Fresh Cut Magazine

Market disruptions force processors, foodservice to innovate

According to the most recent consumer price index, fruit and vegetable costs are up about 6 percent, but growers, processors and distributors are scrambling to find ways to stay profitable. Rising fuel costs, changes in consumer buying habits and a general downturn in the U.S. economy have created a gloomy environment. “They’ve merged into a perfect storm that is changing an industry forever,” said Bryan Silbermann, president of the Produce Marketing Association, at the group’s Foodservice Conference and Expo in Monterey, Calif., in July. Production costs are increasing across the board, said Bob Gray, chief executive officer of Duda Farm Fresh Foods. On average, costs are up 20 percent – ranging from 6 percent to 46 percent. That figure didn’t include a new round of increases that are driving costs up an additional 3 percent to 18 percent, Gray said. “We’re pretty concerned about profitability right now,” he…  » Read more

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New processor sets up shop in Arizona

In the early ‘90s, Henry Chavez saw a need for cooling operations in San Luis, Ariz., so he started Spindle Cooling and Warehousing. As that company grew, he watched fresh fruit going through his warehouse to be shipped out and processed elsewhere. With so much volume moving out of state, Chavez saw an opportunity to start his own processing company that would reduce shipping and provide customers with fresher produce. So Chavez and wife Lydia started Lydia’s Specialty Fruit Inc. about a year ago, and the first fresh-cut products are due to roll out this summer. “I just thought it made sense to build a fresh-cut fruit facility right here, reduce all the transportation costs, add additional jobs to the area, help the local economy and have a product that will stay fresher for a longer period on retail and commercial shelves,” Chavez said. The new processing…  » Read more

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New policy covers growers in a recall situation

When a recall occurs, processors and shippers are usually insured from product loss and the associated costs. But until now the grower hasn’t had that protection. “The growers are left holding the bag, and sometimes they don’t have a big enough bag to take care of the problem,” said Tom Elms of The Thomas Group Insurance Co., Safford, Ariz. Elms’ company is offering a first-of-its-kind recall insurance for growers. The policy, underwritten by the 300-year-old insurance company Lloyd’s of London, covers the losses associated with a recall, even one not directly attributed to the grower. Following the 2006 outbreak of E. coli O157:H7 traced to bagged spinach, Elms said he began to look around at the insurance available to farms at the prompting of Western Growers Association, a group he works with to deliver Western Growers’ health benefits to members. Elms found there wasn’t any insurance offered…  » Read more

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The Grocery Shrink Ray

Prices for food items at the supermarket have been on the rise, and consumers have noticed their shopping budget doesn’t go as far as it used to. But consumers are quickly becoming aware that even as prices increase, they’re getting less for their money. This phenomenon has been termed the “grocery shrink ray” by consumer advocate groups. In a recent National Public Radio broadcast, the editor of the consumer Web site consumerist.com talked about the shrink ray and the shrinking products it’s leaving in its wake. Food brands including Kellogg cereals (2.4 ounces smaller), Folgers coffee (4 ounces smaller), Tropicana orange juice (7 ounces smaller) and Skippy peanut butter (1.3 ounces smaller) have all felt the effects of the shrink ray. Some manufacturers are trying to hoodwink consumers as they shrink packaging, Ben Popken said on NPR. Kraft Foods, for example, reduced the number of slices…  » Read more

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