendments are contingent upon the promulgation by the USDA of regulations implementing Country Of Origin Labeling (COOL) requirements, which by statute is intended to take effect on September 30, 2004.
NMA Executive Director Rosemary Mucklow provided comments. Following are excerpts of her submission:
“There is a long history of live animal trade among the three countries that comprise North America: Mexico, United States and Canada. Each country has a vested interest in free trade among these natural trading partners for live cattle which know no borders. The arbitrary and capricious statutory requirements to label Country of Origin for meat at retail, which is presently in rulemaking at the United States Department of Agriculture, and facing huge difficulties for effective implementation, should not be used by the Chicago MERC to promulgate highly restrictive trade barriers on the mechanics of trading futures contracts for live cattle. The proposed rule simply re-enforces that the hastily-passed statutory authority mandating COOL is impossible to implement, and flies in the face of the international treaties between the parties, including NAFTA and WTO.
“NMA recognizes that the Chicago Mercantile Exchange has a timing problem and that it is appropriately moving to institute requirements that will permit it to comply with the law. Thus, it states that its rulemaking is “contingent upon the promulgation by the USDA of regulations implementing COOL requirements pursuant to (that law) which, by statute, is intended to take effect on September 30, 2004.”
“At this time, it would be prudent for the Chicago MERC to reserve action to restrict the contractual terms for live cattle in the futures market subject to final disposition of implementation of COOL by USDA. All statements and releases to guide traders should be accompanied by a boldly printed statement to the effect that requirements are contingent on the publication of final rule by USDA with an effective implementation date. Further, we strongly encourage the Chicago MERC to provide explicit comments to USDA in its rulemaking process elaborating on the impact that such rules will have on its operations on livestock trading terms, and may lead it to violation of fair trading laws with our natural North American trading partners. Indeed, the Chicago MERC is in a unique position to provide data that will demonstrate the economic impact of this statutory requirement that should have been considered during the legislative process.”
LOST IN WISCONSIN!
An attendee at NMA's Summer Conference lost a standard 8” x 10” college spiral-bound notebook, possibly with a red cover, with lots of unintelligible notes and pieces of paper inside. Reward promised. Please contact Kiran Kernellu at 510-763-1533 or [email protected] if found.
NMA REMEMBERS LOU FUNSTON
The meat industry lost a long time associate on Monday the 25th of September. Lou Funston, owner and president of Western States Leasing, Belvedere, CA passed away after a very short battle with cancer. For over twenty-five years Lou was involved with equipment financing for both small and large meat processors. Over these years he financed equipment packages for many NMA and Western State Meat processors. Lou’s strength was his ability to discuss all potential capitol avenues available to them for the purchase of equipment and equipment packages. Lou is survived by his wife and two sons. He will be greatly missed by all of his friends and associates in the industry.
NATIONAL SUMMARY OF MEATS GRADED
USDA’s Agricultural Marketing Service released the summary report of meats graded for the month of July 2003. For all quality-graded beef, Choice was 56.3%, down from 57.5% in June. Select was 40.9%, up from 39.9% the previous month. And Prime was 2.8%, up from 2.6% in June. For a copy of the entire report, which covers beef, lamb and mutton, NMA members send a self-addressed, stamped envelope to Kiran Kernellu or visit http://www.ams.usda.gov/lsg/mgc/mgc-pubs.htm.
Edited by Kiran Kernellu
September 2, 2003
GUIDELINES FOR DEVELOPING BEST PRACTICES FOR BEEF SLAUGHTER
National Meat Association is pleased to be joined by the Southwest Meat Association, the American Meat Institute and the National Cattlemen’s Beef Association in the development of Guidelines for Developing Best Practices for Beef Slaughter. Leading representatives of beef slaughtering companies met in late 2002 in Kansas City, MO, and under the guidance of Dr. Kerri Harris of the Department of Animal Science at Texas A&M University developed the basics for these Best Practices.
We are indebted to the following individuals who met to develop these Best Practices, with a special thanks to Dr. Kerri Harris for her guidance and preparation of the final document:
Toy Archer, Booker Packing Co.
Tom Durham, Tyson/IBP
Roger Hall, Fresno Meat Co.
Tom Harris, Harris Ranch Beef
Larry Hollis, Beef Packers Inc.
Gary Hyatt, Washington Beef
Bryan Kleczka, American Foods Group
Tom Meyer, Excel Corp.
Brenden McCullough, Farmland National Beef
Alison Nolz, Washington Beef
Darren Olsen, E.A. Miller Inc.
Jonathan Quiroz, San Angelo Packing.
The operating practices at every company may vary slightly from these Best Practices, depending on differing operating situations. Slaughterers are urged to consider these Best Practices as guidelines for their own internal practices and documentation. “Every slaughter floor is different, whether it relates to layout or chain speed,” said NMA Executive Director Rosemary Mucklow. “The Best Practices aren’t meant to be rules. They’re guidelines companies can use to improve their dressing procedures.” NMA members contact Ken Mastracchio at 510-763-1533 or [email protected] for a copy of the Best Practices. The Best Practices will soon be posted to NMA’s website.
JAPAN’S ECONOMIC TURNAROUND
A recent article in Institutional.AllianceBernstein.com from AllianceBernstein Institutional Investment Management examined Japan’s economic turnaround. Japan’s economy fared far better that analysts’ expectations, with real GDP reportedly growing around 2.5% for the first two quarters of 2003, the fifth and sixth consecutive quarters of growth for the economy. Reportedly, the recovery also appears self-generated, with private consumption and investment accounting for all the first-quarter growth and most of the second.
The author of the article, Joseph G. Carson, Director, Global Economic Research, argues that on the positive side, expansion in Japan, especially in domestic demand, will lift US exports and contribute to a faster-growing and more balanced global economy. Carson asserts that economic recovery in Japan can only be good for U.S. industry, and this is good news for meat exports! While recovery in Japan ultimately means higher interest rates globally, it also means stronger export markets and an appreciating yen. Carson feels that “a weak, if not deflating, Japanese economy ushered in a long bull market in U.S. financial assets, so a growing one could conversely trigger a long bull market in industrial equipment and materials.”
FSIS DIRECTIVE 7160.3, ADVANCED MEAT RECOVERY USING BEEF VERTEBRAL RAW MATERIALS
On August 25, 2003 FSIS reissued Directive 7160.3, “Advanced Meat Recovery Using Beef Vertebral Raw Materials.” FSIS reissued the directive to reiterate that establishments whose AMR systems repeatedly fail to produce product that is free of spinal cord will not be allowed to produce AMR meat from beef vertebrae, and that product containing spinal cord tissue will not be allowed to enter commerce labeled as meat. Paragraph VI. B was entirely rewritten to provide for new enforcement procedures and a flowchart was added that sets out the enforcement procedures. The revised Directive reiterates AMR sampling responsibilities of inspection program personnel and, unlike the previous Directive, specifies the number of follow-up verification samples to be taken should any positive test results for spinal cord occur in the sampled AMR product. The revised Directive also provides more detail about agency enforcement procedures when AMR systems fail to produce product that is free of spinal cord. NMA members may contact Kiran Kernellu at 510-763-1533 or [email protected] for a copy of the Olsson, Frank and Weeda memorandum on the Directive. Visit the revised Directive on FSIS’s website at: http://www.fsis.usda.gov/OPPDE/rdad/FSISDirectives/ 7160.3Rev1.htm.
Based on the first several months of regulatory sampling, the agency has determined that some establishments are not adequately addressing the presence of spinal cord tissue in boneless comminuted beef. While the agency has also expressed concern about proper processing of pork AMR product, the revised Directive focuses on only beef AMR product. FSIS presently is completing a survey of pork AMR systems to determine if spinal cord and other materials are inappropriately incorporated into final pork products.
FSIS is holding five workshops around the country to explain its new rule, “Control of Listeria monocytogenes in Ready-to-eat Meat and Poultry Products,” to owners and operators of small and very small inspected establishments. They will be held at the following locations:
September 13 Hilton North Raleigh
3415 Wake Forest Road
Bridgeport Holiday Inn
1070 Main Street
September 20 Hilton Kansas City Airport
8801 N.W. 112th Street
Kansas City, KS
October 4 Oakland, CA Albuquerque, NM
Meeting sites for the remaining cities will soon be announced. Attendees should register in advance by contacting Sheila Johnson at 202-690-6498 or [email protected]. Because of limited space, preference will be given to representatives of federal and state small and very small meat and poultry establishments.
FSIS PUBLIC MEETING ON PRE-HARVEST FOOD SAFETY ISSUES
FSIS will hold a public meeting on pre-harvest food safety issues and E. coli O157:H7 on September 9, 2003 at the Washington Plaza Hotel, 10 Thomas Circle, NW, Washington, DC. from 8:30 a.m. to 4:30 p.m. The meeting will consist of presentations on the research and practical experiences aimed at reducing E. coli O157:H7 at the livestock production level. A tentative agenda will be available in the FSIS docket room and on the FSIS website at http://www.usda.fsis.gov/.