New Shelf Life in South Korea
Agreement should increase beef and pork exports; WTO plays role
by Ken Krizner, senior editor
A long-festering argument concerning access of U.S. meat exports to South Korea has been resolved. The accord sets the stage for a possible increase of hundreds of millions of dollars in U.S. beef and pork sales to that nation by the end of the decade.
South Korean trade representatives agreed to allow manufacturer-imposed shelf-life dates for vacuum-packed beef and pork, and all frozen meat beginning July 1, 1996. In the interim, the shelf-life periods will be 45 days for chilled pork and 90 days for chilled beef, and nine months for frozen pork and 12 months for frozen beef.
The agreement marks a fundamental shift of thinking on the part of South Korea, which was one of the few remaining countries that imposed its own shelf-life dates. A trade dispute arose last year when the South Korean government imposed new shelf-life standards for U.S. products.
"The point is that manufacturers should determine the shelf life of a product," said Paul C. Rosenthal, an attorney with the Washington, D.C., law firm of Collier, Shannon, Rill and Scott, which represents meat processors in their dispute with South Korea. "This was an intensely negotiated point. We think the dates are satisfactory."
U.S. Trade Representative Mickey Kantor said: "For years, South Korea has used unscientific sanitary regulations to keep [beef and pork] exports out of the country. This will now stop."
Karl Johnson, chairman of the National Pork Producer Council's Trade Committee, noted: "This day has been a long time coming. The implications of this agreement cannot be overstated."
The agreement means that within the next year, U.S. beef and pork exports to South Korea should increase between $230 million and $250 million. By 1999, the figure is expected to increase to $1 billion. Two-thirds of the sales increase will go toward beef and one-third will go toward pork.
The accord is also expected to help hog and cattle producers who are losing money because of oversupply of animals.
"These new markets are critical to us," admitted Mark Armentrout, chairman of the National Cattlemen's Association's Foreign Trade Committee.
South Korea's per capita consumption of beef and pork is twice as high as in Japan. Since Japan is the No. 1 importer of U.S. beef and pork, it stands to reason that South Korea has the ability to develop into an unparalleled market for those products.
Beef and pork exports to South Korea have exploded in the past decade. Last year, the U.S. exported $240 million in beef products and $8.3 million in pork products to South Korea. In 1987, those figures were $2 million in beef and zero for pork.
But the issue of shelf life has been contentious. Last year, U.S. sausage products valued at more than $1 million were seized at a South Korean dock.
The Meat Industry Trade Policy Council-consisting of beef and pork trade organizations-accused the South Korean government of assigning the sausages with an unrealistically short shelf life. Much of the product went to waste.
The move led MITPC to request that the Clinton administration utilize the Super 301 trade law, which authorizes the United States to deal with unfair trade barriers and countries that have a pattern of trade abuses.
Based on his investigation, Kantor believed that there was a solid case against South Korea and was ready to take that case to the World Trade Organization, the new arbiter of trade disputes. But before the complaint was filed, South Korea capitulated.
"The WTO played a vital role in two ways," Kantor pointed out. "First, we threatened to go to the panel. Second, the sanitary and phyto-sanitary rules under the WTO gave us the basis to take our case there."
Armentrout stressed that the WTO "is an important piece of leverage that we have in our arsenal."
When asked what kind of message this sent to other U.S. trading partners, Kantor said: "Any time we use a multi-lateral process to induce a trading partner in an appropriate manner, it sends a signal that we will not hesitate to use that process when U.S. products are subject to discrimination."
The question was asked in reference to the U.S. dispute with the European Union over the issue of hormones. The United States is expected to take its case to the WTO if there is no agreement by the end of the year.
Back to South Korea, Kantor said the threat of the WTO will help the United States enforce the agreement. "We expect South Korea to live up to this agreement," he noted.
Inspection would stay on track if budget 'train wreck' occurs
Political observers are calling it a "train wreck" waiting to happen.
On Oct. 1, the U.S. government begins fiscal year 1996. The big question to the nation is whether the government will be allowed to spend money on or after Oct. 1 if President Clinton and Congress cannot compromise on a budget deal.
If the answer is no, the government could shut down. In the game of political one-upmanship, both Clinton and Republican congressional leaders indicate they will let this happen.
A more narrow question to meat processors is whether federal inspectors will be allowed to work if the government does shut down. If inspectors cannot work, the nation's meat industry would be forced to shut down.
But inspection appears to be safe from the potential train wreck.
A USDA spokeswoman said that inspectors are considered "essential" personnel and would in all likelihood remain on the job if the government was forced to temporarily close.
A White House spokeswoman told Meat Marketing & Technology that an opinion issued by the Attorney's General office during the Carter administration gives the White House "leeway to perform essential functions and make the government workable."
However, if the government is forced to close, some personnel at USDA's headquarters in Washington and in its field offices across the country could be furloughed until a resolution is reached.
A similar situation arose in October 1990 when President Bush and Congress could not arrive at a budget deal for fiscal year 1991, forcing a two-day shutdown of the government. However, meat inspectors worked through that shutdown.
World commission supports
food safety based on science
The Codex Alimentarius Commission has adopted principles asserting that science should be the guideline for deciding international food safety rules.
The judgment is viewed as a major victory for the U.S. meat industry in its ongoing dispute with the European Union over the question of hormones in beef. Since 1989, EU nations have banned the production and import of meat from animals treated with growth hormones. The U.S. meat industry claims hormones used on its cattle are well within safety limits.
Estimates of lost trade to the EU caused by sanitary and phyto-sanitary restrictions, including the hormone ban, is nearly $100 million a year, according to USDA and U.S. meat industry estimates.
Another victory for the industry was a ruling by Codex that hormone standards used by U.S. cattle producers are within acceptable levels.
The vote by the Codex commission, a joint organization between the World Health Organization and Food and Agricultural Organization that sets international food standards, is important because the World Trade Organization will rely on its decisions. The WTO is the new arbiter of trade disputes.
AMI President J. Patrick Boyle described the ruling as "a victory for science that will help thwart the efforts of those countries that would rather retreat behind the walls of protectionism than compete with U.S. products on a level playing field."
The Codex decision is expected to bolster the U.S. position that the EU's hormone ban is scientifically unsound and that it should be eliminated. An EU-U.S. conference on the hormone question is slated for November in Brussels, Belgium.
USDA Secretary Dan Glickman has indicated that he will take the matter to the WTO if the dispute is not settled by the end of the year.
Premium Standard Farms to sell pork products to EU, Japan
The Milan, Mo., pork processing facility of Premium Standard Farms Co. has been approved for export of whole muscle pork and variety meats to the European Union.
Company officials believe that Premium Standard Farms is the only processor in the United States or Canada approved for whole muscle export to the EU.
Under the Uruguay round of the General Agreement on Tariffs and Trade, the EU will import about 86 million pounds of tenderloin, boneless loins and boneless hams a year from the United States.
The product is valued at about $172 million.
Al Tank, vice president of public policy and trade for the National Pork Producers Council, called the Premium Standard Farms-EU agreement a landmark event for the U.S. pork industry.
"The EU has been looking for a state-of-the-art, European-type facility in the United States for the past 10 years," he said. "In the Premium Standard Farms' plant, they found it."
In addition, Premium Standard Farms has signed an exclusive agreement with Marubeni America Corp. to sell its branded pork to the Japanese retail market.
Premium Standard Farms has begun weekly shipments of high-value pork cuts to Japan.
The accord includes an extensive merchandising plan, Premium Standard Farm labeling at retail, education programs for retail meat managers, in-store sampling, consumer feedback, and various point-of-sale materials.
Hormel sues Henson to halt 'Spa'am' movie character
Spam has always been a source of pride for Hormel Foods Corp. And with good reason.
Since 1937, more than 5 billion cans of the pork luncheon meat have been consumed by an estimated 60 million people.
Spam fed the Allies during World War II, and Hormel now has a Spam gift catalogue, including T-shirts, golf balls and basketball backboards.
Spam has also always been the subject of numerous jokes over the years. Jay Leno throws an occasional Spam joke on the "Tonight Show"-What's the difference between Spam and Spam Lite? Less green gob in Spam Light-and Hawkeye and Trapper once made a Spam lamb on an episode of "M*A*S*H."
Last year, Joel Johnson, president and CEO of the Austin, Minn.-based company, told Meat Marketing & Technology: "We have a lot of fun" with Spam.
But apparently there is a limit to how much fun.
Hormel has filed a lawsuit in U.S. District Court against Los Angeles-based Jim Henson Productions alleging that the film company has "tarnished" Hormel's trademark for Spam, and "falsely disparaged" the product.
The suit seeks a court to stop Henson Productions from using a character named Spa'am in the "Muppet Treasure Island" movie, scheduled to be released in early 1996. Hormel believes it will be irreparably harmed by the publicity over the pig character, according to the lawsuit.
"The Spa'am character is dressed as a savage warrior, including a headdress of what appears to be a human skulls and feathers, and also wears a necklace of smaller pig heads," the lawsuit states. Henson Productions "has intentionally portrayed the Spa'am character to be evil."
A statement issued by Henson Productions said: "We are sorry that Hormel apparently does not share the Muppet sense of humor. We certainly meant no offense."
Hormel also claims that Spa'am will be part of merchandising and promotional programs, including 45 million boxes for Happy Meals at McDonald's.
The promotional campaign will mislead the public to believe that Henson Productions holds the trademark to Spam and that the "negative depiction" will discourage customers from buying it, according to the suit.
Lobbyist joins AAMP
Bernard F. Shire has been appointed director of legislative and regulatory affairs for the American Association of Meat Processors. He will organize the organization's public affairs program.
Shire previously was director of communications and a lobbyist for the Pennsylvania Catholic Conference. He has also worked for newspapers in Lancaster, Pa., and Lebanon, Pa.
Beef Board OKs merger plan
The Cattlemen's Beef Promotion and Research Board has moved a beef industry consolidation plan one step closer to reality by approving the proposal at its summer meeting in July.
Also approved were revisions to the Beef board's bylaws and a Joint Operating Agreement between the Beef Board and the proposed new beef organization.
When implemented, the new beef organization will consolidate the beef functions of the Beef Board, the National Cattlemen's Association and the National Live Stock and Meat Board. The U.S. Meat Export Federation will coordinate with the new organization's Center for International Marketing to promote U.S. beef in overseas market.
Under the proposal, the Beef Board will remain a separate legal entity to administer the beef Check-off program, ensure compliance with the Beef Promotion and Research Act and Order, and ensure the integrity of check-off dollars.
Beef Board members will participate in joint committees of the new organization, attend meetings of the Board of Governors, and participate in the annual Stakeholder's Congress to assist in the industry's planning and prioritization process.
The USMEF executive committee and NLS&MB are considering the consolidation proposal. NCA will vote on the plan at its convention in January.
If all sides agree, the new organization will take effect on Feb. 1, 1996.
Beef promotion campaign pays dividends, research discovers
A university economist says the $500 million raised by the beef industry since 1987 to stem the decline in beef consumption has paid off.
For every dollar spent on the promotional campaign, producers are getting $5 back in otherwise lost sales, according to University of Florida Professor Ronald Ward. By 1993, the promotions blunted the decline in beef demand to 4 percent from 27 percent in 1987, according to NCA. "That is an incredible rate of return," Ward said.
Ward led a five-year, $225,000 research project on the effects of the advertising campaign. The project was funded by the National Cattlemen's Association.
The research used a computer model of beef demand to gauge the influence of fear of fat and cholesterol, a move to white meats, and spending on promotion campaigns.
The campaign was funded mostly from a $1-a-head assessment on cattle sales allowed under the National Research and Promotion Act.
Leon's names sale manager
Chicago-based Leon's Sausage Co. has named Thomas Hayes to the post of sales manager.
In the newly created position, Hayes will assume sales responsibilities in both retail and foodservice markets for the company's three lines of sausage products: Leon's, Slotkowski and Sausages by Amy.
Hayes has more than 15 years of experience in the sale of retail and wholesale food products and services.
When Hayes was vice president of sales and marketing for Chicago-based U.S. Food Products Corp., he increased overall company sales volume by an average of 13.5 percent annually for five years.
Boston Market campaign wants consumers to remember home
Boston Market is attempting to lure customers into its restaurants by taking them back to yesteryear.
The Golden, Colo.-based fast-food eatery has begun a new advertising campaign that shows people "experiencing warm, happy flashbacks of eating experiences" as they see and taste Boston Market's cuisine, which includes double-sauced meat loaf and double-glazed ham.
The "deja food" campaign captures the consumer sentiment to return to quality food, with the convenience of the 1990s, instead of partaking in typical fast-food fare, according to Bill McDonald, chief marketing officer of Boston Market. The "deja food" campaign will continue in future television and radio advertisements.
The commercials also introduce consumers to the restaurant chain's expansion. Earlier this year, the name was changed from Boston Chicken to Boston Market to reflect its expanded menu beyond poultry. As of July 31, the change had occurred in more than 70 percent of the chain's 683 restaurants. The changeover should be complete by the end of the year.
"This is the first time we have focused on Boston Market as a brand," McDonald pointed out. "We've changed the name of our stores, this campaign reflects that evolution."
Changes for Jones Dairy Farm
Jones Dairy Farm has formed a new sales and marketing team. Phillip M. Kafarakis, vice president of sales and marketing, will head the new team.
"Our focus is to re-energize our brand equity and intensify our selling efforts," Kafarakis said.
The new team includes:
-- John DeGraff, marketing manager, who comes to the company from ConAgra Inc. He will lead marketing efforts, and assist in repositioning the company as a more progressive and aggressive marketer.
-- Four national sales managers have been assigned: Ed Baker (retail), Mike Manor (foodservice), Rich Porwit (export) and Bob Raynor (ingredients).
Fort Atkinson, Wis.-based Jones Dairy Farm produces breakfast sausage, dinner sausage, bacon, ham, Canadian bacon, braunschweiger and scrapple.
Survey: Children know nutrition, but have some misconceptions
Children like hamburgers and hot dogs. But what is their nutritional opinion of these favorites, and where does that information come from?
More than 400 children between the ages of nine and 15 were surveyed on issues such as what foods they eat, and their nutritional information sources and influences.
Children get 90 percent of nutritional information from schools, 77 percent from parents, 64 percent from television, 60 percent from books and 59 percent from health professionals.
The survey-developed by the American Dietetic Association, International Food Information Council and the President's Council on Physical Fitness and Sports-indicated that 97 percent of children concur that a balanced diet is important to good health.
But the survey also showed there are misconceptions. Some children believe that hamburgers and hot dogs are unhealthy and that all foods with a high fat content should be avoided. And children were not aware that some foods may be high in fat while others are high in cholesterol, sugar or salt.
But the survey also showed that children understand that eating small amounts of a large number of foods is better than eating enormous amounts of a few foods.
Kicking the Can
A new study is predicting that for the first time in five years, the annual retail sales growth rate of packaged and canned processed meats will decrease, from 3.9 percent in 1994 to 2.3 percent this year. Last year was the fourth consecutive year of growth for the category after a period that saw a decrease in sales, slipping to as low as $16.6 billion in 1991. Health concerns by consumers are blamed for the market's new loss of momentum.
Here are the projected retail sales of packaged and canned processed meats in billions of dollars through the end of the decade.
Source: Packaged Facts
Whoa, Nellie! New technology
may sniff out horse meat
Research may soon be underway into the use of an "electronic nose" that can detect horse meat mixed in with other meat based on their differing odors.
Leatherhead Food Research Association of Great Britain reports that preliminary experiments have revealed differences in the odor profiles of beef and horse meat.
"The aim of this project is to go a step further in order to establish the value of the technique for the detection of horse meat in a mixture with beef," according to a report in Leatherhead Food News.
It further adds that meat processors, particularly those that buy frozen boxed beef, must be on guard against the possibility of partial or total substitution of beef meat with other species. Although it's more common for this to involve horse meat, it could involve kangaroo meat as well.
Existing analytical techniques have their limitations, according to the report. Based on serological tests, they are time-consuming and require experienced staff to conduct the tests. Sometimes the tests work only with raw meat.
An experienced assessor, however, can identify frozen boxed beef from the appearance of odor and fat-with odor assessment commonly being aided by heating, either by using a hot wire or by boiling a sample in water.
But detection of horse meat in a mixture of beef is more difficult.
Leatherhead Food News reports that research within this area will be carried out on a multi-client basis.
The research will cover:
-- Development of optimum standardized conditions for the presentation of meat samples to the electronic nose.
-- Use of the nose to assess the odor of a range of samples of beef and horse meat. The odors of these will be assessed frozen, raw and cooked.
-- Preparation of conventional and reduced-fat beef burgers containing a range of levels of horse meat.
-- Use of the nose to detect and ideally quantify the level of horse meat in the burgers.
The ability to test meat in the frozen state would enable meat processors to test every sample of frozen meat before the product is accepted.
"In addition, an objective measurement of adulteration-whether in raw material or processed product-would be valuable in a court of law," according to the report.
-- Although this research focuses on horse meat, a data base of genuine beef odors will help detect adulteration in other species-and might help in the assessment of boxed meat quality.
Processors wanting more information on this project can contact Dr. Bob Hart, Leatherhead Food Research Association, Randalls Road, Leatherhead, Surrey KT22 7RY, UK.