Recent Developments Surrounding LFTB

May 9, 2012 06:08 AM

Following are updates on recent developments surrounding lean finely textured beef (LFTB):

Prices have risen for LFTB component: Dow Jones reported that wholesale prices for "50 percent lean" beef trimmings -- one of the components in lean finely textured beef (LFTB) -- have risen by more than 50 percent from mid-April lows, according to USDA data. Ironically the story ran just a day after Beef Products Inc. announced they were permanently shuttering three of their four plants that make LFTB, saying demand for the product had slumped and not recovered. (see item below for details on this....)

PERSPECTIVE: The uptick in prices for the product may well be too little, too late, as evidenced by the BPI announcement. It may also signal that those products are finding some other "home" in the meat sector since the LFTB demand has dropped off so dramatically.

USDA responds to comments from Sen. Chuck Grassley (R-Iowa) on LFTB: USDA is taking exception to comments from Sen. Chuck Grassley (R-Iowa) who contends the USDA response to the LFTB situation helped to make matters worse.

Following the USDA move to offer schools the option to not purchase LFTB for use in lunches despite insisting the product was safe, Grassley said USDA "immediately said hot lunch programs didn't have to purchase it and so that sent a signal if it wasn't good enough for the hot lunch program, it wasn't good enough for this supermarket and that supermarket and they all jumped on board."

Radio Iowa noted that Grassley's comments did not sit well with USDA, quoting Communications Director Matt Paul as saying, "You know, we were very disappointed that Senator Grassley made that characterization. From the first discussion of this in the national news, USDA was very strong in pointing out the safety record of LFTB. And in fact, at the pinnacle of this public discussion, the company cited USDA's support for the product."

Paul further noted, "All we said was that schools have a choice if they don't want to receive this product, we on behalf of them, sort of their wholesaler, are simply making a case based on their concerns until there's some greater public understanding of LFTB, that we would give district the option."

The USDA response was based on "a consistent message about the safety of this product," Paul said.

PERSPECTIVE: Grassley isn't the only one who has questioned the USDA response to the LFTB situation. Others have noted the apparent contrast between USDA's response to the LFTB developments and the apparent message USDA sent to foreign buyers of U.S. beef in the wake of the fourth U.S. case of BSE - that the product is safe and there is no reason for them to halt imports of U.S. beef. Only Indonesia opted to place any limits on U.S. beef.

Meat Industry Update: LFTB Closings | Safeway Pork | Taiwan Team in U.S.

Beef Products Inc. to permanently close 3 plants: Beef Products Inc. announced it will permanently close its plants that produce Lean Finely Textured Beef (LFTB) in Amarillo, Texas; Garden City, Kansas; and Waterloo, Iowa. Its South Sioux City, Nebraska, plant will continue to operate at a reduced capacity.

BPI said sales of LFTB dropped earlier this year and had not recovered, prompting to firm to decide to close the three facilities. "While we had hoped to be able to resume operation at those plants, that is not going to be possible in the immediate future and the temporary suspension of operations will in fact result in the elimination of those jobs effective May 25, 2012," the company said in a statement. The closures will result in the loss of 650 jobs.

Safeway to move to crate-free pork suppliers: Safeway Inc. announced it will stop purchasing pork from suppliers that use gestation crates for sows. "We think there are more sustainable pork production methods," Brian Dowling, vice president for public affairs, said.

No timeline was given for the action, but the second largest grocery chain said it would take a "long period" to be put in place.

A spokesman for the Humane Society of the U.S. hailed the move. "By letting the industry know that this is its goal, (Safeway) is helping move the industry in the right direction," said Paul Shapiro, HSUS spokesman.

But the National Pork Producers Council expressed concern, with NPPC President RC Hunt saying in a statement, "It seems that Safeway was intimidated by an animal rights group whose ultimate goal is the elimination of food-animal production."

Taiwan team holds sessions in Washington. The Taiwanese team visiting the U.S. to inspect nine beef production facilities held meetings in Washington Monday, visiting the American Meat Institute and the Consumers Union. The team received a briefing on U.S. meat production and sales from AMI, and updates on five control measures in place in the U.S. to protect the beef supply, including controls on imports of cattle, bone meal, cattle monitoring, removal of specified risk materials (SRMs) and a ban on slaughter of dead, downer, distressed or diseased cattle, according to a report from the Central News Agency.

The report said that in the session with Consumers Union, the team was told that the U.S. organization did not call for consumers to avoid U.S. beef as there was no evidence it was unsafe, but that they want food inspections to be increased to ensure meat safety.

The Taiwan team will meet today with USDA Chief Veterinarian John Clifford and will meet with representatives from USDA agencies such as the Animal and Plant Health Inspection Service, the Food Safety and Inspection Service and the Foreign Agricultural Service.

The team is scheduled to go to Iowa Thursday and visit the National Veterinary Services Laboratories.

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