**As entries close for the <2008 beverage innovation awards>beverage innovation awards><1> (deadline 22 February), it's time to reflect on awards programmes from previous years, in which entries traditionally highlight market trends.** Ready to drink coffee, a strong contender in late 2005 and throughout 2006, was present in the last awards, as was tea – in more variants than ever before. The ‘superfruits’ – açaí and pomegranate – began to appear in an increasing number of juice combinations. Clearer product positioning in terms of branding and benefit or occasion-related labelling was also a clear trend over the past two years, and issues such as natural and organic indicate the move towards provenance, fair trade and local. But last year, as the judging panel met in Brussels to review the entries, it had to admit that the majority of innovations represented through the awards were in the juice arena. Yes, of course, the traditional carbonated soft drinks sector has evolved at a tremendous pace over the past 18 months, and new non-carbonated categories seem to have been created, but innovation in this sector has mainly been limited to ingredient variation and calorie reduction offerings. Will this year’s awards see these trends continue or will something new emerge? Categories overlapping “2006 saw the emergence of a huge number of category busting products, including carbonated juices, water with juice and juices with so many additives that they have evolved beyond pure juice to become complex beverages," said Zenith International Publishing's Bill Bruce. “It's becoming difficult to see where one category stops and another begins.” As far as its activities in Brussels is concerned, UNESDA – the Union of European Beverages Associations – represents the interests of the ten major operators, plus all of the national associations of the non-alcoholic beverages industry – an industry fondly referred to until only a little over one year ago as the “soft drinks industry”. The juice industry is represented separately, as is bottled water, by other associations. However, Bill Bruce points out that over three quarters of the businesses represented through UNESDA feature juice and drinks with a high juice content in their portfolios. Over one third of this year’s awards entries featured juice in one form or another, and more than one quarter came from companies that refer to themselves as juice businesses. Consumer issues drive agenda "The issues that drive the regulators in Europe are mainly consumer issues," added Bill Bruce. "The UNESDA commitments saw an industry responding to the health and physical activity debate. Beyond that response, the industry was even praised for setting the agenda and raising the bar in terms of variety of offering, portion size and availability. In addition, it has gone on to present a clear message in terms of labelling and is successfully monitoring the commitments. Beyond the original nine signatories, close to 100 companies have now signed. “Most of the consumer issues that interest Brussels affect juice as much as carbonates. In fact, all non-alcoholic beverages compete for consumers’ attention in an increasingly varied offering, ranging from overtly good-for-you products to the deliberately decadent. “Some observers have said that the juice industry was concerned that so many traditional carbonates companies had diversified into juice, cynically suggesting that this was a ploy to distract from the real issues concerning sugar and so on. In fact, these companies entered the juice arena directly due to consumer demand. “The beverage innovation awards present a fascinating opportunity to take a snapshot of what's happening across the whole non-alcoholic drinks industry right now. To the consumer, and to many in the industry, each different category and type of drink simply offers a choice dictated by occasion, benefits, needs – and in many cases, cost. “I've written in past issues under the heading ‘One industry, one voice', as I firmly believe that, while there are many issues which dictate a separate agenda for each association, the consumer issues provide common ground that should be dealt with on a common agenda. The awards process therefore forces us to look at traditional carbonates alongside juices, just as the consumer might contrast and compare non-alcoholic drinks options in-store. “I hope that the issues that bind these products together may soon be reflected in increasingly direct cooperation between the associations representing all sectors, including juice and water.” Finalists and winners in the 2008 beverage innovation awards will be announced during the 4th InnoBev Global Soft Drinks Congress in Moscow in April.* <1>: http://www.beverage-innovation.com/2008beverageawards%28New%29.asp

*Cadbury Schweppes announces that Dr Pepper Snapple Group, Inc. (DPS) has filed a revised and updated version of its Form 10 Registration Statement with the US Securities and Exchange Commission (SEC). * In addition to information disclosed in DPS' two earlier filings, this revised version of the Form 10 includes further information on the relationship between Cadbury Schweppes and following the demerger, and information on future compensation programmes of DPS. The document is available on the SEC's website, www.sec.gov. Today's filing relates to the proposed demerger by Cadbury Schweppes of its Americas Beverages business. DPS will own Americas Beverages following the demerger and will be listed on the New York Stock Exchange. The revised Form 10 is the third filing by DPS, following its initial filing on 13 November 2007. DPS will file further revisions in the first half of 2008. A final Form 10 will be filed with the SEC and sent to shareowners before the demerger becomes effective, which isn't expected to occur before the second quarter of 2008.

Specialist soft drinks company, Metro Drinks is expanding Latitude, its popular iced tea range, into 750ml retail/take-home glass bottles. Initially there are two green tea flavours: the top-selling mango green tea and a delicious new raspberry flavoured green tea. The new range provides consumers with a healthier alternative to an alcoholic drink, and also many other soft drinks. The range has just 66 calories per 200ml serving, the antioxidant properties of green tea and no artificial sweeteners or preservatives. They're light, refreshing and fruity while preserving the subtle dryness of the green tea. Commenting on the new range, Paul Bendit, Metro Drinks’ founder, said: “Consumers are now much more adventurous in choosing tea flavours as well as being aware of the health properties of green tea, so our new raspberry green tea responds specifically to this consumer trend. And the new range also provides shoppers with a new, large format ready-to-drink tea range for enjoying at home.” The new range has a 12-month shelf life and joins the existing Latitude Iced Tea range that's currently available in 275ml and 375ml bottles. Metro Drinks also produces Herbert’s, the UK’s only Fairtrade iced coffee, Juice Patrol, the healthier drinks range for children, and Qu4ttro Stagioni, its premium adult soft drink range. The new 750ml Latitude green teas will retail at around £2 per bottle and is available in cases of 12.

Scottish & Newcastle has announced its intention to close its Berkshire Brewery operations, on the outskirts of Reading, by early 2010. It will immediately commence consultation with affected employees at the site on the impact of the closure of Berkshire Brewery. The consultation process will include full support for all employees affected. This follows the announcement in November 2007 of the closure of bottling facilities at the site, and the transfer of 3 million hectolitres of production to Coors Brewers Ltd, under a contract brewing agreement. S&N has carried out a detailed review of the site, and concluded that closure is currently the most viable option going forward. These plans have been shared with the Heineken & Carlsberg consortium as part of the due diligence. The intention would be to transfer residual brewing and packaging work progressively to other S&N sites, including Tadcaster in Yorkshire, the Royal Brewery in Manchester and Dunston, Gateshead. If fully implemented, the net effect of these changes would be a saving of £13 million per annum from S&N’s cost base, which will enable it to remain competitive within the UK market. Alternative employment Every effort will be made to seek alternative employment for those affected, including outplacement support, retraining and/or redeployment where a suitable alternative post exists. S&N will work closely with local agencies to ensure that the impact on the local economy and community is minimised. Stephen Glancey, S&N Group Operations Director said: “It's well documented that there is general over-capacity in the UK brewing sector, and these proposals have been put in place to address this issue. The nature of the Reading site, the amount of investment required to make it competitive, and its relative cost compared to other UK facilities means that there's a strong business case for closure. "We will, of course, do all we can to mitigate the effects of the closure on the people affected.” Briefings with affected employees began 12 February, and talks with union representatives will begin over the next few days. In the meantime, it remains business as usual at the site.

It will also be partner of the Canadian Olympic and Paralympic Teams for the Beijing 2008, Vancouver 2010 and London 2012 Games. Saputo’s participation in the 2010 Winter Games was a logical fit, as it's an extension of its involvement in sport. With this partnership, Saputo will bring the Vancouver 2010 Olympic and Paralympic Winter Games into kitchens across Canada.

Watermark Consultancy’s Mike Hurst assesses the impact of the summer 2007 floods on the UK cooler industry.

Wal-Mart Stores has announced that it has become the first US grocery chain to require suppliers to have factories certified against the Global Food Safety Initiative standards. Factories supplying the US superstore's private label and other food products such as produce, meat, fish, poultry and ready-to-eat foods will be expected to meet the standard. According to Wal-Mart, Global Food Safety Initiative (GFSI), a group of international retailers, now lists Wal-Mart among the companies which have agreed to improve food safety through a higher and consistent auditing standard. Wal-Mart said that under the GFSI program, producers of Wal-Mart and Sam's Club private label and other foods sold in the US must be audited by independently trained, approved and licensed auditors who are experts in their industry. The GFSI requires food suppliers to achieve factory audit certification against one of its recognized standards, which include Safe Quality Food (SQF), British Retail Consortium (BRC), International Food Standard (IFS) or an equivalent such as Global-GAP. Wal-Mart Senior Vice President and Chief Compliance Officer JP Suarez, also board member of the GFSI, said: "We are taking this additional step to ensure the integrity of our products throughout the entire food supply chain. We encourage other US retailers to follow our lead and to also endorse these standards."

Some of our competitors are sanitising by just using ozonators. Is this proper sanitisation? Ozone is a highly effective disinfectant – one of the best – but it isn't a cleaning agent. Its use must be preceded by physical cleaning of the surface. The definition of sanitisation is cleaning followed by disinfection. The objective of sanitisation is to remove the biofilm that forms on the water contact surfaces of coolers and render them fit for another period of use. After three months or more, biofilm levels can become significant. Biofilm is a layer of protective polysaccharides excreted by bacteria attached to a wetted surface, which can contain millions of bacteria within it. A disinfectant may only kill those bacteria at the surface, as most disinfectants react and combine with organic matter. This means that they quickly become neutralised when confronted by significant organic matter such as biofilm. Therefore, only the surface layers of biofilm are reached and many undesirable microorganisms may remain unaffected. In addition, the biofilm matrix remains even when bacteria within are killed. This acts as a food source and a refuge for further bacteria that will inevitably come along. This is why the biofilm must be physically removed before disinfection. Ozonation remains to be tested by the EBWA test protocols for cooler sanitisation methods. The only form of ozone that can be used on its own is in the cooler ozonators, which ozonate daily and wipe out the naked bacteria before they can lay down biofilm. These have been tested according to the EBWA protocols and work. What is the correct procedure for schools and offices that are closed over the Christmas break with regards to switching off POU coolers? Should they be sanitised before use is resumed? It's part of the BWCA and EPDWA schools codes that coolers should be sanitised at the beginning of each school term even if the coolers are left running. The trouble is that many schools and businesses now switch off coolers over long breaks to "save the planet". This will permit bacterial regrowth in a POU cooler and may lead to raised microbial counts and possibly unpleasant tastes developing in the cooler. There are, however, no health issues here as the heterotrophic plate count of water comprises harmless water bacteria that are able to grow in the low-nutrient conditions existing in clean coolers and bottled water. I also recommend that the mains feed be disconnected at the cooler before sanitisation, and that it's run until the water comes through cold before reconnection. Water sitting in warm feed pipes may have deteriorated. After shorter breaks, five litres should be run to waste by the school before drinks are taken. This should flush out the feed pipes, filter and cooler. A client who has just taken delivery of new POU coolers from us is complaining that the water from the hot tank is causing tea to “go frothy”. What can we do? I've heard of this before. I'm assuming, of course, that you have cleaned/sanitised the cooler and removed any manufacturing residues/chemicals from the hot tank before issue. A client of mine recently had this problem, which was caused by gas trapped in organic tea bags being released in the hot water, and had nothing to do with water quality. We've recently installed a cooler in a local community centre and are finding that it's being damaged and soiled by people washing their feet from it. What can we do? This does go to show the unexpected perils encountered by coolers in the field. The trouble is that a POU cooler doesn't obviously have a bottle on it and may be perceived as just a fitting on the tap water supply. I suggest the following, some of which may work: Put a notice on the cooler in the appropriate language saying: ‘To be used for drinking purposes only’. Speak to those who run the centre and suggest that they install foot washing facilities for those preparing to pay.i>Change the cooler for one with recessed taps.Point out that the cooler ought to be sanitised more often.We have a client on a large development site that regularly returns most bottles to us encrusted in dust, paint, cement or worse. What should we do? Such bottles must be discarded, as they're not fit for washing. If washed, they will probably affect your washer, with the result that most of your bottles will go out in a contaminated condition. Excessive bacterial and algae growth are likely consequences of a dirty washer. At present, you're losing significant money on every bottle you sell, as the economics of bottle use rely on many refills into each washed bottle. Ask yourself what does a new bottle cost? How much am I charging this customer for a filled bottle? The sums may prove alarming. You have a number of choices: Stop supplying the customer. You're probably losing money on every delivery. Charge a bottle deposit. The drawback is that this adds to administrative costs. Include the full cost of a new bottle in your charge for filled bottles. Suggest that POU may be more appropriate. The trouble is that sites like this often don't have running water in the right places. And then, of course, we could well have heavily soiled coolers instead of dirty bottles!

POU coolers In July and August 2007, the UK experienced extreme summer weather which had a large impact on bottled and POU coolers. Such phenomena are not confined to the UK, so there are lessons here for bottled and POU cooler operations across Europe. In part one, I talked about the impact of heavy rainfall on one bottler. POU was also affected, but on the other side of the UK. Now to discuss the problems encountered by POU coolers in some parts of the UK, when the mains water supply quality was compromised by flooding. Mains water – differences from bottled water for coolers The UK is blessed with a well-maintained, safe public water supply. The tap water companies are supervised and checked by the Drinking Water Inspectorate, a government body. The DWI carries out close supervision of tap water quality and is empowered to fine or discipline water companies if there's a decline in water quality. If there's a temporary disruption to tap water quality, the companies generally issue 'Boil Water Orders' to deal with any microbiological issues. This happens occasionally, sometimes because of the presence of the chlorine-resistant Cryptosporidium parasite. The UK POU industry is built on the premise that the UK’s tap water is fit to drink and, to be frank, the POU industry has had little reason to doubt its suppliers. POU coolers are entirely dependent on the quality of the water delivered to them by tap water companies. The floods of July and August 2007 delivered a big shock to tap water users and the POU industry as a whole. Shortly after the massive rainstorms that led to the flash flooding that caused the demise of the bottling company described in part one, it became clear that the flood water had made its way into major river systems, and that a wave of heavy flooding was moving down the rivers, keeping almost to a timetable. The flooding that occurred in the Thames and Severn river systems was very heavy, with many towns, villages and even cities experiencing major flooding. The worst was yet to come, as a major water works in the Severn Valley at Mythe near Tewkesbury was flooded. The water company advised everybody that the water supply to more than 140,000 homes had been compromised and wasn't fit to drink. The water supply to these homes and offices was then cut off and a major operation delivering bottled water and water tankers to affected areas began. A few days later, the water company said that the water could be used for non-drinking purposes, but that it shouldn't be drunk even if boiled. This was virtually unprecedented and strongly suggested that the water supply might be dangerously contaminated, not just with microorganisms, but chemicals as well. No advice was given about the extent of the contamination or the treatment of devices such as POU coolers and vending machines that were connected to the supply. Users were asking questions and no answers were being given. EPDWA members and Watermark Consultancy clients were advised that any coolers that were proven to be grossly contaminated should be removed from use, and that they were probably beyond sanitisation. This certainly applied to any coolers that had been flooded. Responsible cooler companies warned their clients and told them to isolate coolers before any affected water could reach them. This looked like being an expensive lesson for POU cooler companies, as some had hundreds of coolers in the affected area. Given the all-clear About a week later, the water company announced that the water supply was now fit to drink, and that simply running water until it ran clear and cold, then running off a further five litres, was sufficient to restore the supply. This was the first indication that perhaps the drama of the preceding days was not as serious as it had looked. After all, what about the millions of litres held in the supply system? In fact, after a number of enquiries, the water company revealed that the actions they had taken had been precautionary and that serious contamination hadn't actually taken place at all! This was a relief, but of no consolation to those cooler companies who had taken positive action (but those who had been in touch with their clients received many appreciative comments). Significantly, some consumers complained to me about cooler companies who had failed to communicate with them. So perhaps all was not in vain. When coolers were reconnected, advice was given as follows: Disconnect the cooler at the take-off point to the supply. Run off water until it runs clear and cold. Run off a further five litres into a bucket. Consider whether to replace all 5mm tubing. Reconnect to the cooler. Flush at least 10 litres of fresh water through the cooler. Change the filter and sanitise the cooler before recommissioning. For coolers that may have been adversely affected by moderately contaminated water, the following advice was given to Watermark Consultancy clients. After disconnecting the cooler and isolating the hot tank: Fill the water contact parts of the cooler with an activated solution of chlorine dioxide. For overnight disinfection, use 50mg/l. For 'immediate' disinfection, use 200mg/l for four hours. Rinse well and flush, making sure that the taps have received the full dose of chlorine dioxide. Flush out the hot tank and ensure that it's up to temperature before permitting use. For slightly contaminated water, routine sanitisation methods will suffice. Lessons learned Companies must be on the alert for incidents such as this. If you can develop contacts with the tap water companies in your area and ask to be given immediate warning of any boil water orders or worse, you will be able to act quickly. Remember these are your water suppliers, so talk to them. Make sure you know which supplies every one of your coolers. They will differ according to location. Fit all coolers with an easily accessible shut-off valve adjacent to the cooler that the customer can identify and use. On hearing of a crisis, immediately contact all of your customers in the affected area and tell them to shut off the coolers so that affected water cannot reach them. Keep in close touch with all of your customers and contact them if an incident occurs. Don't wait for announcements or action to be taken by the tap water companies. At times like this, the last thing they're thinking about is water coolers. This is your responsibility. Be prepared to replace pipework and filters and sanitise the coolers when the supply returns to normal. Make sure that your filters will take out parasite cysts. These are filters with NSF 53 standard or those with documentation to show that they will remove 95% removal of one-micron particles. This is an EPDWA requirement. Filters claiming to be just 'one-micron nominal' may not offer adequate performance. Choose your filters carefully. Wait and see before taking drastic action. The water company may merely be acting in a precautionary way. If the coolers are isolated, they're safe. Be prepared to write off seriously affected coolers. Press your trade association for a statement on this, as it will help with insurance claims. Accept that with climate changes taking place, disruptive weather may hit at any time and even mains water isn't protected against extreme weather. Remember that taking the initiative with customers on issues like this will raise the reputation of your company. Failure to do so will have the reverse effect. Tap water quality and POU coolers POU coolers are not an easy option – like bottled coolers, they have their limitations. Even if they're installed and serviced properly, problems can still arise. So: Make sure that you only connect to designated portable water that's fit to drink. Tanked supplies are mainly to be avoided. Remember that the role of the filter is to make tap water taste nicer and not to make unsatisfactory water fit to drink. Carry out a survey when you plan installation. Keep micro bore piping to a minimum. Do not route the feed water or site filters so that they become warm. Realise that the problem bacterium Pseudomonas aeruginosa, which is illegal in bottled water, isn't illegal in tap water. It is present quite often in water distribution systems. Only use professionally trained installers who have also received hygiene training. The EPDWA and BWCA provide training on hygiene and installation. This will hopefully be available through EBWA soon. Don't take short cuts with installation, as you will probably regret it. Installation isn't an area in which to look for economical savings. You only do it once, so get it right first time. Sanitise regularly. The EPDWA has built up a lot of expertise with POU coolers. Let's hope that this expertise can be made available to EBWA. N.B. As I was putting the finishing touches to this article, I was told that there was a problem with Cryptosporidium in tap water in Oslo. Please, not again!

The Food Standards Agency (FSA) and the Meat Hygiene Service (an executive Agency of the FSA) have submitted statements, and witnesses from both agencies are expected to be called to give evidence. The hearings, which are being chaired by Professor Hugh Pennington, will enable issues which are central to the inquiry to be explored in detail. These include the source of the outbreak, the inspection of food businesses, the procurement of school meals, and the way the outbreak was managed. Other witnesses likely to be called include representatives from local authorities, the National Public Health Service for Wales, Welsh Assembly Government, expert witnesses and representatives of families and individuals who were affected by the outbreak. Expected to last six weeks, the hearings will be open to the public and evidence will be published on the inquiry’s website along with full transcripts of each day's proceedings.

CHS Inc., a leading energy and grain-based foods company, and Kansas State University, have announced that $40,000 in equity held by CHS member cooperatives has been transferred to Kansas State University for 2008. The transferred equity will be used to fund an endowed chair or faculty professorship for cooperative studies at Kansas State University's Arthur Capper Cooperative Center (ACCC), a premier centre of excellence in cooperative education. In total, $80,000 in CHS equity has been transferred to Kansas State University since the CHS Equity Transfer Program was piloted in Kansas last year. "This is a part of our stewardship focus on education, youth and leadership," said CHS Board Chairman Michael Toelle. "This is an opportunity to make a significant financial contribution to an outstanding institution, invest in the future of rural America, and connect the public with the values of agriculture and cooperatives." "We're pleased that CHS is working together with local Kansas cooperative leaders to support the Arthur Capper Cooperative Center in such an innovative way," said ACCC Director David G Barton. "The CHS Equity Transfer Program demonstrates the power of the cooperative spirit." Under the program, participating member cooperatives transfer ownership of a minimum of $5,000 of their CHS equity per year to the university. As the new holder of the equity, Kansas State University will receive any future cash redemptions issued by the CHS Board of Directors. For fiscal 2008, CHS is expecting to return $345 million to member owners in cash, based on the company's record fiscal 2007 earnings. It marks the fourth consecutive record return to owners by CHS and is the largest ever made by a US agricultural cooperative. In the future, CHS will expand the program to other land-grant universities across the CHS trade territory. *About CHS* CHS Inc. is a diversified energy, grains and foods company committed to providing the essential resources that enrich lives around the world. A Fortune 200 company, CHS is owned by farmers, ranchers and cooperatives, along with thousands of preferred stockholders, from the Great Lakes to the Pacific Northwest and from the Canadian border to Texas. CHS supplies energy, crop nutrients, grain, livestock feed, food and food ingredients, along with business solutions including insurance, financial and risk management services. CHS is listed on the NASDAQ at CHSCP.

Investigators raided the German offices of chocolate bar makers Mars, Ritter, Nestle and Kraft, the companies said on Monday, on suspicion they colluded over price increases. A spokeswoman at the Federal Cartel Office said its antitrust investigators searched seven chocolate makers on Thursday, on suspicion of price-fixing in the German market early this year. She did not name the companies. If the suspicion is confirmed, the companies could be fined up to 10% of their annual sales. Nestle, Kraft Foods and Mars confirmed the raids at their offices and said they would cooperate fully with the authorities. Ritter also said its offices had been searched. Investigators examined Nestle operations in Frankfurt on Thursday, a spokesman for Nestle in Germany said, confirming a report by the Financial Times Deutschland newspaper. Silke Troesch, a spokeswoman for Kraft Foods Deutschland, said the investigators searched its offices in Bremen. "We are cooperating fully with the authorities," Troesch said, adding that price increases were necessary due to recent sharp price rises in raw materials such as milk powder and cocoa. A spokeswoman at Ritter said it raised its chocolate prices by about 20% in January. Source: Reuters