Illegal Chinese Honey Shipments Threaten MI Beekeeper’s Bottom Line

GRAND RAPIDS, Mich. (Feb. 25, 2014) — The sound of the honeybee is part of the sweet sound of a West Michigan summer.

They pollinate the region’s wildflowers, apple trees, blueberry bushes and vegetable fields.

Without them, there would be no crops or that golden honey.  The bees support the $460 million dollar business of Michigan agriculture by pollinating it.

In fact, there are thousands of honey bee hives all over West Michigan with local beekeepers like Todd Hubbard of Trufant looking out for them.

“When you hear that hum, they know somebody`s opened the top,” said Hubbard about tending to his bees. “This is a naturally tasty treat right there,” he said as he pulled out a comb dripping with bees and honey.

Hubbard is a fourth-generation beekeeper, his son Luke is carrying on the tradition as well.

“You smoke, the bees off like that three times,” said Luke, as he took a smoker to one of the hives that he wanted to open up.

The Hubbards will sell what their hardworking bees produce from under the “Hubbard’s Honeybees” label at the Under The Pines farmer’s market in Grand Rapids and online at hubbardhoney@yahoo.com.

“They`ll have to travel, just for one pound, 55,000 miles,” said Hubbard.

Hubbard says there is something that has been threatening the domestic US honey producers for quite some time.

He says, illegal imports of Chinese honey have been hurting the beekeeper’s bottom line because they have been driving down prices.

“China knows that the American bee keeper in the USA is low on bees and low on honey so they`re bound to drive into this market and they will do anything to do it,” said Hubbard. “The foreign honey market strangles the American bee keeper. It really puts a sting in his wallet.”

It’s a practice sometimes called honey dumping, or the transshipping of Chinese honey.

Recently a bottling company headquartered in Onsted, Michigan was fined for bringing in honey from China without disclosing where it actually came from, thereby avoiding paying millions of dollars in tariffs on it.

The federal government conducted a sting called Operation Honeygate, finding two executives were responsible for doing the illegal shipping.

Court documents say, “GROEB FARMS, acting through Executive A and Executive B, purchased Chinese honey, all while knowing that the honey had been falsely and fraudulently imported.”

It goes on to say they were, “declaring Chinese-origin honey as having originated from countries other than China.”

and….”declaring Chinese-origin honey as a product other than honey, including sugars and syrups.”

Groeb farms was fined $2 million dollars.

The company issued a statement saying, “Senior executives who were who were responsible for Groeb Farms` purchasing and mislead the Board of Directors, customers and the public about transshipping are no longer with the company.”

Later domestic honey producers including representatives from Adee Honey Farms, Cox Honey of Utah, Moore’s Honey Farm, filed a million dollar racketeering and corruption civil suit in federal court, listing Groeb Farms as a defendant along with two former executives, Troy and Ernie L. Groeb citing losses.

The domestic honey producers were demanding $9,999,000, citing losses.

“There`s big bee keepers in the United states that`s upset because it`s kept prices down for them for 10 or more years,” said Hubbard, who was not part of the lawsuit, but knew others who were.

According to a press release, Groeb Farms declared bankruptcy and merged with Natural American Foods, losing the Groeb Farm Name.  They were purchased by Peak Rock Capital.

‘This is a very desirable outcome, and we are extremely pleased with the smooth transition to our new ownership,” said Natural American Foods CEO Rolf Richter in a written statement.

With things starting to change, we wanted to see if anyone would talk to us in person.

A former Groeb Farm office location we visited in Baytown, Texas was clearly vacant and locked.

We also went to headquarters in Onsted, Michigan for an on-camera interview about where the company was heading following the changes.

However, our request was declined.

“If you are really interested in where you`re honey comes from, it`s really difficult to find out the truth,” said Dr. Vaughn Bryant.

Bryant grew up in Holland and now works as an anthropology professor at Texas A & M University.

He’s also called the “honey detective”.

He knows how to test the pollen in the honey to find out where the bees made it.

He even tested samples for Groeb Farms before they changed to Natural American Foods.

“One of the conditions of the bankruptcy is that they have to get rid of all the transshipped honey,” said Dr. Bryant. “They were trying to figure out which of the honey samples they had were transshipped and which were not.”

Many hope a new US Senate Bill will crack down on those who don’t stick to the rules.

It ensures resources, “it would require customs and the border protection agency to test and make sure that honey being imported into the United States is legal.”

“It`s really important the way you shop, for it if you care for the American Bee Keeper or the MI bee keeper,” said Hubbard. “The bottom line is what are you eating?”

Although there have been hearings on it, that senate trade bill is still in finance committee.

The bill wasn’t sponsored by US Senator Debbie Stabenow, but she does sit on that committee.

Coming up Tuesday at 10:00 pm, we’ll take a look at some samples of West Michigan honey to see how they stack up to the Texas A & M pollen test.

Groeb Farms Full Statement:

NATURAL AMERICAN FOODS ANNOUNCES COMPLETION OF ITS SALE TO PEAK ROCK CAPITAL

 

ONSTED, Mich. (Jan.  2, 2014) – Natural American Foods, Inc. (“Natural American Foods” or the “Company”) one of the world’s largest producers and distributors of honey and other food products, today announced completion of its successful sale to an affiliate of Peak Rock Capital (“Peak Rock”).  Natural American Foods merged with Groeb Farms, Inc., which also concurrently completed a successful reorganization of its balance sheet under Chapter 11 protection in just 90 days.  Natural American Foods now enjoys a fully recapitalized balance sheet with professional management and significant capital resources provided by its new owner to invest in and grow the Company.

“This is a very desirable outcome, and we are extremely pleased with the smooth transition to our new ownership,” said Natural American Foods CEO Rolf Richter. “We thank Peak Rock for their dedication to helping us establish a strong, well capitalized foundation that will allow us to focus on what is most important; making the highest quality honey products for our commercial and retail customers.”

Richter, who joined the Company in July 2012 with more than 20 years of major food brand experience, led the Company through its sale to Peak Rock and remains at the helm of Natural American Foods.  Richter is joined by additional new members of management who have also joined the Company since 2012 to head the new leadership team.

Natural American Foods produces a full range of honey and commercial sweeteners for some of the world’s best known food manufacturers and food service customers, as well as national retailers and distributors. The company’s footprint is significant, with global procurement operations and on-site laboratory where its products are tested for quality and safety.

“At Natural American Foods, we pride ourselves on integrity in all that we do, including producing the highest quality products and upholding top standards in honey procurement and production, according to our vigilant compliance processes,” said Richter. “As we look to the future, we will continue to evolve with new innovations and seek to work together with others to continually raise the bar on industry standards,” he said.

About Natural American Foods

Headquartered in Onsted, Mich., Natural American Foods is one of the world’s largest producers and distributors of honey and has been producing high-quality honey under the Miller’s American brand for more than a century.  The company provides top quality honey and related food products to industrial and retail customers as well as the American consumer. For more information please visit www.NaturalAmericanFoods.com.

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1 Comment

  • Rob Green

    Everyone needs to be really clear about a few items:

    1) Chinese honey has typically contained traces of Chloramphenicol, a banned antibiotic that can cause aplastic anemia, a form of cancer, in some people.

    2) Some estimates indicate Chinese honey is a component of a third or more of the honey in the retail supply chain.

    3) The government fined Groeb because tariffs were not paid. There is nothing that indicates that government action was based on product and consumer safety. In fact, they allow the free import of this tainted honey, so long as tariffs are paid. This is about the government suing for lost revenue, not product or consumer safety.

    for more info on tainted honey: http://tinyurl.com/k2qq864 (opens a google search with lots of relevant reports).