Archive for the ‘Uncategorized’ Category

The Feedlot: Your Daily Serving of Food News [08/20/08]

August 20, 2008

Starbucks: Big Investor’s Divorce Grounds

How Restaurants Are Becoming the New Art Galleries

Organic Food Not More Nutritional, Says New Study

Whole Foods Issues Yet Another Recall, This Time on Popcorn

Fictitious Restaurant Wins Wine Spectator Award of Excellence

Irish Barley Farmers Pay the Guinness Factory An Angry Visit


Italy helps consumers text their way to cheaper tomatoes

August 19, 2008

The Italian government has come up with a way keep produce sellers accountable to their customers, inform consumers, and, theoretically, make the food market more efficient through a text-message based service called SMS Consumatori.  (Crudely translated here.)  How it works:

1) Shopper notices that the price of a basket of cherry tomatoes at the corner produce stand is 5.60 Euros per kilo.  Hm, seems a bit steep.

2) Shopper sends a free text message to SMS Consumatori: “pomodori ciliegini 5,60€.”

3) SMS Consumatori instantly sends back current info from the Ministry of Agriculture’s database: the average wholesale price of cherry tomatoes (1.06€), plus the average regional retail price (2.60€) and the price in supermarkets, specialty stores, and produce stands.

4) Shopper decides she is getting gouged — the going rate in similar places is €4.50 — and either haggles over the price or chooses to shop elsewhere.

Seems like a potentially useful service for price-conscious consumers.  I floated the concept by an economist of the non-armchair type, Anwar Naseem, an assistant professor of agricultural economics at McGill University.

“Generally speaking, the more information a consumer has about a product, the more efficient and competitive the market will be, as the incentive for retailers to price-gouge will be minimized,” he said in an e-mail.  “In that respect this service should make the market efficient.  It will particularly benefit the most price sensitive consumers — usually the poor — whereas those who can afford to pay higher prices may not want to be bothered [to use the service] every time they buy tomatoes.”

It’s not likely that this would fly in the US.  “Retailing already is very competitive in the US,” Naseem asserted, “so there is very little gouging going on.” (Which is why monopolies are so gosh-darn fun.)  He pointed out that grocery shopping in the US is almost strictly limited to supermarkets, and a consumer would almost certainly just suck it up and pay the extra fifty cents per pound for overpriced tomatoes rather than waste time and gas to drive to another store.  (And imagine how the cashier at Ralph’s would react if you tried talking him down a buck-fifty.)  Besides, he said, the operating costs of such a program would be extremely high.

Still, in a fantasyland where A) really poor people have cell phones and B) the government has the infrastructure to track such data, a service like this could help keep consumers informed — maybe helping to take a bit of the mystery out of soaring food prices, and subsequently helping to keep the peace.

(What? Your definiton of fantasyland has no cell phones at all?  And rivers of wine and foie gras forests?  To each their own.)

(And little, beefy matters)

August 19, 2008

Where’s the beef?

Look down.

Ah, there it is.  In the form of a mini-cow.

That’s right, a mini-cow.

These little creatures are the Priuses of the bovine world — smaller, cuter, and more fuel-efficient.  Standing about three feet tall, they are half the size of a normal cow, but eat only a third as much.  And they yield more meat per unit of feed.  They also use less land, and are less likely to trample if you piss them off.

While there are only 14,000 or so minicows in the US, compared to 10 million regular-size cattle, the sale of mini-cows has been growing steadily, originally to outside-the-box-thinking pet owners and, more recently, small farm owners and people looking to save a bit on their grocery bill.

Don’t expect to find mini-steaks behind the counter at your local Whole Foods any time soon — but it’s a sign of the times.  A cuddly, limpid-eyed sign of the times.

Big, beefy matters: Spike in meat prices predicted for fall

August 18, 2008

It’s looking ominous: All signs point towards a very expensive cheeseburger.

A recent story on the beef industry on NPR’s All Things Considered says that surging costs, flagging supply, and rising demand strongly suggest that US beef prices will jump through the roof in the next few months.

For starters, explains Yuki Noguchi, cow chow has gotten prohibitively expensive.  It’s not news that corn prices have shot up exponentially over the last year, driving the price of cattle feed up 50%.  But it’s more than corn: hay prices have more than doubled over the same period.

Throw in rising gas and diesel prices, and your profits are halved.  Might as well throw a pitchfork into your cattle ranching operation.

Many ranchers are selling off significant portions of their herds to cover costs — one of the reasons why the USDA shows that the national inventory of cattle is actually shrinking.

And it’s not just going to be meat that’s going to get suddenly pricier. I’m no expert, but I suspect that dairy will feel the brunt of that, too.  Across the pond, many UK dairies that that were undergoing the switchover to organic have changed back to more immediately affordable, chemically-intensive techniques.

That trend has some perplexing implications for the organic industry, in the US and elsewhere.  Sales of organic foods are predicted to do quite well, despite being surrounded by miserable company.  But does this mean that the burgeoning community of small, organic farms and dairies will shrivel up, leaving those who can afford to compete, like Niman Ranch and Horizon Organic, to reap the spoils?

Traci Des Jardins: San Francisco restaurateurs feeling the pinch

August 14, 2008

Earlier this evening I chatted on the phone briefly with Traci Des Jardins about the the challenges of being a restaurateur in San Francisco these days.  Jardiniere, the eleven-year-old restaurant where Des Jardins is co-owner and head chef, is something of an institution for the ballet and opera-going crowd and grosses around $7 million annually.

She says that while it has been business as usual for the most part, the front of the house noticed that diners were cutting back on spending slightly; diners who would ordinarily order a $200 bottle of wine were opting for the $150 bottle instead.

Des Jardins also talked at length about the new bane of most local, budget-minded business owners: Healthy San Francisco, a program which requires employers to help pay for their employees’s health care.  She did what many other restaurants did: added a 4% surcharge onto the bill to recoup expenses.  “I don’t see how a restaurant can survive without either raising prices or doing the service charge,” she said, adding that food costs and wine delivery expenses were already up, no thanks to the weak of dollar and rising gas prices.

Indeed, some restaurants haven’t survived: Des Jardins pointed out that Rubicon, also on the short list of respected SF fine dining establishments, shut its doors last week, citing rising expenses like rent and mandatory insurance payments.  “San Francisco’s health insurance requirements were killing us,” owner Drew Nieporent is quoted as saying. “The restaurant was doing well, but we just couldn’t make money.”

Des Jardins is keeping a cool head about it all, as it’s still the off season. “I’m not terribly worried…If we see a big drop in business in the fall, then I’ll be really concerned.”

FTC gives Whole Foods merger another long, hard look

August 14, 2008

Oh, Whole Foods.  August just isn’t your month, is it?

First, there were last week’s disappointing third quarter results and your warning to shareholders that Q4 isn’t looking so hot, either.  We don’t blame you entirely — buying Wild Oats last year was expensive, and you are still trying to find a way to trade in your arugula-peddling ways for something that will resonate with the newly budget-minded consumer.

Then, that ground beef recall. (You say you didn’t have your quality control tracking systems in place? Oopsie.)

And now this: the Federal Trade Commission hearing to review last year’s merger for a possible antitrust violation is now official.  Mark your calendar for September 8.

The FTC alleges that you broke antitrust laws by merging with Wild Oats, arguing that “premium, natural, and organic” stores (simplified in legal documents to the awkward “PNOS”) belong in their own niche of supermarketdom.  You now own the organic megastore market in the twenty or so cities where you were once lone rivals with Wild Oats — a dynamic that the FTC insists is a monopoly.  They tried to request a preliminary injuction before your merger was completed last year, but the court denied their attempts to block you.

But the FTC didn’t forget, even as you happily went through with your merger, and finally, their plea made it to the right ears — the federal appeals court has now ruled that FTC should have been granted that injuction.  So last year’s decision was overturned, and now you are back in the hot seat.  You say that all of the other major supermarkets like Kroger’s and Ralphs are your primary competitors, not just places like Wild Oats — but what will the district court say, this time around?

With the merger already almost a year old, the FTC’s proceedings are perhaps more an attempt to lay the groundwork for future cases than they are an earnest effort to topple your empire — assuming they are even able to successfully build the argument that you are monopolizing the, er, PNOS market.

If that’s the case, this may be nothing more than a nuisance.  But your stock prices are circa 2001 and falling, so it sure is a badly-timed nuisance.  And there are still two weeks left in August.

Time to sacrifice a heap of sustainably-raised salmon at the Altar of the Sherman Act and pray.  A lot.

When life gives you jellyfish, make jellyfish lemonade

August 13, 2008

Or cookies.  Or tofu.

At least, that’s the approach that a few intrepid Japanese entrepreneurs are using to take advantage of the ballooning population of jellyfish. Rapidly becoming known as the “cockroaches of the sea” for their ability to flourish in a variety of environments, these creatures have seen* their numbers explode, thanks to warming oceans and a decline in natural predators.

The biggest innovators are the students at the coincidentally-named Obama Fisheries High School in the Fukui prefecture of Japan, who have been working in partnership with a local company to develop potential new uses for the invaders.

Delightfully sting-free.

Delightfully sting-free.

Over the last several years, these students have devised ways to incorporate jellyfish into everything — from a baking powder-like substance to be added in cakes and cookies, to fruit punch.  (We don’t doubt the other Obama’s many talents, but we’d like to see him whip up a tray of jellyfish snickerdoodles.

Another entrepreneur, Kaneo Fukuda, who goes by “Jellyfish Fukuda,” says has created over twenty different tentacle-based products, including cocktails and makeup.   Still more promising is a recent discovery of jellyfish as a potential source of mucin, a protein substance that has potential to work in a variety of processed foods.

*This is purely figurative, as jellyfish do not have eyes.  They do have light-detecting structures called rhopalia, but you cannot gaze meaningfully into them.

France chews its own fat

August 11, 2008
Researchers in France are asking the government to propose a special sales tax on “extra-fatty, salty or sugary” foods, claims an Associated Press story published last Wednesday.  A report submitted by agency experts to the national health and budget ministries late last month presents the tax increase as a drastic measure in the country’s ongoing effort to control swelling obesity rates.  Approximately one in five French citizens are considered obese.
The revenues will help fund the country’s debt-ridden national health care system, which was out $9 billion in 2007 — incredibly, a deficit billions less than in previous years.  So the proceeds from your perfectly buttery, flaky croissant Polaine at could theoretically finance an angioplasty somewhere in Lyon.  The V.A.T. tax on all food in France is currently 5.5%, but the sugary, salty, fatty offenders would be taxed up to a suggested 19.6%.
Given that the report will not be officially presented to legislators until September, much of the AP story is highly speculative. Whether goose-liver lovers will be suffering alongside Le Big Mac aficionados is unclear.   What’s particularly interesting is that this approach is a departure from the education-focused interventions the government has relied upon, and a move more directly hostile to the food industry, which has become increasingly regarded as the culprit in the national widening of waistlines. Would a junk food tax make a measurable difference?  (An imperfect comparison that merits further analysis: A cigarette tax as a disincentive to smokers, a public health intervention that has met with a degree of success.)
And before we get ahead of ourselves: Would such a bill even pass muster?  For a country whose national identity stands upon glistening mounds of lardons it would likely affect most everyone.  With everyone suffering from a collective hit to the wallet these days, such a change could make life really, really difficult for the lower-middle class consumers who rely on many of these products, which are often the most affordable options.
Of course, hell froze over with the demise of the country’s 35-hour workweek, so anything is possible.  (And hey, uh, legislator dudes?  While you’re trying to straighten things out over there, a Pooper Scooper mandate is worth considering.)

Who’s down about the economy? (Hint: Not Diageo.)

August 8, 2008

With grain prices sky-high and the very integrity of the McDonald’s Dollar Menu in jeopardy, it’s no wonder that no one has had paid much attention to the handful of beneficiaries of the economic downturn: chief among them, the liquor industry.  Why is it doing so well?  Consider this: There’s no better accompaniment to an evening of tearing your hair out over your impending foreclosure/layoff/bankruptcy than a glass of perfectly aged, single malt Scotch — or better yet, a few of them.

All across the country, sales of alcohol — particularly spirits and wine — are up, up, up.  A June 2008 survey conducted by Nielsen shows that consumer attitudes towards spending on booze have changed little despite the failing economy.  At least a couple of states, including Iowa and Pennsylvania, have reported increased sales of alcoholic beverages in the last year of 5% or more.  (And perhaps as a sign of the times, South Carolina is considering repealing its Blue Laws and allowing restaurants to serve alcohol on Sundays.) Whereas today’s financially pinched shopper may see other, larger purchases as excessive, liquor is still seen as an affordable luxury for many. 

All of these gains may not be reflected in the current fortunes of some of the major, publicly-traded liquor companies.  French-owned vodka maker Belvedere filed for bankruptcy last month.  And then there’s Diageo, the mega-conglomerate that owns pretty much every major alcohol brand you can think of — go ahead, try: Smirnoff? Yep. Cuervo? Mmm-hmm.  Guinness?  Red Stripe?  Dom Perignon? All, yes.  Recent U.S. sales have been less than robust. But according to a recent Wall Street Journal article, neither the company — the world’s largest purveyor of booze — or the analysts who track it are worried about slowing sales as the country slips deeper into a depression.  In fact, they suggest that the company’s stock will quite possibly “rise sharply” in the next year.  Blind optimism or prescience?  We don’t know yet, but we’ll think about it over a cold one.