Packaging-free grocery store opens in Austin, Texas

With excessive packaging increasingly coming under fire, is it any wonder that one ingenious store decided to do away with it altogether?

While recycling certainly plays a part in reducing packaging waste, a vast amount of potentially recyclable material still ends up as landfill, and newer sustainable and bio-degradable packaging options are not an immediate solution, still requiring significant energy to produce.

In the US, up to 40% of the cost of food can be attributed to the packaging alone and whilst previous generations often cleaned their purchased containers and re-used them (remember your grandmother’s cupboard of old vegemite and jam jars?) most modern packaging is intended to be single-use and disposable.

These concerns have led many eco-minded consumers to embrace stores that allow for bulk-bin buying options of staples such as grains, nuts, fruit etc, though these are still often accompanied by rolls of plastic bags.  Some stores have recognised this as an issue and have adopted strict paper-bag only policies.

But now a grocery store in Austin, Texas has gone one step further and removed any kind of packaging from their entire range of products.

in.gredients aims to promote sustainability on all levels by providing pure food that is packaging-free.

The store is made up mostly of bulk bins containing staples such as rice, beans, flour, cereals, spices, nuts, coffee, tea and the like, whilst bulk vats dispense honey, maple syrup, oil, tamari and even dishwashing liquid.  Other options like meat, eggs and fruit are kept refrigerated and are all local and organic.

Store manager Brian Nunnery calls in.gredients a “grocery store in scope, but a convenience store in scale”.

"We have everything, but only one brand of most things, not 50 brands of each item like a conventional store."

Shoppers are required to bring their own containers, ensuring that the message of sustainability is carried into customers everyday lives and they become aware of what can be re-used.

Looks like grandma’s old jam jars could start coming in handy if this trend catches on.

Photo by John Anderson

Senate sets sights on supermarket duopoly; Xenophon demands more

The recently released Senate Select Committee report examining Australia’s food processing sector has made 35 key recommendations as to how the industry can be improved and made more sustainable.

However, some senators felt that the recommendations did not go far enough, with a minority report making a further three recommendations.

These additional recommendations included rejecting calls for further review of the Fair Work Act, encouraging food processing industry employers to use existing FWA mechanisms and calling on the Federal government to increase dialogue within the sector around opportunities and obligations arising from the carbon tax.

Considering widespread concerns as to how the carbon tax will impact prices along the supply chain, the committee’s report recommended the government monitor how these costs are being passed down the food supply chain and the impact the tax is having on profitability of businesses in the chain, including to farmgate.

Outspoken Independent Senator Nick Xenophon submitted his own dissenting report which makes a further 10 recommendations, calling for stronger consumer and competition laws in order to better monitor and control any potentially anti-competitive conduct by Coles and Woolworths.

“The federal government must move to make a fairer operating environment for Australian food processors and priority consideration needs to be given to the divestiture of the grocery retail market.

“Australia’s current regulatory regime has made it too easy for the Coles and Woolworths duopoly to profit at the expense of producers and consumers.

“To that extent producers must be protected by effective laws against unfair contract terms and unconscionable conduct.”

The Select Committee has recommended that the major Australian supermarkets establish a voluntary set of benchmarks to measure and improve satisfaction of suppliers in dealing with the supermarkets and that these be incorporated within their corporate social responsibility policies.

Read more at Stock & Land

Coca-Cola Amatil spending $46 million to re-enter beer market

Coca-Cola Amatil (CCA) has confirmed it will be re-entering the Australian beer market with a $46 million investment in the Australian Beer Company.

The money, which the beverage giant is lending to the Australian Beer Company, will be used in the acquisition of a state-of-the-art brewery in Griffith, New South Wales, according to an Australian Stock Exchange (ASX) announcment today.

The facility to be acquired by the Australian Beer Company, which is a part of the Casella group, has an annual capacity of 500 000 hectolitres.

Currently, CCA cannot sell, distribute or manufacture beer in Australia until 16 December 2013.

The Australian Beer Company will also refrain from such activities until that date.

After the restraint against CCA expires, the loan will convert into a joint venture equity interest in the Australian Beer Company which will see the Australian Beer Company manufacturing premium beer and developing new brands, while CCA will be solely responsible for the sales, distribution and development and management of customer relationships.

CCA Group Managing Director, Terry Davis said the investment will be a good way for the company to be part of the beer sector again.

“This new agreement with Casella will give CCA the opportunity to access a world class, low cost brewery which will enable us to re-enter the premium beer market in Australia after 16 December 2013 with sufficient initial manufacturing capacity to cater to approximately 15 per cent of the beer market in Australia.”

Man killed at Perth packaging factory

A man was killed at a packaging factory in Perth when he got caught in a robotoc pallet loader.

The incident, which occurred at the Richgro Garden Products factory in Jandakot, in Perth’s south on Saturday, is being investigated by WorkSafe.

No further information on the incident or the deceased is currently available.

Heineken wins control of Tiger for US$4.5bn

Heineken has won the controlling stake in Tiger beer, buying out Fraser and Neave’s shares for US$4.5 billion.

The Dutch beer company raised its offer price for the 40 per cent share in Asia Pacific Investment Pte Ltd (APIPL) from 50 Singaporean dollars per share up to 53.

The offer was dependant on a vote by shareholders of Singapore-based Fraser and Neave’s, and on Saturday it confirmed it had accepted the offer.

APIPL is a joint venture between Heineken and Fraser and Neave which operates Asia Pacific Breweries (APB).

In addition to the Tiger brand, APB range also includes popular Asian brands Anchor beer, Baron's Strong Brew, ABC Extra Stout, Archipelago beer and Bintang beer.

Heineken's chief executive, Jean-François van Boxmeer, said in a statement that the operations will stay largely the same.

"Our Asian headquarters will continue to be based in Singapore, and we remain 100% committed to the growth and success of APB and the Tiger brand,” he said in a statement.

If the offer is officially approved, Heineken will have a stake of more than 80 per cent in APB, leading to automatic takeover offer for the remaining shares, which would cost the company another 2.5 billion Singaporean dollars.

As part of the deal, Fraser and Neave has confirmed it will not "solicit, engage in discussions or accept any alternative offer or proposal" for its interests in APB, a clause which refers to a rival bid from the family of Thai billionaire Charoen Sirivadhanabhakdi.

Charoen, who controls Thai Beverage (ThaiBev), South East Asia's second biggest brewer, made a 55 Singapore dollar per share offer for a smaller stake in APB.

ThaiBev is Fraser and Neave's biggest shareholder with a 26.4 per cent stake, meaning it will play an important role in the upcoming shareholder vote.

Dick Smith only wanted controversy: News Ltd

News Limited has offered its perspective on debate over its decision not to include marketing material from Australian entrepreneur Dick Smith in its papers.

David Penburthy writes for The Punch:

“When you walk into the Commonwealth Bank you don’t see advertisements on the walls attacking banks for paying obscene salaries to their executives. McDonalds would refuse to place banners outside its stores stating that Big Macs are rubbish and the Whopper is a superior burger. In a similar vein, News Limited, the publisher of this website, has taken the unremarkable commercial decision not to use its products as a vehicle to trash its reputation.

The person in question is Dick Smith and the material is a 28-page magazine he has written called Dick Smith’s Magazine of Forbidden Ideas That You Won’t Read About in the Mainstream Media.

As a businessman, Smith has harnessed the concept of martyrdom – be it real or imagined – as his preferred marketing technique. He has made millions presenting himself as a nuggetty Aussie battler taking on the big guys, despite being bigger than most in Australian business.

ndeed some of his wealth has come from pinching market share from local businesses, such as the family-owned preserves producer Beerenberg,whose boss said last month that it was struggling to sell its productsbecause of Smith’s posturing as one of the only patriots in the field of jam production.

In a way, the last thing Smith would have wanted was to have his magazine inserted in News Limited publications, as it would undermine his claim of persecution as the basis for making profits. The magazine is so totally out there that it seems he deliberately went overboard to ensure it wouldn’t be carried as an advertisement, as it is filled with conspiracy theories involving Rupert Murdoch’s American citizenship, this company’s (non-existent) refusal to run pieces calling for a smaller Australian population, our alleged bias against climate science, our supposed determination to attack Smith for using patriotism to make money.

Even the independent website Crikey, hardly a friend of News Limited, rana piece by former Media Watch producer David Salter saying it was “not surprising” that News refused to run the insert, and attacking its content as the work of an “egomaniac” falsely claiming a conspiracy.

I would not be so disrespectful as to call Mr Smith an egomaniac, even though, as Crikey points out, there are 29 photos of him in his 28-page insert. He is certainly a conspiracy theorist and his theories do not pass muster.

Smith’s obsession with News Limited is so acute that he misrepresents both our general conduct and our specific treatment of him. A few years ago I heard him on ABC Radio after the Victorian bushfires saying News Limited had never given a cent to charity. I rang the station and asked (fruitlessly) to go on air to point out that in the previous week News donated $1 million to Victoria. I could fill the rest of this column with similar examples, be it families who made the news for tragic reasons, cultural bequests for the arts, money for our State Library, the Pride of Australia awards for unsung community heroes.”

Read the full article at The Punch.

What do you make of the controversy between Dick Smith and News Limited? Who is in the wrong here?

Four’N Twenty expands product range to combat market pressure

Iconic Aussie pie maker Four’N Twenty is diversifying its product range, as the pressure of the supermarket price wars increases and food manufacturing jobs continue to be lost.

Four’N Twenty’s parent brand Patties Foods said last month that the ever-increasing number of private label products in supermarkets will damage the business.

To that end, the company has researched and identified some key areas in need of a breath of fresh air, and have launched products to fill one already.

The Four’N Twenty Brekky Wraps, which will be available at convenience stores nationally, fill a significant gap in the market, according to the company.

“Consumer research shows there was no real breakfast solution in the petrol and convenience market, and Four’N Twenty Brekky Wraps score highly on overall appeal, convenience and purchasing intent,” the company said.


Four’N Twenty Brand Manager, Mark Malak, said Four’N Twenty is confident the new options, which are hand made in the company’s Bairnsdale, Victoria facilities, will be well received in the market place.


The Four’N Twenty Brekky Wraps consist of either tomato, ham and cheese or sausage, egg, bacon and BBQ sauce in a warmed tortilla wrap and Four’N Twenty Brand Manager, Mark Malak said they are perfect for a hot savoury breakfast on the go.

“Consumers want more choice in the hot food section. We all know it’s important to have a good breakfast – and too many busy people skip it for want of a convenient, tasty and value-for-money option,” he said.

“Brekky Wraps are a totally new offering designed to give on-the-go consumers an attractive breakfast alternative.

“If you’re after a quick, easy and tasty savoury breakfast, Four’N Twenty Brekky Wraps are just the thing.

“We’ve used only the finest ingredients.

“For a true Aussie favourite, there’s a delicious ham Brekky Wrap with chunks of tomato and melted cheese.

“And we have a Brekky Wrap with scrambled egg, a slice of bacon and a seasoned sausage patty glazed with Barbecue Sauce – an offer sure to appeal to Aussie Blokes everywhere.

“Each wrap is hand-folded in a light tortilla wrap, making it easy to eat on the go.

Four’N Twenty Brekky Wraps are available in the hot food section of convenience stores nationally, priced at $4.95.


Finding a unique path for Australia’s manufacturing future

As the manufacturing landscape shifts in response to new economic and social pressures, Australia is looking for an answer to the question: What does the future look like for Australian manufacturing?

By virtue of my role as the Director of the Future Manufacturing National Research Flagship at CSIRO, I am often confronted by this question. Many commentators and peers expect a simple answer, but that would be underestimating the complexity and diversity of manufacturing, both in terms of challenges and opportunities.

The recent work undertaken by the Prime Minister’s Manufacturing Task Force and other commentary is beginning to create a picture of what the future could (or ought) to look like for manufacturing in this country.

Irrespective of the wide-ranging views on what alternate futures for manufacturing might look like, Australian manufacturers need to be competitive in global markets and be highly productive and sustainable in their business operations. Manufacturing firms also need to capture the opportunities offered by Australia’s comparative advantage in natural resources in minerals and agriculture, as well as emerging markets for products and services that support more sustainable living in transport, construction, energy, health and well-being.

As part of its contribution to the Task Force, CSIRO has done an analysis of global mega-trends and identified a number of drivers that are already shaping the future of manufacturing in Australia. They include the rise of a new digitally-driven infrastructure, a move towards mass customisation, an emphasis on sustainability and the need to produce more from less.

Over the next decade, success factors that will influence the competitiveness of Australian manufacturing firms will include the need for faster discovery and development to respond more quickly to dynamic markets, advanced design to create much more competitive and sustainable products, improved collaboration across our innovation system to maximise the exchange and transfer of knowledge, an increase in our ability to leverage our national broadband infrastructure, and encouraging a better understanding of supply chains.

Another key success factor will be our ability to develop, adapt, adopt and integrate the right enabling technologies that provide a competitive advantage for Australian manufacturing firms.

There are number of potential game changers in terms of enabling technologies and advanced capabilities. This includes additive manufacturing, assistive automation, advanced design and smart information systems.

Globally we have seen a major shift towards technology-led manufacturing focused on large scale industrial automation. In countries such as Germany, production lines are increasingly dominated by automated processes and robotics. More recently, China has embarked on a large-scale industrial automation program. However, we need to think about how such technological leaps work for Australia. We have our own unique manufacturing DNA, made up of tens of thousands of SMEs. This is very different to some other industrialised countries, where there are many more large scale manufacturing enterprises. Australian SMEs often find it difficult to embrace industrial automation because of cost and the risk of disruption to their production.

However, there may be other paths to large scale industrial automation. Simple repetitive tasks have largely been addressed by automation (robotics) in manufacturing environments. However, there are many complex tasks that still require human involvement; it may be these technologies that “assist” (rather than replace) human processes that may become more prominent in Australia. The emerging field of assistive automation may play an important role in the future of Australian manufacturing.

Additive manufacturing is a method of fabrication by layers that translates digital design information into prototype or production parts. Currently used mainly in prototyping, additive techniques are increasingly seen as effective for manufacturing highly complex parts and devices that are costly to make by conventional means. Manufacturers can potentially deliver more niche, high value, customised products and be competitive even by producing low volumes. This is important as Australian manufacturers operate in a relatively high-cost environment, and generally cannot compete by generating economies of scale. In the Australian context, the availability of high-speed broadband will also greatly assist the adoption of this digitally-enabled technology. However, much still needs to be done to adapt these relatively new additive processes to make them robust and cost-effective for mainstream manufacturing.

Design will become increasingly important part of the manufacturing value chain. Better design can lead to products with superior functionality and sustainability. For manufacturing firms, making the transition from pure production to being more service based, design thinking could also play an increasingly important role in innovation.

There is emerging evidence, particularly in northern European countries, that the adoption of design-led innovation is directly linked to increasing firm competitiveness. A number of European and Asian countries are looking to (or have already incorporated) discrete design-focused settings into their broader economic policies. In Australia, awareness of the potential application of design-based innovation is still in its infancy and will require both coordination and investment.

The application of Smart Information Systems has the potential to lift productivity, competitiveness and safety. For example, Smart Information Systems that provide a high degree of situational awareness can provide a much higher degree of automation for the remote control of equipment used to handle complex and potentially hazardous tasks. Smart Information Systems that are highly scalable and interoperable across various media also provide the platform for intelligent collaboration networks that can assist in helping firms and research organisations innovate through more effective sharing of information.

There is no doubt that Australian manufacturing will need to take its own path to innovation and maintaining its competitiveness. Global influences will play their part, but Australia’s unique manufacturing DNA, natural resource endowment and increasingly strong communication infrastructure will help shape a uniquely Australian manufacturing future.

Swee Mak does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

The Conversation

This article was originally published at The Conversation. Read the original article.

Gov releases manufacturing taskforce report

The Government has released its Manufacturing Taskforce report, which has a five point policy designed to get the manufacturing industry moving again.

The report, released today, states that it "looks to shape a more dynamic contribution from manufacturing over the medium term to longer terms", adding that there is an "urgent priority that needs to be given to addressing the immediate challenges faced by businesses and employees".

The first point the report lays out is addressing these challenges and "the real and imminent danger of large losses of jobs and capabilties".

It also looks "to help reboot economy wide growth, encourage investment, and reduce the costs of doing business" via a targeted stimulus and initiatives such as new regulation and taxations have also been proposed.

The report also seeks to address competitiveness issues in the market, putting forth "the development of globally oriented innovation precincts".

This report also outlines the need to "address the multiple barriers facing SMEs, and to help more SMEs grow into mid sized firms".

"The agenda proposed here is a complex one. It will require sensible sequencing and the engagement of multiple stakeholders. Notwithstanding the urgent pressures on parts of manufacturing, the non-government members of the Taskforce stress the need to get it done right rather than get it done fast," report states.

It goes in to say that the industry must focus on invention and innovation, with government assistance, if it is to succeed.

To read the report in full, click here.


High Court rejects tobacco industry’s plain packaging appeal

The tobacco industry’s appeal against mandatory plain packaging was dismissed by the High Court this morning and the legislation will take effect from October.

The majority of justices rejected the argument from Australian cigarette manufacturers that the laws were unconstitutional, but the reasons for the decision have not been published by the court.

The tobacco industry’s stance was that the government had not acquired their trademarks on “just terms” and they were therefore owed billions of dollars in compensation.

Chief Justice Robert French said the majority of justices found that the Tobacco Plain Packaging Bill was not in contravention of Section 51 of the Australian constitution and the tobacco companies have been ordered to pay the Commonwealth's legal costs.

From October, cigarettes made in Australia will be required by law to be packaged in ‘drab brown’ boxes.

Only standard fonts will be allowed, with a ban on all logos, slogans colours and other branding and larger graphic health warnings will be mandatory.

From December all tobacco products on Australian shelves will be in plain packaging.

Tobacco companies still have a legal challenge against plain packaging through international trade laws pending, but it is expected these will take several years to conclude.

Director of the anti-smoking group McCabe Centre for Law and Cancer, Jonathan Liberman, welcomed the decision, saying it would set the standard around the world.

"It shows to everybody that the only way to deal with tobacco industry claims, sabre rattling and legal threats is to stare them down in court," he said.

“It would be great if the tobacco industry would just say ‘We understand our products are addictive, they kill up to half of long term users and we will cop on the chin whatever the Government decides needs to be done to reduce their harm’.”

British American Tobacco Australia spokesman Scott McIntyre said plain packaging will benefit black market cigarette products.

“Although the Tobacco Plain Packaging Act passed the constitutional test it’s still a bad law that will only benefit organised crime groups which sell illegal tobacco on our streets,” he said.

“The illegal cigarette black market will grow further when all packs look the same and are easier to copy.

“Plain packaging will also put pressure on the industry to reduce legal tobacco prices.”

Health groups are heralding the decision as a major victory for public health.

"Today’s High Court decision that tobacco plain packaging can proceed is a massive win for public health and also the global tobacco industry’s worst defeat yet.” Australian Council on Smoking and Health president Mike Daube, who chaired the Federal Government committee said.

"The global tobacco companies have opposed plain packaging more ferociously than any other measure because they know that plain packaging will have a major impact on smoking here and other countries will follow.”

Cancer Council Australia chief executive Ian Olver said it was a significant for public health over commercial interests.

What do you think plain packaging will do for Australia's health? Will it be beneficial or create more problems?

Govt needs to stop Coles and Woolworths dominance: lobby group

The representative body for smaller grocery retailers in Australia are again calling on fairer competition in the sector, releasing a report outlining the consequences if regulators and governments don’t step in.

Master Grocers Australia (MGA)’s report “Let’s Have Fair Competition,” says the independent supermarket industry is at risk of being annihilated by the unabated growth of the duopoly, Coles and Woolworths, according to an industry report.

They say unless the Australian Government and the Australian Competition and Consumer Commission (ACCC) take action now, Australians will have no competition in the sector, leading to prices increases and the end of freedom of choice.

The report refers to the enormous growth of the chains in the last decade and how their massive market power has resulted from practices such as anti-competitive price discrimination, store saturation strategies and shopper docket schemes.

“We want a ‘fair go’ for the smaller independents. It’s time to take action against this powerful Goliath that is growing stronger every day,” Jos de Bruin, chief executive of the MGA said.

“If the Regulators sit back and do nothing to foster fair competition in the grocery and liquor retail industry, then the Australian consumer will literally pay the price in the long term.”

Food manufacturers produce growers and farmers have been warning of the same problems for years, but have been forced into silence in recent years as the power of the duopoly means those who do voice their concerns are punished with reduced shelf space or non-renewal of contracts.

The MGA also wants state and local governments to strengthen retail assessment criteria to prevent the major supermarkets from building oversized outlets in small towns that push smaller retailers out of business.

“The independent supermarket industry strongly supports competition, but we want fair competition because without it, there will be no one left to challenge the big retailers and they will become even stronger.”

Earlier today Australia’s largest bread maker, Goodman Fielder admitted its $1 private label bread deal with Coles was unprofitable and unsustainable and managing director Chris Delaney admitted it was “not a good investment and I wouldn't do it again if I had a choice.”

Coles only response on the issue came in the form of a written statement that seemed somewhat threatening in its attitude towards cost absorptions and contracts.

"Coles is happy to review any supplier requests for cost price increases that can be appropriately validated,” the Coles spokesperson said.

In reponse to the MGA report, Coles told Food Magazine "Coles is not in the business of opening unprofitable stores as the Master Grocers Association report claims.

"We only open stores where we believe there is customer demand for our offer.

"Some other points that might be of interest in the debate are store openings.

"Coles has 749 stores. IGA/Metcash (whom the MGA represents) have 1365 stores, and 700 Foodworks stores.

"Metcash’s 2012 annual report advises that they opened 58 new IGA stores in the last financial year.

"In the same period, Coles opened 19 new stores and closed 11."

A Woolworths spokesperson told Food Magazine that “given it’s an industry issue, you need to speak to the industry body,” and would not provide any further comment.

Food Magazine then contacted industry representative body the Australian National Retailers Association (ANRA) for comment, but received only a media release singing the praises of Woolworths and Coles.

"A report attacking Australia’s leading supermarket retailers has been rejected as long on accusations and short on facts, by Australian National Retailers Association (ANRA) CEO, Margy Osmond," it states.

“The Master Grocers Australia (MGA) report is designed to be as sensational as possible at the expense of two highly successful Australian companies, Coles and Woolworths,” Osmond said.

The MGA represents the IGA group of retailers and far from ‘fair competition’, what they recommend will tilt the playing field in their favour, at the expense of consumers, she said.

“It is time that IGA came out from behind this myth they are a small business – they have a substantial slice of the grocery and liquor market in Australia.

“Aldi, a foreign owned entrant to the market, has grown from zero to 300 stores in less than a decade, a clear indication of the demand and the level of competition.

“More regulation, as called for in this report will only damage companies that employ more than 300,000 Australians and support hundreds of local businesses.

"The major chains play a critical role in regional communities where they represent jobs and cheaper prices for local consumers.

“The Australian supermarkets are leading the charge to bring the lowest possible prices to consumers, while still supporting local growers and manufacturers.

"Australian families struggling to cope with cost of living challenges like increasing electricity prices benefit from the price cutting competition that exists between the major supermarket chains.

“To suggest that Coles or Woolworths are deliberately establishing loss making stores to limit local competition is a nonsense. It does not make good business sense.

“This IGA-inspired report suggests that Australian shoppers need the Government to make their decisions for them and tell them, where, when and how they can shop.

"Nothing could be further from the truth,” Osmond said.

When we contacted a representative from ANRA to discuss the impact of the supermarket price wars on Australian workers and families who are out of business due to the duopoly, Food Magazine was told they did not speak about the pricing and operations of the business and we should go back to Woolworths for responses.

Here at Food Magazine, we are always hearing the shocking stories from manufacturers, farmers and suppliers about the impact of the supermarket duopoly’s power, but so few are ever willing to go on the record with their complaints.

The Senate Inquiry struggled to get anyone to speak up, because they were afraid of the consequences, we suffered the impact of the same fear campaign in organising the Food Magazine Industry Leaders Summit and Coles and Woolworths continue to maintain that what they are doing benefits their consumers.

Unfortunately, it is putting more Australians out of work as facilities move offshore and companies go bust.

Food Magazine was also told by a Coles representative that more favourable coverage of the supermarkets would result in more requests for comment being returned, but we are not willing to bow down to any form of bullying.

Do you agree with us that we need a Royal Commission into the supermarket powers? 

Bread prices to increase due to US drought, but who will absorb the cost?

Australia’s largest baker has confirmed that the price of bread will increase due to the US drought.

Goodman Fielder’s managing director Chris Delaney said the increase in grain price as a result of the drought in the Midwest of the United States  and that “the consumer would have to pay for that increase',” meaning higher shelf prices for shoppers.

Now that the US corn harvest is forecast to collapse by 100 million tonnes to 274 million tonnes due to the drought, prices will increase throughout the rest of the manufacturing process.

The price of wheat, often used as a substitute livestock feed grain, has also suffered as a result of the unseasonable weather.

Since May, the price of Australian east coast milling-grade wheat has increased by almost half, from $214 a tonne to $310 a tonne.

Experts predict it could remain around $300 a tonne by the end of the year.

The company has also revealed it regrets its choice to manufacture $1 bread for the Coles private label, as it is already unprofitable.

Like so many other industries, including the dairy, produce and food manufacturing, the bread sector is suffering the impacts of being forced to sell their products at prices less than the cost of production for the sake of supermarket private labels and their war on price.

“Dollar bread is at a loss,” Delaney said.

''This was not a good investment and I wouldn't do it again if I had a choice.”

Countless industry insiders and experts have labelled the current private label environment as unsustainable, as farmers and manufacturers leave their sectors because they can’t break even, let alone make a profit.

While Goodman Fielder says the flow on effects of the grain price increases will flow on to consumers, it remains unclear whether the supermarket giants will actually change the shelf price.

They could absorb the costs within their own businesses, but if past experience is any indication, that would be unlikely and it would be more probable that the bread companies and others impacted by the cost increases would absorb the costs within their already struggling structures as Coles continues to sell bread for $1.

Delaney said clauses surrounding rises and falls such as grains allowed commodity prices to be factored into product pricing, but Coles’ response to questions by Food Magazine about the cost absorptions and private label pricing came in the form of one sentence that would seem somewhat threatening to suppliers.

"Coles is happy to review any supplier requests for cost price increases that can be appropriately validated,” the Coles spokesperson said.

When pushed further for comment the response was “sorry, not appropriate to speculate on outcomes.”

The baking company’s private label contract with Coles is up for renewal in the first half of 2013.

 Goodman's private label contract with Coles will be renewed in the first half of next year.

Migration bill will hurt us: produce industry

Australia’s largest representative body for the produce industry has slammed a draft migration bill, saying it shows the federal government will unnecessarily target the industry.

Ausveg says the Migration Amendment Bill 2012 released last week by the Minister for Immigration and Citizenship, the Hon. Chris Bowen MP, will negatively impact one of Australia’s most important industries.

“Federal Government plans to target growers under immigration reforms that are manifestly unfair,” AUSVEG said.

While the government maintains that the new laws aim to deter and punish employers who hire illegal workers, Ausveg says their concerns are unfounded.

“Illegal workers undermine the integrity of Australia’s migration program, reduce work opportunities for Australians, and expose vulnerable workers to exploitation,” Minister for Immigration and Citizenship, Chris Bowen, said.

Ausveg said heavy reliance on foreign workers for seasonable work through labour hire companies is vital to ensuring the profitability of the industry and that the draft Bill is unfarly targeting the produce industry.

“These workers must adhere to strict visa conditions in order to work legally on Australian farms, however, the proposed Bill appears to place additional responsibility with vegetable growers to double check the legalities,” Ausveg chief executive Richard Mulcahy said.

Image: The ABC

All GM foods to be declared on labels if Californian bill passes

Genetically modified (GM) food is a controversial issue that is set to become an electoral one in the US, with one state set to vote on the practise.

In November, California will be the first state to vote on whether declaration labels will be mandatory on all genetically modified food.

Up to 18 states in the US have attempted to pass similar laws in the same way, but so far all have failed to make it to the statewide ballot.

But in California, Proposition 37 as it is known, has received over a million citizen signatures, indicating it will be successful and foods that have been genetically modified with have to include that information on labelling.

Those against genetically modified foods believe consumers have the right to know if what they’re eating has been created or altered in such a way.

Major food manufacturers including PepsiCo, Nestlé and Coca-Cola, however, are opposed to the legislation, arguing that fears over the lack of long term health impacts of genetically modified foods are misguided.

They even argue that the benefits of genetically modified food far outweigh the perceived negatives.

"Bioengineered crops are the safest crops in the world," Bob Goldberg, a molecular biologist who's a professor at UCLA and a member of the National Academy of Science said.

"We've been testing them for 40 years.

“They're like the Model T Ford.

“There is not one credible scientist working on this that would call it unsafe."

Up to 80 percent of all processed foods sold in the US are made with genetically modified ingredients, including corn, soybeans, sugar beets and cotton oil.

If the proposal became law in California, genetically modified processed foods would be required to include the words "Partially produced with genetic engineering" on the front or back label, while foods entirely made through GM systems would h have to declare so with a sign on the shelf.

Where do you stand on genetically modified foods? Do you think Australians need input, similar to California?

Breakfast cereal alliance to improve industry and consumer health

The Australian Food and Grocery Council has formed an alliance of Australian breakfast cereal manufacturers to develop health and nutrition changes for the industry.

The Australian Breakfast Cereal Manufacturers Forum (ABCMF) members produce about 80 per cent of all breakfast cereals purchased in Australia.

Companies making up the alliance include Freedom Foods, Kellogg Australia, Carmens, Nestlé Australia, Popina Foods and Sanitarium.

The Forum aims to improve consumer understanding of breakfast cereals by being proactive in emphasising the benefits of breakfast cereals, engaging in a positive dialogue with stakeholders and consumers and highlighting the benefits of breakfast cereals and correcting misinformation.

The Australian breakfast cereals industry has received praise recently for its proactive approach to health, particularly in the reduction of sugar and sodium levels.

In June it was revealed Kellogg Australia’s commitment to reduce sodium content across its products by 20 per cent had already been met, eight months ahead of schedule.

AFGC Chief Executive Gary Dawson said the ABCMF will provide evidence-based, practicalinformation for Australians on the benefits of breakfast cereals.

“Through continued education, the ABCMF aims to improve consumers understanding of the important role that breakfast cereal can play as part of a healthy, balanced diet,” Dawson said.

“A healthy start to the day is important and breakfast cereals represent the most cost effective, nutritious way to get your day off to a good start.

Australia’s breakfast cereal products market in is worth over $1.2 billion in retail sales per annum and employs approximately 3000 people, many in rural and regional areas.

“All forum members manufacture locally for the Australian market and rely almost exclusively on Australian grown grain, Dawson said.

“The ABCMF will provide category wide, evidence based information on breakfast cereals to media, stakeholders and consumers.”

Food Crisis: The Development of Modern Aquaculture in Australia is an Imperative

The US corn crop has failed due to the severe drought and extreme temperatures experienced in the US this year.   But the US is not alone, Ukraine, also a major exporter of grain, has banned wheat exports due to poor harvest this year.   As a consequence only 50 days’ worth of stocks are left in world’s granaries. This will lead to big food shortages and higher food prices in poorer countries in Asia and Africa. Indeed, food prices have already risen by 7% this year and cereal prices rose 17% between June and July. A rise in food prices is often linked to social and political turmoil in poor countries, where people already use most of their income to buy food.

A recent paper published by NASA scientist James Hansen and coworkers in PNAS, alerts that heat waves, such as those affecting the US, Greenland and Southern Europe this year, are becoming more frequent and are linked to anthropogenic climate change. Their analysis shows that extremely hot summers have affected an estimated 10% of global land area in recent years, compared with less than 1% of the Earth’s surface between 1951-1980.

With climate change progressing unchecked due to failure of global leaders to reduce global green house emissions, global population already exceeding 7 billion and heading to 9 billion by 2050, and a forecasted 15 to 20 % increase in per capita calories intake and meat consumption, the future is looking ugly.

Indeed, food security and climate change are considered to be key threats to global security in the future. Some nations, such as China, are already taking action by buying arable land around world, including Africa, and, yes, Australia.

Nations that depend on international markets for food supply must develop a food security policy to reach food sufficiency in the likely event that the international market will run dry of food supply or will only supply food at exceedingly high prices.

Whereas Australia is self-sufficient for cereal supply, this is, again, at risk due to climate change, including droughts, heat waves and floods. Moreover, Australia already depends on imports to supply 70% of domestic seafood consumption. As for cereals, there is no guarantee that excess seafood will be available in the international market for import in the future. A shortage of seafood by 70% seems hardly acceptable for a nation that prides itself of being a maritime nation.

The Commonwealth has announced the development of the world’s largest network of marine protected areas. With 3.1 million Km2 this network will encompass more ocean surface than that protected in the rest of the world. This is a bold, game-changing decision in marine protection and conservation, and one that I value positively, although it poses significant challenges.

In addition to preserving key marine habitats and biodiversity, the network seeks to ensure the sustainability of fish stocks in Australian waters, thereby avoiding the depletion of fish stocks that have impacted many nations, such as Canada.

But, how will Australia be able to satisfy present seafood demands and the increase forecasted if we place a cap on domestic landings?

Whereas many, but certainly not all, Australian fisheries appear to be well managed and sustainable, pushing them closer to overfishing to help satisfy domestic demands further would not alleviate the current deficit significantly. The capacity of wild fisheries to satisfy Australian demands for seafood in the future is even meager, provided the increased demand expected. Hence, pushing fish quotas further, as some argue, would place our fishery resources at risk while not enhancing significantly seafood supply security for Australians.

The only option to improve the capacity of Australia to come closer to satisfy present and project seafood requirements through domestic production is the rapid development of aquaculture. With the third largest economic exclusive zone in the world, Australia has a huge, untapped capacity to develop aquaculture. Yet, it ranks poorly both as a producer of aquaculture and a supplier of new technologies and innovation in this industry.

Australia is a giant in the extent of its economic exclusive zone, but a dwarf in its capacity to develop food from its huge expanse of productive ocean.

The development of Aquaculture in Australia is an imperative and, as a key component of food security, must be introduced as a pivotal element of our national defense policy.

The development of aquaculture in Australia will fail if it was to follow that of the leading Asian nations. In addition of being a component of food security, marine aquaculture must also be a viable business, and yet, aquaculture has traditionally be considered a technology of the poor, arguably unsuitable for a high-wage economy, as the Australian economy is. In addition, marine aquaculture has generated multiple environmental impacts through its dependence on wild fisheries and the emission to the marine environment of nutrients and organic detritus.

The pending Australian aquaculture strategy must be economically viable and environmentally sustainable. Is such strategy possible?

The development of Australian aquaculture must be closely linked to that of biotechnological applications. I submit that an economically viable model for aquaculture in Australia must develop the combined capacity to deliver sufficient mass production as to satisfy national demand, and possibly export, while targeting high-value molecules, such as carotenoids, omega-3 and others, for biotechnological applications. Marine biotechnology is a growing business, growing at 12 % annually and with a global value in excess of 20 billion annually. Comprising a considerable fraction of the global marine biodiversity, the scope for new domestications for aquaculture and biotechnology applications in Australia is immense. Developing an “aquaculture 2.0” industry, underpinning the growth of marine biotechnology and its growing applications, will also flip Australia’s global position from being in the demands side, from being in the supply side of new technologies and innovations for aquaculture applications.

The development of an “aquaculture 2.0” industry Australia must also lead the world into transforming aquaculture into an environmentally sustainable industry. In a previous blog I posed the rhetoric question of whether sustainable aquaculture is an oxymoron. It is not. To become sustainable, aquaculture must close its production cycle to abandon its present dependence on wild catches, focus on the production of macroalgae and animals low in the trophic chain, and combine them in polycultures that maximize production while minimizing detritus production. Moreover, aquaculture can become a tool in conservation biology, helping catalyze the recovery of threatened species and fisheries stocks, and, through the mass culture of macroalgae, help recover degraded marine ecosystems, such as many of Australia’s estuaries.

Regulators should facilitate this transformation, and should leave behind the prevalent attitude to consider aquaculture as a threat to the marine environment. In fact, some regulators in Australia impose more stringent restrictions to license aquaculture farms than they do impose on, for instance, the far more dangerous gas and oil industry. The impacts of aquaculture can be best brought in perspective if compared with the environmental costs of food production on land, responsible for much of water consumption and the deterioration of our waters due to excess fertilizer application, the introduction of dangerous chemicals, such as herbicides and pesticides, in the environment, loss of habitats for biodiversity, a substantial proportion of anthropogenic greenhouse gas emission and risks to human health.

In summary, Australia is at the crossroads. It must now develop an all-Australian “aquaculture 2.0” model or be relegated to be on the demand side for both seafood products and know-how from Asian nations.

The development of aquaculture 2.0, combining mass production with key high-value molecules for biotechnology applications and developing best practices to render it a positive force in the environment, will play a pivotal role in ensuring our seafood security in the future. As such it should be a pillar of our defense strategy.

Carlos Duarte does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.

The Conversation

This article was originally published at The Conversation. Read the original article.

Kerry closing Melbourne ingredient factory

Ingredient maker Kerry is closing its manufacturing plant in Melbourne, leaving up to 100 employees out of work.

The National Union of Workers says the Ireland-based company will move at least 75 per cent of its production to Asian factories.

The Altona factory, in the Melbourne’s west, will close for the last time on March 31 2013, and the production of products including bases for milkshakes, donuts and biscuits to Malaysia.

“These are high-wage jobs, high skilled jobs and they were good quality middle class jobs in the western suburbs,” National Union of Workers secretary Tim Kennedy said.

“The problem for these people is that the work for them in the future will be casual work here and there.

“There is just no confidence in the manufacturing industry in Victoria.”

Kerry’s factory closure is further indication that the manufacturing sector in Australia is struggling more than ever, he said.


“This is not just a job emptying bins at the footy,” he said.

“Some of the equipment is going to New South Wales but the bulk of it, about three quarters is going back to Malaysia.”

Kerry Group says some employees impacted by the closure would be offered jobs at the company's New South Wales and Queensland operations.

"Whilst manufacturing remains a very competitive environment in Australia and international markets, these decisions enable Kerry to provide sustainable business growth by leveraging the offering at our existing sites within the region," Kerry Ingredients and Flavours Asia-Pacific president Mark McCormack said in a statement.

"Whilst Kerry will continue to invest in and expand our presence in Australia, this is a consolidation of a number of acquisitions made over recent years."

"We'll now be focusing on redundancies and making sure that happens promptly and it happens well, and we'll also be looking at reskilling and retraining the workers."

Poultry industry criticised for proposed changes to ‘free range’ rules

The poultry industry is copping criticism for its attempts to change the definition of ‘free range,’ to allow more than 140 000 birds per hectare.

The demand for ‘free range’ poultry and eggs is increasing in Australia, and numerous producers have been caught misleading the public over the conditions the birds are raised in.

GetUp!'s infographic paints a scary picture for the future of free range.

Representative body for the largest chicken meat producers in the country, the Australian Poultry Industries Association (APIA) is now asking the Australian Competition and Consumer Commission to allow producers to use the ‘free range’ claim, even when the birds have an area the size of an A4 sheet of paper to move in.

Activist group GetUp! has received an extension on the submission deadline until 10 August, and is calling on consumers to push back against the APIA request, and call  on the ACCC to implement more rigorous regulations regarding free range chickens.

Are you in the poultry industry? Where do you stand on the request?

Little World Brewers boosts sales by 26pc

Little World Beverages (LWB), the boutique beer company recently acquired by Lion, has delivered a 26 per cent growth in profits, an achievement which is sure to impress its new owner.

The result is likely to be LWB’s last result as a public company and the maker of the Little Creatures, White Rabbit and Pipsqueak said strong external beer sales have boosted the sales.

The company has achieved $11.6 million net profit for the year, significantly up from last year’s $9.2 million, an enviable feat in the struggling Australian beer market, which has seen beer sales had drop by 4 per cent in volume.

Craft beers, such as those brewed by LWB, are rising by up to 20 per cent, according to Chief executive Ross Sudano.

"We're in a segment of the market where we have got great engagement with consumers and they're demanding more," he said.

“The success had been fuelled by increased distribution and "pull-through" marketing which created customer demand through brand awareness.

Beer sales were almost entirely the reason for the 22 per cent increase in revenue to $85.8 million, he said.

It is expected that LWB will commission a new brewery in Geelong in early 2013, which is expected to ultimately double output.

In June, Japanese-owned Lion submitted an offer to acquire the company, valuing it at $382 million and shareholders will vote next month on the $5.30-a-share offer.

Sudano some consumers have expressed disappointment in the buyout, but it has not impacted sales.

"A lot of consumers are waiting to make sure nothing changes, particularly around the product profile, which it won't,” he said.

"Then it will just be business as normal and they will forget who owns us, I think."

Image: Sydney Morning Herald

The new Sicily: DPI heat maps used to produce quality blood oranges in Australia

The Italian influences on Australia’s eating habits have become so ingrained in our diets that we forget where they started.

There have of course been positive impacts felt elsewhere throughout the country since our European football-lovers began immigrating to Australia, but the biggest difference to our society has been with food.

Prior to Italian people setting their sights on these sunburnt shores as a new place to call home, the diets here were boring at best.

Meat and three veg was the way of life, not just an option for nostalgic or laziness reasons.

When you think about how extremely diverse our food offerings are nowadays, it is almost an unfathomable concept.

While Aussies have countless countries to thank for this widening of not only our palates but our culture, the Italian influence has been one of the most significant.

Pasta (including the modern staple of Australian households, spaghetti bolognaise), espresso, pizza, lasagne, garlic bread and different cheeses just were not eaten prior to Italian immigration.

Imagining a life nowadays without these options we now almost consider our own is extremely difficult, and makes one grateful for the diversity brought to Australia by these cultures.

Where did you come from, where do you grow?

Blood oranges are a staple of Italian food, which until recently, we have been unable to enjoy in the same way they do across the pond in Italy.

RedBelly Citrus was more serious about ensuring authentic blood orange offerings for Aussie consumers than Leonardo De Vinci was about painting.

Not only did they decline to work with a marmalade manufacturer because its processing wasn’t in keeping with Grandma’s traditional recipes, but they even got the government involved in selecting the best climate in Australia to grow the fruit before settling on land north of Griffith.

“Sicily is renowned for their blood oranges, they are the biggest growers around the world,” Vito Mancini, Director, Redbelly Citrus told Food Magazine.

“The weather gives them the growing benefits compared to other countries that grow them, like Brazil and Florida because they need a very big differential between day and night temperatures.

“The weather in Sicily can go from nights down to about 2 degrees whereas in the day it gets up to 14, 15 [degrees Celsius] and that difference, the trees don’t like it, and it causes stress and that is why it what comes out in the fruit.

Mancini assured Food Magazine that the “stress” the trees face in the extreme variables of the weather does not damage the tree or the fruit at all, and is necessary to create the colour of the fruit.

“It’s just like growing wine grapes, you get a better wine grape with temperature differences like that too.

“Orange trees aren’t as tolerant as grapevines, if it gets too cold, it will damage the tree.

“So we worked really hard at finding the perfect balance.

“If I go towards Victoria, way in the high country it will get too cold and damage the trees and if I got to northern New South Wales, to Bourke or up to Queensland, it gets too warm and the tree doesn’t develop enough stress.”

“They’ll look like a Valencia, and generally you won’t get typical blood orange.

“It’s taken eight years to get to this point, we worker with the NSW Department of Primary Industries (DPI) for a couple of years to work out best variations in temperature and they did heat unit mapping to work it out.

“They grabbed the temperature data from Sicily and overlayed it over southern Australia, over New South Wales, Victoria and South Australia, and there is a very distinct band which passes close to where we are that had similar temperatures to the growing areas in Sicily.

“So with that data, we could see the similarities.

“We always knew blood oranges grew in this area, but with that data were more confident we could match the Italian version.”

For health's sake

The reasons for ensuring the similarities in temperature between traditional growing regions in Italy and those in Australia was simple, Mancini told Food Magazine.

“Were farmers, not multimillionaires, and had to borrow cons money so needed guarantee that it would work,” he said.

Beyond the need to ensure the venture would be successful for business reasons, Vito Mancini and his fellow Director (and brother), Leonard Mancini are passionate about the benefits of the fruit and sharing the taste and health properties with Australians.

“The best way to put it is to think of a mix between an orange and a berry, like a blueberry,” he said.

“You get all the vitamin C and folate that you get from citrus fruits, which also have lots of other benefits,

“But grapefruit, for example, is really good, but they don’t recommend having them when on certain medications because it has high amounts of hesperin, which interferes with blood pressure tablets because it is a natural blood press regulator.

“Blood oranges don’t have the same level [of hesperin] as  grapefruit, but has got the Vitamin C, folate, potassium, calcium, but an added benefit they contain belongs to the berry family chemicals, the main one being anthocynanins, which is a group of plant chemicals that have shown a lot of benefits.

“They’re called Neutrogenicals because of their benefits for the skin; they save against UVA and UVB damage, but another added benefit is the angiogenic inhibitors,” Mancini explained to Food Magazine.

Angiogenic inhibitors are molecules that prevent the growth of new blood vessels, which fights against ageing, obesity and most cancers which are dependant on new blood vessels.

Blood orange brothers Len and Vito Mancini

Just like Nonna used to make

Once the Mancini brothers had decided on the very best spot in Australia to grow their blood oranges, they set about making the fruits come to life in the same way their family had done for generations.

But it wasn’t a job that any average company could do, because they were determined not to sacrifice the quality, flavour or process of their marmalades, cordials and syrups.

“The recipes are quite basic, like any good Italian recipe,” Manini told Food Magazine.

“It’s about the quality of the ingredients, rather than quantity.

“We don’t make the product selves, we got contractors to do it because we don’t have bottling facilities and things like that.

“So we went through the receips with them, and some didn’t want to do our recipes, or didn’t have the gear.

“The marmalade for example, the way my Nonna used to make was with long thin strips of marmalade, but we found one company that wanted to run it through a machine to cube it up, so we said no to that.

“A lot of people we spoke to said they had to use preservatives, and I think that by using more natural and basic ingredients, sure we may not have a shelf life of a hundred years, but we have the quality products and the story behind it that’s going to help push it.

“We could use preservatives so that my great grandchildren can eat that jar, but it’s probably not good for them,” Mancini laughed.

With over 40 hectares to take care of and more than 30 000 tress in the ground, the Mancini brothers have a lot of work to do running their business.

Mancini told Food Magazine he pruned 16 000 tress on his own last year alone.

During picking season, the company will hire a few extra sets of hands to help out, but for the most part, they do it on their own, and are enjoying the ride.

Despite the company’s success and a reputation as the expert on all things blood orange, Mancini is humble about their story.

“We will be the biggest producers around Australia, but it’s not about that, we just want to make produce that consumers can understand and appreciate,” he said.

“What we’ve done here, I call it a prototype farm, a huge prototype.

“I believe the world would be able to accept about 1500 tonnes of blood oranges, and if you look at the largest four producers in the world, Morocco, Spain, Turkey and Italy, we’re able to compete here in Australia, being an alternate season.

“What I’m trying to do is open up opportunities for citrus growers in Australia.”

Olive you glad it's authentic?

Another quintessential Italian product Australians have embraced wholeheartedly is olive oil, and according to Paul Berryman, Chief Executive for Bertolli Australia, consumers are much savvier these days when choosing their ingredients.

“Consumers are becoming more and more aware of how the flavour of olive oil helps enhance their dishes,” he told Food Magazine.

“The good quality Mediterranean olive oils are rich, full of flavour but smooth and not too acidic or grassy.”

He explained that in the last 20 years especially, consumers have redefined what they are looking for, and can tell authentic products from the imitations.

“Australians are generally accepting of foreign flavours and this has certainly developed further in the past two decades,” he said.

“We have such a wide range of cultures making up the Australian culture.

“Italians are a big part of Aussie culture and this contributes to this acceptance of Mediterranean food.

“We must also recognise that the Australians of today are also quite different to 15-20 years ago.

“We are a much more multicultural society and many people have grown up with foreign flavours being considered the norm.

“This leads to a greater acceptance to trying new things and a reliance on the products’ country of origin to produce the best.”

The Bertolli range of olivefg oils are still manufactured in Italy to ensure their authentic taste and production, but when asked by Food Magazine whether the company would ever manufacture in Australia, Berryman did not rule it out.

“It is believed that the Mediterranean countries produce the best olive oil,” he said.

“The olive oil for our spray products come from our growers in the Mediterranean but are packed at a local company in Sydney’s west.

“Since the introduction of sprays on the market, we have seen demand growing.

“However, consumers will always want the option of bottled olive oil as this suits other purposes.

“Bertolli is part of a global olive oil company.

“While we have an Italian heritage, we are always looking for new possibilities.”