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Volume 8, Number 10 October 2003
Bioterrorism Act Regulations Edge Forward, Open
to More Public Comment
Ralph Russo Address, Bioterrorism Regulations
Highlight 2003 NCA Fall Conference
NCA Accepting Agreements Electronically for New
Agent Service to Members
Coffee Found to Boost Male Fertility
Coffee and Colon Cancer: Missing Link Found
Retail prices (all sizes/per pound)
The ICO composite average indicator prices
Industry News & Information
Bioterrorism Act Regulations Edge Forward, Open to More Public Comment
The FDA has made some small,
but substantive changes to the initially proposed regulations that deploy
provisions of the Public Health Security and Bioterrorism Preparedness and
Response Act of 2002, better known as The Bioterrorism Act. In "Interim
Final Regulations" it posted in the Federal Register on October 10, the
FDA eased somewhat the law's overall burden on exporters of coffee to the United
States.
Two regulations -- Prior
Notice of Imported Food Shipments and Registration of Food Facilities -- have
gone from "proposed" to "interim final" status after a
public comment period, leading up to their effective date of December 12, 2003.
The most significant change to the proposed rules is to the prior-notice
regulation. Responding to industry
concerns and to minimize unnecessary costs, the FDA has drastically reduced the
time period required for advance notice prior to the shipment of food to a U.S.
port of entry.
Under the proposed
regulation, prior notice had to be made by noon of the day before the
shipment's scheduled delivery. Under
the new, interim final regulation, that period has been reduced to two to eight
hours before arrival, depending on mode of transportation -- two hours if by
land via road, four hours if by air or by land via rail, or eight hours if by
water. Also, for international mail shipments, notifications must be made
before the shipment is mailed.
More Room for Comment
Both regulations will be
open to another 75-day comment period. Also, to ensure that those who want to
comment have had the benefit of FDA outreach and educational efforts, as well
as experience with the systems, timeframes and data elements of the interim final
rules, the FDA will reopen the comment period in March 2004 for an additional
30 days.
Two remaining regulations
under the Bioterrorism Act -- Record Keeping Requirements for Food Processors
and Administrative Detention -- are to be issued in final form, and are
scheduled to be released by the FDA in a few months.
Registrations Now
Accepted by FDA
The FDA is now accepting
registrations of facilities under the Registration of Food Facilities
regulation. You can find the FDA
Registration Form at www.fda.gov/oc/bioterrorism/furls.
U.S. Agent Service
Available through NCA
The National Coffee
Association is now accepting online Agent Agreements to serve as members' U.S.
Agent for purposes of registration of facilities under the Registration of Food
Facilities regulation. To complete the
registration process, visit www.ncausa.org/public/pages/index.cfm?pageid=289.
The Bioterrorism Act in
Perspective
Under previous law, most of the prior notice information required by the interim final regulations was provided by importers or brokers to the Bureau of Customs and Border Protection (CBP) when foods arrive in the United States. The Bioterrorism Act requires that this information also be provided to the FDA in advance of an imported food's arrival into the U.S. In turn, the FDA will use the information in advance of the arrival to review, evaluate and assess the information and determine whether to inspect the imported food.
Ralph Russo Address, Bioterrorism Regulations Highlight 2003 NCA Fall Conference
The annual NCA Fall
Education Conference for 2003 paralleled the wide-ranging changes facing the
coffee industry this year. From a first-time seminar embedded in the Conference
program, to a keynote address by the CEO of Sara Lee Coffee and Tea
Foodservice, to a mock trading session at the NYBOT's new facilities in Lower
Manhattan, it forged new ground for members seeking new answers.
"This year's conference
had tremendous take-home value," said Steven M. Wolfe, CAE, NCA Marketing
Director. "Each year, the conference gains momentum as word gets out about
the quality of our program."
Bioterrorism Act
Clearly, the subject most on
the minds of participants was the new Public Health Security and Bioterrorism
Preparedness and Response Act of 2002, better known as The Bioterrorism Act.
Appropriately, the Conference offered two segments on the subject, providing
insight from legal, governmental and industry perspectives.
One session offered an
experienced customs lawyer who discussed the conceptual and definitional
permutations of the newly proposed Interim Final Regulations for prior notice
of food shipments to the U.S. and registration of foreign food facilities. The
second session signaled the first time the NCA scheduled a
seminar-within-a-conference to address members' needs for in-depth analysis of
a pressing current issue. That session addressed the logistical and practical
aspects of the Interim Final Regulations, with perspectives from the FDA, a
lawyer experts and the coffee industry.
Thinking Outside the Cup
While the Bioterrorism Act
appeared to evoke the strongest response from participants, this year's
conference focused on the unprecedented changes facing the industry. A keynote
address by Ralph Russo, the CEO of Sara Lee Coffee and Tea Foodservice, played
on words and thoughts with the theme "Thinking Outside the Cup" and
emphasized how coffee is now part of the larger beverage segment as consumers'
tastes evolve over time. He also called upon the industry to recognize consumer
trends and embrace change.
In his comprehensive and
thoughtful address, Russo emphasized how coffee no longer holds a hallowed
position, even among morning drinkers, and so must now compete against other
beverages for what he called "Share of Stomach."
Carbonated soft drinks
account for 47% of market share, while coffee comes in at a distant second at
14%, and, according to Russo, it's no longer uncommon to see people starting
their days with a Coke, Pepsi or health/energy drink. And, if coffee doesn't
give consumers what they want, they'll move to other beverages.
Among consumer trends, Russo
cited recent "hiving behavior" among Americans wary of a bad economy
and terrorist threats as a potential boon to the market for gourmet foods
consumed in the home, including specialty coffees. He also noted a trend toward
piqued interested in gourmet coffees among ethnic groups, and questioned why
the industry targets little advertising to the exploding Hispanic population.
He recommended that the industry begin to reflect ethnic tastes in its product
offerings.
Russo's suggestion for
solving current coffee challenges was fivefold: educate, jazz it up, innovate,
capture attention, and sustain. He suggested that the industry cater to
consumers' love of being educated and begin to "romance" coffee like
wine. He also recommended jazzing up options available to consumers such as
low-acid coffee and decafs of different flavors. Innovations such as single
cup-brewing -- up a whopping 20% over the last four years -- need to be
considered. To capture consumer attention in the beverage market, Russo advised
making the "coffee experience" more vibrant, with graphically
pleasing and colorful delivery. Finally, Russo issued a shot across the bow,
entreating the industry to embrace sustainability, and called for cooperation
rather than infighting on what he called an important quality issue.
A Spectrum of Expertise
Many new topics peppered the
two-day New York conference, with presentations delivered by a diverse Who's
Who of experts from across the industry spectrum. Among them was a discussion
of origins by an expert on source issues, the certified coffee movement by an
authority from industry pioneer and advocate Starbucks, a technical description
of ideal roasting by an engineering consultant, health updates on coffee
drinking by a leading scientist from Kraft, marketing perspectives on coffee as
a beverage from marketing gurus from the coffee and beverage industries, and
packaging options from canning industry executives.
Other innovative, trend-catching topics included achieving global sustainability, the new realities of certified coffees, the mystique of single origin, why consumers prefer whole bean, the role of good water in making good coffee, the Robusta story from geopolitical, scientific and marketing perspectives, and leveraging brands in office coffee service.
Quantifying Sustainability
"Sustainability"
has become the industry's mantra for social responsibility as well as a cache
of upscale consumer appeal. However, like the "organic" designation
on groceries and produce, it can be an elusive, qualitative concept that is
hard to pin down.
As the social and economic
benefits for coffee farmers become more apparent to the health of the industry,
efforts to define and quantify sustainability are beginning to emerge. Taking
the form of model guidelines and measuring indices, these efforts aim to make
sustainability a tangible concept and commodity for the mainstream coffee
industry.
The pioneers in quantifying
sustainability are the Neumann Kaffee Gruppe (NKG) and Starbucks Coffee
Company. NKG has developed a Sustainability Index that assigns values based on
a comprehensive set of precisely defined ecological and social actions, the NKG
Sustainability Standards. Starbucks Coffee Company's model rewards performance
in sustainable categories and enables vendors to qualify as a Starbucks
preferred supplier.
NKG Sustainability Index
In line with NKG’s mission
and as part of its program "NKG Partnership for Sustainability," the
group recently devised a comprehensive matrix -- The NKG Sustainability Index
(the Index) -- to measure and promote its own Sustainability Standards for use
by group members.
The objective of the Index
is to standardize evaluation of coffee farms using social and environmental
standards. Unique to its approach is targeting the mainstream market, as well
as enabling step-by-step compliance to allow farms with less investing capital
to gradually attain full compliance. To accomplish these goals, NKG sought to
develop a measurement construct that can be applied to all coffee farms
regardless of region, requires less than three days to apply, is focused on key
criteria regarding sustainable coffee farming, and can serve as a tool for the
transparent and credible evaluation of social and environmental conditions on
coffee farms.
A matrix encompassing the
full spectrum of sustainability principles, the Index sorts them into ten
distinct categories. Within each category, points are awarded for adhering to
individual social and environmental criteria.
Among the 10 categories, 5
are based on environmental factors, and 5 on social criteria. The categories are: 1) Shade and
Biodiversity; 2) Water Use, Conservation and Protection; 3) Management of Waste
and Crop By-products; 4) Soil; 5) Integrated Management and Energy Use; 6)
Child Labor and Education
for Children on the
Farm; 7) Salaries; 8) Health; 9)
Training and Work Safety; and 10) Living Conditions for Workers on the Farm.
Within each category, point values are assigned to specific activities or
levels of achievement.
Additional points are
available, too, for farms that have achieved excellent results in some areas
not considered sufficiently within the evaluation system. So, farms can compensate possible deficits
in some areas with outstanding results in others.
The 100-point scale, in
turn, provides an incentive for farmers.
NKG also plans to use the index going forward as a sourcing tool for
sustainable coffee farms in several planned pilot programs.
Starbuck's Green Coffee
Sourcing Guidelines
In late 2001, Starbucks
launched the industry's first sustainability standards with its Green Coffee
Sourcing Guidelines in partnership with Conservation International's Center for
Environmental Leadership in Business. The guidelines were introduced in an
effort to enlist Starbucks current suppliers and others as partners in
developing sustainable coffee sources.
The company based its
guidelines on the Conservation Principles for Coffee Production developed
jointly by the Consumer Choice Council, Conservation International, the
Rainforest Alliance and the Smithsonian Migratory Bird Center. Starbucks served
in an advisory role in the initiative, reflecting the company's commitment to
coffee producing countries.
To implement its Sourcing
Guidelines, Starbucks developed a flexible point system that rewards
performance in sustainable categories. To be considered for the program,
suppliers must first meet Starbucks rigorous green coffee quality standards.
Another difference from NKG's standards is the requirement for financial
transparency and third-party verification.
Suppliers accrue points
based on their ability to meet the sustainability guidelines. Those who earn
100 points become Starbucks Preferred Providers, but as they move toward that
goal, vendors who earn more points can receive higher purchasing preference
when Starbucks purchases green coffee in the market. To help defray vendors' costs
associated with taking steps necessary to meet the sustainable requirements
during a two-year pilot phase, Starbucks has provided premiums of up to ten
cents per pound based on how well a supplier meets the standards.
The guidelines divide the
sustainability principles into three categories: Environmental Impacts, Social Conditions and Economic Issues.
Initiatives within
each category are assigned
point values that comprise the total. For example, the 50 environmental points
can be earned in 10 sub-categories:
§
Soil management --
controlling erosion, enhancing fertility and favoring organic fertilizers,
cover crops, mulch and compost
§
Water reduction --
using methods that minimize water use for coffee processing
§
Clean water --
preventing pollution of surface and ground water
§
Water buffer zone --
creating vegetative buffer zones adjacent to all water sources, with no
alteration to the hydrology of streams or other bodies of water
§
Forest and biodiversity
conservation -- maintaining and enhancing biological diversity on farms and
surrounding areas without disturbing natural forests
§
Use of shade --
maintaining or enhancing canopy cover with diverse tree species that conserve
local and endemic biodiversity
§
Energy use -- using
energy efficiently, employing renewable sources wherever possible and not
relying on firewood obtained from forest clearing
§
Pest management --
employing integrated systems that limit pesticide application to extreme cases
of severe crop loss and substantial economic failure
§
Accepted agrochemical
-- minimizing use of agrochemicals such as chemical pesticides and synthetic
fertilizers, or holding certified organic farm status
§
Waste management --
applying reduction, reuse and recycling, such as composting coffee pulp and
parchment, to minimize environmental impact
The social conditions score
is comprised of the following sub-categories:
§
Wages and benefits --
meeting or exceeding legal requirements, ensuring workers' rights to organize
and negotiate, and conforming to all local laws and international conventions
as well as working toward continual improvement over time
§
Health and safety --
meeting or exceeding applicable health and safety laws and employing effective
measures to ensure health and safety of farm workers who may be exposed to
agrochemicals.
§
Living conditions --
providing workers and seasonal workers with access to potable water, sanitary
facilities, adequate housing, education and training, transportation and health
services
Starbucks economic issues' points are awarded for "economic transparency." This term means the complete documentation of prices paid to suppliers throughout the entire supply chain to ensure that farmers, millers, exporters and importers all benefit from the program. Additionally, while not part of the scoring system, Starbucks includes economic principles of seeking long-term trading relationships with preferred suppliers, and providing incentives and support for sustainable coffee production, processing and shipping methods through ongoing purchasing and pricing policies.
NCA Accepting Agreements Electronically for New Agent Service to Members
In step with evolving
industry requirements, the NCA is offering a new member service to facilitate
compliance with new federal legislation -- to act as U.S. Agent for members
under requirements of the Public Health Security and Bioterrorism Preparedness
and Response Act of 2002 (the Bioterrorism Act).
Beginning on December 12,
2003, facilities that manufacture, process, pack or hold food for consumption in
the United States, unless otherwise exempt, must register their facilities with
the U.S. Food and Drug Administration (FDA) under the new legislation. Foreign
facilities, when registering with the FDA, must designate a U.S. Agent, and the
NCA is offering that service to members to facilitate the process for them.
Members can access all
necessary instructions and execute an Agent Agreement with the NCA online at www.ncausa.org/public/pages/index.cfm?pageid=289. From this page, members can also link to the
appropriate FDA web pages to register their facilities with the government
agency.
For further information, visit the NCA website at www.ncausa.org or call NCA at 212-766-4007.
Coffee Found to Boost Male Fertility
It's common knowledge how
coffee makes us work faster, think clearer and endure longer. But, our favorite
caffeinated pick-me-up has now been found to enhance performance of another
kind -- making men more fertile.
Just a few cups of coffee a
day will not only keep you moving, but revs up the speed of sperm cells,
according to Brazilian scientists at the American Society for Reproductive
Medicine. According to findings, the caffeine in coffee appears to make sperm
cells move faster, potentially increasing the odds of pregnancy. Increasing the
speed at which sperm swim -- or, their "motility" -- could offer a
solution to millions of men who suffer infertility problems.
For the study, Fabio
Pasqualotto and colleagues at the University of Sao Paulo tested the sperm
quality of 750 men, including those who had never drunk coffee before as well
as aficionados. While sperm motion and concentration remained steady, as did
hormone levels, the motility of sperm was significantly higher in patients who
drank coffee compared to those who did not. Since "hyperactivation"
of sperm is, in fact, needed to fertilize an egg, the research team suggested
that compounds with active components found in caffeine may be useful for
treating some infertile men.
The Brazilian researchers assessed coffee-drinking and semen quality in men undergoing vasectomies from January 1999 to September 2002. The study results were presented at a meeting of the American Society for Reproductive Medicine in San Antonio, where the effects of various drugs on male fertility were under review. Compared with other substances examined at the meeting, caffeine appeared to be the only substance that is good for sperm. The study results were published in the latest issue of New Scientists.
Coffee and Colon Cancer: Missing Link Found
For years, scientists have
suspected that coffee may offer some cancer protective properties. A new
discovery appears to have landed the evidence, finding the missing link in an
obscure but potent coffee compound.
German researchers recently
identified a powerful antioxidant in coffee known as methylpyridinium. This
highly active compound was shown to boost the activity in animals of
"Phase II" enzymes, which are widely believed to protect against
colon cancer. The study results appear
in the November 5 2003 issue of the Journal of Agricultural and Food
Chemistry.
Significantly,
methylpyridinium is found almost exclusively in coffee and coffee products. It
is formed during the roasting process from its chemical precursor, trigonellin,
which occurs naturally in coffee beans.
However, study co-leader
Thomas Hoffman, professor and head of the Institute for Food Chemistry at the
University of Munster, says that until human trials are done, it is not known
how much coffee is needed to have a protective effect against colon
cancer.
The study also notes that the stronger the coffee, the more the methylpyridinium. Therefore, darker roasts can contain two to three times more of the anticancer compound than medium roast coffees.
Key Indicators
Retail prices (all sizes/per pound)
|
|
Ground roast |
Instant |
||
|
August '03 |
August '02 |
August '03 |
August
'02 |
|
U.S.
Avg |
2.921 |
2.929 |
12.140 |
12.155 |
|
Northeast |
3.313 |
3.339 |
N/A |
N/A |
|
Midwest |
2.663 |
2.540 |
N/A |
N/A |
|
South |
2.716 |
2.641 |
N/A |
N/A |
|
West |
3.012 |
3.374 |
N/A |
N/A |
Source: U.S.
Bureau of Labor Statistics
|
|
Colombian
Mild Arabicas |
"Other
Mild" Arabicas |
Brazilian
& Other Arabicas |
Robustas |
Composite
Price |
|
March |
61.82 |
61.66 |
43.77 |
38.26 |
49.61 |
|
April |
66.12 |
65.35 |
48.71 |
38.68 |
51.87 |
|
May |
67.56 |
66.47 |
51.06 |
38.90 |
53.19 |
|
June |
65.01 |
61.34 |
47.11 |
35.33 |
48.90 |
|
July |
67.84 |
62.32 |
49.64 |
36.71 |
50.89 |
|
August |
68.65 |
63.60 |
52.88 |
37.92 |
52.22 |
The Coffee
Reporter
is published monthly by the
National Coffee Association
of U.S.A., Inc.
15 Maiden Lane, Suite 1405
New York, NY 10038
© Copyright 2003 NCA
Telephone:
(212) 766-4007
Facsimile: (212) 766-5815
www.ncausa.org
info@ncausa.org
Chairwoman: Mary J. Williams
President & CEO: Robert
F. Nelson
Editor: Joe DeRupo