The FDA wants to regulate spent grains, and the beer industry is not having it

posted at 6:41 pm on April 14, 2014 by Erika Johnsen

In case any of my fellow beer-lovers out there are not already aware, thanks to auspices of both federal and state governments, Americans generally pay quite a bit more for their favorite alcoholic beverage than what it really costs brewers to produce and distribute. An estimated national average of 40 percent of what we pay for beer is actually just various taxes, via the Tax Foundation:

There isn’t much consistency on how state and local governments tax beer. This rate can include fixed-rate per volume taxes; wholesale taxes that are usually a percentage of the value of the product; distributor taxes (usually structured as license fees but are usually a percentage of revenues); retail taxes, in which retailers owe an extra percentage of revenues; case or bottle fees (which can vary based on size of container); and additional sales taxes (note that this measure does not include general sales tax, only those in excess of the general rate).

The Beer Institute points out that “taxes are the single most expensive ingredient in beer, costing more than labor and raw materials combined.” They cite an economic analysis that found “if all the taxes levied on the production, distribution, and retailing of beer are added up, they amount to more than 40% of the retail price” …

The federal government, however, is looking to potentially jack those government-imposed costs up ever further — all for our own good, of course. Last October, the Food and Drug Administration proposed a potential new rule via the Food Safety Modernization Act that would regulate brewers’ spent grains the same way as pet food, requiring that the grains be dried and packaged to ward off contamination before they come into contact with other humans. Seeing as how this would completely mess up the mutually beneficial arrangement between many brewers and ranchers wherein ranchers come and pick up brewers’ spent grains and then productively and inexpensively recycle them as a feed source for their livestock, this rule poses something of a problem.

The U.S. Food and Drug Administration today issued a proposed rule under the FDA Food Safety Modernization Act (FSMA) aimed at improving the safety of food for animals. This proposed regulation would help prevent foodborne illness in both animals and people and is open for public comments for 120 days. The proposal is part of the Food Safety Modernization Act’s larger effort to modernize the food safety system for the 21st century and focus public and private efforts on preventing food safety problems, rather than relying primarily on responding to problems after the fact.

The proposed rule would require makers of animal feed and pet food to be sold in the U.S.to develop a formal plan and put into place procedures to prevent foodborne illness. The rule would also require them to have plans for correcting any problems that arise.  The proposed rule would also require animal food facilities to, for the first time, follow proposed current good manufacturing practices that address areas such as sanitation.

“The FDA continues to take steps to meet the challenge of ensuring a safe food supply,” said FDA Commissioner Margaret A. Hamburg, M.D. “Today’s announcement addresses a critical part of the food system, and we will continue to work with our national and international industry, consumer and government partners as we work to prevent foodborne illness.”

But the beer industry is arguing that they have no idea what exactly these foodborne illnesses are supposed to be, since the grains are already declared fit for human consumption before they start the brewing process and because they have been working with ranchers for decades without problems. A bunch of brewers are currently protesting the proposed rule, arguing that the equipment and processes they would need to install would make the whole thing too expensive, and that they’ll just end up trashing their spent grains into landfills — while ranchers are worried that they’ll lose a valuable source of feed, via HuffPo:

The controversy surrounds the rule’s effect on the longtime practice of beer brewers giving their spent grain, the malted barley left over after the beer brewing process, to neighboring ranchers and dairy farmers. The practice serves two purposes: to help the brewers get rid of millions of tons of leftover product, and to provide a free, nutritious food source for animals at local farms.

Under the new regulation, the practice would be outlawed, unless breweries go through expensive and time-consuming measures to ensure the grain is up to regulation. …

Since the grains are used to brew beer, they have already been deemed safe for human consumption. But the FDA fears the lack of oversight from the time of brewing to the time the grains are fed to the animals could lead to contamination. …

But though the move could be a problem for brewers, some say it could deal a fatal blow to small ranchers and farmers.

“If I were to purchase feed, it would be an extra $300-400 per day,” said Rick Olufs to HuffPost.

Olufs is the owner of Olufs Ranches in Windsor, Calif., and has been feeding spent grain to his cattle for over 30 years. For the past 18, he estimates, he’s gotten his grain from Cilurzo and her husband at Russian River Brewing Company. “We’ve worked together a long time,” he said.

I realize this seems like something of a niche issue, but it is exactly this sort of regulatory death-by-a-thousand-cuts that is largely preventing our economy from the robust rebound that the Obama administration is still trying to convince us is actually happening — and niche issue though it may be, it’s plenty important to the many craft brewers in, say, Colorado, for instance. Ahem.

In one of those intersections of economic clout, linking Colorado’s craft breweries with the need to shore up U.S. Sen. Mark Udall’s (D-CO) shaky reelection prospects, spent grains are suddenly right up there with health care and traffic congestion as statewide issues.

Udall fired off a letter Monday to FDA Commissioner Margaret Hamburg demanding that she put the proposed animal food rule aside until a “risk assessment” can be completed on the reuse of spent brewery grains as animal feed.

“I support a robust framework of smart regulations that minimize unnecessary risk and keep our nation’s food supply safe,” Udall wrote. “This particular part of the Animal Food (Rule), while well intentioned, does not seem based on evidence of risk or hazard. I hope FDA will reconsider its initial interpretation and formally review the body of evidence that exists in abundance on this particular topic to determine if in fact spent brewers grains warrant designation as ‘animal food.’”

Udall claims new regulatory treatment of brewer’s grains is not justified, adding, “Perhaps most relevantly, the U.S. Department of Agriculture has decades worth of data that demonstrates the history of spent brewers grain used as animal food. This information does not reveal to my knowledge any evidence that dedicating spent brewers grains for agricultural use has ever compromised food safety to animals or humans.”


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To borrow from Nancy Reagan: JUST SAY NO!

It’s time to start telling the government NO.

“NO you can’t tax that”
“NO you don’t have that authority”
“NO I am not going to do that”

Treat the Federal Government like the spoiled 6 year old brat it is.

ConstantineXI on April 14, 2014 at 6:42 PM

It competes with DDGS from ethanol plants.

Kermit on April 14, 2014 at 6:44 PM

You mess with the beer, and it’ll be considered fightin’ words…..

dentarthurdent on April 14, 2014 at 6:47 PM

Coincides very nicely with the U.N. wanting to save the planet by turning us all into vegetarians. Except, the Mooch of course who couldn’t live without her wagu beef.

BeachBum on April 14, 2014 at 6:49 PM

Call me crazy but this could be an indirect attack on the meat industry, which the global warming nuts have placed in their sights as one of the causes of that lie.

Mr. Curly on April 14, 2014 at 6:49 PM

The FDA wants to regulate everything. (don’t they already?)

Mimzey on April 14, 2014 at 6:50 PM

Besides – didn’t a recent study claim that marinating your steak in beer before grilling reduces carcinogens?
Sounds like we need to be feeding our cows more beer byproducts, not less.

dentarthurdent on April 14, 2014 at 6:51 PM

Progressives still trying to get us to stop drinking. Banning it didn’t work so they’ll drive the price up.

Where in the constitution is the FDA authorized?

Grammar Nazi on April 14, 2014 at 6:55 PM

Progressives still trying to get us to stop drinking. Banning it didn’t work so they’ll drive the price up.

Where in the constitution is the FDA authorized?

Grammar Nazi on April 14, 2014 at 6:55 PM

This one is a double hit – higher cost for both beer AND beef – a leftist eco-terrorist wet dream.

dentarthurdent on April 14, 2014 at 6:57 PM

Ah, good ol’ FDA with a solution in search of a problem.

Bitter Clinger on April 14, 2014 at 7:00 PM

Progressives still trying to get us to stop drinking. Banning it didn’t work so they’ll drive the price up.

Where in the constitution is the FDA authorized?

Grammar Nazi on April 14, 2014 at 6:55 PM

When has the constitution ever stopped them from doing anything?

rightside on April 14, 2014 at 7:02 PM

Whut? No spent grains for animal feed? I guess they will stymie that cow flatulence and save us from Global Warming as well.

elowe on April 14, 2014 at 7:02 PM

Is Bloomberg, et al, behind this?

vnvet on April 14, 2014 at 7:03 PM

A solution in search of a problem.

What a bunch of jerks.

WitchDoctor on April 14, 2014 at 7:05 PM

Well, yeah.

Murphy9 on April 14, 2014 at 7:06 PM

I feed my spent brewing grains to the chickens.

HICON on April 14, 2014 at 7:06 PM

Whut? No spent grains for animal feed? I guess they will stymie that cow flatulence and save us from Global Warming as well.

elowe on April 14, 2014 at 7:02 PM

Bingo.

I wish beef producers would refuse to ship Wagyu beef to the White House in protest.

slickwillie2001 on April 14, 2014 at 7:14 PM

They should post this article over on The Daily Gay. The way that pos site can spin an issue is unbelievable.

Nexialist on April 14, 2014 at 7:14 PM

Perhaps we should feed used bureaucrats to cattle, instead.
Of course, cattle no doubt have standards, and might reject them as non-nutritive refuse.
Best to grind them up reeeell little-bitty like, and mix a bit of barley in there.

Worth a try, I say. Worst that could happen is a dramatic shortage of bureaucrats.

orangemtl on April 14, 2014 at 7:18 PM

I’ve got an idea. How about we regulate the govermnent?

rrpjr on April 14, 2014 at 7:26 PM

How about this: start making life hell for gun owners, beer drinkers, and pickup truck drivers.

You want to start a revo, that will do it.

Bishop on April 14, 2014 at 7:31 PM

I’ve got an idea. How about we regulate the govermnent?

rrpjr on April 14, 2014 at 7:26 PM

^ Waitress, I would like to buy this man a 40% overpriced beer.

Axe on April 14, 2014 at 7:36 PM

Why not? They regulate just about everything else already.

xNavigator on April 14, 2014 at 7:36 PM

The government sets up petty rules just so they have an excuse, when ever they need it, to inspect, fine, arrest any person, group or organization it likes.

Name the people that make these rules.

albill on April 14, 2014 at 7:40 PM

How about this: start making life hell for gun owners, beer drinkers, and pickup truck drivers.

You want to start a revo, that will do it.

Bishop on April 14, 2014 at 7:31 PM

Amen Bishop.

vamp57mw on April 14, 2014 at 7:41 PM

They don’t want us to drink and smoke as it will add to nationalized healthcare’s financial burden, and they want to make sure they have a comfortable margin from which to steal.

But, most Americans don’t smoke and rarely drink, so I doubt there will be significant outrage about it. Even the ticked off will still either not vote or vote for the same old names/faces next election, so what’s the point of even complaining about it?

Dr. ZhivBlago on April 14, 2014 at 7:46 PM

Well, they got in bed with B.H.O and supported him in all kinds of different ways. Now they cry when they come after them for more $.00
I think a lot of Americans are just plain “stuck on stupid”!

mmcnamer1 on April 14, 2014 at 7:57 PM

So what outbreak of disease has occurred that warrants this? Oh, that’s right. NONE!

GarandFan on April 14, 2014 at 8:01 PM

The price of beer and Tbones will necessarily skyrocket. Oh, well, the epa will be outlawing grills pretty soon.

Kissmygrits on April 14, 2014 at 8:11 PM

It is far past time to make all regulations subject to Congressional approval and presidential signature, just like all other laws.

Food safety is entirely a phony issue. There is no problem with the safety of the food supply, much less of the supply of brewers’ grain as livestock feed.

The alleged incidents of food poisoning are tiny; the investigations usually cannot pinpoint sources because the evidence is so thin, scarce and inconclusive. I did some calculating on a supposed contaminated egg problem a year or two ago, and found that the incidents of possible actual illness amounted to one egg in a half a million produced and sold. Before that, an “outbreak” of food poisoning from vegetables could not determine what type of vegetable was the culprit. Eventually they (arbitrarily?) decided it was a batch of peppers which had been irrigated with sewer water.

There is virtually no food supply problem. Where there are problems, the professionals working the supply chain quickly crack down on the perps. One incident of food poisoning can close a restaurant or grocery forever. Let the market do its job. Stop the bureaucrats from fabricating problems and imposing costly, unnecessary “solutions”.

RedBaker on April 14, 2014 at 8:16 PM

Spent grain is also delicious in breads.

Lance Corvette on April 14, 2014 at 8:54 PM

This country is being crushed under a incomprehensible Federal Bureaucracy. All the federal agencies are in headlong competition with each other for regulatory power and tax dollars. Our laws now seem to come more and more from federal agencies or from federal courts orders. Our elected officials would rather play petty politics with each other while handing out favors to special interest and political donors.

There is a solution, time for dissolution
Unthinkable? I’m pretty sure that what most folks in the USSR thought in 1986.

Wallythedog on April 14, 2014 at 9:41 PM

Udall fired off a letter Monday to FDA Commissioner Margaret Hamburg demanding that she put the proposed animal food rule aside until a “risk assessment” can be completed after the 2014 elections

Fixed….

UltimateBob on April 14, 2014 at 9:52 PM

Not just brewers, but distillers would also be affected by this regulation, and if you think your income taxes are too high you should see how much the feds take from the sale of a bottle of whisky.

smfoushee on April 14, 2014 at 9:59 PM

C’mon Erika… just a modicum of research on the topic would have lead you to this vital bit of the story.

Now, the FDA is clarifying its intentions—saying that the law is not meant to require spent grains be dried and pre-packaged—and plans to update its proposal.

FDA To Revise Its Plan

On Friday, the FDA said in an e-mailed statement to Twin Cities Business that, after soliciting comments on its proposed rule and hearing brewers’ concerns, it will propose “revised language” later this summer, at which point it will provide more details.

But national associations like the American Malting Barley Association and the Beer Institute informed members that they have now heard directly from FDA officials, and the proposed changes appear less dramatic than first anticipated.

“The primary concern of the FDA now appears to be how the spent grain is held at the brewery and transported to the farm,” the American Malting Barley Association told its members.

In other words, the agency appears to be seeking documentation to confirm the cleanliness of the silos that store the grains and the trucks that transport them—which would presumably have a much smaller impact on brewers than if they were, say, required to dry and package the spent grains.

Local Brewers React

Mark Stutrud, CEO of Summit Brewing, first reacted to the FDA’s proposal by saying that substantial changes to the spent-grain process could become “very serious” for his industry.

But following the latest clarifications from industry trade groups, Stutrud said he believes that the issue has been resolved—and he agreed with the FDA that small brewers should be required to keep their equipment clean and keep appropriate records.

That doesn’t mean brewers are completely at ease. Fitger’s Nelson, for example, said it remains difficult to gauge the impact of the FDA proposal until the rules are more defined. Even without packaging requirements, other changes could still translate to increased costs, he said.

For example, Fitger’s brewers shovel spent grains from their “mash tuns,” which steep the grains, into open plastic buckets, which are picked up by farmers and put directly onto a field. Nelson said it’s unclear at this point whether that process would pass muster, or if, say, a brewery might be required to purchase an auger that moves spent grains into a closed truck container.

“We’re definitely watching it,” Nelson said of the FDA’s upcoming revised language. “A big part of our food brand is wrapped up in what we call the ‘beer-beef cycle,’” he said, pointing out that the company has even set up a Facebook page touting Fitger’s “Drunken Cattle Brewhouse Beef” brand.

lexhamfox on April 14, 2014 at 10:06 PM

Beer is the new tea! Party time.

shades_of_gasden on April 14, 2014 at 10:22 PM

Welcome to Fascist America

deadite on April 14, 2014 at 10:36 PM

AGED BEER: Older Budweiser.

Dr. Charles G. Waugh on April 15, 2014 at 2:24 AM

lexhamfox on April 14, 2014 at 10:06 PM

Are you naive enough to think this “re-evaluation” was the result of anything except public outcry? LOLOL You’re funny!

gryphon202 on April 15, 2014 at 5:42 AM

Is there a problem that this proposal is addressing? Has there been a rash of livestock sickened by unregulated spent grain? I doubt it, since considering the cost of an animal, how many farmers would continue to feed them with something detrimental just because it was free?
This is just the government’s standard operating procedure at work: If it ain’t busted, fix it ’til it is.
Once the busybodies find their tax revenues shrinking because of the over-regulation and taxation of beer, they’ll come after us homebrewers with egregious recycling requirements the way the Nazis in San Francisco do — mix your eggshells with your coffee grounds or carrot stumps and you’ll get a knock at the door.

tpitman on April 15, 2014 at 5:59 AM

@ Lexhamfox,

Do you really think that an expensive auger and closed trucks are easier to clean than a shovel and some plastic buckets? The feds can pound sand. Tpitman is absolutely right that if they pass new regulations for the breweries, it won’t be long before they are making life Hell for homebrewers. Don’t think that these jerks do not have that as their end game. It is the entire point. They don’t like the lost tax revenue from people who make their own beer. Why do you think moonshining is illegal?

SteveThomas on April 15, 2014 at 9:31 AM

I don’t want to be mean. And Erika Johnsen seems like a nice person. But her grammar and vocabulary drive me right around the bend.

“thanks to auspices of both federal and state governments”

ERIKA! If you don’t know what a word means, please just use another word.

Gesundheit on April 15, 2014 at 10:44 AM

1. Why is the FDA involved? Since it is livestock feed, should not the regulating agency be the Dept. of Agriculture?
2. What demonstrated problem is being solved? Where are the decimated herds/flocks from contaminated feed?
3. Who would be incented to allow contaminated, spoiled feed? Perhaps the brewer/distillers, but the livestock producers, who are removing the spent grains from the brewery/distillery, are disincented, since they would be damaging their livelihood. So the system has a built in regulation.

MTinMN on April 15, 2014 at 11:11 AM

Udall claims new regulatory treatment of brewer’s grains is not justified, adding, “Perhaps most relevantly, the U.S. Department of Agriculture has decades worth of data that demonstrates the history of spent brewers grain used as animal food. This information does not reveal to my knowledge any evidence that dedicating spent brewers grains for agricultural use has ever compromised food safety to animals or humans.

There ya go, using common sense and facts again… please don’t make it a habit… please use the pre-arranged narrative.

Keith_Indy on April 15, 2014 at 12:22 PM

It’s time like these that I really wish I could win the lottery and have $100 Million at my disposal…oh the ads I would run, the billboards I would purchase. Dems and the Feds would be wishing for the days of the Koch brothers.

nextgen_repub on April 15, 2014 at 1:04 PM

1. Why is the FDA involved? Since it is livestock feed, should not the regulating agency be the Dept. of Agriculture?
2. What demonstrated problem is being solved? Where are the decimated herds/flocks from contaminated feed?
3. Who would be incented to allow contaminated, spoiled feed? Perhaps the brewer/distillers, but the livestock producers, who are removing the spent grains from the brewery/distillery, are disincented, since they would be damaging their livelihood. So the system has a built in regulation.

MTinMN on April 15, 2014 at 11:11 AM

You miss the point. There is budget to be had. There will be some GS-15 to be the FDA director of alcohol waste management. Then there will be ONE GS-14 for distilled spirits waste management another for malt beverages and another for wine. Each will have an immediate staff of 5 people and then each department will need a flock of inspectors each with support staff to ensure compliance. This is nothing but the FDA trying to justify another budget increase.

hunthjof on April 15, 2014 at 3:24 PM

Foolish, wasteful bureaucrats should begin and end their discussion with the Russian River dairyman who has been feeding his cows beer byproduct safely for the past 30 years!

FireBlogger on April 15, 2014 at 6:03 PM

There are too many people working for the federal government, trying to justify the paychecks they collect. If there were 25% fewer bureaucrats and at least 25% fewer government agencies, that would be good for everyone except the AFSCME honchos who would have less money from union dues.

J Baustian on April 15, 2014 at 11:37 PM