Add Us to the List…..Sigh
This morning we checked the FDA web site as we have been doing several times every day. We discovered that one of our suppliers, who had previously confirmed that they had no product from the PCA plant in Blakely, did in fact buy peanuts that originated in the PCA Texas plant. One of those products, milk chocolate covered peanuts, is an item that we buy and then sell from behind the candy counter in our two retail stores here in Grand Rapids. (We don't sell this item in any other way.)
Thankfully, there are no reports of illness associated with this item, which was distributed nationally by our supplier to many retailers. The manufacturer's press release also says that the product and their plant tested negative.
So add us to the ever-growing list of folks forced to call back products. As soon as the FDA gets our information up on their website, I'll plug in a link to both our notice and to that of our supplier.
My Post From the Daily Kos
My wife suggested I put some of my thoughts about the peanut recall on Daily Kos. The text of my post follows. There were a number of interesting and helpful comments, several of which I responded to. I hope to copy some of the comments and my responses over to this blog later today.
One long month in the peanut butter business from an insider:
Last month I was trying to sell peanut butter at the San Francisco Fancy Food Show when people started showing up at my booth and asking me if my peanut butter contained salmonella. This was not a good way to find out about a recall. Since we do all of our own roasting from raw peanuts, I knew our peanut butter wasn't affected by the recall. So I wasn't terribly concerned.
I then got a couple worried phone calls from our staff back at the office in Grand Rapids. Customers are calling. They want to know if our peanut butter is "safe." Safe is a hard word. Yes, our peanut butter is safe as in "he is a safe driver -- he's never had an accident, doesn't drink, drives a Volvo, doesn't speed." And we haven't had a problem in our 80 years of making peanut butter. But safe as in "100% guaranteed safe absolutely no risk under any circumstances" -- as the mother of a child with a chemotherapy-impaired immune system asked us -- no. There is no responsible food manufacturer who can say that.
Back home from the food show, I watched this recall unfold like a slow-motion train wreck. While our peanut butter wasn't affected, we needed to check our purchasing records for our retail stores. A couple of our suppliers issued recalls on some products, but nothing we had purchased. One bullet dodged. But we are still watching the FDA Recall List like a hawk.
We put a little notice up on our web site indicating that we weren't affected by the recall, and put ourselves on the primary list of unaffected products. We assured our wholesale customers that we were unaffected.
I next scheduled a series of small group meetings with all of our employees to talk about the recall, our responses, and to re-emphasize how important our sanitation and personal hygiene rules are. I am fond of saying about business problems "lighten up a bit, nobody is going to die." In the case of sanitation, that's not so.
I also told our employees that for a couple weeks every inspector in the nation was going to be tied up chasing down all the recalled products. Once that was over, we could expect the FDA to show up.
For the next two weeks I spent most of my time on line following the reporting as carefully as I could. This wasn't rubber-necking, but an attempt to figure out exactly what had happened at the PCA facility. In the case of the Peter Pan recall in 2007 the explanation given for the salmonella contamination was a roof leak. Fine. Keep the roof from leaking -- we're on it.
But now we had a second recall in two years. Had something changed in the peanut supply chain -- practices in the peanut fields, in the shelling process, in the heat resistance of salmonella? -- that meant that industry practices which had previously prevented illness were no longer effective? Was general nastiness in the PCA plant enough to explain to their problems? (Maybe, but I have my doubts.) If it is general nastiness, why was the FDA considering moving peanut butter to the "high risk"category? Political cover? Or do they share some of my questions?
On February 5th we shut down our nut roasting, confectionery, and peanut butter lines for our annual preventative maintenance period in which we really tear apart the equipment. Since we would be shut down for a couple weeks at least, I decided this was time to review all of our practices to see if we had holes in the safety net. In addition to a complete internal review, I have hired a sanitation expert from the largest food safety consulting company to come and review our practices as well.
Last Thursday (2/12) I was just finishing up a conversation along these lines and informing my senior managers of our plans when there was a knock at the conference room door. "Jeff, the FDA is here." Even though I was expecting this, I felt like I'd been called to the principal's office.
I met the inspector at the door with my production manager. The inspector showed his ID and badge (yes, they have badges, just like the police), and we went to a conference room. He explained that we were due for our annual inspection and that today was the day because his supervisor had picked us out and moved us up the list. The initial concern was that we had covered all the bases in checking to be sure we had not purchased or sold any recalled items. But in asking questions our inspector realized that we actually made peanut butter ourselves. After an hour or so of additional background questions on the company, products, distribution, and such matters, it was time to do the walk through the facility looking for Good Manufacturing Practice violations. We gave him everything he asked for, and answered his questions forthrightly.
That took another hour (it would have been longer had we been operating). The inspector left for lunch and checked with his office for additional guidance. The main issue was whether to return and take environmental swabs for testing, and whether to pull product samples for microbiological testing. Since we were shut down and hadn't run for a week, the decision was no. We will, as a courtesy, inform them of our next few peanut butter runs should they desire to inspect. We haven't received the written report of the visit yet, but I expect it will be clean, just as our last nine annual inspections have been.
A long story. What's the point? Much political energy is being put into reform proposals. But the rubber hits the road when an individual inspector walks into a particular plant. In our case, that is for 3 or 4 hours, once a year. The other 364 days it is up to me and my employees, working on food safety issues as I've tried to work through this one.
Is that a problem? In PCA's case, yes. But would an additional annual inspection have prevented it? Two more inspections? Three? Would combining USDA's food regulation authority with the FDA's have prevented this? How, exactly? Would having federal inspectors replace state inspectors help? The inspector who called on us had worked for the State of Michigan for years before moving to the FDA. Would some enhanced ability to trace food help? Only after the fact, when it is too late. HACCP plans for all food manufacturers? PCA had one. How about reporting all salmonella and other microbial tests to the FDA? How many people would it take to police and follow up on millions of tests conducted by hundreds of labs, and by companies in house?
I'm OK with all of the above, and with having my taxes raised to pay for it all. But the safety of our food is still going to depend on ordinary people struggling to do the right thing every day.
What a Time to Be Selling PB
We're in the home stretch of getting ready for two trade shows. Because of the peanut butter and peanut recall I'm hopelessly behind, but we'll get there.
On the 28th of this month we leave for Japan to sell our Cream-Nut Natural Peanut Butter and our Sweet Ella's Organic Peanut Butter at a trade show in Tokyo.
I fly directly from there to the Natural Products Expo West in Anaheim to formally roll out Sweet Ella's. This will include a special appearance by Sweet Ella herself. My daughter.
As soon as I teach myself how to handle photos in WordPress I'll put up some shots of everything that went into building our booth for the expo.
But what a time to hit new markets with a peanut product.
Peanut Corporation of America and the Ruin of Being the Low Cost Provider
This is not a defense of PCA or Mr. Parnell. But from the public coverage I can see exactly how he put himself in a box where shipping bad product might have seemed like a risk worth taking.
The peanut business has been brutally competitive on a price basis for 30 years. A penny a pound in price can make the difference between keeping business and losing it. So PCA bought peanuts cheap and produced cheap. Part of the produce cheap was, it appears, skimping on training, wages, sanitation, and plant maintenance. The other part was getting raw peanuts in the door and finished product out as fast as possible so as to keep inventory low and cash flow strong.
Everything goes fine for quite awhile. PCA makes money and grows rapidly. Then they get a positive salmonella test in the summer of 2006. At this moment, PCA was effectively out of business. Here's why: to deal correctly with that test, given the conditions cited by the FDA at their plant, the plant had to be shut down, essentially be renovated, and then all the equipment cleaned from top to bottom, inside and out.
This is a huge job. It would take a month or two, minimum. During that time, all of PCA's customers, used to fast turn around on orders and cheap prices, are long gone. Could they shift to the Texas plant? Probably not, given conditions, but especially given freight costs.
PCA was running with no room for error -- and errors in business are inevitable.
PCA was finished when that 2006 test came back -- or at least in deep trouble. But that is a hard thing to admit. Maybe a retest -- we've never had a problem before, and labs aren't perfect. The rationalizing begins, and is repeated, becoming habit. PCA keeps digging the hole deeper, like a hooked gambler, until they are busted. Busted financially, busted legally, and busted ethically.
What Actually Happened at PCA?
A long and completely speculative post concerning a situation about which we are never likely to learn the full story:
I remain a bit skeptical that just general dirty conditions could account for the amount of salmonella-tainted product found coming out of the Georgia plant. This is because in most cases nut production lines are largely closed to environmental contamination and because the first step in the process -- roasting at high temperature -- basically sterilizes the nuts. So the plant can be dirty, but "inside" the process, you have a continuous flow of "clean" material.
Never having been in the PCA facility, and not having seen their product flow, I'm talking through my hat, but I think that some of their internal practices spread contamination around and made the problem much worse.
The most obvious examples are the tests from 1/24/08 and 1/25/08, and the test from 9/24/08 and 9/26/08. In those cases, there was a positive test on granulated nuts, followed by a positive test on peanut paste. When you granulate nuts the nuts are passed through screens to separate the pieces based on size. You are left with too big, too small, and just right. One wouldn't want to waste the too big or too small -- they would go right into the peanut butter or peanut paste lines. One could also appropriately and routinely move product from the peanut paste line to the peanut butter line. So, once PCA had a positive result on granulated nuts, the contamination could easily be spread to other lines in the ordinary course of business.
So, if the granulated nuts were the source of at least some of the positive tests for peanut paste, and perhaps for peanut butter, how did they get contaminated?
Poor storage of roasted nuts in a generally nasty environment could do it, but I can think of a couple of other ways.
One would be "totes." Totes for raw peanuts are big sacks that hold 2000 pounds of nuts. When we move nuts from our oil roasting to our packaging equipment, we use very expensive covered stainless steel totes. But if one really wanted to save money, one could perhaps re-use fabric totes that had previously been used to hold raw product.
Another way would be processing contaminated roasted peanuts purchased by PCA from another source. According to some press accounts, PCA was always looking for a deal on raw peanuts. But it is also possible to buy roasted peanuts. And to find them on a deal. So, were I the FDA, I'd want to trace back upstream from PCA to see what I could find.
Finally, I thought of floor scrap. It is almost impossible, when granulating, to keep nuts from flying all over the place. Once they hit the floor, they should go straight into the trash. But an inspector would have to get awfully lucky to catch someone sweeping them up and dumping them back into the process.
None of these possibilities, of course, are mutually exclusive.
It’s A Wonderful Life
Watching the former employees come forward in the PCA disaster, I can imagine one of them saying to Mr. Parnell:
Do you realize what this means? It means bankruptcy and scandal and prison. That's what it means. One of us is going to jail - well, it's not gonna be me.
Very Cool, But Also Horrifying, Chart from the FDA.
This chart of where PCA product went is amazing. Note that this is the "simplified" chart.
Here We Go Again?
Officials in Colorado claim to have tied some of their salmonella cases to PCA's Texas plant, reports the Oregonian.
The source was "grind it yourself" peanut butter from a health food store.
(Don't get me started on these in-store grinders, but if a food company of Kellogg's sophistication has a hard time checking up on suppliers, imagine how good your local health food store is about checking up on theirs. The same goes, in my mind, for all the bulk bins. Not to mention the "Who used this last?" issue. I say yuck.)
At least everybody who uses peanuts has their supplier lists already on their desks, so the cascade of downstream recalls will go faster.
Cocoa, Sugar Prices Soaring
From the February 13, 2009 Wall Street Journal:
While prices for many commodities have fallen, a supply shortage caused in part by crop diseases in Ivory Coast and Ghana sent cocoa up 38% from its lows in November, to $2,644 a metric ton on Thursday. The price of sugar, another raw material, is up 23% since October to 13.13 cents a pound, the result of a smaller-than expected crop in India, the No. 2 producer after Brazil.
The International Cocoa Organization predicts that supply will fall faster than demand in the global cocoa market, which is likely to push prices still higher. Chocolate makers usually buy cocoa butter, cocoa liquor or powder from processors, who purchase cocoa beans at market prices and tend to quickly pass on the price moves.
Cocoa surged 65% in the first half of 2008, to a 28-year high of $3,360 a ton on July 1, before falling back and then climbing again.
In a deflationary enviroment it is tough to be in a business where costs are still shooting up.
Two Meanings of Safe Food
Surfing around the internet, I see several links to lists of "safe" peanut products. And we've seen food companies rush to label their peanut butter as "safe." But I think there are two different meanings to that word.
One meaning is 100% guaranteed, no risk whatsoever "safe."
The other meaning I'll illustrate with a little story. Imagine that you are going to hire somebody to drive your elderly parents and their grandchildren -- your children -- to Florida. You want a safe driver. You find a friend who is willing. You have ridden in the car with this friend many times. She has always driven very cautiously. Your friend has never had a ticket. Your friend has a very safe car which is well-maintained. Your friend doesn't drink. Your friend is unaware of any medical conditions that could cause trouble while driving. Anyway, you get the idea -- your friend is a "safe" driver.
So you ask your friend -- Will you guarantee me 100% that you won't get in an accident on the drive to Florida? Of course, the answer to that question is no.
I think most of our food meets the "safe driver" definition of safe. (Not enough, but the overwhelming majority.)
I don't think any of our food meets the 100% no risk definition. Never has. Never will.