Target, Kroger Enjoying Growing Sales of Organic and Natural Foods
Photo: Pexels
Originally Appeared in Presence Marketing News, September 2019
By Steven Hoffman
Target Corporation (NYSE: TGT), based in Minneapolis, MN, on August 19 announced the launch of a new flagship private label brand, Good & Gather. The in-house brand will focus on four categories: organic; kids; seasonal; and premium products. More than 2,000 products including dairy, produce, ready-made pastas, meats, granola bars and sparkling water, are expected to roll out under the Good & Gather brand over the next 18 months. Good & Gather will become Target’s largest brand, replacing existing house brands Archer Farms and Simply Balanced and reducing the number of products under Target’s Market Pantry Brand, reports Sustainable Food News. In related news, Cincinnati, OH-based grocery giant Kroger (NYSE: KR) claims its Simple Truth brand now offers more Fair Trade Certified products than any other U.S. private label brand. The company reported on August 20 in its 2019 Sustainability Report that it sold $17.6 billion worth of natural and organic products in 2018. Kroger’s natural and organic private label brand, Simple Truth and Simple Truth Organic, achieved sales of $2.3 billion in 2018, making it the second largest brand sold in its stores, the company reported. Kroger said it purchased 17.2 million pounds of Fair Trade certified ingredients for its private label products, and also said it sold more than $1 billion worth of organic produce in 2018. Kroger operates 2,800 supermarkets and multi-department stores in 35 states. Each store carries on average 4,000 natural and organic items, reports Sustainable Food News.
USDA Draft Hemp Rules Await White House Approval
Photo: Unsplash
Originally Appeared in Let’s Talk Hemp Newsletter, September 2019
By Steven Hoffman
While USDA has up to a year to finalize regulations governing hemp cultivation in the U.S., the agency submitted draft federal rules to the White House in mid-September to assure states and farmers they can participate in the 2020 growing season.
The hemp industry is anxiously awaiting federal rules for the cultivation of hemp in the United States, and it may soon get its wish. In mid-September, the U.S. Department of Agriculture (USDA) completed a draft of proposed rules for growing hemp and submitted the document to the White House Office of Management and Budget (OMB) for review and approval.
The new USDA regulations are expected to clarify changes that were included in the U.S. Farm Bill, which was passed into law in December 2018. Currently, most state hemp growing programs are operating under older rules included in the 2014 U.S. Farm Bill. The new USDA rules are expected to provide clarity on the legal definition of hemp and reinforce that hemp has been removed from the controlled substances list by the U.S. Drug Enforcement Agency (DEA). According to UPI, the new rules also are expected to designate hemp as a commodity crop, simplify rules for interstate hemp commerce, and allow for tribal nations and U.S. territories to participate in hemp growing programs.
Originally scheduled for release on August 1 in advance of the 2020 growing season, William Richmond, USDA’S Director of the Specialty Crops Program in the Agriculture Marketing Service, informed attendees of the American Herbal Products Association’s Hemp and CBD Congress held in Denver in mid-August that the regulations were delayed in part because USDA is struggling with a requirement in the 2018 Farm Bill for a national THC testing protocol. “Our goal is to provide a consistent, easy-to-follow regulatory framework around hemp production,” Richmond said at the AHPA Congress.
Other issues impacting the rapidly emerging hemp industry include the availability of crop insurance and banking services for farmers, approval pesticides for use on hemp crops, and the import of hemp seeds, Geoff Whaling, Chair of the Washington, DC-based National Hemp Association, told UPI. Whaling predicted the USDA rules would be released “in a matter of weeks.”
According to Hemp Industry Daily, the USDA regulations will be temporary for the first year, allowing states and farmers around the country to participate in the 2020 growing season and identify and iron out any small fixes. While the 2018 Farm Bill calls for federal authorities to allow states to set their own rules for hemp production, as long as certain criteria are met, states will need to get USDA approval first, a step, Hemp Industry Daily says, that won’t happen until after the national guidelines are released.
According to UPI, the OMB has scheduled meetings to receive initial public comments regarding the USDA hemp regulations. Once released, members of the hemp industry will be invited to submit feedback before final rules are issued.
The OMB, the largest office within the Executive Office of the President of the United States, is responsible for producing the President’s Budget, but also measures the quality of agency programs, policies and procedures to make sure they comply with the president’s policies. OMB also coordinates inter-agency policy initiatives, according to Wikipedia. Current OMB Director Mick Mulvaney also currently serves as Acting White House Chief of Staff for the Trump administration.
General Mills Working with Farmers to Reduce Pesticide Use
Photo: Pexels
Originally Appeared in Presence Marketing News, September 2019
By Steven Hoffman
Over the past several years, leading food producer General Mills has committed to sourcing major ingredients, including oats, wheat and sugar, from farmers who follow sustainable practices. Now, the maker of Cheerios and hundreds of other products is taking it one step further and encouraging its farmers to reduce their use of pesticides. “Recognizing that synthetic pesticides may harm beneficial insects including pollinators, or drift beyond a farmer’s field, affecting nearby fields and ecosystems, we are actively working across our value chain to limit these unintended and potentially harmful impacts,” General Mills says on its website. “We have strategies in place to reduce synthetic pesticide use, and we work with trusted agronomists and other experts to implement continuous improvement practices throughout our supply chain.” General Mills reports that it is employing four strategies to reduce pesticide use, including: 1) encouraging regenerative agriculture; 2) promoting Integrated Pest Management (IPM); 3) expanding organic acreage; and 4) promoting pollinator health. Earlier this year General Mills announced a goal of increasing regenerative agriculture practices to one million acres by 2030. The practice, which includes the use of cover crops, diverse crop rotations and other strategies, could be a key part of the company’s pesticide reduction plan, reported The Western Producer. “Among its many benefits, regenerative agriculture suppresses pests by promoting natural competition to significantly reduce the need for synthetic pesticides,” General Mills says. According to General Mills, the company is working with 45 farmers, mostly in Manitoba and Saskatchewan, coaching the producers on regenerative practices. The company is measuring a number of outcomes from regenerative agriculture, including pesticide use. According to The Western Producer, General Mills is the second largest producer of organic and natural food in the U.S. In 2018, the company reached 200,000 acres of organic production, with a goal of 250,000 in 2019.
Proposed Tariffs on European Products Would Devastate Specialty Food Sales
Photo: Pexels
Originally Appeared in Presence Marketing News, September 2019
By Steven Hoffman
The Trump administration is currently considering adding tariffs this fall to a large number of items imported into the U.S. from the European Union (EU), including most foreign cheeses. Many top-selling and popular cheeses including Italian Parmigiano-Reggiano and Dutch Gouda could become twice as expensive, reports Modern Farmer. The tariff proposal would increase duties on hundreds of EU products by as much as 100%. Originating from a trade dispute in the aviation industry, the proposed tariffs, supposedly meant to punish the EU, will end up directly impacting specialty food retailers who are already operating on thin margins. According to the Specialty Foods Association, the latest list of proposed tariffs includes 100% levies on a range of pork products, cheeses, pastas, coffee, olives and other goods. “If something happens, we are insulated for a time,” Bob Marcelli, owner of specialty food importer Marcelli Formaggi in Clifton, NJ, told Specialty Food News. “But long term, it would be just devastating. Everybody’s going to pay more; that’s the bottom line, he said.
Trader Convicted in Organic Fraud Scheme Commits Suicide Before Serving 10-Year Prison Sentence
Photo: Pexels
Originally Appeared in Presence Marketing News, September 2019
By Steven Hoffman
Facing incarceration for his role in masterminding a $142 million organic grain fraud scheme, organic farmer and trader Randy Constant was found dead by suicide on August 19 at his home in Chillicothe, MO. Constant was sentenced on August 16 by a federal court judge to 10 years in prison for knowingly marketing and selling non-organic corn and soybeans as organic. Federal prosecutors called the scheme “one of the largest, if not the largest, organic fraud schemes in the history of the United States.” Police officers found Constant dead from carbon monoxide poisoning weeks before he was to report to federal prison. Prosecutors alleged that Constant falsely marketed non-organic grains as certified organic on a massive scale, reported Time Magazine. Sales through his Iowa grain brokerage equaled up to 7% of the organic corn grown in the U.S. in 2016 and 8% of organic soybeans. From 2010 to 2017, Constant was reported to have sold over 11.5 million bushels of grain, primarily used as feed for chickens and cattle, which would then be unwittingly marketed as organic meat products by the respective producers. Constant’s death came as authorities publicized his prison term, which they hoped would deter other farmers from defrauding the National Organic Program, reported Time Magazine. Judge C.J. Williams said during the sentencing hearing that Constant’s fraud did “extreme and incalculable damage” to consumers and undermined public confidence in the nation’s organic food industry.
Presence Marketing’s Tracy Miedema Featured at AHPA Hemp-CBD Congress
Photo: AHPA
Originally Appeared in Presence Marketing News, September 2019
By Steven Hoffman
Comparing CBD to other herb-derived products like echinacea, American Herbal Products Association (AHPA) Chief Executive Michael McGuffin said, “Hemp is just another herb that should be regulated the same as any other dietary supplement.” Speaking at the sold-out AHPA Hemp-CBD Congress held in Denver on August 15-16, McGuffin said CBD producers should be expected to comply with “all federal regulations” including using registered food and processing facilities. Tracy Miedema, VP of Innovation and Brand Development for Presence Marketing / Dynamic Presence, also spoke at the conference, which was sponsored in part by Presence Marketing. Miedema, a “true believer” who was married in the 1990s in a hemp wedding dress, said CBD is a huge phenomenon worldwide, expected to generate between $15 billion and $20 billion in sales in the next few years. Miedema, who is a board member of the Lexington, KY-based U.S. Hemp Roundtable, was quoted in UPI News saying, “When the 2018 Farm Bill passed, taking CBD off the Schedule 1 [drug list], that unlocked the potential in funding.” Commenting on the uncertain regulatory environment, Miedema added, “This is a political problem, not a legal problem. Neither supply nor demand can be stopped at this point.” Colorado Governor Jared Polis, a champion of hemp, opened the Hemp-CBD Congress, declaring hemp “a crop of the past and yes, a crop of the future.”
Natural Products Association (NPA) Files for Bankruptcy
Photo: Natural Products Association (NPA)
Originally Appeared in Presence Marketing News, September 2019
By Steven Hoffman
The Natural Products Association, (NPA) the oldest trade group in the natural products industry, filed for bankruptcy protection on August 19, 2019, which it attributed to six straight years of losses and a costly arbitration with the association’s former CFO. According to Reuters, NPA CEO Daniel Fabricant said in a filing with the U.S. bankruptcy court in Wilmington, DE, that the Chapter 11 case will provide a “breathing spell” for the Washington, D.C.-based trade group to focus on advocacy and membership. Founded in 1936 and formerly known as the National Nutritional Foods Association, NPA said it has more than 1,000 members comprising over 10,000 retail, manufacturing, wholesale and distribution locations for natural foods, dietary supplements and natural health and beauty products. According to Reuters, NPA’s former CFO Brent Weickert holds the largest unsecured claim in the bankruptcy petition – a disputed $780,179 arbitration settlement awarded as a result of a wrongful termination lawsuit filed by Weickert in 2015 against NPA.
Athletic Appeal – Former Professional Athletes Passionate About the Hemp/CBD Business
From Left: Two-Time Funny Car World Champion turned hemp farmer Matt Hagan; NFL Veteran and CBD advocate Kyle Turley; and former NHL player turned hemp educator and CBD entrepreneur Riley Cote. Photos: Matt Hagan: Matt Hagan/Twitter; Kyle Turley: NeuroXPF.com; Riley Cote: Athletes for Care.
Originally Appeared in Let’s Talk Hemp Newsletter, August 2019
By Steven Hoffman
Hear two-time Funny Car World Champion turned hemp farmer Matt Hagan, NFL veteran and CBD advocate Kyle Turley, and former NHL player Riley Cote, CBD entrepreneur and co-founder of Athletes for Care, speak at the 2nd Annual Southern Hemp Expo, September 6-7, 2019, at the Williamson County AG Expo Park in Franklin, TN.
Professional athletes know how to take a lickin’ and keep on tickin.’ However, after years in the sports world, athletes are increasingly turning to full spectrum hemp extract and CBD to help provide relief for stress and for injuries accumulated over a career or a lifetime of impact athletics.
Three such former professional athletes were so impressed with results garnered from full spectrum hemp extract that they got into the business – one, two-time Funny Car World Champion Matt Hagan, as a hemp farmer; another, Kyle Turley, is a former NFL player who says CBD saved is life; and the third, former NHL player Riley Cote, is a hemp advocate and educator and also a marketer of CBD products to athletes, weekend warriors and the general public. Matt, Kyle and Riley will be featured speakers at the upcoming Southern Hemp Expo September 6-7, 2019, at the Williamson County AG Expo Park in Franklin, TN.
Matt Hagan – Funny CarWorld Champion Turned Organic Hemp Farmer
Recognized as a top competitor in the world of Funny Car drag racing, Matt Hagan is also a beef cattle farmer. When the 2018 Farm Bill passed, he immediately started planning to plant 140,000 plants on 90 acres, making his TruHarvest Farms one of the largest hemp farms in Virginia. “Every day I feel better about it,” Hagan told his local TV station, WFXR, at the beginning of the planting season. “The first couple of days starting this up I was ready to puke, ‘cause it’s just the unknown, the fear of the unknown.” However, Hagan added, “We’ve picked up over 20 people to work this farm for this year and that alone is driving revenue back into our country and into our state.” Hagan plans to sell his organically produced hemp plants to create CBD and strives to break the stigma around hemp. In the future, he hopes to open his farm to educate people on the uses of hemp and its differences from marijuana.
Riley Cote – From NHL Enforcer to CBD Educator and Entrepreneur
Riley Cote is a former professional left winger in the National Hockey League (NHL). He spent four seasons (2006-2010) with the Philadelphia Flyers where he was renowned for his role as an enforcer. Upon retiring from the NHL, Cote founded the Hemp Heals Foundation, a 501 (c) 3 non-profit organization dedicated to promoting hemp as a viable renewable resource that can help increase the quality lives of all people. Cote also sits on the Pennsylvania Hemp Industries Council (PAHIC) board. As a co-founder of Athletes For Care and one of its NHL League Ambassadors, Cote continues to pursue his passion to help athletes discover safe, non-toxic ways to find relief, manage pain and achieve a better understanding of self-healing. Riley recently launched BodyChek Wellness, a line of full spectrum hemp extract-based products with a mission to optimize everyday performance and challenge individuals to rethink the healing process. The BodyChek Wellness line reinforces Cote’s passion to help individuals discover safe nontoxic methods for pain management and self-healing.
Kyle Turley – After 100+ Concussions in the NFL, CBD Saved His Life
Diagnosed with chronic traumatic encephalopathy (CTE) due to the 100-plus concussions he received during the 10 years he played as an NFL offensive lineman, Kyle Turley struggled with pharmaceutical addiction, violent thoughts, and suicidal tendencies — until he started taking medical marijuana. “It saved my life,” he says. “I wouldn’t be where I am today, I would not have my family, my kids, my house, everything I have right now, if not for cannabis.” To help save other lives, Turley founded the Gridiron Cannabis Coalition to use his story and those of other players to advance the idea of marijuana as a valid medicine for neurological conditions and other athletic injuries. “This plant has to be set free,” he says. “We have people committing suicide in football and other sports. How far do we have to go?” Knowing the value of the plant and the hurdles that the government and big pharma has placed on marijuana, Kyle has created Neuro XPF, a lab tested, federal guideline compliant, THC-Free, CBD (Hemp derived) cannabis supplement focused on bioavailability. CBD (cannabidiol) has shown in studies to have neuro-protective and antioxidative properties that could address a myriad of maladies facing our military and NFL veterans while supporting the general health and wellbeing of all aged athletes, says Turley.
USDA Proposal Seeks to Remove 3 Million Recipients from Food Stamps and Rescind School Lunch from Over 265,000 Children
Originally Appeared in Presence Marketing News, August 2019
By Steven Hoffman
The U.S. Department of Agriculture (USDA) on July 23 proposed new rules to limit access to food stamps for households with savings and other assets, a measure that could cut benefits to 3.1 million people participating in the Supplemental Nutritional Assistance Program (SNAP). According to USDA Secretary Sonny Perdue in a call with reporters, the proposed SNAP rules are aimed at ending automatic eligibility for those who are already receiving federal and state assistance. “What we’ve found is some states are taking advantage of loopholes. This proposal will save money and preserve the integrity of the program. SNAP should be a temporary safety net,” said Perdue. Secretary Perdue’s “rhetoric makes it sound like there are many households out there taking advantage of this so-called ‘loophole,’” reported H. Claire Brown in New Food Economy. However, Brown points out that the Congressional Research Office (CRO) found that only 4.2% of households that received SNAP benefits in 2016 were making more than the SNAP program income limit of 130 percent of the federal poverty line, or approximately $1,307 per month for an individual.
The majority of SNAP recipients—85%—fell below the poverty line. This suggests that the number of families that make a little more money and are grandfathered in by broad-based categorical eligibility is quite small, Brown asserts. The Trump administration estimates that the new rule will rescind food assistance from about 3 million of a total 36 million SNAP participants, or about 8% of the total. Based on CRO estimates, “this seems to indicate it’s possible that many of the people who stand to lose benefits are actually eligible for SNAP under the regular rules—they just haven’t gone through the process of filling out all the paperwork,” Brown writes. “This rule seems to be inserting another layer of red tape between people entitled to food assistance and their benefits,” she adds. In addition, Brown reports, USDA’s proposed changes could potentially take free school lunch away from 265,000 students. Students are automatically eligible for free lunch if they receive SNAP benefits. If automatic SNAP eligibility is uncoupled from the Temporary Assistance for Needy Families program, children may lose their free lunch as a result. When asked about this on the press call, Brandon Lipps, administrator of the USDA Food and Nutrition Service, said, “USDA is estimating all the children who will no longer be directly certified for school meals if their parents are not categorically eligible would qualify for free or reduced price meals through the regular application process.” What this means, Brown reports, is more paperwork for parents.
Photo: Wikimedia Commons
Market Update: Organic and Plant-Based Food Sales
Originally Appeared in Presence Marketing News, August 2019
By Steven Hoffman
Rabobank: Organic Food Sales Growth Slows; Market to Hit $60 Billion by 2022
Between 2010 and 2016, organic food retail sales grew by an average of 10% per year, however, that growth has slowed to 5.9% for the past two years, says Rabobank. The international bank, known for its focus on food, predicts that organic food sales will reach $60 billion by 2022. While fruits and vegetables remain the top organic food category, representing 36% of all organic food purchases in 2018, even that category is showing signs of slowed growth, noted Rabobank Senior Analyst Roland Fumasi in a report by Food Navigator USA. “Organic produce availability has now become mainstream which means that the organic produce market will continue to more closely resemble the traditionally grown produce market,” Fumasi told Food Navigator USA. “Just a few short years ago, both organic produce prices and organic produce volumes were rising, indicating that demand expansion was occurring more rapidly than supply growth. However, there are indications that continued growth in the organic movement has partially been driven by lower prices for some of the top-selling organic product items.” Fumasi predicts that in a few years, demand for organic produce will see an increase in sales as millennials grow their income and start their own families.
Plant-based Food Sales Growing 5X Faster than Overall Food Sales
Plant-based food sales are growing like a weed, according to new research from the Plant Based Foods Association and the Good Food Institute. According to the research published in July 2019, U.S. retail sales of plant-based foods have grown 11% in the past year, bringing the total plant-based market value to $4.5 billion. Since April 2017, total plant-based food sales increased 31% according to the study. Additionally, plant-based foods unit sales are up 8.5%, compared to total U.S. food sales, which are flat, showing the overall health and momentum of the plant-based foods category. The data covers the total U.S. grocery marketplace and was commissioned from SPINS, a wellness-focused data technology company and retail analytics provider, says the Plant Based Foods Association (PBFA). According to PBFA, sales of the plant-based meat category alone is worth more than $800 million, with sales growth of 10% in the past year. Refrigerated plant-based meat is driving category growth with a 37% sales increase. Sales of plant-based milks, which grew 6% over the past year, now comprise 13% of the entire milk category, while cow’s milk sales have declined 3% over the same period. In addition, in the past year, plant-based yogurt has grown 39%, while conventional yogurt declined 3%; plant-based cheese has grown 19%, while conventional cheese is flat; and plant-based ice cream and frozen novelty has grown 27%, while conventional ice cream and frozen novelty has grown just 1%, according to the PBFA study.
Good Food Insights: Natural Continues to Set the Pace
Here’s some good news for natural products marketers, writes New Hope Network’s Bob Benenson: Natural product sales are growing five times faster than conventional product sales nationally—in the Multi-Outlet (MULO) channel, a.k.a. traditional grocery chains. Here’s the even better news: Natural product growth in this channel, where the vast majority of Americans get their groceries, outstrips conventional growth in all seven regions of the U.S., as defined by SPINS, the leading data market research firm for the natural, organic and specialty products industry. Along with FamilyFarmed’s Good Food Accelerator, Naturally Chicago and Esca Bona, SPINS is a collaborator in the Good Food Insights series. Based on the annual State of Good Food Report, derived from SPINS’ analysis of MULO market data for the 52 weeks ending May 19, 2019, while natural products comprise 9% of total sales in the MULO channel, sales in this category grew 5% over the study period, compared to 1% growth for conventional products. “Conventional retailers are recognizing that the rise of natural is an ongoing historic and generational shift, not a fad. And as they address consumer demand by adding more natural products to their shelves, they are jump-starting further growth in the sector,” writes Benenson. According to SPINS, California has the largest MULO market share of natural products at 14%, followed by the Northeast, with 12% MULO market share for natural products. The South-Central states recorded the lowest MULO market share, with only 6% of sales attributed to natural products. According to Andrew Henkel, SVP of Brand Growth Solutions at SPINS, the forerunner regions have the biggest consumer bases that are apt to adopt a “good food and natural products lifestyle.” “Parts of the country that have significant urban, progressive consumer bases are indicators of where the rest of the country is going to go,” Henkel told New Hope Network.