Fruit, we are told, is the key to protecting our children from obesity and diabetes today and from stroke, cancer and other chronic disease later in life. That's why the 2010 Dietary Guidelines for Americans recommends children under 18 eat around 1 to 2 cups of fruit every day, preferably in the form of whole fruits rather than juice or fruits as part of mixed dishes. Yet we know from previous national estimates that only four in 10 kids get that recommended amount.
As to how they're doing in the other half of that requirement regarding whole fruit vs. mixed dishes, researchers from the Centers for Disease Control and Prevention in Maryland analyzed data from 3,129 youth aged 2 to 19 years, from the 2011-2012 National Health and Nutrition Examination Survey. Using the Food Patterns Equivalents Database and the What We Eat in America 150 food groups, they then calculated the contribution of whole fruit, 100 percent fruit juices, mixed fruit dishes, and 12 discrete fruit and fruit juices to the average American kid's total fruit consumption. Here's a snapshot of what they found:
Nearly 90 percent of total fruit intake came from whole fruits (53 percent) and 100 percent fruit juices (34 percent) among 2- to 19-year-olds.
Of the 12 discrete fruits and 100-percent juices that contribute almost 90 percent of total fruit intake in the diet of American youth, apples, apple juice, citrus juice and bananas were responsible for almost half of total fruit consumption. Apples accounted for 18.9 percent of average fruit intake. Differences by age were predominately between youth aged 2 to 5 years and 6 to 11 years.
Farm commodity markets have always had their wild ups and downs, but last year was particularly volatile for U.S. cattle markets. The futures price for cattle--those prices bid on animals not yet ready for market in anticipation of their future delivery--fell by 16 percent at the end of 2015, the hardest fall in more than 30 years. Combine that particular instance with more general wild price swings for many other farm commodities globally that started in 2008, and many sellers and buyers of commodities have started looking hard at the futures markets. Are they still working?
Futures markets have traditionally been considered a valuable tool to reduce natural market risk, both for the farmers who produce crops and livestock and the food manufactures who buy those commodities. In theory, they allow both parties to lock in prices today for commodities that won’t be ready for delivery for months, allowing them to better plan around the natural price swings in the market.
But in January, the Denver-based National Cattlemens Beef Association, the trade association for American cattle producers, wrote a formal letter to the the Chicago Mercantile Exchange, the world's biggest futures market and the exchange that trades futures on cattle prices in this country, complaining the mercantile's contracts are growing useless to the typical beef-cattle grower.
“For several months we have been hearing from our members across the country regarding market volatility and their concerns about high frequency trading’s contribution to that volatility,” the letter said. “The effectiveness of cattle futures contracts as a viable risk management tool is being called into question due to the concerns over high frequency trading. In fact, we continue to hear our members question their use of the cattle contracts because the volatility has made them a tool which is more of a liability than a benefit.”
NCBA complains that such “high-frequency trading,” in which computerized trading that can place and cancel orders in fractions of a second has replaced human beings, is artificially altering the futures market. NCBA’s letter also questions whether some of the market swings have been caused by the process known as “spoofing," an illegal practice in which participants try to change pricesby placing orders they quickly cancel, creating the false notion of genuine movements in the market.
In a conference with cattle officials at the NCBA’s annual meeting in San Diego last month, officials of the mercantile exchange promised to make changes, without admitting to the group’s complaints. It said it would add cattle futures to a system the exchange already uses that will limit the number of order updates traders can send compared to how many they actually execute. It also plans to consider five-to-six-second trading delays that would slow down computer-automated trading and address NCBA’s complaints about that practice. “High frequency trading occurs at a rate faster than any human can analyze," the cattlemen’s letter complained. "Latency would therefore level the playing field so that everyone sees the market at the same speed." NCBA also wants audit trails released on trading activity to better monitor market activity that may be less than above-board.
This recent activity has led others to ask some bigger questions about the health of America’s commodity marketing system in general. R-CALF USA, a smaller organization of western cattle ranchers that advocates for more independence and better market protection for independent cattle ranches, has demanded the U.S. Senate Committee on the Judiciary investigate the recent collapse in market prices. That group blames large meatpackers for artificially altering prices.
Others agree. An executive for the Chicago Mercantile Exchange told Reuters News that one contributor to the futures market uncertainty is the reality that fewer and fewer cattle today are sold on the open market. Those more traditional “cash sales” in which cattle buyers and sellers negotiate immediately before those animals are ready, have declined in the past decade in favor of longterm contracts that lock in prices, often months before the animals are put onto feed. Futures markets, as they were originally intended to function, depend upon a meaningful underlying cash market to set their prices. That evolution toward contracting rather than cash price is occurring throughout agricultural markets.
A second, and perhaps more serious, underlying problem is the reality that futures markets have changed, as well. According to some ag ecomomists, what was once a market that allowed buyers and sellers to hedge the price of commodities they were forced to hold has now become a market for the diversification of financial assets. That change has turned them into “derivatives,” the same type of financial-market tool that nearly sunk the world financial markets in the crash of 2008. Those economists argue that when the fundamental market factors that affect producers and consumers of physical commodities become “uncoupled” from the financial-asset diversification of speculators in the futures market, the futures markets lose their value in helping buyers and sellers predict true prices. The relatively low cost of futures trading, some have argued, invites speculators to jump in and out of the market, artificially causing commodity prices to vary excessively, destabilizing markets from everyone, from farmer to your consumer. The research is split on whether futures are to blame for underlying market-price changes, or simply a victim of those factors.
As a potential billion-dollar defamation lawsuit quietly moves forward against ABC News over its March 2012 broadcasts that labeled ground-beef products by South Dakota-based Beef Products Inc. "pink slime," expert concensus contends the public-relations bruising to both that company and the beef industry as a whole cost a great deal in lost demand. Ad Age, for example, quoted celebrity supermarket know-it-all Phil Lempert's opinion that the media coverage had left the industry scrambling to get control of the message. "From a PR/advertising standpoint, this is the perfect storm," Lempert told Ad Age, "From a PR standpoint, very little can be done." Brandchannel was nearly gloating in reporting the effect it believed the scandal had played on the entire beef-promotion structure. "It’s been a rough couple years for the marketing initiative, which was established as part of the 1985 US Farm Bill," it said. "Between [the] ‘pink slime’ standoff and recalls for listeria contamination, selling a red meat patty these days isn’t as easy as it looks."
But how bad was the damage, really?
Purdue research published in the journal Food Policy now challenges the common notion of those like Lempert that bad press always necessarily hurts demand for food products. The researchers looked at overall demand for pork, chicken and turkey and for individual beef products in the USDA choice, prime and select grades, as well as ground beef, immediately after the pink-slime news broke. They plugged price and consumption patterns into a mathemetical model that accounted for the consumer's tendancy to switch product categories in response to changes in their preferences, and tested the theory that negative news coverage affected not only ground beef demand, but demand for other beef and aggregate meat categories, as well.
There's no question the negative word about lean finely textured beef got out, the researchers concluded. They constructed a weighted news media index that not only summed up the number of news articles from news transcripts, newspapers, magazines and journals, web news, video and radio per week, but went on to calculate an expected importance index, based on the percent of consumer readership for each of those news channels. Using the week of March 24, 2012, the week the pink-slime story first broke, they then created a news-impact index comparing the news that followed to that most-heated week using a range of zero to one.
But next, they matched price and consumption patterns against that media coverage index, to estimate the effects of media portrayal of LFTB on consumer demand. They found that media portrayal of LFTB did lead to significant changes in consumer demand across meats or within the beef category immediately. Consumer purchases of pork, turkey and USDA prime beef--which you might expect shoppers to choose over suspect ground beef--were affected for two weeks or greater after news reports of LFTB surfaced. Nevertheless, those effects were temporary and waned or disappeared shortly after. Even more surprising, they found media coverage did not significantly impact consumer demand for ground beef, which consists of LFTB. Consumers may have responded quickly and initially to the food scare by making changes to their meat and beef consumption, but their response didn't last long.
The Purdue work notes a similar pattern occurred in response to negative publicity regarding BSE, which the press called "mad cow disease." For example, a USDA report used food purchase records from the Nielsen Homescan panel and showed that while beef purchases declined initially, there was no evidence of response beyond two weeks after the BSE announcements. Other studies from that period confirmed the same: Consumers react quickly in response to media announcements of food scares, but those reactions are short-lived.
The lesson to be learned? Pay attention to your "industry infrastructure," says Kevin Murphy, founder of Food-Chain Communications, a Missouri company specializing in communicating up and down the food chain. The industry infrastructure is composed of all influencers who can potentially impact your brand by telling others about it. ABC's negative coverage of LFTB may not have hurt overall beef demand, but it nearly devastated the product's inventor, costing the company an estimated $1.2 billion and 700 jobs. During March 2012, 70 percent of ground beef included LFTB. However, that number dropped to 5 percent by March 2013.
That damage occurred because a handfull of key customers succumbed to panic and abandoned BPI, Murphy notes--even as consumers were apparently absorbing the news and dealing with it. Had preventive communication been applied to help those key customers communicate a reassuring story to their customers within the infrastructure, BPI may have succeeded in riding out the only temporary impact on demand the Purdue researchers confirmed was only fleeting.
Hams. USDA reports the U.S. pork sector appears to be fully back on its feet following losses last year from the disease Porcine Epidemic Diarrhea, which took out a large portion of young pigs. Pork supplies are expected to finish 2015 with year-over-year production gains of 7.3 percent, which is 5.7 percent higher than even 2013's production, before pig farms began feeling the effects of the disease. Fourth quarter commercial pork production is expected to be 6.5 billion pounds, 5.4 percent greater than the same period a year ago. That supply increase will hold prices down from 5 percent to 10 percent compared to the average for 2015 as a whole. For the first half of 2016, USDA expects production to be nearly equal to the first half of 2015, at 12.1 billion pounds, holding off any price increases until at least second quarter.
Turkey. U.S. turkey meat production in third-quarter 2015 was down 9 percent from a year earlier, at 1.35 billion pounds. That lower production combined with already lower stocks boosted wholesale prices for whole hen turkeys 17 percent above the previous year's level at this time, to $1.36 in October. September turkey shipments decreased 38 percent from a year ago, totaling just 43 million pounds. Since April, the average weight of birds at slaughter has been lower than the previous year, for a period of 6 consecutive months—reflecting the impact of bird flu in spring which caused processors to slaughter birds earlier than they normally would in order to maintain supply levels. Turkey meat production in fourth-quarter 2015 is forecast to total 1.4 billion pound, which would be 8 percent lower than in fourth-quarter 2014. This decrease is expected to come from both a smaller number of turkeys slaughtered and a decrease in the average live weight per bird at slaughter. Production in 2016 is forecast at 6 billion pounds, which would be an increase of 8 percent from year; however much of the increase won't be here until holiday season 2016.
Lamb. A marked reduction in the number of lambs and sheep coming through the slaughter chain in 2015 relative to last year leads USDA to predict third-quarter 2015 commercial lamb and mutton production will be down nearly 3 percent from the same period in 2014, at 37 million pounds. Unlike in 2014, most slaughter lamb market prices thus far in 2015 have been below the 3-year average, despite this tighter supply. USDA theorizes the increasing strength in slaughter lamb prices is likely due to greater demand and an infusion of younger market-ready higher quality lambs. Imports of lamb and mutton remain strong despite record stocks in cold storage. Based on the NASS Cold Storage report, September 2015 beginning stocks for lamb and mutton were roughly 4 percent higher than this time last year, at 41.9 million pounds.
Summer has ended, but that doesn't mean the grilling season has to. Here are five ways to extend the grilling season and the high-margin commodity sales that accompany it:
Believe it. Retailers themselves may fall into habit of respecting season over consumer preference when they automatically abandon grilling features once the traditional three-month summer window closes. But they do so at their risk. According to CPG sales and marketing agency Acosta, more than six in 10 surveyed shoppers grill at least eight months out of the year, and nearly one in four grill year-round. Thirty-nine percent of all U.S. shoppers say they used a grill for meal preparation in the past six months, Acosta shows.
Promote it. That extended grilling season means extended opportunity for promoting grillable sales and educating shoppers on unique applications, says Acosta's Marianne Quinlan-Sacksteder. “Grilling is popular as a year-round cooking method, so food manufacturers and retailers can promote grilling items in the spring, fall and winter – beyond the traditional Memorial Day to Labor Day timeframe – and still drive sales,” she urges.
Respect it. "A person could even argue that autumn’s eating is better: It is the harvest season, for crying out loud," Washington Post food columnist Jim Shahin wrote in a glorification of fall grilling. "Before we started trucking and flying everything from everywhere, obliterating seasons, the natural foods of autumn were cabbage, potatoes, onions, beets, Brussels sprouts, eggplant, garlic (yes, garlic), Hatch chilies, potatoes, all sorts of squashes and tomatillos, not to mention apples and pears. They take to a little fire and smoke just as those summer gems do," he writes.
That appeal to the tradition of fall outdoor cooking and smoking opens numerous opportunities for the retailer. Burgers still top Acosta's list with 80 percent of grillers cooking these in the last six months. Chicken came in second with 77 percent, followed by beef steak and hotdogs or sausages, which 66 percent of US grillers cook. Acosta notes that as Millennial dads shoulder more of the shopping role traditionally held by women in the household, grilling moves forward in cooking method preference, as a greater proportion of men than women choose to grill over other methods.
Adapt it. Meahwhile, Acosta's survey also found Americans are branching out and grilling more non-traditional fare, like seafood, at 31 percent; vegetables, at 46 percent; and fruit, at 10 percent. Adding warmer fall tastes to traditional fare can adapt the summer meal to the cool autumn by adding chutneys and salsas, for example--two additions that benefit from the added flavor of the grill. Even pizza, which not only benefits in flavor from grilling but becomes a communal event around the hearth. Adaptation also applies beyond food choices to venue, too: Think Thanksgiving meal preparation and tailgating opportunities brought on by football season's beginning and baseball's post-season.
Spice it up. The cooler evenings of fall invite the opportunity to try something different on the grill from duck to ham. Citrus slices on top, liquor-based marinades and low smokey heat over flavored wood chips can all spice up grill staples with some drama. The Washington Post's Shahin, for instance, suggests wood-smoked poached pears in red wine, orange and vanilla syrup or smoky green apple salsa verde.