Believe it or not, there are a lot of food industry legislative and regulatory activities going on in Congress these days even as they get ready (and that is a “maybe”) for their traditional summer recess which is in flux at presstime. It may indeed be business before pleasure on the Hill for elected officials this summer. However, of major importance to our food industry is the news that the House Agriculture-Food and Drug Administration Committee has advanced a draft spending bill for the Ag Department. The full Congress still must approve the final version which will not occur until the fall.
As just stated, the House Appropriations Agriculture-FDA Subcommittee authorized the $26.5 billion spending bill for farm, food, and rural programs. This is more than a 10 percent increase over current funding levels. The bill includes $4.43 billion for rural development projects, including $907 million for broadband deployment; and $3.32 billion for agricultural research. Also, of the total requested amount, some $3.47 billion in discretionary funding is allocated for the FDA, including an additional $65 million to address foodborne illness outbreaks and heavy metals in baby food which is a subject that has been in the news a lot lately.
What are the next steps in the budget progress? At press time, Congress is not expected to pass a final appropriations bill before the end of next month. A continuing resolution is also possible which would maintain fiscal 2021 spending limits for most federal agencies.
Foodborne Illness Action Plan
A non-profit activist group, Stop Foodborne Illness, has announced, according to Food Safety News, that the organization has finalized recommendations to the FDA to modernize the nation’s food recall system.
The recommendations, titled “Collaborative Plan to Achieve Customer-Focused Recall Modernization,” outlined the steps needed for the U.S. to improve its recall process. The organization labeled the current recall process as antiquated and disjointed.
In a recent news report in Food Safety News, it was mentioned that the nation’s food recall system had not been enhanced in five years! Stop Foodborne Illness called it right. However, last year the FDA in its “New Era for Smarter Food Safety” blueprint, which I have commented on previously in this column, had made updating procedures for reaching consumers about potentially unsafe food products a high priority. It was reported that the Stop Foodborne Illness proposals will be delivered to high-ranking FDA officials – FDA’s acting commissioner and deputy commissioner for food policy and response. That should all but guarantee a lot of attention to the recommended suggested changes to protect consumers from food safety issues.
From our viewpoint at Policy Solutions, you should not dismiss all of this as just another NGO (non-government organization) telling Uncle Sam what to do. Stop Foodborne Illness is a powerful organization that has a long record of advocating to regulate food handling and processing from farm to fork and often partners with Congress, USDA, FDA, and the CDC to mitigate food safety risks through policy and legislation.
Food Price Inflation
Recent stories have appeared in many national news media electronic and print outlets about rising food prices. The front-page stories and national electronic media coverage of the issue have caused the Biden Administration to make public statements to calm consumer (voters) fears.
The most recent indicator of food price increases published reflects June prices. U.S. food prices increased 0.8 percent in June from May, double the pace of the prior two months. Meat and poultry prices surged 2.5 percent last month, according to the U.S. Department of Labor’s Consumer Price Index. Still, food costs are up just 2.4 percent from a year earlier, while overall inflation was 5.4 percent for the period.
Agriculture Secretary Tom Vilsack got orders from the White House to make a statement to explain the situation and to calm the public’s concerns. He came out like the team player he is and predicted just weeks ago that the jump in food prices in June will quickly moderate despite rising concerns about risks in the economy. “There are certain selective items in the grocery store folks may see for a period increased costs,” Vilsack said recently in an interview on Bloomberg Television’s “Balance of Power” show. He concluded his media appearance by saying, “We think this will even out as we begin to recover, as we begin to get the supply and demand in better balance.”
Vilsack also suggested his department would soon announce proposed regulations to provide more protection to livestock producers in their dealings with the highly consolidated meatpacking industry. President Joe Biden’s executive order on competition instructed the Agriculture Department to consider stronger regulations, according to a companion story in Bloomberg.
Made In The USA? – Be Sure
Meatingplace News reported that, in a bid to support U.S. farmers, the Biden administration plans to issue new rules for when meat can have the “Product of USA” label affixed to packaging. The White House explained that under current labeling rules, most grass-fed beef labeled “Product of USA” is raised and slaughtered abroad and then imported to the U.S. for processing. The White House announcement came less than a week after USDA said it would review the voluntary “Product of USA” standard. The FDA is also taking similar steps as both USDA and FDA regulate the food industry.
Just a month ago the Federal Trade Commission (FTC) announced the availability of the pre-publication of the final rule on “Made in USA” claims in the Federal Register. The final rule was published on July 14, 2021. Note that the rule does not set a new standard for “Made in the USA” claims. Instead, it authorizes the FTC to seek not only an injunction but also civil penalties of up to $43,000 per violation of the final rule. So, all these actions when combined called for a complete review of the “Made in the USA” claims as false claims may now result in a monetary penalty. Expect additional clarification to come from USDA and FDA soon.
Marketing After COVID-19
U.S. consumers are likely to continue to use online and app-based shopping now that the threat of COVID-19 seems to be on the wane, according to a new survey that crossed my desk. The poll of 1,000 Americans found people showed they were already gravitating toward e-commerce for ordering their groceries before the pandemic, either using a mobile app or maintaining a mix of in-store and online shopping. The study by Inmar Intelligence said 87 percent of respondents shopped online before the pandemic, and between 50 percent and 75 percent of that group ordered groceries via Internet-based sites. Speedy checkouts, ease of ordering and product selection were the top three reasons cited for using online grocery shopping, according to Inmar Intelligence. Nearly 30 percent of respondents also said they were unlikely to return to in-store shopping because e-retail is so much easier.
Food for thought with the following sidebar note for my readers: With COVID-19 cases declining across the country, restaurants are reporting that they are expanding their workforces and enjoying a sales rebound as they make big plans to grow their businesses. Will the uptick with the Delta variant and the renewed emphasis upon wearing masks reverse this restaurant trend?
What will all this mean for the traditional food retail environment? That’s the $64,000 question.
Attention Marketing Departments
Retail food marketing folks may want to tie-in on a new USDA initiative. The folks at USDA have just announced the launch of its first ever Alexa skill, a digital tool for parents and caregivers of infants and toddlers. Families who use the MyPlate Alexa skill receive nutrition information on what and how to feed their child based on their age.
“The Biden-Harris administration is committed to building back better by developing a more resilient federal nutrition safety net that not only ensures all Americans have food to eat but also access to nutritious diet that meets their individual needs,” said Secretary Vilsack. USDA’s MyPlate Alexa skill leverages technology to meet American families where they are and foster healthy eating habits from an early age,” he concluded.
Have a great summer vacation and stay safe!
Barry Scher is associated with the public policy form of Policy Solutions LLC and may be reached at [email protected]