In a breaking story, The New York Times is reporting an alarming increase in the number of food recalls involving organic foods due to bacterial contamination. The issue accounts for 7% of all food recalls so far this year, up from 2% last year. Among the problems so far are recalls involving salmonella, listeria, and hepatitis, The Times says. What is happening? Popularity, for one. Organic food sales are up nearly 25% in the past 3 years and along with that increase come higher risks to the organic supply line. Sales of certified organic products exceeded $39 billion last year. As demand continues to increase, the incidence of recalls will likely also increase, but that does not make for a trend, the Organic Trade Association says. For that to happen, you have to watch what happens over time, an Association spokesperson says.
Wholesale Food Prices Rise Slowly
According to The Food Institute, wholesale food prices for the first 7 months of 2015 topped out at 0.3%. Fish and shellfish, however, moved up nearly 7.5% in July. Other products that saw prices rising include turkeys, pasta, coffee, cooking oil, soft drinks, and frozen specialties. As a result, most retail prices held firm with some industry watchers saying that food prices will increase by about 1% for the year.
Eating And Drinking Establishments Soaring
The July numbers are in and they indeed look quite healthy, The Food Institute reports, up 9.8% for July. Full-service restaurants are seeing sales grow at a faster clip than their limited-service counterparts, but cash registers are ringing at a healthy clip in both sectors. Sales for the first half of the year are up over 9%.
Farm-to-Table A Tall Order For the Big Chains
It is one thing to pay lip service to local, fresh produce. It is quite another if you happen to be a national chain. Increasingly, the big players in the food industry are finding it more difficult to make good on the local, fresh, and healthy trend of their small, more nimble competitors. Seems as if the “big boys” are having trouble finding adequate supplies of ingredients to roll out specials nationwide. In one instance, Wendy’s went through 30 suppliers before finding two who could handle the company’s volume. That same issue plagues all of the major chains. Still, even in the face of shortages, giants like Chipotle are countering with aggressive ad campaigns featuring the quality of its ingredients while pointing out the artificial ingredients used by others in the industry.
Lawyers And Food Industry Consolidation
Shakespeare once advocated that we kill all of the lawyers. Today, it is the lawyers who are making a killing, so to speak, with schemes such as the tax inversion strategy that is changing the face of the food industry. The brainchild of a group of U.S. lawyers, tax inversion mergers re-incorporate a company overseas in order to reduce the tax burn on income earned abroad. The strategy now accounts for some of the biggest deals in the business, including Chiquita’s acquisition of Fyffes of Ireland; Burger King’s acquisition by Tim Hortons, and the D.E. Master Blenders spinoff from Sara Lee. Even Coke is not
immune. It recently announced a tax inversion merger with several European bottlers that will have the company based in the UK.
Key Commodities Trending Down… For Now
The global markets took a beating last week, accounting for the 9th largest drop in the Dow Jones in history. Not surprisingly, commodities were not spared, as prices continued to drop for feed corn, soybean meal, live cattle wheat, live hogs, and crude oil, which dropped below $40 a barrel for the first time in six years. That one bit of news, alone, accounts for a rising layoff rate in U.S. energy jobs, including oil, and natural gas employees. In addition, the ripple effect from cheap oil is yet to be felt, but it will likely be short-lived. “We’ll be at $70 a barrel by the end of 2015,” T. Boone Pickens, chairman of BP Capital Management, recently told The Wall Street Journal. “By the end of 2016, you’ll be up to $90 to $100.”
Food Producers Abandon Artificial Dyes
Be prepared for guests to complain that their favorite dish does not look as appetizing as it did previously. The reason is simple. Major food and drink manufacturers are removing artificial coloring from products. For example, Trix cereal will no longer have blue or green colors, while the red color will now be rendered via radishes and strawberries. Companies admit that vibrant colors may be gone in our foods, but they will be a whole lot healthier, The Washington Post reports.
Egg McMuffins Rule
How popular are eggs on English muffins? How about so popular that Time magazine estimates that if the sandwich was available on a 24/7 basis, it would boost sales by 2.5%. In fact, the company is, in fact, offering its classic Egg McMuffin all day every day, says the company’s president, who is interested in culling the menu and increasing profits.
Beef Production Is Increasing
The USDA is reporting that beef production in the U.S. increased some 3% since June. Beef production totaled nearly 2.1 billion lbs., while pork production totaled some 2 billion lbs. Veal, meanwhile, totaled 6.9 million lbs., the USDA says.
California Drought Update
The pictures are painful. Thousands of arid acres, farmers needing to spend millions drilling for water, and hundreds of thousands of acres destroyed by fires that burn out of control. No, this is not Dante’s vision of hell… it is California and it is hurting. A study by the American Geophysical Union recently noted that the historic drought is being made worse because of global warming, and the future is even scarier unless we change our ways The Des Moines Register reports.
Bar Food Goes Upscale
Walking into a famous haunt and you might score a seat at the bar. But how is the food? Increasingly, bar menus are going upscale, SmartBrief reports. In addition to seasonal snacks, the best bar menus from
eateries like Applebee’s, Bennigan’s, Chili’s, and countless specialty restaurants now regularly feature extensive appetizers and finger foods, but great entrees as well.