FarmPolicy

August 18, 2019

New Antibiotics Policy at McDonald’s

Reuters writers Lisa Baertlein and P.J. Huffstutter reported on Wednesday that, “McDonald’s Corp’s U.S. restaurants will gradually stop buying chicken raised with antibiotics vital to fighting human infections, the most aggressive step by a major food company to change chicken producers’ practices in the fight against dangerous ‘superbugs.’

“The world’s biggest restaurant chain announced on Wednesday that within two years, McDonald’s USA will only buy chickens raised without antibiotics that are important to human medicine. The concern is that the overuse of antibiotics for poultry may diminish their effectiveness in fighting disease in humans. McDonald’s policy will begin at the hatchery, where chicks are sometimes injected with antibiotics while still in the shell.”

The article added that, “[Marion Gross, senior vice president of McDonald’s North American supply chain] said McDonald’s expects its suppliers will treat any animals that become ill, using antibiotics when prescribed. McDonald’s, however, will not buy those treated chickens, she said.

“The poultry industry’s lobby takes issue with the concerns of government and academic scientists, saying there is little evidence that bacteria which do become resistant also infect people.”

Wednesday’s article also noted that, “There are exceptions to McDonald’s new policy. The company will buy chicken from farmers who ‘responsibly use’ ionophores, an animal antibiotic not used in human medical treatment, Gross said.

“The phase-out applies only to McDonald’s roughly 14,000 U.S. restaurants. It currently does not affect the company’s approximately 22,000 international restaurants.”

David Kesmodel, Jacob Bunge and Annie Gasparro reported on Wednesday at The Wall Street Journal Online that, “While the shift doesn’t apply to its burgers, McDonald’s is now the biggest company to make such a commitment on drug use in livestock.”

The Journal writers noted that, “McDonald’s said it would work with chicken suppliers including Tyson Foods Inc., the largest U.S. meatpacker—which said it has already taken steps to curb antibiotics in its birds.”

The Journal article pointed out that, “The announcement comes three days after Steve Easterbrook took over as McDonald’s chief executive, vowing significant change at the fast-food giant to reverse two years of worsening sales declines that culminated in the retirement of his predecessor, Don Thompson . Mr. Easterbrook in recent weeks has told analysts that he sees himself as an ‘internal activist’ who plans to create a ‘modern, progressive burger company.’ Observers have been anticipating possible changes to ingredients to improve consumers’ views of McDonald’s food.”

In addition, the Journal writers stated that, “McDonald’s also said it would offer customers milk products from cows that aren’t treated with rbST, an artificial growth hormone. The announcements coincide with a McDonald’s meeting in Las Vegas that includes U.S. franchisees, suppliers and other stakeholders where the burger chain is discussing what it has called its ‘turnaround agenda.'”

A news release from the National Chicken Council on Wednesday included remarks from Ashley Peterson, Ph.D., National Chicken Council vice president of scientific and regulatory affairs, who stated that, “The top priority of farmers and chicken companies is to raise healthy chickens, because healthy chickens are directly related to a safe food supply. Responsible, FDA-approved veterinary treatment and prevention benefits animal welfare and human health by reducing the need for increased doses of antibiotics of human importance in the event of widespread disease.

“The vast majority of these antibiotics are never used in humans. McDonald’s, veterinarians and animal scientists recognize their importance to minimize the use of those antibiotics that are important in human medicine.”

In a news release on Wednesday, Sen. Dianne Feinstein (D., Calif.) stated that, “The tide is shifting. The largest restaurant chain in the United States has taken a huge step to eliminate unnecessary antibiotic use in chickens…McDonald’s announcement demonstrates that businesses can be effective partners in ensuring antibiotic use in animals does not affect human health. Public health officials, businesses and farmers must address this issue, and I look forward to working with them to implement further change and combat the overuse of antibiotics in agriculture.”

Meanwhile, Kelsey Gee reported on Wednesday at The Wall Street Journal Online that, “McDonald’s Corp. ’s announcement that it will curb antibiotic use in its U.S. chicken products raises an obvious question: Where’s the antibiotic-free beef?

“The restaurant company, which became famous for its hamburgers long before it sold chicken sandwiches, unveiled no plans to stop purchasing beef from cattle raised with antibiotics used to treat humans. The same is true for the pork that goes into its sausage patties and Egg McMuffins.

“The decision to start with chicken highlights the complexities of making sweeping changes to a supply chain serving about 14,350 U.S. restaurants, according to meat-industry experts. Antibiotic-free chicken also is more widely available than beef and pork, and chicken costs less.”

Ms. Gee explained that, “Making major changes in the beef supply chain also is more complicated than it is for chicken because beef ranching is highly fragmented, and cattle buyers purchase animals from many different suppliers.

The chicken industry, by contrast, has been vertically integrated for years, with companies like Tyson contracting with farmers to produce chicken for them alone and guiding them on their production, which often includes what the animals are fed. The lifecycle of chickens also is much shorter than for cattle, enabling changes to take effect in the supply chain more quickly.”

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Dietary Guidelines Discussed at House Appropriations Subcommittee on Agriculture- FDA Budget Hearing

Today, the House Appropriations Subcommittee on Agriculture heard budget related testimony from the Food and Drug Administration.

Committee Chairman Hal Rogers (R., Ky.) noted at today’s hearing that, “Like many, I am concerned about obstacles created by the Chinese government to our inspection of foreign food and drug products. While the safety of American consumers is our paramount concern, there is also a fundamental question about fair trade practices. Domestic manufacturers and producers are subjected to extensive regulation to ensure the safety of their products, and they should have an equal playing field with their foreign competitors. The Fiscal Year 2015 Omnibus included $2 million to speed up drug facility reviews in China, and we are looking forward to an update on this effort.”

In his opening statement, Subcommittee Chairman Robert Aderholt (R., Ala.) indicated that, “The size of FDA’s FY 2016 request includes increases for budget authority that disregard the debt crisis facing our nation. The agency is proposing large increases using scarce discretionary resources. Since FDA is informing Congress that Food Safety, Medical Product Safety, and Rent and Infrastructure needs are their highest priorities this year, it will be incumbent upon FDA to prove to Congress that such priorities cannot be funded out of base resources first.”

Subcommittee Chairman Aderholt added that, “FDA’s request for budget authority exceeds the 2015 enacted funding level by six percent.”

FDA Commissioner Dr. Margaret Hamburg, who is stepping down at the end of the month after six years in that position, noted the FDA’s work on the Food Safety Modernization Act and stated at the hearing: “FDA published seven major proposed rules and, based on stakeholder input, four supplemental proposals to implement FSMA. The Agency also completed 8,607 high-risk food establishment inspections in FY 2014, exceeding the target of 6,507 inspections by 32 percent. FDA also released a FSMA Operational Strategy Document that focuses on how we can implement FSMA by prioritizing prevention, voluntary compliance, risk-based oversight, and expanded collaboration across the food safety community.”

During the discussion portion of the hearing, Subcommittee Chairman Aderholt focused on the 2015 Dietary Guidelines Advisory Committee Report, which was released last month.

Below is a transcript of the discussion on this issue.

Rep. Robert Aderholt: Let me switch over to dietary guidelines. The Department of Health & Human Services, and of course FDA is a part of that, has a lead role in developing the dietary guidelines for Americans in 2015. The Secretary of Agriculture appeared before this subcommittee, was sitting where you are sitting just about a week ago. He made a commitment to adhere to the statutory directive for developing the dietary guidelines for Americans. And as he put it, and this was his quote, “I know my role and I will color within the lines.”

I reminded him, when he was here last week, of the need to stay focused only on the dietary and nutritional recommendations of the Dietary Guideline Advisory Committee and subsequent comments collected by USDA and the Department of Health & Human Safety about these recommendations. To quote from former Senator Bob Dole, he said, “I believe the committee exceeded its mandate when it made dietary recommendations based on environmental concerns of sustainability.” I urged the Secretary of Agriculture and the Secretary of Health & Human Services to [amend] those recommendations in issuing their final guidelines.

The science of nutrition can be confusing to the average consumer. Integrating environmental considerations into dietary recommendations lessens the report’s impact and usefulness. My question, Commissioner, would be, as a vital player in the development of these final guidelines, can we get an assurance from the Department of Health & Human Services that the final report would include only nutrient and dietary recommendations and not include environmental factors and other extraneous material?

Dr. Margaret Hamburg: Well, our role in the nutrition space is a little bit different. We are involved, of course, in the dietary guidelines, but that’s not our direct responsibility. We have many responsibilities directly in areas of nutrition and nutrition science. And I’m really happy to be able to report to you that we have a very strong commitment to science-based decision-making in our nutrition programs, that as we look at what matters to promoting health and protecting health of the American public with respect to health and nutrition, you know, we spend a lot of time examining what is known, what does the [literature] show, soliciting input from other experts in helping to get additional information that we might not be aware of. We also do undertake research ourselves and in partnership with others.

We also have just recruited a wonderful new director of our Center for Food Safety & Applied Nutrition, Dr. Susan Mayne, who is here, who we got from Yale University, you know, who has a long and distinguished career in nutrition science and health. So I think we are well positioned to help advance understanding and to make sound policies based on evidence. And certainly we try very hard to color within the lines, too. We already have responsibilities that outstrip our resources. We have no desire to take on new activities that are outside of what we’ve been mandated and asked to do.

Rep. Aderholt: Okay, I’ll take that as a yes then, so… I find it interesting that the advisory committee has found that cholesterol is not an nutrient of concern for over consumption, even though previous dietary guidelines have recommended limiting cholesterol intake to [no] more than 300 milligrams per day. There are other such examples in the recent past where the advisory committee completely changed its focus, despite claims of sound science.

The advisory committee also recommended a diet higher in plant-based foods and lower in animal-based foods as more health promoting, even though lean meat has been included as a part of a healthy, balanced diet in previous dietary guidelines. How are consumers supposed to feel confident about following the dietary guidelines when the recommendations contradict what was just put out five years ago?

Dr. Hamburg: Well, I think one of the challenges in this arena and other arenas as well is that the science base is always changing. Also, with the vast array of different kinds of studies going on, with different perspectives, it can get very confusing about emerging [science] and how to put it into context, and what information consumers should rely on.

Again, I come back to my earlier answer that we really view as the foundation of the work we do establishing the database and the evidence for regulatory decision-making, but recognize that this is a dynamic process, and new evidence emerges as understandings of the science and of human biology advance, and as that happens, we do think it’s very important to periodically update the work we’re doing.

For example, not too long ago we put forward a proposal to update our nutrition facts label, which is the nutrition information on the back of various kinds of processed and other foods. That was first begun, I think now, more than 20 years ago. And some of the nutritional components being represented there didn’t represent advances in nutrition science, and also the serving size information didn’t reflect current practices and behaviors of American consumers. So I think that’s very important so that Americans can have access to the most recent and updated information so they can make informed choices.

Rep. Aderholt: I reminded Secretary Vilsack, when he was here last week, of the enormous impact the dietary guidelines have on individual diets. Also nutritionists and dieticians who plan and prepare food for schools and other institutions and elsewhere across the United States. I suggested to him that the 45 day timeline for the comments is too short. And he committed to discussing extending that comment period for an additional 60 days with Secretary Burwell. Can I get a commitment from you that you and your colleagues will convey that need to extend that comment period?

Dr. Hamburg: Well, I will certainly reflect back to Secretary Burwell, you know, your comments in this discussion.

Rep. Aderholt: Thank you. Well, as I say, he was…the Secretary, I think, he was in agreement that this additional 60 days was important because of the impact of this, and so we would appreciate your conveying that to the Secretary, and that how…that this, we…many of us feel here on the committee that it is important as well.

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Federal Reserve Beige Book: Observations on the Ag Economy- Feb ’15

Today, the Federal Reserve Board released its Summary of Commentary on Current Economic Conditions. Commonly referred to as the “Beige Book,” the report included the following observations with respect to the U.S. agricultural economy:

* Sixth District- Atlanta– “Drought conditions improved in parts of the District although there were still some areas reportedly affected by dry conditions. Florida citrus crop producers continued field practices to combat citrus greening while the USDA announced additional funding to help fight the disease. The most recent 2015 domestic production forecasts for rice, soybeans, peanuts, and cotton were unchanged from a month ago while beef, pork, and broilers production projections were up from the prior month.”

* Seventh District- Chicago– “Corn, soybean, and wheat prices were lower than during the previous reporting period, although they recovered some in recent weeks. Apart from fuel costs, input costs for spring planting have remained steady. Some farmers purchased lower quality seeds than last year to reduce their planting costs. Even though higher relative input costs were likely to shift acres toward soybean production and away from corn, there were reports that farmers were reluctant to plan major changes in crop rotations. Contacts also noted plans to return some marginal ground to pasture or hay production, instead of planting corn or soybeans this spring. Hog production was strong, with no major issues from diseases, which had cut production last year. This pushed down pork prices substantially, and consumers began substituting from beef to pork. However, somewhat lower cattle prices did not translate into lower retail prices for beef. Milk prices declined amid rising stocks of dairy products and stalled exports. The slowdowns at ports along the west coast hurt exports of many agricultural products.”

* Eighth District – St. Louis– “As of early February, close to 90 percent of the District winter wheat crop was rated in fair or better condition. Total District red meat production during 2014 was largely the same compared with 2013.”

* Ninth District- Minneapolis– “On balance, District agricultural conditions were down, with livestock and dairy producers faring better than crop farmers. According to preliminary results from the Minneapolis Fed’s fourth-quarter (January) survey of agricultural credit conditions, 70 percent of respondents said farm incomes had fallen from a year earlier, while 73 percent reported decreases in capital spending; the first-quarter outlook was similar. Land values and rents fell in 2014 in Minnesota and North Dakota, according to appraisers.”

* Tenth District- Kansas City– “District farm income weakened further since the last survey period, but cropland values generally held steady. Corn and soybean prices edged down in January and early February, and farm income remained well below year-ago levels even as profitability in the livestock sector remained relatively strong. After several years of herd culling, District cattle operators retained more replacement heifers compared with last year, indicating the potential for rebuilding herds in 2015. Following several years of strong gains, District non-irrigated and irrigated cropland values leveled off while ranchland values continued to rise due to strong demand for good-quality pasture. Lower farm income trimmed farm loan repayment rates and increased demand for new loans as well as loan renewals and extensions. Looking forward, District contacts expected modest declines in cropland values and further deterioration in farm loan repayment rates amid tighter profit margins for crop producers.”

* Eleventh District- Dallas– “Moisture conditions stabilized for a large portion of the District, but drought conditions persisted in some areas. Cotton prices are below profitable levels for most producers. Prices and export demand for sorghum is high, which may lead more farmers to favor sorghum over cotton when making planting decisions this spring. The strong dollar has slowed agricultural exports. Corn, cattle, wheat, soybeans and dairy prices declined over the reporting period.”

* Twelfth District- San Francisco– “Agricultural conditions in the District were mixed during the reporting period. Drought conditions and unseasonably warm weather in parts of the District contributed to lower yields, but the associated increases in many of the prices received by farmers resulted in slightly higher revenues. Farmers remain concerned that the drought will continue, requiring them to leave more acreage fallow. Numerous contacts reported that the labor disputes at West Coast ports reduced agricultural exports, as perishable products such as fruits wasted away in storage containers waiting for shipment. Contacts also stated that the stronger dollar limited exports.”

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Update on Cuba Trade Issues

Nick Miroff reported on Tuesday at The Washington Post Online that, “Cuba policy sometimes makes strange bedfellows, which is how a man like Thomas Marten, a burly Illinois soybean farmer with a bushy red beard, had come to Havana to make a statement about the principles of free enterprise. ‘As a Republican, I believe in trade for the betterment of all people,’ he said, as he rushed to another business meeting with communist officials. ‘Prohibiting it is something that hurts us all.'”

The Post article noted that, “Over the years, no country in the world has triggered more U.S. government penalties and fines on private businesses than Cuba, and Marten had come to Havana with nearly 100 other American farmers, farm lobbyists and former U.S. agriculture officials looking to throw a little weight behind a new push against those sanctions.

“Calling itself the U.S. Agriculture Coalition for Cuba, the group isn’t shy about its interest in selling more American food to the communist government, but its members also appear sincerely interested in helping the island’s small farmers after decades of technological isolation and the disastrous legacy of state-run agriculture.”

Mr. Miroff explained that, “The Cuba effort isn’t a new one for the farm lobby. But after Obama’s announcement, it had produced a new enthusiasm, said the group, telling foreign reporters and television cameras from Cuban state media that supporters of the embargo in Congress were ‘a minority.’

“Lawmakers have offered new proposals to lift U.S. trade and travel restrictions on Cuba, but it’s unclear whether Republican leaders will allow the measures to come up for a vote.”

The Post article added that, “American food sales to the island peaked at more than $700 million in 2008, according to trade figures. That made the United States one of Cuba’s largest trading partners at the time, despite the sanctions.

“But because the U.S. sanctions limit the sales to a cash-only basis and bar U.S. banks from financing the sales, Havana has increasingly looked elsewhere to cover its import needs. Last year the Castro government spent less than $300 million on U.S. food, mostly frozen chicken and soybeans.

“Cuba has stopped buying U.S. wheat entirely, and rice shipments have plunged as well, the farm group said.”

Last month, Sen. Amy Klobuchar (D., Minn.) introduced the Freedom to Export to Cuba Act with Senators Mike Enzi (R, Wyo.), Ag Committee ranking member Debbie Stabenow (D., Mich.), Jeff Flake (R., Ariz.), Pat Leahy (D., Vt.), and Dick Durbin (D., Il.). “This bill lifts the trade embargo on Cuba and knocks down the legal barriers to Americans doing business in Cuba.”

And a recent editorial in the Minneapolis Star-Tribune noted that “Klobuchar, who often pushes relatively noncontroversial legislation, is to be commended for taking on such a divisive issue. Forging the consensus needed for passage will be difficult, but this is a battle worthy of her skills.”

Also last month, Sen. Klobuchar traveled to Cuba with with Senators Claire McCaskill (D., Mo.) and Mark Warner (D.,Va.).

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Des Moines Register– Iowa Ag Summit, Sen. Grassley

Christopher Doering reported on the front page of the Business Section of today’s Des Moines Register that, “Presidential hopefuls have reached out to Sen. Chuck Grassley for advice on agricultural issues, a step the Iowa lawmaker said could shed light on a topic that has struggled to get national attention in past races.

“Grassley, who farms corn and soybeans with his son in Butler County, told reporters that two candidates have contacted him for his insight ahead of Saturday’s Iowa Agriculture Summit, which is expected to attract a dozen GOP presidential contenders. He wouldn’t name those who had reached out to him.

“‘The candidates are doing what they should not need an incentive (such as the ag summit) to do,’ Grassley said. ‘If I have to brief them, that means they need some more understanding of the ag issues. When only 2 percent of the people in this country are producing food, we need all the help we can get.'”

Mr. Doering pointed out that, “Grassley said agricultural issues have long failed to attract the attention ‘they ought to get’ during past presidential races. The six-term Iowa senator and member of the Agriculture Committee said he was hopeful the summit would boost the profile of agriculture in the caucuses and throughout the 2016 presidential election.

“Grassley said he told the two potential candidates about several agricultural issues, including the importance of trade to Iowa farmers and the drop in corn and soybean prices that has left some growers struggling to cover their cost of production. He said he reminded the candidates to be compassionate to producers when times get difficult.”

Also with respect to Saturday’s Summit, Jennifer Jacobs tweeted the following about Sen. Marco Rubio (R., Fla.) this morning:

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Wednesday Morning Update: Policy Issues; Ag Economy; Trade; Regs; and, Budget

Policy Issues

Yesterday, the House Appropriations Subcommittee on Agriculture heard testimony regarding the USDA’s Marketing and Regulatory Programs.

In his opening statement, Subcommittee Chairman Robert Aderholt (R., Ala.) indicated that, “USDA is requesting a total of $987 million in discretionary resources in FY 2016 for the mission area, a decrease of $12.5 million from the 2015 enacted level…I am particularly concerned that USDA has requested scarce discretionary resources for lower priorities. For example, APHIS has requested an increase to enhance implementation of the Lacey Act provisions. I have trouble supporting such an increase at the expense of higher priority and more effective animal and plant health programs, many of which the agency has proposed to decrease.

“With the overall spending caps still in effect, I anticipate that the Subcommittee’s funding levels will remain relatively flat at best.”

Ed Avalos, USDA Under Secretary for Marketing and Regulatory Programs noted yesterday that, “To strike the balance between rigorous scientific review and timely entry to the market of genetically engineered crops, USDA streamlined and improved the process for making determinations on petitions involving biotechnology. Because of the enhancements, we reduced the length of the petition review by more than 600 days when we can use the environmental assessment process. With this improvement, we estimate that the cumulative number of actions taken to deregulate biotechnology products based on a scientific determination will increase from a cumulative total of 87 actions in 2011 to an estimated 119 in 2016.”

This topic came up in the discussion portion of yesterday’s hearing; Chairman Aderholt inquired: “Last year you reported that you were only able to reduce the backlog of 22 petitions by six. Your testimony this year states that you are nearly through the list of backlogged petitions. Can you provide us some more details on the status of the backlog and what progress you’ve been able to achieve?”

Animal and Plant Health Inspection Service Administrator Kevin Shea offered more details, and explained that, “You might recall a year ago I pledged to you we would cut the backlog of 16 by at least half, and I’m proud to say that the fantastic men and women who work in our biotechnology review program have indeed exceeded that goal, and there now only six of those 16 remain, so that means we reduced it by more than half.

“I would say this also, when we began our business process improvement just a few years ago, 2012, there were 23 re-regulation requests in the backlog. Since then 11 [more] requests to come in, so there were a total of 34 regulation requests. There are only six left. We got 28 out of 34 done. There are only six remaining. We’re going to get those done, we think, by the end of this fiscal year.

And so now we have the system in equilibrium. We can handle the amount that come in. And not only can we handle them, we can handle them quicker. It was taking us three to five years to do these things. We are now down to 15 to 18 months. Our goal is no more than 15 months, and I think we’re going to achieve that as well.”

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