by Peter Quinter, guest columnist

The US Food and Drug Administration (FDA) issues “Import Alerts” almost daily. A recent one that affects many seafood importers is Import Alert #16-81, issued May 1 and entitled “Detention without Physical Examination of Seafood Products Due to the Presence of Salmonella.”

The Import Alert identified hundreds of specific companies from countries all over the world. Although many people mistakenly believe that adulterated food may come from certain countries such as China, the truth is that there are hundreds of companies listed from countries including Korea, Japan, Thailand, India, Philippines, etc. Any seafood from companies on the “Red List” will not be allowed to enter the United States, but will instead be detained because of the suspected presence of salmonella pursuant to 21 USC 801(a)(3).

Fortunately, there is a procedure to clear seafood that has been automatically detained, even if it is on the Red List, through the FDA. An importer must establish to the FDA that the particular shipment of seafood has been tested using the Salmonella Analyses described in the Bacteriological Analytical Manual (BAM), 7th Edition (1992). A private laboratory familiar with food testing for FDA import procedures must be used, with samples obtained, submitted, and analyzed by that food testing laboratory. A lab report must then be issued by the private laboratory to the FDA. Once the FDA laboratory reviews the report and determines that the particular shipment is not adulterated with salmonella, the FDA Compliance Officer at the local port where the food is being detained will authorize the release of the shipment through an FDA Notice of Action.

Otherwise, the seafood will be “refused” by the FDA and, within 90 days, must be destroyed under FDA supervision or exported from the United States under the supervision of the US Customs and Border Protection (CBP). An attorney familiar with both CBP and FDA import procedures often works with the importer to coordinate the activities of the private laboratory with the local FDA Compliance Officer.

There is a separate procedure for foreign suppliers identified on the Import Alert’s Red List for detention without physical examination to submit a request that they be removed from the list to the FDA’s Division of Import Operations and Policy (DIOP). That means that a foreign manufacturer or supplier of seafood can permanently get off the Red List so that the seafood it ships to the United States will automatically proceed through FDA without being detained and examined. The process may take several weeks to several months before the FDA issues a decision on the request for removal from the Red List.

Please call or email me with any questions or comments at peter.quinter@gray-robinson.com or (954) 270-1864.

Copyright © 2012 GrayRobinson

About Peter Quinter

Long-time Datamyne Blog contributor Peter Quinter is now a Shareholder in GrayRobinson’s Miami and Ft. Lauderdale offices and Chair of the Customs & International Trade Law Group. Mr. Quinter principally represents persons and companies involved in international trade and transportation. He is editor of the GrayRobinson Customs and International Law Blog. Quinter is widely recognized for his expertise in international and trade law: He was appointed by the US Secretary of Commerce to the Florida District Export Council; Florida Trend magazine recognizes Quinter among its “Legal Elite” in the area of International Law; Florida Super Lawyer magazine includes him in the top 5% of Florida; and he is recognized in “Best Lawyers in America” in the area of FDA Law.

You can contact Peter via email at peter.quinter@gray-robinson.com or at (954) 270-1864.

Reuters reports that Brazil will end automatic import licensing for 10 perishable products from Argentina, including apples, raisins, potatoes, wheat flour, and some cheeses and wines. The policy change, which will take a couple of months to implement, is the latest retaliatory response to Argentina’s restrictive trade policies which include non-automatic licensing on a list of 600 goods.

The change will apply to these imports from all sources, but products from Argentina will be singled out for delays while inspectors consider license applications. Under the new rule, they will have up to 60 days to make up their minds – plenty of time for cargoes to spoil.

We took a look at our data on first-quarter trade in some of the perishables mentioned by Reuters (see the table below). Clearly, these products represent a small slice of Brazilian import trade – but within each product category, Argentina is a leading, if not the primary, source.

The consequences of this trade spat go well beyond the price of apples in Brasília. We’ve noted that Uruguay’s bright prospects are clouded by Mercosur partner Argentina’s protectionist policies. The Financial Times opines that Mercosur trade partnership itself may be dead in the water.

Download Datamyne’s free report, Quick Look at Mercosur Import-Export Trade, here.

Last month, a flurry of headlines, starting with a report in the UK’s Telegraph, warned that the wholesale price of vanilla was set to rise sharply – adding as much as 10% to the retail price of a vanilla ice cream cone this summer.

Within days, the primary source cited in the Telegraph’s story – Nick Peksa of market analysts Mintec – was resetting the forecast for a price spike from “likely” to just “possible”.

Shortfalls in Mexican and Indian production seem to have prompted some stockpiling of vanilla from Madagascar. But, as Madagascar accounts for from two-thirds to 80% of global output, the impact of poor harvests in a couple of the several countries that contribute the other 20-30% should be modest.

Right now, says Peksa, the market for vanilla has “nicely balanced” supply and demand. This equilibrium might be upset by an event in Madagascar, such as a hurricane or political unrest, and vanilla prices could move up, perhaps double, but will go nowhere near as high as 2003.

Indeed, the price of vanilla reached a peak of $500 per kilogram in 2003. The current price is estimated to be approaching $40/kilogram, up from the $20/kilogram vanilla’s been stuck at for the last six years.

Both extreme weather and political unrest were the immediate causes of the stratospheric price climb of 2003. But, really, this period marked the final loosening of the old regime’s grip on the country … and its economy. Through the 1990s, Madagascar’s vanilla producers, farm-gate prices and export volumes were closely regulated and, by extension, so was the global vanilla market.

As in 2003, Madagascar is still the leading vanilla producer and the small market remains vulnerable to speculative price swings. There are some important differences in the 2012 market, however. When prices peaked, global consumption of vanilla beans fell by half. Estimates vary, but the natural product seems to have permanently lost a third of its previous (already minority) market share to synthetic substitutes.

The last six years of low prices have caused Madagascan farmers to neglect vanilla – derived from the pods of orchids that must be pollinated, harvested, processed, sorted and graded by hand – in favor of more profitable crops.

Meanwhile, new countries are entering the market for vanilla. These include countries such as Uganda and Tanzania that have been encouraged by agencies such as USAID to cultivate this high-value labor-intensive crop for export. At $20/kilogram, the value doesn’t seem so very high for all the labor involved. And, in fact, the Fair Trade minimum price at the source is about $40/kilogram (where today’s higher market prices are headed) plus a $6 premium for local community development, for a total minimum price to the buyer of $46/kilogram.

Datamyne’s trade data confirms vanilla’s flat-line price and the fall-off in vanilla shipped from Madagascar to the US, the world’s largest consumer of vanilla, over the last five years.

The data on last year’s imports indicates the rising significance of Uganda’s vanilla exports (10.5% in 2011 compared to 8.8% in 2010) as well as the success of USAID. Tanzania, another USAID beneficiary, also makes the top five, in its very first year of exporting vanilla to the US.

Top US importers, based on first-quarter volumes, are Roukia Trading; Firmenich Inc.; Tripper, Inc.; Dammann & Co., Inc.; and Peru Food Import, Inc. To find out what else you can learn about vanilla – or any other ingredient in trade – contact us, or speak to one of us by clicking “live chat” on our homepage.