Business Of Farming

Being Like Soros in Buying Farmland Reaps Annual Gains of 16%

By Seth Lubove
August 10, 2011 12:00 AM EDT

Perry Vieth baled hay on a neighbor’s farm in Wisconsin for two summers during high school in 1972 and 1973. The grueling labor left him with no doubt about getting a college degree so that he’d never have to work as hard again for a paycheck. Thirty-eight years later, and after a career as a securities lawyer and fixed-income trader, Vieth is back on the farm.

Except, now, he owns it. As co-founder of Ceres Partners LLC, a Granger, Indiana-based investment firm, Vieth oversees 61 farms valued at $63.3 million in Illinois, Indiana, Michigan and Tennessee. He’s so enthusiastic about the investments that he quit a job in 2008 overseeing $7 billion in fixed-income assets at PanAgora Asset Management Inc., a Boston-based quantitative money management firm, to focus full time on farming, Bloomberg Markets magazine reports in its September issue.

On a spring afternoon, Vieth, 54, barrels along backcountry roads in a Jeep Cherokee in Indiana and Michigan to scout a fruit orchard and corn and soybean farms to buy. Rural towns with names such as Three Rivers pass by in a blur, separated by a wide horizon of fields with young crops popping up.

“When I told people I was leaving to start an investment fund in farmland, they said, ‘You’re doing what?’” says Vieth, in a red polo golf shirt and khakis. “It will always be difficult for Wall Street firms to understand. It’s not like buying stocks on a computer.”

It’s much better: Returns from farmland have trounced those of equities. Ceres Partners produced an average annual gain of 16.4 percent after fees from January 2008, just after the firm started, through June of this year, Vieth says.

George Soros

The bulk of the returns are in rent payments from tenant farmers who grow and sell the crops and from land appreciation. The Standard & Poor’s GSCI Agriculture Index of eight raw materials gained 5.3 percent annually over the same period, and the S&P 500 Index (SPX) dropped almost 1 percent.

Investors are pouring into farmland in the U.S. and parts of Europe, Latin America and Africa as global food prices soar. A fund controlled by George Soros, the billionaire hedge-fund manager, owns 23.4 percent of South American farmland venture Adecoagro SA.

Hedge funds Ospraie Management LLC and Passport Capital LLC as well as Harvard University’s endowment are also betting on farming. TIAA-CREF, the $466 billion financial services giant, has $2 billion invested in some 600,000 acres (240,000 hectares) of farmland in Australia, Brazil and North America and wants to double the size of its investment.

Jim Rogers

“I have frequently told people that one of the best investments in the world will be farmland,” says Jim Rogers, 68, chairman of Singapore-based Rogers Holdings, who predicted the start of the global commodities rally in 1996. “You’ve got to buy in a place where it rains, and you have to have a farmer who knows what he’s doing. If you can do that, you will make a double whammy because the crops are becoming more valuable.”

The growth in demand for food, spurred by the rising middle classes in China, India and other emerging markets, shows no signs of abating. Food prices in June, as measured by a United Nations index of 55 food commodities, were just slightly below their peak in February. The UN’s Food and Agriculture Organization said in a June report that it expects food costs to remain high through 2012.

So many investors have rushed to capitalize on food prices in the past three years that they may be creating a farmland bubble. The Federal Reserve Bank of Kansas City, which covers Colorado, Kansas, Nebraska and other agricultural states, said in May that farmland prices had surged 20 percent in the first quarter compared with a year earlier.

Safe Haven

“Yes, farmland will be a bubble again; all agricultural products will be in a bubble again,” says Rogers, who is an investor in Agrifirma Brazil Ltd., a South American farmland owner.

Hedge-fund manager Stephen Diggle calls farming the ultimate safe haven. Diggle began buying farms with his own money in 2008 after Lehman Brothers Holdings Inc. (LEHMQ) filed for bankruptcy in September of that year and the S&P 500 plunged 43 percent in the next six months. He purchased 8,000 acres in Uruguay, three smaller plots in southern Illinois and an 80-acre New Zealand kiwi-and-avocado orchard.

“We really thought all the investment banks would go under,” says Diggle, who as a hedge-fund manager uses options and warrants to bet on price swings in the market. “Everyone said, ‘Buy gold.’ But at the end of the day, you can’t eat it. If everything else goes and I just have these farms, it makes me moderately wealthy.”

‘Prosperous China’

The hedge fund Diggle co-founded, Artradis Fund Management Pte in Singapore, suffered about $700 million in losses. He closed it in March and opened another Singapore-based hedge fund, Vulpes Investment Management Pte. Diggle plans to incorporate his five farms into an investment management group run by Vulpes.

From his vantage point in Asia, where the British expatriate has worked for the past two decades, Diggle says he’s witnessed aspiring locals eating their way up the food chain.

“You can see what a more prosperous China will consume,” Diggle, 47, says. “It means more dairy, more meat -- not just pork and chicken.”

Investors find in farmland a respite from the cyclical price swings of the commodities market. Since 1970, there have been at least four price jumps of at least 100 percent that were followed by steep declines in the S&P agriculture commodities index. By contrast, the average value of an acre of farmland tracked by the U.S. Department of Agriculture has been on a mostly steady climb from $737 in 1980 to $2,350 in 2011.

Leaving BlackRock

“Farmland is the lowest-risk part of the value chain, but it’s also a key part of production,” says Jose Minaya, TIAA- CREF’s head of natural resources and infrastructure investments.

In the U.K., where farm prices are also rising, one money manager traded his career at BlackRock Inc. (BLK) for one in farming. Graham Birch, 51, left in 2009 as the London-based head of the natural resources team at BlackRock, the world’s biggest asset manager, to run his two dairy, wheat and barley farms in southwest England full time.

Birch, who says farming has suffered from a lack of investment and management talent, has spent $1 million on improvements. He now captures all of the effluent from his 600- cow herd, stores it in a 4 million-liter (1-million-gallon) steel tank and uses it as fertilizer for his crops. “At heart, I am basically a businessman, and I want to try to apply the things I learned over the years to see what I could do,” Birch says.

Wall Street Roots

Ceres Partners’ Wall Street roots are evident in the firm’s makeshift office in an old clapboard farmhouse that sits in the middle of cropland. Lucite tombstones resting on a shelf in a small room mark deals done by Brandon Zick, a former vice president of strategic acquisitions at Morgan Stanley (MS)’s investment management unit. Vieth hired Zick in January to help analyze and manage farm purchases.

Vieth, a 1982 graduate of the University of Notre Dame Law School, began his career as a securities and corporate lawyer before moving to the pits of the Chicago Mercantile Exchange, where he traded S&P 500 options. After a series of stints running an arbitrage team for Fuji Securities Inc. and other firms, he was hired as chief investment officer of fixed income at PanAgora, the quant firm, in 1999.

By about 2006, Vieth’s concerns about the economy were mounting: Inflation was at a low, and the dollar had peaked as U.S. debt and deficits soared. So he searched for an asset class that would benefit from a currency decline and rising prices. His research led him to farms, since a falling dollar boosts U.S. crop exports.

Falling Dollar

Vieth then connected with Paul Blum, a fellow Notre Dame alumnus who spent some of his youth on a farm in upstate New York and today acts as Ceres’s point person with tenant farmers.

As the dollar fell 24 percent against the euro from January 2006 through May 2008, the pair started buying land as personal investments until the business grew too big for Vieth to manage during evenings and weekends. So, in late 2007, he founded Ceres, just as tightening credit markets began to push the global economy into a recession.

He named the firm Ceres for both the Roman goddess of agriculture and a bar he frequented during his trading days in Chicago. “I was more convinced hard assets were where you wanted to be, and farmland was the best investment I could identify,” Vieth says. By May 2011, he had collected 17,238 acres, mostly in the Midwest.

Shade and Rocks

When Vieth wants land, he goes shopping, as he does with Zick and Blum under a partly cloudy southern Michigan sky in May. Armed with aerial and soil maps, they look for farms with predictable rainfall, mineral-rich land and good drainage. They avoid land that slopes too much, which could lead to soil erosion.

The trio drive by a 337-acre farm for sale by a bank, and Vieth frowns at the slant of the land and the trees that line the perimeter. “Those trees will shade the corn and stunt growth,” he says. Blum doesn’t like the many rocks scattered on the unplanted dirt. Zick is skeptical that the bank will get its asking price of $7,000 an acre in a foreclosure sale.

The investors next visit a farmer they hired, Ed Kerlikowske Jr., who grows watermelon, peas and corn on their 782-acre spread near Berrien Springs, Michigan. For farmers such as Kerlikowske, the entry of outside investors frees up money for new equipment that they would otherwise have to spend on land. “To really grow the business in today’s economy, you need partners,” Kerlikowske says as he passes around slices of fresh watermelon.

Possible Bubble

The farm-investing boom is making lots of people happy, but could it all end in tears? The Federal Deposit Insurance Corp., which regulates banks that lend to farmers, has examined whether investors may be pumping up prices and creating the conditions for a crash like the one that devastated the market in the 1980s, resulting in the failure of 300 farm banks.

In March, then-FDIC Chairman Sheila Bair devoted a symposium to the topic in Washington with the participation of economists, bankers and agricultural experts. “If there is a bubble in farmland prices, I hope the bulk of any correction is borne by investors such as hedge funds and not by the banking industry,” William Isaac, chairman of the FDIC during the farm banking bust and now senior managing director of FTI Consulting Inc. (FCN) said during the event.

Overpaying

Charles McNairy, whose family has been involved in agriculture since 1871, says neophyte investors who lack a deep understanding of farming are making bad deals. In 2009, McNairy started U.S. Farming Realty Trust LP, a fund based in Kinston, North Carolina, that had raised $261 million as of late May to buy farms, according to a Securities and Exchange Commission filing.

McNairy says funds such as Ceres have been overpaying for land, based on the return from crops. “Ceres shouldn’t be buying in the Midwest,” says McNairy, who declined to disclose the states he invests in. “It’s crazy to be buying up there.”

Vieth disagrees, saying Ceres’s returns prove that his strategy is working. “I certainly don’t want to start slinging mud, but I don’t know what the heck he’s talking about.”

Greyson Colvin, who started farming fund Colvin & Co. LLP in Anoka, Minnesota, in 2009, dismisses the idea of an overheated market. “After the housing bubble, people are a little too quick to assign the word bubble these days,” says Colvin, whose two funds and separately managed accounts hold 2,300 acres of farmland in Iowa, Minnesota and South Dakota valued at more than $10 million.

Head Winds

Colvin, a former analyst at UBS AG (UBSN) and Credit Suisse Group AG (CSGN), says U.S. farmers aren’t carrying as much debt as they did during the 1980s crisis, which contributed to the downfall of banks as agriculture loans defaulted. The farm debt-to-asset ratio, which peaked in 1985 at 23 percent, is expected to fall to 10.7 percent in 2011, according to Agriculture Department estimates.

Vieth’s farm funds are facing head winds in coming months and years: A likely rise in interest rates will push up his acquisition costs and the value of the dollar, which in turn might hurt commodity exports. While the former trader keeps a close eye on the dollar, he says farming will continue to thrive.

Investors seem to agree. At a dining-room table in the farmhouse in Granger, Vieth sits down at his computer one evening and totals the day’s haul: another $900,000 from investors looking for comfort -- and profits -- in one of the oldest and most essential industries on the planet.

To contact the reporter on this story: Seth Lubove in Los Angeles at slubove@bloomberg.net;

To contact the editor responsible for this story: Laura Colby in New York at lcolby@bloomberg.net.

http://mobile.bloomberg.com/news/2011-08-10/being-like-soros-in-buying-farm-land-lets-investors-reap-16-annual-gains

Expanding The Climate Zone - Ginger In Virginia

Growing baby ginger: Farmers find it’s worth the fuss

By Tim Carman, Published: October 18

If you walk past the tidy rows of raspberries inside the hoop house at Casselmonte Farm, you’ll dead-end at a waist-high forest of green stalks, whose explosion of leaves conceals not a single fruit or vegetable. If you didn’t know any better, you’d swear that Bill and India Cox were growing Florida swamp grass on their property in Powhatan County, Va.

As it turns out, the couple is raising a crop with virtually the same recognition factor as swamp grass: baby ginger. These young rhizomes, buried in the soil just under that jungle of foliage, will not mature long enough to develop the familiar beige skin of their older siblings. Nor will they develop any of those stringy fibers that can make grating mature ginger feel as if you’re trying to shred a burlap bag. Immature ginger is off-white, rather soft and pliant, with rosy, undeveloped leaves called bud scales. Baby ginger tickles your palate instead of assaulting it.

You sort of feel as though you want to pinch baby ginger’s cheeks.

The infant analogy is apt. The growing season for immature ginger, roughly from March to October, is almost as long as the gestation period for a human newborn, and baby ginger might be just as difficult to raise. The plants require not only a long growing period (which, on a farm, can monopolize valuable real estate) but also ample amounts of water and just the right soil temperature. “They’re not an easy crop,” says Heinz Thomet, owner of Next Step Produce, an organic farm in Charles County, which was an early adopter of “fresh” ginger (as it’s often called) about five years ago.

Bill, 64, and India Cox, 59, a pair of former office professionals from Richmond and Annandale, respectively, are just discovering the unique challenges of growing a tropical plant in the Mid-Atlantic as they move forward with their second careers as small-scale farmers. The couple planted baby ginger for the first time this season to supplement their more common crops, including tomatoes, greens and carrots, and they’ve had to confront the limitations of central Virginia as a hub for ginger production.

The weather, of course, is the primary obstacle. Ginger is fussy; it prefers a warm environment — but not too warm. The plant generally requires soil between 50 and 90 degrees, which essentially means that the Mid-Atlantic can be a miserable place to grow the crop. The late winter and early spring months are too cold, and the summers too hot.

To deal with the climactic vagaries, the Coxes had to sprout their ginger seed — merely pieces of mature rhizomes — in a tented and heated area in their basement until temperatures in the hoop house were warm enough for replanting. In late April, the couple transferred the ginger to the hoop house, where it fared well until the heat of July turned some of the plants’ leaves brown. The farmers tried to comfort their stressed crops by keeping the space well ventilated and the plants well watered.

Like all beginners, the Coxes learned other tricks too late. They could have bought a screen that would have limited the sun’s ability to heat the hoop house like a toaster oven; they could have rotated the plants around the hoop house, giving each one equal time near the structure’s ventilated walls; they could have clumped the plants closer together, so that their own foliage would provide shade for the soil. Yes, they could have done any or all of those, but they didn’t have to. Instead, the weather finally cooled a little in August.

You might wonder how the Coxes could move their ginger around once the seeds are planted. Simple: Rather than placing the rhizomes directly into the ground, the couple submerged their ginger in durable fabric grow-bags filled with a nutrient-rich potting soil mixed with mineral-heavy, super-fine rock dust from a nearby quarry. The bags allow the farmers to have, literally, a movable crop.

Despite the farmers’ best efforts, however, nature still tends to win out in the region, which explains, in part, why the Coxes harvest their ginger when it’s immature. The cold fall temperatures, by and large, won’t allow them to extend the season the extra two or three months that ginger needs to mature fully. Plus, as Bill Cox notes, baby ginger is “a product that you can’t find. Period.” That gives Casselmonte Farm some cachet when it takes its produce to markets, such as the Powhatan Farmers Market on Thursdays or the South of the James Market on Saturdays in Richmond.

If Susan Anderson has anything to say about it, the Coxes soon will have a lot more competition. Early this year, Anderson started East Branch Ginger, a company in Pittsboro, N.C., that imports organic ginger seed from Puna Organics in Hawaii, where the plant thrives. Anderson is sort of the Joanna Appleseed of baby ginger. Her company might be built for profit, selling nearly 4,000 pounds of the Big Kahuna ginger seed to about 150 growers in its first season, but her agenda is largely to proselytize. She has the constitution for it. Anderson is not just a saleswoman for ginger. She also grows the stuff; she holds a degree in horticulture from Virginia Tech.

“Countrywide, this is something that’s very new,” says Anderson, who also works with her customers to help them grow ginger. “It’s like people discovering basil for the first time. . . . I think the potential is huge. It’s a matter of getting farmers on board with it, because it is a different crop.”

Anderson sold Bill and India Cox their seed pieces. Her sales pitch is direct and somewhat fear-based: While ginger rhizomes bought at local stores or through wholesalers can be tainted, she says, East Branch’s products are free of diseases such as fusarium and bacterial wilt, ginger’s most common afflictions. Once one of those diseases sets in, “it’s very difficult to get rid of it,” Anderson says. The fusarium fungus, in particular, can contaminate a field for years.

Such a warning, you’d think, would scare the bejesus out of the average baby ginger farmer in the Mid-Atlantic, who’s still a rookie in this budding business. But apparently not. Next Step Produce and Tree and Leaf Farm in Unionville, Va., buy ginger seed in bulk: Next Step from a restaurant wholesaler and Tree and Leaf from an international market. “Our seeds can’t be traced back” to their source, says Katherine Stewart, the Tree and Leaf manager who handles the farm’s fresh ginger production (which, alas, has already wrapped up for the season).

The problem with the organic, disease-free seed from Hawaii is, plain and simple, the price, says Thomet of Next Step. East Branch Ginger’s rates range from $5.50 to $9.50 a pound, depending on the quantity purchased. Thomet can pay a fraction of those prices for his wholesale seed, which gives him a better return on investment for such a high-maintenance crop. The going rate for baby ginger can vary widely at farmers markets around the country — from $7 to $25 a pound, says East Branch’s Anderson — but even the lowest price is still higher than the price of mature ginger at, say, Whole Foods on P Street NW, where it sells for $5.99 a pound.

“I think it ends up being a pretty good moneymaker for the farmers,” says Bernie Prince, co-director of FreshFarm Markets, whose outdoor markets have featured at least three vendors selling baby ginger this season: Next Step, Tree and Leaf and New Morning Farm (whose experiments produced only a small amount of the crop).

In the end, the gamble on ginger seeds essentially falls on the farmers’ shoulders; they’re the ones who assume the risk of contaminating their soil or losing most of their crop. (The consumer assumes no risk at all: Even diseased ginger is safe to eat.) So far, Thomet says, he has had only one misfire: Several years ago he bought Chinese rhizomes, which “just rotted,” he says.

If a rhizome is disease-free, whether purchased from East Branch or H Mart, it can produce baby ginger of rare beauty, all pink and slender and ivory, in contrast to the majority of fall produce, a khaki parade of lettuces and squashes. The aroma of baby ginger is intoxicating as well, even three feet above the rhizomes. Just plant your face in the middle of ginger leaves and breathe deeply. It’s a contact high of perfume and pungency.

You don’t have to sell Greg Haley on the benefits of baby ginger. The chef de cuisine at Amuse restaurant at the Virginia Museum of Fine Arts in Richmond has been gobbling up ginger from Bill and India Cox from the start: rhizome, stalk, leaves and all. The chef has incorporated the immature rhizomes into a half-dozen dishes, including a new one in which he pairs grilled chicken thighs with fried lengths of baby ginger and a carrot juice reduction infused with the flavor of ginger leaves.

“It’s a lot more subtle” than mature ginger, Haley says. “I like that most of the things I’ve used it in so far, I don’t even peel it. . . . There’s no need to; the skin is so white and thin, it just melts into whatever you’re doing.”

http://www.washingtonpost.com/lifestyle/food/growing-baby-ginger-farmers-find-its-worth-the-fuss/2011/10/12/gIQAHHEhuL_story.html

Olive Oil

Beyond extra virgin: New standard aims to guarantee quality in olive oil

By Jane Black, Published: October 18

Paolo Pasquali does not like to be called a crusader for good olive oil. But when I visited his oleoteca, the tasting room he built at Villa Campestri, his “olive oil resort” in the hills north of Florence, it was impossible for him to talk of anything else. At lunch, dinner and breakfast the next morning, Pasquali rhapsodized about the storied history of the olive and fumed about consumers’ feckless embrace of cheap oil. And, for most of the time, his pitch sounded like that of any number of upstart chocolate, coffee or cured-meat producers: Like wine, my product deserves more respect.

That is, until Pasquali reached into an imposing antique sideboard and pulled out a silver tray holding several small, brown apothecary bottles. “Smell this,” he said, waving one labeled “rancid” under my nose.

It didn’t smell bright or floral, like Pasquali’s oil. But it did smell familiar. The rancid oil smelled like most olive oils I had had at restaurants and cooked with at home.

It has been about 30 years since many Americans began giving up their lard and Crisco for more-healthful extra-virgin oil. But that extra-virgin label has proved a poor guide to choosing the highest-quality oils. According to a recent study by the UC Davis Olive Center, 73 percent of the top five brands of imported extra-virgin olive oil failed to meet accepted international standards for extra-virgin. Moreover, a separate report revealed that 44 percent of consumers actually preferred rancid or fusty oil, a possible result of the prevalence of substandard extra-virgins available to American consumers.

Now, a new movement is afoot to redefine extra-virgin, teaching consumers — and the marketplace — what makes high-quality olive oil. Last year, Pasquali helped build an olive oil tasting program at the Culinary Institute of America in California’s Napa Valley. An international organization, 3E, has created a “super-premium” category for extra-virgin oils that meet exacting standards of production, milling and storage. At the “Beyond Extra Virgin” conference this summer in Cordoba, Spain, the executive director of the International Olive Council, the guardian of the current extra-virgin standard, acknowledged that better label information should be a “priority for the sector.”

New students of olive oil often believe the product was better before the sector industrialized. But extra-virgin oil is, in fact, a 20th-century invention. New technology allowed for faster picking and pressing and, therefore, fresher oil. Modern storage techniques eliminated exposure to heat and light, two factors that lead to rancidity. Indeed, the European Parliament invented the term “extra-virgin” only in 1960. Many Americans believe it refers to the first pressing of the olives, but in fact it’s a baseline standard that embraces any oil made by solely mechanical means, instead of chemical treatment, and with less than 0.8 percent of free acidity, a laboratory measurement of rancidity. (Formerly, the limit was 1 percent.) Extra-virgin oils also are forbidden to have “disgusting odors such as rancidity, putridity, smoke, mold and olive fly.”

“Extra-virgin just means it’s free of defects,” said Greg Drescher, executive director of strategic initiatives at the Napa CIA. “Can you imagine a stamp of approval in the wine industry that says it’s good enough because it’s not defective?”

The popularity of the Mediterranean diet in the 1990s was a boon to the olive oil industry. But olive oil fraud was also on the rise, according to a forthcoming book, “Extra Virginity,” by Tom Mueller (Norton, 2011). Generous government subsidies encouraged farmers and corporations to overstate their production figures and to make up the difference with inferior olive oil or even seed oils. Americans aren’t the only consumers who are cheated. “There is no difference between Tuscany and the United States,” said Pasquali, who takes his own olive oil with him to local restaurants. “We’re all in the same boat.”

Rampant fraud makes it difficult for high-quality producers to compete. But critics say the extra-virgin standard fails even the market of legitimate oils. The minimum sensory and chemical requirements admit a huge range of oils. Some are perfectly fine. Others are extraordinary. “But as a consumer, it’s impossible to look at a shelf of bottles and be able to guess which is which,” said Drescher.

3E (pronounced “tray ay” because it’s Italian), an international organization, is trying to change that with the debut of its “super-premium” category. The group gives that stamp of approval to 21 producers, including Pasquali’s Villa Campestri and McEvoy Ranch, in Marin County, Calif. To receive the 3E certification, oil must pass rigorous chemical and sensory analyses. (Where extra-virgin allows oils with 0.8 percent free acidity, for example, 3E allows just 0.3 percent.)

Producers also must submit documentation about cultivation, milling and storage practices and on-site inspections. The aim is to certify the oil in a particular bottle and not — as is done for, say, Burgundy and Bordeaux wines — the estate. So a producer’s oil might make the cut one year but not the next. Super-premium olive oils cost far more than the supermarket stuff. Half-liter bottles run between $30 and $55.

The new category offers particular opportunities for small California olive oil producers, which have difficulty competing with the scale and reach of their European competitors. California producers provide about 1 percent of the olive oil consumed in the United States; over time, they aim to grow that to 10 percent. “We see this as an opportunity to set our oil apart,” said Jeff Creque, McEvoy’s mill supervisor.

McEvoy’s 3E oil is available at the Flavor Bar at the CIA in Napa. Guests pay $15 to watch a video presentation that explains how super-premium olive oil differs from plain old extra-virgin. Then they taste: chickpeas, shredded cabbage and chocolate custard with marmalade, each paired with a super-premium oil.

As at Villa Campestri, the CIA also offers an olive oil menu in its restaurant, which employs Pasquali’s patented olive oil dispenser called OliveToLive. The shiny copper console keeps three oils under a layer of nitrogen gas — safe from heat and light — until the moment they are poured into small glass flasks and served.

The contraption, says Bill Briwa, a CIA chef-instructor, allows consumers to taste the variety of flavors in an extra-virgin oil that’s as fresh as if it had just been pressed. Since the CIA’s olive oil tasting program launched in February 2010, 3,500 visitors have sampled olive oils at the Flavor Bar or in its restaurant.

Educating consumers about peppery, grassy or fruity notes is fun. But freshness is the simplest and most compelling way to illustrate the difference between excellent and run-of-the-mill extra-virgin olive oils, says Luanne O’Loughlin, manager of Olio2Go, an online olive oil market based in Fairfax that sells about 75 varieties (including a spicy, fruity, 3E-approved Tuscan estate oil, La Poderina Toscana).

“Without tasting a good and a mediocre oil side by side, it is very hard to convince someone. Freshness is a concept they can grasp,” O’Loughlin said. It is also essential, she added, for reaping the health benefits of olive oil. Older, rancid oils lack not only vitality and flavor but also antioxidants, which are believed to protect against some cancers, heart disease and other chronic ailments.

Ultra-fresh oil is what brought the CIA’s Briwa to his olive oil “aha” moment. It happened about 10 years ago, when the culinary academy was given an olive press by a local producer. The oil straight from the press tasted “pure, unsullied, like sunlight,” he remembers. It was completely different from the oil served with bread he had tasted at Napa restaurants.

Still, even Briwa, an avid crusader, knows it will be difficult to reeducate the American public. “There are some consumers who get it. They’ve had their epiphany here or somewhere in Tuscany,” he said. But for the rest, it’s a challenge. “The question is: How do you make someone have an epiphany?”

http://www.washingtonpost.com/lifestyle/food/beyond-extra-virgin-new-standard-aims-to-guarantee-quality-in-olive-oil/2011/10/13/gIQAG8Q1uL_story.html?wprss=rss_lifestyle

Saturday, October 8, 2011 9:44 AM EDT

California Tightens Olive Oil Labeling Rules

California's burgeoning olive oil producers are counting on a newly enacted state labeling law to persuade more consumers that American brands are more virginal than their imported rivals.

The measure, signed into law on Friday by Governor Jerry Brown, tightens the definitions of various calibers of olive oil, such as "virgin" and "extra virgin," to conform with standards recently adopted by the Department of Agriculture.

Supporters of the bill say overseas labeling enforcement has slipped to the point where the overwhelming majority of imported "extra virgin" olive oil on supermarket shelves is actually a lower-grade product.

The aim of the new law is to help persuade California shoppers to reject imported olive oil touted as "extra virgin" in favor of domestic brands that are more honestly labeled, and more than likely made from olives grown in-state.

"We spend a lot of money for imported extra-virgin olive oil that in many cases isn't extra virgin, when we produce actual extra-virgin olive oil ourselves," said state Senator Lois Wolk, a Democrat who sponsored the labeling measure.

In 2010 studies, University of California at Davis and Australian researchers found that of the five best-selling imported "extra virgin" olive oils 73 percent of bottles tested failed to meet International Olive Council standards for "extra virgin."

To California's expanding olive oil industry, what "extra virgin" means is a big deal. The state's "extra virgin" is unable to compete against lower-priced and sometimes lesser quality imports claiming to be "extra virgin."

A tighter definition of olive oil grades is aimed at preventing that.

Each year, more California growers enter the marketplace. The amount of California farmland devoted to olives raised for oil has increased from 6,000 acres in 2004 to 30,000 acres today.

Given its Mediterranean-like climate, California accounts for 99.5 percent of U.S. domestic olive oil production. It ranks about 20th worldwide.

Still, roughly 80 percent of all categories of olive oil are made in the European Union. While labeling standards there are comparable to the USDA's, enforcement has been lax, allowing for adulteration and labeling abuses, critics say.

The volume of olive oil consumed by Americans has jumped ten-fold during the past 30 years, from 8 million gallons to 80 million gallons annually.

"One of the fastest-growing production crops is olives. They're being planted the way they were planting vineyards 10 years ago," said Wolk, whose kitchen contains bottles of olive oil made in her northern California district.

"The good stuff tastes different. More flavorful. Full-bodied."

http://sanfrancisco.ibtimes.com/articles/227560/20111008/california-tightens-olive-oil-labeling-rules.htm

October 17, 2011

A Surfeit of Pesto

By MARTHA ROSE SHULMAN

Summer is long gone, but my basil doesn’t know that. When tomatoes are around I have no trouble staying on top of my crop, as rare is the tomato salad on my table that isn’t showered with slivered basil leaves. Now I’m making big batches of puréed basil with olive oil to freeze and use later for pesto and pistou (the Provençal version of pesto, minus the pine nuts). I make the pine nut and garlic paste and blend it into the basil and olive oil along with the cheese when I need the pesto; the garlic will taste much better if it’s fresh. If you don’t like the taste of raw garlic, you can always leave it out.

I use pesto and pistou in many other dishes besides pasta. Pesto is a nutritionally dense condiment; basil is a great source of flavonoids that are believed to have antioxidant and antibacterial properties. It’s also an excellent source of vitamin K, and a very good source of iron, calcium and vitamin A.

Pesto and Pistou

Purists will only use a mortar and pestle for pesto. I like the results I get using a hand blender inside a straight-sided jar. As long as you make the full batch, this is the best machine to use, as it purées the basil much more efficiently than a food processor.

1 or 2 garlic cloves, to taste

2 cups fresh basil leaves, tightly packed (2 ounces)

2 tablespoons Mediterranean pine nuts* (for pesto; omit for pistou)

Salt and freshly ground pepper to taste

1/3 cup extra virgin olive oil

1/3 cup (1 1/2 ounces) freshly grated Parmesan, or a mixture of pecorino Romano and Parmesan (more to taste)

1. If using a hand blender, place the garlic, basil, pine nuts, salt and olive oil in a pint jar. Stick the hand blender right down into the mixture and turn on. Blend until smooth. You may have to start and stop a few times at the beginning, and scrape down the sides of the jar. Once the mixture is smooth, add the cheese and stir or blend together. If using a food processor fitted with the steel blade, turn on and drop in the garlic. When it is chopped and adhering to the sides of the bowl, stop the machine and scrape down the sides of the bowl with a spatula. Add the basil, pine nuts, salt, pepper and olive oil to the food processor and process until smooth and creamy. Add the Parmesan and pulse until well combined. If using a mortar and pestle, add the basil leaves a handful at a time and mash with the pestle. Add the pine nuts, garlic, salt and pepper, and mash to a paste with the basil. Work in the olive oil and the Parmesan.

Yield: 1/2 to 2/3 cup

Advance preparation: You can freeze pesto or pistou for several months, and it will keep in the refrigerator for a few days. If you are making this for the freezer, you’ll get the best results if you purée the basil with the olive oil and salt only. When ready to use, mash the garlic and pine nuts, blend in the thawed basil purée, and add the cheese.

*If I can’t find pine nuts that come from the Mediterranean, I substitute pumpkin seeds. Some people have a bad reaction to certain varieties of pine nuts, and I am one of them.

Nutritional information per tablespoon: 86 calories; 2 grams saturated fat; 1 gram polyunsaturated fat; 6 grams monounsaturated fat; 2 milligrams cholesterol; 1 gram carbohydrates; 0 grams dietary fiber; 42 milligrams sodium (does not include salt to taste); 2 grams protein

For pistou (without pine nuts), per tablespoon: 98 calories; 2 grams saturated fat; 1 gram polyunsaturated fat; 7 grams monounsaturated fat; 3 milligrams cholesterol; 0 grams carbohydrates; 0 grams dietary fiber; 53 milligrams sodium; 2 grams protein

Martha Rose Shulman is the author of “The Very Best of Recipes for Health.”

http://www.nytimes.com/2011/10/17/health/nutrition/17recipehealth_pesto.html?_r=1