Price Discovery and Competition in Markets for Fed Cattle Advance Notice of Proposed Rulemaking
• https://www.ams.usda.gov/content/price-discovery-and-competition-markets-fed-cattle-advance-notice-proposed-rulemaking
• https://www.r-calfusa.com/r-calf-usa-statement-on-usdas-effort-to-improve-fed-cattle-price-discovery-competition/

The U.S. Department of Agriculture (USDA) Agricultural Marketing Service (AMS) announced its next step to deliver on the Biden-Harris Administration’s commitment under the Executive Order on Promoting Competition in the American Economy in the form of a new rulemaking effort under the Packers & Stockyards Act of 1921 to enhance price discovery, transparency, and fairness in cattle markets. AMS has issued an Advance Notice of Proposed Rulemaking(ANPR) seeking public comment on several possible interventions to develop new benchmarks such as Alternative Marketing Arrangements (aka AMAs) base prices and approaches to trading when using benchmarks.

The Advance Notice of Proposed Rulemaking requests comment on a range of targeted options designed to ensure that base prices in fed cattle AMAs are broadly representative of general market conditions and are not vulnerable to distortion or strategic behavior that could cause prices to shift for reasons other than changes in supply and demand.

For more than two decades, R-CALF USA has sought reforms to correct what it viewed as a disconnect between the competitive value of fed cattle sold by cattle producers to meatpackers and the actual price that cattle producers receive from the meatpackers for their cattle.

The ranch group has long argued that producers receive a less than competitive price for their cattle due in large part to the meatpackers’ ongoing practice of shifting large volumes of cattle out of the competitive cash market and into unpriced formula contracts (known today as alternative marketing arrangements or AMAs). The price producers ultimately receive for their AMA cattle is determined sometime in the future and is most often based on an average price discovered in the very cash market from which the cattle had been removed, thus leaving the cash market too thin to establish a competitive value for fed cattle.

R-CALF CEO Bill Bullard commented that “reforming the cattle procurement practices of the highly concentrated meatpackers as this ANPR sets out to do is the cattle industry’s holy grail. It is inarguable that the highly concentrated meatpackers possess overwhelming market power when compared to independent cattle producers, and the meatpackers’ current cattle procurement practices that this ANPR intends to reform are among the tools they use to exact that market power upon independent cattle producers.”

Bullard added that R-CALF USA strongly supports “USDA’s effort and view it as the most critical step undertaken by any administration over the past two decades to restore for independent cattle producers a robustly competitive marketplace, which is absolutely essential to our goal of reversing the alarming decline in the number independent cattle feeders and independent cattle farmers and ranchers, and for ensuring an abundant and affordable supply of beef for American consumers.”

Interested persons are invited to submit comments concerning this notice by using the electronic process available at Regulations.gov. All comments should reference the document number and the date and page number of this issue of the Federal Register. All comments submitted in response to this notice will be posted without change, including any personal information provided, at Regulations.gov and will be included in the record and made available to the public.

McDonald’s: Onions source of E coli outbreak
• https://www.nbcnews.com/health/health-news/fda-mcdonalds-e-coli-onions-farms-source-rcna177007

NBC News reported Taylor Farms, a California-based produce company, as the source of fresh onions linked to a deadly E. coli food poisoning outbreak associated with McDonald’s Quarter Pounder hamburgers.

Meanwhile, McDonald’s stopped serving the Quarter Pounders in several states and other fast-food restaurants — including Taco Bell, Pizza Hut, KFC and Burger King — pulled onions from some menus.

In a notice to customers last Wednesday, distributor U.S. Foods said Taylor Farms announced a recall of four raw onion products out of an abundance of caution because of “potential E. coli contamination” and customers were urged to stop using and destroy the affected products as soon as possible.

As of last Wednesday, at least 49 people had been sickened with E. coli infections linked to the outbreak. One older adult has died, and 10 other people, including a child suffering from hemolytic uremic syndrome, have been hospitalized.

Until now, it wasn’t clear where the McDonald’s outbreak stemmed from as neither the restaurant chain nor public health officials had said publicly where the onions were grown or whether they were sent to other restaurants. A McDonald’s spokesperson said that the raw onions were sourced from a single supplier and processed at a single facility. They are sliced and packaged at the facility as raw vegetables in individual bags and then distributed to restaurants.

A spokesperson for Taylor Farms did not immediately respond to a request for comment.

USDA approves trials for bovine H5N1 vaccine

According to the Hagstrom Report, the Agriculture Department has approved safety trials for two companies developing cattle vaccines against the H5N1 virus commonly known as bird flu.

Eric Deeble, the Agriculture Deputy Undersecretary for Marketing and Regulatory Programs announced the safety trials in a call to reporters with Health and Human Services Department officials. On the call, the HHS officials said there are now 31 confirmed cases of H5N1 in humans, and released a fact sheet on their efforts on H5N1.

A USDA official said Deeble did not release the names of the companies in order “to protect manufacturer privacy and ensure a level playing field. Companies that wish to disclose and share this information on their own accord, are free to do so.”

Medgene, a South Dakota-based animal health company, confirmed to The Hagstrom Report that it is one of the companies authorized to begin a field trial, and that “the trial began earlier this month at a contract research facility. The goal of the field trial is to demonstrate a reasonable expectation of efficacy and preliminary safety in animals specific to the company’s H5N1 vaccine, data to support a conditional license by the USDA.’”

Alan Young, co-founder and chief technology officer for Medgene, stated, “As unfortunate as the H5N1 spread is, this is exactly the kind of situation that our technology was created to address. Our goal from the very beginning of this outbreak was to be ready for our cattle customers whenever the USDA gave us the green light.”

Medgene’s H5N1 cattle vaccine study is expected to be complete in five weeks, with results then shared with the USDA.

In an earlier interview, Medgene CEO Mark Luecke said that the company has 500,000 doses of a cattle vaccine ready and has been urging USDA to allow sale of the vaccines, but Deeble said in an interview conducted prior to last week’s announcement that USDA cannot approve the distribution of the vaccines until the safety trials have been conducted, but that they “applaud USDA for taking any steps in this current situation” although they encourage them “to move faster” as Medgene uses a “platform technology” that would allow the vaccine to be changed as the virus evolves.

Japanese embassy holds wagyu event

The Hagstrom Report announced that the Japanese Embassy in Washington sponsored an event to promote imported wagyu beef last week.

Gregorio Fierro, the culinary director of the Philadelphia-based firm, Wagyu Sommelier said in an interview that the U.S. government now allows the importation of many cuts of wagyu beef from Japan, but that most American chefs are not familiar with it, especially the lower cost cuts.

The purpose of the event held at the embassy was to acquaint American chefs and the agriculture community in Washington with imported wagyu beef.

Fierro differentiated the imported beef from American wagyu, which comes from descendants of cattle and semen brought into the United States from Japan beginning in 1976. Japan, which considers its cattle to be a national treasure, later stopped the export of both the cattle and the semen which led to American ranchers cross breeding the wagyu with traditional American breeds.

Fierro claimed that American and Australian wagyu cattle “have very little in common with their true Japanese counterparts,” stating that “Japanese wagyu cattle are genetically more marbled than any other cattle breed in the world.”