In one of its last actions in 2006, Congress passed legislation containing several items of interest to AFI members. In summary:

Generalized System of Preferences (GSP)
Extends GSP for two years, consistent with the President’s budget request.

After a six-month delay, tightens rules on competitive need limit waivers to tailor the program for use by lesser developed countries that need help exporting to the United States. President is given discretion to end waivers on products that constitute 150 percent of the competitive need limit or 75 percent of U.S. imports of that product. It does not appear any products handled by AFI members will be impacted.

Andean Trade Preferences Extension Act

Grants a straightforward six-month extension for Peru, Colombia, Ecuador, and Bolivia, followed by an additional six-month extension for each country only if the United States and that country both complete their legislative process to approve a trade promotion agreement (the additional six months would be used to finalize implementation in the other country prior to entry into force of the agreement).

Miscellaneous Trade and Technical
Corrections Act (MTB)

The purpose of the bill is to amend the Harmonized Tariff Schedule (HTS) of the United States to modify certain rates of duty, to make technical amendments to trade laws, and for other purposes. For inclusion in the bill, a provision must have been vetted, raise no objection, and be administrable.

Suspends or reduces the tariff rate on more than 500 selected products. AFI had provisions regarding eliminating duties on oysters and continuing duty reductions on artichokes on the MTB.

PROPOSED RULE USES
MARKETING ORDER TO
IMPOSE FOOD SAFETY ON ALMONDS

USDA’s Agricultural Marketing Service (AMS) issued a proposed rule requiring almonds grown in California to be treated to reduce potential contamination with Salmonella bacteria. Comments on the proposed rule must be submitted to AMS no later than January 22, while comments on the proposed information collection are due by February 5.

This is one of the first times AMS used an agricultural marketing order to impose mandatory food safety requirements. Historically, AMS has taken the position that marketing orders should address quality and efficient marketing issues only, but there appears to be a movement to allow orders to broadly address food safety issues. In addition to this proposal, the recent outbreaks of E.coli and Salmonella associated with fresh product have resulted in some discussion of using marketing orders as a vehicle for monitoring food safety measures. The proposed rule, which would amend the “quality control” requirements of the marketing order, characterizes Salmonella reduction as a quality issue.

COUNTRY-OF-ORIGIN LABELING
COMMENT PERIOD RE-OPENED

AMS announced it is re-opening the comment period for the interim final rule that mandates country-of-origin and method-of-production labeling for fish and shellfish. The re-opened comment period will close Feb. 26.

AMS is re-opening the comment period for the interim final rule for 90 days, but only to receive comments on the economic impacts of the interim final rule. AMS is particularly interested in receiving comments and data from affected parties (i.e., retailers and suppliers of fish and shellfish products) regarding the initial costs to implement the interim final rule, ongoing costs to maintain compliance, the burden of complying with the interim final rule’s information collection and recordkeeping requirements, and any economic benefits resulting from country-of-origin and method-of-production labeling for fish and shellfish.

Comments on issues other than the economic impact of the interim final rule will not be considered. Congress has delayed implementation of mandatory country-of-origin labeling for these other covered commodities until Sept. 30, 2008.

FDA RELEASES NEW
NUTRITION FACTS LABEL TOOLS

FDA released two new tools to help consumers use the Nutrition Facts label and improve their diets – a brochure called Nutrition Facts Label available at http://www.cfsan.fda.gov/~dms/lab-gen.html and an interactive, on-line educational program called Make Your Calories Count available at http://www.cfsan.fda.gov/labelman .

These new tools were developed in response to the recommendations of FDA’s Obesity Working Group in its 2004 report Calories Count. The dietary recommendations contained in the new brochure and educational program are derived from the Dietary Guidelines for Americans. Both are designed to help consumers use the Nutrition Facts label to choose lower calorie, nutrient-dense foods (i.e., to make their calories “count”).

FDA also issued a press release and a questions and answers document about these new tools. They are available at http://www.fda.gov/bbs/topics/NEWS/2006/NEW01508.html and http://www.cfsan.fda.gov/~ear/hwm/labelman.html, respectively.

CSPI PETITIONS FDA TO CREATE
“HEALTHY FOOD” LABELING SYSTEM

The Center for Science in the Public Interest (CSPI) formally petitioned FDA to design a national set of symbols to help consumers quickly identify healthier foods. While Kraft has a “Sensible Solution”, Pepsi has a “Smart Spot” and the American Heart Association licenses it’s “heart-check” symbol, CSPI says consumers can easily be confused or misled since the various programs have different aims and use inconsistent nutrition criteria.

FDA ISSUES REVISED
FOOD ALLERGEN GUIDANCE

FDA announced the availability of a revised guidance document entitled “Guidance for Industry: Questions and Answers Regarding Food Allergens, including the Food Allergen Labeling and Consumer Protection Act of 2004 (Edition 4).” The guidance uses a question-and-answer format which explains FDA's current thinking on a number of issues related to the regulation of food allergens, including implementation of the Food Allergen Labeling and Consumer Protection Act of 2004 (FALCPA). The guidance is available at http://www.cfsan.fda.gov/~dms/alrguid.html.

GPO GAINING PRESENCE
IN FOODSERVICE

Group purchasing organizations (GPOs) are gaining a presence in foodservice, accounting for $16 billion in annual purchases and growing, according to a new International Foodservice Distribution Association (IFDA) white paper.

While foodservice is a relatively small percentage of overall GPO business, sales within that channel are estimated to be between 8.5 and 9.5 percent and are growing with some GPOs having recently achieved significant increases in their share of business in foodservice.

IFDA’s report notes that operator-members of GPOs can achieve savings in the cost of goods, enabling them to compete more effectively. These same operators can also benefit from peripheral services offered by some GPOs, such as insurance, linen service, etc.

The report also indicates manufacturers and distributors can also derive benefits in possible increased volume of sales to markets not currently served. That volume, however, only goes to suppliers approved by or under contract with GPOs. In some cases manufacturers and distributors must also agree to contribute a margin percentage to the GPO as an administrative fee.

Some executives interviewed for the report said the GPO model does not translate well into foodservice where suppliers hold strong pre-existing relationships, where operators use many SKUs and may need many different brands from operation to operation, and where the restaurants have requirements that add costs, such as more frequent deliveries with fewer cases per delivery.

CONGRESSMAN CONGRATULATES
AFI MEMBER ON DUTY REDUCTION

In a letter to John Fressie of Bascom Corporation, Congressman Bill Pascrell, Jr. (D-NJ) congratulated Fressie on the passage of reductions and elimination of certain duties on capers and pepperoncini. Congressman Pascrell also thanked Fressie for bringing the matter to his attention, stating he is pleased to help business owners in his district to create savings which can then be passed on to the consumers.

AFI also wishes to congratulate its members in their continuing efforts to contact legislators on key issues. The elimination of duties on capers will save importers $450,392 in 2007 alone. In addition the reduction of duties on pepperoncini will save importers an estimated $1,174,150 in 2007 alone.

START PLANNING
FOR 2007 AFI CONVENTION

It’s time to begin making travel arrangements for the upcoming AFI Convention. The convention is scheduled for April 26-29 at the Resort at Longboat Key Club in Longboat Key, Florida.

Hotel

The Resort at Longboat Key Club is a AAA Four-Diamond, beachfront resort located on the southern tip of beautiful Longboat Key on Florida’s west coast. The discounted room rate is $245 ($265 for a beach-view club suite). Members traveling with their families are encouraged to make reservations as soon as possible.

Airfare: A travel discount has been negotiated with Continental Airlines. Continental offers discounts off published fares of 2 percent to 15 percent or zone fares. Call your travel professional or Continental Meeting Works at 800-468-7022 for reservations. When booking your reservation, please refer to Z-Code ZU7S and Agreement Code AGCX64. Or save an additional 3 percent by booking your own reservation at http://www.continental.com/specials/group/meetingworks/reservations.asp by entering both the Z-code and Agreement Code without a space (ZU7SAGCX64) in the Offer Code Box. Booking online avoids the $10 service fee collected per ticket through MeetingWorks reservations or any Continental Airlines ticketing facility.

Program: The convention will kick off Thursday evening with a welcoming reception. Presentations and meetings will take place Friday and Saturday mornings, with sporting activities and evening receptions on Friday and Saturday and a dinner Saturday evening. Watch your mail for complete program details.

Sponsorships: Sponsorships are going fast. Contact AFI for complete details on sponsorship opportunities.

Register by Jan. 15 and save! Look for details in the mail and at www.afius.org.

PUT YOUR BEST FOOT FORWARD:
ADVERTISE IN THE AFI ANNUAL

AFI is proud of its members and encourages them to put their best foot forward in the upcoming AFI Annual. Some members have advertised in every issue. It’s nice to know that their identification with AFI means a lot to them and to their business.

Each year, thousands of copies of the AFI Annual are distributed to supermarket buyers, foodservice buyers, overseas suppliers, brokers and trade offices. It’s a year-round resource used by companies here and abroad that want to do business with the marketers, importers and import agents in AFI and its sections. By advertising, you identify yourself in a high-profile way with your association. You assure your company of the recognition it deserves in the industry, here and abroad.

If you have never advertised before, AFI can make it painless for you, designing an ad especially for you.

Please reserve space by February 15 to assure you are included in the 2007 edition. If you have any questions, please call the AFI office.

MEMBER NEWS

TSC Holding Company, LLC, announced it had completed an investment and recapitalization of Taormina Sales Company in which TSC acquired a controlling interest in Taormina Sales. Joseph Taormina, founder of the company, is remaining involved in the business and retaining an ownership interest in the company. Following this transaction, the company is continuing all of its products, supply relationships, customer relationships and business operations and will continue to operate under the name “Taormina Sales.” Anna M. Gannon has been named chief executive officer of the company. Taormina Sales specializes in importing and distributing olive oil, vinegar and specialty food products and has recently expanded into natural soaps and personal care products with the introduction of the Olivella line of natural olive oil based soaps, creams and other products made in Italy from 100 percent virgin olive oil.

MEMBERSHIP NEWS

New Members

The following companies were approved for membership in AFI by the Board of Directors at its November 14 meeting.

Regular

Port Royal Sales, Woodbury, NY – importer of canned food products, including fruits, vegetables, tuna and pasta

Overseas

Agroindustrial Diaguitas, Santiago, Chile – supplier of artichokes

Nuova Fornareta S.r.l., Soave, Italy – manufacturer/distributor of panettone, pandoro and colombe

The Annual Meeting of the National Honey Packers and Dealers Association will take place January 12 at the Hyatt Regency in Austin, Texas.

The Mid-Year Meeting of the North American Olive Oil Association will take place January 19 at the Hilton in San Francisco.

AFI will host a reception at SIAL Montreal on March 28.

The 2007 AFI Convention will take place April 26-29 at the Longboat Key Club and Resort, Longboat Key, Fla.