Starting off the four days of meetings was the Fats and Proteins Research Foundation (FPRF), where it was announced that the Clemson University Board of Curators had just approved the Animal Co-products Research and Education Center (ACREC) agreement. The three-year program will provide an exclusive but inclusive research and education process for the rendering industry, with nine inaugural projects already funded. A dedication of the center will take place in late March 2006.
Another milestone at the FPRF meeting was the decision to accept the NRA’s proposal to manage the administrative functions of the foundation. While the search continues for a new FPRF president following the retirement of Dr. Gary Pearl, who served in the position for 12 years, the transition will take some time as both groups work to ensure the foundation continues to operate as a separate entity. It was also decided to investigate into reclassifying FPRF as a non-profit organization under Internal Revenue Code Section 501(c)(3). Currently, FPRF is registered as a non-profit under Section 501(c)(6), a category not entirely suitable for the scientific foundation because it does not partake in lobbying activities.
Along with the research projects at ACREC, FPRF has 18 current projects being conducted outside of Clemson relating primarily to animal nutrition, with the exception of dairy, and biodiesel. Pearl received several comments on the absence of the foundation’s Emerging Issues and Opportunities Seminar this year.
“I think the industry is missing an opportunity to hear from the people who are actually doing the research,” he commented. There was some discussion on how to re-incorporate the seminar into the meeting schedule but no decision was made on future dates.
Although the past year’s contributions to FPRF exceeded $500,000 for the first time in 13 years, much more financial support will be needed in the years ahead to help fund future projects, especially those at Clemson.
“The research side [of the industry] is extremely helpful to us in terms of getting through some of the challenges we have right now,” said FPRF Chairman Ross Hamilton. “Research is one of our lifelines we need to take very seriously.” He pleaded with current contributors to reevaluate and increase their current donations, and encouraged others to provide financial support to the foundation. Contributions to FPRF are tax deductible and a benefit of establishing the ACREC is the opportunity to receive government grants.
The Animal Protein Producers Industry (APPI) jumped into their meeting with a discussion and vote on a proposal that APPI become a standing committee of NRA. One member voiced his concern that, “we will be losing more than we’re gaining” by merging with NRA. Yet another member spoke that the merger will make APPI stronger as a single voice within NRA. While non-NRA members of APPI will be encouraged to join NRA by being given a discount on NRA membership dues for up to two years, APPI members do not have to join NRA to participate in APPI testing and education programs. A ballot vote was taken with overwhelming, but not unanimous, approval for the merger.
APPI President Dr. David Meeker recapped the Institute of Continuing Education program activities, which included sessions at three different locations throughout the United States. One of the sessions was videotaped and will be edited down to a three-hour training video available for purchase. APPI is also reissuing the Salmonella Reduction Education Program kit that includes a training video, posters, pamphlets, and other training materials. The kit is available to purchase for $150 plus shipping. In addition, the group is re-releasing on DVD two previous videos – one that focuses on Salmonella reduction and another that demonstrates a model plant.
The second day began with NRA committee meetings, starting with the Communications Committee where Meeker submitted a proposal for an updated industry book. The last book, The Original Recyclers, was published in 1996. The committee voted to allocate funds and Meeker will contact potential authors. Anticipated release is October 2006.
The Environmental Committee tackled such issues as dioxin and the Environmental Protection Agency (EPA) Spill Prevention Control and Countermeasure rule (see “Tech Topics” in the August 2005 Render), which the industry is still awaiting a guidance document from EPA. Receiving much discussion was the subject of rendering horses. Legislation has been introduced in the last few Congresses that would prohibit the slaughter of horses for human consumption. Also, funding has ceased for U.S. Department of Agriculture (USDA) inspection at U.S. horse slaughter plants for fiscal year 2006. These two actions have raised concerns that there would be no outlet for unwanted horses thus increasing the collection and rendering of horses. The NRA took no position on legislation preventing horse slaughter, acceptable euthanasia methods, or recommendations on rendering of horses.
Frustrations Flare
Perhaps the largest crowd all week gathered for the Transmissible Spongiform Encephalopathy (TSE) Committee meeting, where the recently released Food and Drug Administration (FDA) proposed feed rule (see article on page 14) was discussed in length. Committee Chairman Mark Myers, National By-Products, LLC, was the first to speak up.
“In my opinion, if this rule is implemented, it would be devastating to our industry,” he stated. “It would be a huge economic impact not only to our industry but to the small packers throughout the United States.”
In preparing a response to the proposed rule, Informa Economics is surveying NRA members and will provide a compilation of statistics to NRA, keeping all company responses confidential. Myers pointed out that under the proposed rule, compliance rests with the industry.
“We will become the policemen with this proposed rule,” he commented. “How are we going to prove that we did what we say we’re doing? That is going to be extremely difficult.”
David Evans, Evans Associates, who was the TSE Committee chairman when the first feed ban rule was proposed in 1996, feels there will be a rule and the most important thing is the language in the rule. Dennis Griffin, Griffin Industries, reminded attendees that FDA does not control animal disposal, but that EPA does.
“If this rule is put in, FDA has absolutely no responsibility for enforcement of disposal,” he remarked. “There are no requirements [in the proposed rule] for any of our suppliers we pick up products from or any of the places that we sell feed, they are not required one iota of recordkeeping. They have selected our industry as the policemen of this whole issue and I think that’s a very heavy load for our industry to bear. We could wind up being the culprits real quick.
“If there is ever one time over the last 40 years I’ve been in the business that we should be united as one group, and speak with one voice, this is the situation,” Griffin continued. “This is a major, major crossroad that our industry is facing with absolutely no scientific evidence to change this feed rule.” He pointed out that in perhaps another two years there will be few, if any, animals left that are older than the feed rule has been in place.
Some renderers believe the industry needs to provide FDA with the solution.
“If they’re going to allow product from animals under 30 months of age, how do you know if it’s an animal under 30 or over 30?” asked Michael Langenhorst, Sanimax. “How do you know if it’s from dead stock or a healthy animal? It’s totally impossible. You bring these types of situations to light, they cannot refute it.”
“They make the assumption that the only threat, from a BSE perspective, is feed and therefore, meat and bone meal is the risk when in fact it’s the animal who has the disease that’s the risk,” said Ross Hamilton, Darling International. “I think we do have to give them the solution.”
Doug Ward, Argent Group Europe, United Kingdom, shared that European regulations require spinal cord removal of bovines over 24 months of age under veterinary supervision at the slaughterhouse. He stated that the only effective way to ensure the spinal cord is removed is to make the vertebral column a specified risk material (SRM).
Humphry Koch, West Coast Reduction, Canada, pointed out there are dramatic differences between the Canadian Food Inspection Agency (CFIA) and FDA feed ban proposals. CFIA’s proposal that came out earlier this year includes:
• removing, processing, and destroying SRMs from cattle under 30 months of age;
• classifying dead stock as SRMs regardless of the ability to remove spinal cords and brains; and
• requiring dedicated lines for ruminant and non-ruminant species as well as SRMs.
“We continue to press for harmonization [between Canada and the United States],” said Koch. The hope is that CFIA will hold off finalizing their proposal until FDA finalizes their rule.
In the Legislative Committee, Griffin commented that he is starting to see small farm-level biodiesel plants being built and selling the alternative fuel that does not meet American Society of Testing and Materials (ASTM) specifications, yet the plant is receiving tax credits. He would like to see legislation that ensures biodiesel meets ASTM standards before receiving a tax credit to help preserve the integrity of the biodiesel industry.
Convention Gets Underway
The 72nd Annual Convention got underway in the afternoon with Hamilton presenting an update on FPRF activities. He announced that the foundation approved a project in Chile that is considered “cutting edge research,” using animal proteins as a source of nucleotides (DNA/RNA) for the developing fish gut. Carl Wintzer followed by informing attendees on APPI events, such as the Salmonella reduction program that continues to show a low incidence among samples taken at the press.
NRA Chairman Doug Anderson presented the state of the rendering industry (see “Association” on page 16) and agricultural speaker Mark Pearson provided an animated and humorous keynote address. He said that since “mad cow disease” was not mad “sow” disease the world meat market has increased their usage of hogs, causing prices to escalate. Pearson added that the consumer helped change the hog market because of their desire for quality, convenient products and stated that the media is crisis motivated. He also predicted a great future for the rendering industry.
“You’re a pretty bright group, and you have a tremendous history,” Pearson commented. “I think the industry can survive regulatory changes. I think the opportunities are there and you have to capitalize on that.”
The third day opened with a large audience eager to hear about bioenergy, beginning with Dr. Roger Conway, USDA Department of Energy Policy and New Uses, who said that relief from high energy prices is two to five years away. He commented that the Commodity Credit Corporation program funding has decreased over the past few years due to budget constraints and new tax credits now available. Conway agreed that biodiesel quality is an issue within the credit programs and that USDA is working with the National Biodiesel Board on ways to ensure that biodiesel receiving credits and incentives meets ASTM standards.
Langenhorst and Steve Kopperud, Policy Directions, took turns discussing the future of bioenergy for renderers. In 2005, an estimated 40 million gallons of biodiesel was produced in the United States compared to 650 million gallons produced in Europe. Langenhorst credited the large production in Europe to financial incentives. For instance, in Germany, the incentive is $2.26 per gallon; in the United States, the tax incentive is $1.00 per gallon. Langenhorst reminded attendees to not forget about state programs that also encourage biodiesel use.
Environmental issues these days are very complex and come at a cost, so said Jon Scholl, counselor to the administrator for Agricultural Policy, EPA. He said there is an emphasis at the agency on utilizing environmental management systems to help identify potential environmental problems.
California State Veterinarian Dr. Richard Breitmeyer shared some tidbits about the country’s top agricultural state for more than 50 years: California boasts over 350 commodities; the state produces 23 percent of the U.S. milk supply; and livestock coexists with 35 million people. He stated that the philosophy within the California Department of Food and Agriculture (CDFA) is that laws and regulations should be the last resort, and encouraged renderers to tell their story.
“You provide very valuable services to both animal agriculture and the public, and in my opinion, you do a great job of protecting both public health and animal health,” Breitmeyer commented. “But you’re largely invisible to the general public, to most legislators, to most policymakers, to many agencies, and the only time anybody knows anything about you is when somebody encroaches upon you and starts complaining about land use and odors and you’re seen in a negative light instead of the positive light you really should be.
“In California, we’ve been very pleased and very blessed with very progressive and positive leadership from your industry,” he continued. “We’ve had a great relationship with many of the [rendering] companies in our state. I think part of that is we’ve really worked hard on both sides to have very open and regular communication directly with industry representatives.” Breitmeyer credited 95 percent of the samples collected in California for the USDA BSE enhanced surveillance program to the rendering industry and said the CDFA will be responding to the latest FDA proposed feed rule.
“A very important issue, in my opinion, if this does go through, is we will be looking at a carcass disposal crisis in California and probably many other areas as well,” Breitmeyer stated. “And I don’t think our environmental protection agencies or public health agencies are aware of this impending crisis and it is important for us to make sure they are aware of this.” In California, it is illegal to compost any animal except poultry, and most of the state’s counties prohibit animal burial. He added that although the science of FDA’s intentions is hard to argue, “at the same time, we have really got to be careful we don’t trade one relatively small risk for one huge intended consequence of a carcass disposal crisis.” Breitmeyer concluded that good statistics are needed to respond to the proposed rule.
Dr. Chuck Lambert, USDA deputy under secretary, Marketing and Regulatory Programs, thanked renderers for their participation in the BSE enhanced surveillance program, which he said could not have been accomplished without the industry’s support, and stated that the feed ban implemented in 1997 has been very effective. He explained some of the trade issues the USDA is battling, which includes Indonesia’s desire to purchase meat and bone meal, but has concerns about removing SRMs, and China’s resistance to import non-ruminant protein products and tallow that meets international standards. Taking advantage of Lambert’s presence, many renderers pelted him with questions and comments amid their frustration at the latest FDA proposed feed rule. He said that although USDA has not taken a position on the proposal at this time, the agency plans to take the BSE enhanced surveillance program data and rerun the Harvard Center for Risk Analysis study model, which most feel will show an even lower risk of BSE in the United States than the study previously validated.
The World Over
After an enlightening luncheon with Bob Cashell, mayor of Reno, NV, sharing his gambling recommendations, the international arena took center stage. Paul Stenzel, president, Australian Renderers Association, discussed the “smallish” Australian rendering industry that processes 2.5 million tons of raw material into 1.2 million tons of finished product. He commented that one major battle currently being fought by the cattle industry down under is a rule put in place seven years ago that allows removal of all beef products from store shelves if BSE is ever discovered in Australia. Another conflict Stenzel addressed is the European Food Safety Authority’s consideration that the Australian rendering process is unstable because SRMs are not removed, even though the country has not had a case of BSE. The biodiesel industry in Australia is heating up, thanks to excise tax relief, and if the dozen or so plants currently under consideration are built, Stenzel predicted that Australia might have to import tallow to meet the demand for its use in biodiesel production. He said that going forward, the industry needs to reestablish its meat and bone meal markets and educate customers on the value of rendered products.
“There is nothing wrong with meat and bone meal,” Stenzel stated.
Europe was the focus next, with Niels Leth Nielson, president, European Fat Processors and Renderers Association, explaining that the number of new BSE cases in the European Union (EU) continues to decline: in 2001, there were 2,167 new cases within the EU-15 countries; in 2004, that number dropped to 825 cases within the EU-25 countries.
Kent Swisher addressed the importance of exports, which have declined since the discovery of BSE in the United States in December 2003. He said the NRA international staff is working hard at re-opening markets to non-ruminant proteins, animal fats, and greases. According to Dr. Yu Yu, NRA director for Asia, there is an opportunity for protein use in aquaculture as a replacement for fish meal. Ninety percent of the global aquaculture production is in Asia. Yu stated that 1.7 million metric tons of fish meal was used in China in 2005, which was a record usage, and the projection is for an increase in usage in 2006, even though the production of fish meal in China is expected to drop.
The International Market Development Committee met on the final morning of the convention, beginning with the announcement that the committee is presently operating under a tighter budget due to decreased funding of the government’s Market Access Program and Foreign Market Development program. However, once Congress approves and the president signs a budget, the funding may increase.
The NRA Board of Directors took their meeting out on the water of Lake Las Vegas aboard the La Contessa yacht, thanks to Diversified Laboratories’ sponsorship of the event. But the beautiful scenery didn’t deter board members from taking care of business, including the changing of leadership. Doug Anderson, Smithfield Foods, happily passed the chairman gavel to David Kaluzny II, Kaluzny Bros., Inc., who will serve as NRA chairman for the next two years. Stepping into the role of first vice chairman is Mike Reiser, Valley Proteins, Inc., and elected as second vice chairman was Michael P. Koewler, Sacramento Rendering Company.
The NRA 73rd Annual Convention is scheduled for October 24-28, 2006, in Laguna Niguel, CA.
December 2005 Render