Petfood Industry Electronic Newsletter May 15, 2007

May 15, 2007
Volume 7, Number 10

This newsletter is also available in an Acrobat PDF format. To download the PDF click on the following link: May15PDF.

Your free copy of the Petfood Industry Electronic Newsletter is sponsored by AFB International, maker of Optimizor® and BioFlavor® brand palatants. AFB is the petfood industry's first choice for dog and cat food palatants. For more information, please visit our website at http://www.afbinternational.com.

Here's what's been happening lately:

Industry news

ChemNutra calls for summit on petfood ingredients
ChemNutra today called for a national summit of petfood ingredients importers, analysis laboratories and manufacturers to begin drafting import standards and specifications for petfood ingredients--not only those from China, but also from around the world. Steve Miller, chief executive officer of ChemNutra said, “Just as E. coli incidents have forced retailers and restaurateurs to get more directly involved with ensuring the safety of growers, the melamine adulteration of petfood mandates that importers and manufacturers establish new protocols for ensuring the safety of our suppliers.”

ChemNutra has volunteered to serve as the coordinator of a one-day conference tentatively scheduled for July 14, 2007, in “off the strip” Las Vegas, Nevada, USA. “I am hopeful that those who import and use imported petfood ingredients will set aside any competitive differences we may have to unite for what I know is a common purpose—the safety of pets. We also invite the participation of experts in product safety and analysis,” said Miller.

Miller added, “We are not trying to in any way supersede or interfere with the government agencies who will also, we're sure, be establishing new protocols. Rather, we seek to move for self-improvement at the quickest possible pace, even while new rules or legislation are being considered.” He said, “The sole purpose of this high level meeting will be to (a) establish a process for collectively drafting new testing and importing standards for petfoods and (b) discern the industry's interest in establishing a new trade association with a single mission: to ensure the safety of petfood ingredients and petfood.”

For further information on the petfood safety summit, please contact Steve Stern at steve@sdsternpr.com or the ChemNutra website, http://www.chemnutra.com to register.

Sensible Choice and Kasco products recalled
Royal Canin USA recently announced the voluntary nationwide recall of eight Sensible Choice dry dog food products and seven Kasco dry dog and cat food products. This announcement was based on the company's identification of trace amounts of a melamine derivative from tainted Chinese rice protein concentrate provided to the company by domestic ingredient supplier Cereal Byproducts.

Survey to quantify pet deaths from tainted food
A Michigan State University (MSU) veterinary professor is reportedly launching a survey to better estimate how many pets have died after eating tainted food and to determine what, specifically, killed them. Wilson Rumbeiha, professor of veterinary clinical toxicology of MSU's veterinary school, began the survey on April 4 and is to present findings in October in Reno, Nevada, USA, at a convention of the American Association of Veterinary Laboratory Diagnosticians. The group is funding the survey.

The survey asks US and Canadian veterinarians and lab workers 17 questions, such as what food a dog or cat ate, the animal's age and breed and how the pet's illness was diagnosed. “We want to find the common denominators,” Rumbeiha told the Detroit Free Press. The Michigan Veterinary Medical Association said that it questioned 157 members and reported last month that 35 cats and 17 dogs in Michigan were suspected of having died from consuming the tainted food.

Natura launches testing program
Natura Pet Products said in a press release recently that it has directed an independent laboratory to continually test all of its ingredients and finished products to guarantee that they are free from any melamine contamination. “Over the past few weeks, Midwest Laboratories has tested our ingredients and all of our finished products for melamine contamination—this includes dry, canned and baked treats,” said Natura president Peter Atkins.

AFIA Liquid Feed Symposium announced
The American Feed Industry Association (AFIA) will hold its 37th annual Liquid Feed Symposium on September 5-7, 2007, at the Radisson Fort McDowell Resort & Casino, Scottsdale, Arizona, USA. The theme of this year's symposium is “Liquid Feed – Impacts from an Evolving Economy.” Along with regulatory and ingredient forecasts, topics will cover the latest nutritional research, biofuels, ethanol by-products, glycerin in-utero nutrition for calves and the outlook for the dairy industry. More program and registration information will soon be available on the AFIA website at www.afia.org. For information on exhibiting, contact Leanna Nail at lnail@afia.org.

Mars Inc. to acquire Nutro Products Inc.
Mars Inc. has announced the signing of a definitive agreement to acquire the global petfood operations of Nutro Products Inc. Closing of the purchase of Nutro is subject to normal regulatory approvals which are expected to be completed within a few months. Terms of the deal were not disclosed.

Nutro will reportedly operate as a stand-alone organization within the Mars family of companies and will maintain its commitment to the pet specialty channel. Nutro president and CEO David Kravis, together with the current management team, will continue to operate the business from its headquarters in City of Industry, California, USA.

Developments in melamine contamination cases
China launched a food and drug safety crackdown recently, following an announcement that authorities had detained managers from two companies linked to contaminated ingredients used in petfood products. Ongoing revelations have shed a harsh light on China's food and drug safety woes, according to the Associated Press, sparking fears that exported products could contaminate food supplies abroad.

Few details were given about the detentions. The detained managers were identified as having worked for Xuzhou Anying Biologic Technology Development Co. Ltd. and Binzhou Futian Biology Technology Co. Ltd., both listed as having exported melamine-spiked rice protein and wheat gluten to the US. In a notice on its website, China's government body responsible for overseeing food safety said investigators had focused on individuals at two companies blamed for the melamine tainting, and said local police had already brought charges. It did not name those under investigation or give other details.

The FDA sent food inspectors to China to investigate the companies that made the melamine-tainted ingredients. “We visited the two facilities, but there's essentially nothing to be found in that they are currently closed down, not operating,” Walter Batts, deputy director of the FDA's Office of International Programs said. The FDA has stated that those Chinese companies mislabeled the melamine-tainted ingredients shipped to the United States. Those ingredients—labeled as wheat gluten and rice protein—are really wheat flour.

“When our forensic chemistry center specifically looked into that…they were able to measure the starch level of this product and determine that it wasn't in fact wheat gluten, but the wheat flour,” said Dr. David Acheson, the FDA's new assistant commissioner for food protection. He added: “I can tell you that some of our testing has indicated that some of the melamine-positive material labeled as rice protein concentrate was not rice protein concentrate. It was indeed the ground up wheat flour with melamine…so certainly some of the rice protein concentrate that we tested was mislabeled.”

The FDA said the mislabeled melamine-tainted rice protein entered the US in August of 2006; the mislabeled wheat gluten first came into the country in November 2006. “Those are the only two companies that we are aware of that sold this contaminated protein concentrate,” said the FDA's Dr. Stephen Sundlof, director of the Center for Veterinary Medicine.

In related news, the Oregon Department of Fish and Wildlife says fish hatcheries have received fish feed that is potentially tainted with melamine. Earlier, the FDA confirmed the presence of melamine in fish feed from the Canadian company, Skretting. FDA tests revealed one sample of fish feed at the Marion Forks Hatchery in Oregon contained that chemical.

In other petfood recall news:

All vegetable protein products—like wheat gluten or rice protein concentrate—imported from China cannot come into the United States unless they've been tested for melamine, cyanuric acid or other melamine-derived compounds, the FDA said.
The FDA is sampling petfood imported from China to see if those products contain melamine or melamine-related compounds. The agency said it will soon start sampling animal feed and fish feed imported from China.
FDA officials are visiting manufacturers in the United States that use protein concentrates in human, pet or animal foods—and testing samples of the companies' products for melamine and melamine-related compounds. The agency said it will also sample some of the finished products.
The FDA said there are no indications that melamine-tainted bulk products were shipped directly to firms that manufacture products for humans.

Corey Feed Mills Ltd. receives international recognition
Corey Feed Mills Ltd., a family-owned and operated company based out of Fredericton, New Brunswick, Canada, announced that it has achieved the highest level of food safety and quality—Safe Quality Food (SQF) certification (Level 3) for its animal foods manufacturing operation. The Safe Quality Food (SQF) Certification Program, owned by the Food Marketing Institute (FMI) based out of Washington, DC, is an internationally recognized, third-party audited food safety and quality management program.

The SQF program is a complete supplier food safety and product quality management system. It consists of both a primary production (SQF 1000) and manufacturing (SQF 2000) standard, complete with training, auditing and certification protocols. SQF has been implemented in many different food sectors around the world and is recognized as raising the bar in food sector certification by requiring the appropriate validation and verification of the food safety and quality controls implemented. Corey Feed Mills Ltd. has been in business since 1982. The company has since grown, expanding its product line in 1991 to include petfood, and presently serves an international clientele.

FSNS offers HACCP and Micro 101 courses
Food Safety Net Services (FSNS) is offering HACCP and Micro 101 courses in Green Bay, Wisconsin, USA, this next month. E-mail Terri Pease at tpease@food-safetynet.com or visit the company website at http://www.food-safetynet.com/education_training.htm for more information.

Market data

Each month the Petfood Industry E-newsletter will bring you the latest market data available from several different sources including Euromonitor International, Information Resources Inc. (IRI) and ACNielsen.

Top US food, drug and mass merchandiser (excluding Wal-Mart) wet cat food sales for the 52 weeks ending October 8, 2006. Source: Information Resources Inc.

Vendor	US$ sales	% chg vs. 2005	Unit sales	% chg vs. 2005
Friskies Fancy Feast	$307 million	2.4%	453 million	-3.3%
Friskies	$163 million	0.6%	333 million	-7.1%
9Lives	$95 million	-8.8%	126 million	-16.0%
Private label	$61 million	-7.3%	174 million	-12.5%
Whiskas Choice Cuts	$36 million	-4.6%	35 million	-25.2%
Friskies Special Diet	$27 million	-2.3%	72 million	-5.5%
Friskies Prime Filets	$25 million	9.3%	67 million	6.4%
Meow Mix	$19 million	-2.7%	25 million	-7.0%
Iams	$18.5 million	-8.8%	24 million	-16.0%
Friskies Fine Cuts	$16.5 million	5.2%	15 million	-17.1%
Whiskas Tender Bites	$15.2 million	-12.2%	14.4 million	-31.4%
Friskies Senior	$14.5 million	-6.1%	37.1 million	-10.0%
9Lives Plus	$13.3 million	-4.5%	9.8 million	-13.2%
Whiskas	$13 million	-21.8%	29 million	-23.3%
Iams Select Bites	$12.5 million	65.9%	13 million	44.3%
Total	$906 million	-1.8%	1.5 billion	-9.5%

New report: Petfood and pet care products in China
With increasing disposable income levels and a growing tendency to humanize pets, along with increased acceptance for fortified/functional packaged food and vitamins and dietary supplements, the future for health and wellness petfood and pet care products in China appears bright. Fortified/functional products will become the norm, with players striving to find new ways of differentiating themselves from competitors, according to Euromonitor International. The nutritional composition of petfood will be increasingly significant, with players homing in on key nutritional ingredients such as omega-3 and -6 oils or calcium.

This trend will inevitably be strongest in premium dog and cat food, where high prices offer more room for nutritional experimentation and permit the use of high-quality ingredients. However, mid-priced dog and cat food will also benefit from new product development focusing on health and extending the life expectancy of pets. Larger players such as Effem may indeed conduct widespread product trials to prove the health-giving properties of its products, as Effem did in India. This is a particularly pertinent issue for Effem, given the 2004 media scandal blaming its Pedigree and Whiskas brands for health problems in dogs and cats.

Euromonitor International publishes petfood and pet care reports on 52 country markets. Click here for more information about petfood and pet care reports from Euromonitor International and to buy reports online.

Product news

New service designed to build consumer confidence in petfood
Integrated Management Information, Inc. has announced the launch of Pet Supply Verified, a “comprehensive new petfood verification system designed to build consumer confidence in petfood products.” Pet Supply Verified was reportedly developed in response to the recent nationwide petfood recalls. More information is available on http://www.petsupplyverified.com.

E-news

Broadband users make online time a priority
Broadband users spend almost half their spare time in a typical weekday online, according to Media-Screen's Netpop|Play report. A copy of the study provided to eMarketer stated that the average broadband user spent an hour and 40 minutes of his/her typical weekday spare time online.
Over half of that time online was devoted to entertainment and communication. The study also noted a range of users' spare time activities, and found that E-mail and personal web surfing trumped TV viewing. Josh Crandall of Media-Screen said that the point of the results was not that broadband users spend more time online, but that online marketing is still underused in proportion to that time.

“Currently, the proportion of advertising resources devoted to the Internet (about 7%) is nominal relative to the value it generates in interest and engagement among fans,” said Crandall. “As more of the population goes online and there are more marketing channels, it will be imperative for the industry to know how to effectively allocate marketing and advertising dollars,” he said.

Positions available

•Penford Food Ingredients Co. seeks R&D scientist–pet products
Company summary: Headquartered in Centennial, Colorado, USA, Penford Corp. is a US$325 million (sales), publicly held developer, manufacturer and marketer of specialty natural-based ingredient systems for industrial and food applications. The company uses its carbohydrate chemistry expertise to develop ingredients with starch as a base for value-added applications in several markets including papermaking and food products. The company manages its business in three segments:

Industrial Ingredients – North America (approximately 50% of total sales),
Food Ingredients – North America (approximately 20% of total sales), and
Australian and New Zealand Operations (approximately 30% of total sales).

The first two segments, industrial ingredients and food ingredients, are broad categories of end-market users, primarily served by the United States operations. The third segment is the geographically separate operations in Australia and New Zealand. The Australian and New Zealand operations are engaged primarily in the food ingredients business.

Penford's family of products provides functional characteristics to customers' products. Carbohydrate-based specialty starches possess binding and film-forming attributes that provide convenient and cost-effective solutions that make customers' products perform better. The company has extensive research and development capabilities, which are used in understanding the complex chemistry of carbohydrate-based materials and their application. In addition, Penford has specialty processing capabilities for a variety of modified starches.

Penford's North American Food Ingredients Business is operated through Penford Food Ingredients Co., based in Centennial, CO. Products for food applications are designed to enhance the characteristics of food coatings; reduce fat, improve texture and bind moisture in protein applications; improve texture and reduce fat in soups, sauces, gravies and dairy applications; improve the quality and texture in imitation cheese; improve the characteristics of dough and mixes for bakery; develop binders, moisture control and novelty products for the companion animal market; and provide specialty sweeteners and tableting agents for food, nutraceutical and pharmaceutical applications.

Position summary:

Title: Research scientist – pet products
Location: Headquarters based in Centennial, Colorado, USA
Reports to: Director of business development
Other primary relationships: President and general manager; territory sales managers (6); R&D managers (2); R&D team members (10); marketing managers (2); customer service manager; and customer service team members (3).

Penford Food Ingredients operating background:

Total sales–US$58MM (Penford Food Ingredients sales)
US manufacturing plants–4 (Washington, Idaho, Wisconsin, Iowa)
Total no. of employees–9
Manufacturing employees–68
Sales employees–6
Marketing employees–3
R&D employees–10
Administrative employees–10
Products offered–potato starch; corn starch; tapioca starch; rice starch; dextrin (potato and tapioca); spherical dextrose; potato starch gel.

Nature and scope: The research scientist–pet products focuses on the development and extension of PFI's product offering to the companion animal marketplace. The position works closely with the business development and field sales teams to identify, investigate and develop pet products using Penford's carbohydrate technology systems.

A key focus for the Research Scientist is the development and usage of ingredients and ingredient systems for use in dry food, wet food, snacks and novelties for companion animals. The position will work closely with R&D and commercial resources within customer organizations serving as the primary technology transfer agent for PFI.

The research scientist will participate heavily in the product commercialization process. This will include executing the commercialization plan while providing necessary support to external and internal customers.

Principal responsibilities:

Leverage PFI knowledge of carbohydrate technologies in petfood and novelty applications.
Develop ingredient systems that enhance the performance and functionality of edible pet products.
Analyze commercialized products to identify market entry and improvement opportunities.
Conduct experiments on ingredient usage and functionality in targeted applications.
Prepare ingredient functionality indexes based on application.
Advise and support the business development and field sales team in technical presentations and serve and category technical expert.
Serve as technology transfer agent between PFI and customer.
Develop experiments of scientific design and document results to support intellectual property claims.
Research and evaluate patent literature to determine feasibility of work product in commercial marketplace.
Keep abreast of new developments and technology that may be advantageous to Penford.
Provide technical support to Company manufacturing resources in commercial product scale-up.

Qualifications: The ideal candidate has a successful track record of new product development of pet products in an industrial or consumer branded environment and will possess the following experience and abilities:

Minimum of eight years R&D experience developing petfood and treats in a commercial environment.
The ability to effectively analyze, evaluate, and develop petfood and treat formulations.
Knowledge of ingredient systems and processing conditions in commercial petfood applications.
Successful track record of developing commercially viable products.
Strong analytical capabilities.
Good computer aptitude.
Effective written and verbal communication skills.
Outgoing personality and flexible, team player attitude.
Bachelor's degree in Animal Science, Food Science or related discipline. MS a plus.
Strong pet industry market knowledge.

Compensation and benefits: The company offers a highly competitive total compensation package, including base salary, annual division bonus participation, health and other standard benefits. For consideration, please submit a resume, letter of interest and salary history to: jsmith@penx.com or Penford Food Ingredients, pet research scientist, 7094 S. Revere Pkwy., Centennial, CO 80112 USA.

•SPF: Sales account manager needed
SPF North America Inc., the worldwide leader of palatability enhancers, is seeking a sales account manager. This position will play a major role in our development in North America. Individuals with entry-level sales experience are encouraged to apply. Contact Judy Gehler with your resume at jgehler@spf-usa.com or fax to +1.715.926.5285.

Our help wanted listings aim to inform petfood industry professionals about employment opportunities worldwide. Contact gstadel@wattnet.net for more information on placing a listing in upcoming issues.

Contact information

To submit any information you would like us to consider for publication on our website, in the printed magazine, or on this newsletter, E-mail your information to Jenny Kvamme, DVM.

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