Food, Beverage, Nutraceutical Ingredients News

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Peanut Butter: Singing its Praises

2010-03-04T20:15:00.000-08:00

This week marked the passing of National Peanut Butter Day, and in honor of one of America's favorite creamy treats, we have a few words to say:

Mainly, "yummy, yummy, and yummy!" ...spread about in a generous creamy swath of yummy.

Peanut butter has become a mainstay of American diet since the early 20th century, when it originally appeared as a means of providing people with a protein that is more easily consumed than meats.

But, according to the Sturgis Article's piece on the history of peanut butter, the Incas were grinding peanuts as far back as 950 B.C!

Smart people, those Incas.

Peanut butter offers us more than delicious PB&Js, heavenly Girl Scout Cookies, and the perfect accompaniment to chocolate. It's high in protein and provides a lot of that "good" fat we're all supposed to be getting more of.

The average American child will eat over 1,500 peanut butter sandwiches by the time they're 18, making this one of the most popular and healthiest ways that kids get protein and good fats in their diet.

And Americans in general eat about 3 pounds of peanut butter per person, each and every year.

So we raise our glass (of milk, of course!) to you, peanut butter. Thanks for providing unbeatable flavor, cost efficient protein and other nutrients, and overall convenience of use to American families for the past 80 years.

While we're at it, we'll also tip our hats to George Washington Carver for his many years of dedicated research on the humble legume the peanut and for helping make peanut butter what it is today.

Is Natural Sugar the New Health Food?

2010-02-25T20:24:00.000-08:00

Oh, the whims of a fickle health-food population. It appears that we'll never know just what to expect from them.

Is "natural" sugar finding popularity among health food consumers? With the rising sales behind natural sugar soft drinks, and the growing consumption of smaller portioned treats made with the real stuff (instead of artificial sweeteners), it might just might be so.

It used to be that butter was all we ate. Then it was margarine. Then it was anything but margarine.

Then sugar became the bad guy and artificial sweeteners were "in."

But the current trend towards the consumption of goods sweetened with good, old fashioned, real sugar indicates a desire to take the science out of our food, and put the taste back in it.

Regardless of taste, the trend seems to be one of reduced use of things like, crystalline fructose and other sweeteners.

What's next, bacon?

In order to appeal to consumers who are concerned about calorie content, candy makers and snack manufacturers have found a successful means of marketing their treats in smaller portions, whether it's in the 100-calorie pack or simply smaller versions of popular goods.

So, should savvy food manufacturing companies be doing the same?

It depends on your customers' demands.

For instance, kids don't usually care what's in their goodies, while adults, and particularly women, definitely do.

Diabetics definitely need non-sugar options, and those who follow strictly healthy lifestyles often do the same.

If you're following the cost of sugar, the good news is that sugar prices are set to start falling soon, so opting for a natural sugar product may be even more viable for many manufacturers very shortly.

Just don't wait too long, or you may miss the sugar resurgence and be rushing to cash in on that bacon craze that's on the horizon. Yum.

Should You Switch High Fructose Corn Syrup for Sugar?

2010-02-18T20:28:00.000-08:00

If you're into food or food distribution, chances are you're aware of the whole slew of accusations recently leveled at corn syrup.

There are claims floating around - all unproven mind you - that corn syrup is responsible for everything from obesity to cancer to headaches.

But whether or not it's true, companies who have publicly switched from corn syrup to sugar are enjoying a noticeable boost in sales and profits.

Just ask PepsiCo. The release of Pepsi Throwback, and its tremendous popularity, has led many food manufacturers to question whether or not they should switch from corn syrup to sugar too.

Pepsi Throwback is a "time-limited retro version of Pepsi" that has the natural sugar taste of the 1960s and 1970s (in the '80s almost all soda companies switched to corn syrup).

Groovy.

So, is there any difference between Pepsi Throwback and their current beverage?

Only the price. And their customers don't seem to care.

Some people do say that Pepsi Throwback has a sweeter, more distinctive flavor, but taste tests haven't been definitive.

And whether it's sugar or corn syrup, the calories are almost the same.

So should you make the jump to sugar instead of corn syrup? That depends on your client base as well as your product. Corn syrup is less expensive than sugar, and many manufacturers would lose a lot of revenue by making the shift.

However, if yours is a health-conscious client base, then you could stand to make a tidy profit by switching to natural sugar. Many consumers today will willing spend more on a product they feel is more "natural" or healthy for them.

In this case switching to natural sugar won't cost more, and could in fact boost revenue.

So, you can look at it like a combination of 1960s food manufacturing with modern day health consciousness.

And that's both groovy, and sweet.

Should You Cut Salt From Your Food Products?

2010-02-15T20:32:00.000-08:00

In the wake of recent studies regarding sodium and American heart health, big name food corporations and distributors are cutting or reducing salt in their most popular products.

Here's why - as it says at the Chicago Tribune, major food corporations like Sarah Lee Corp., Kraft, and ConAgra Foods are working to cut back on salt so as to minimize the health problems inherent to too much sodium intake.

There are many reasons why they're doing this, but the question is: do people really want it?

It turns out that people actually like salt. Numerous studies have found that foods with lower sodium content are often found to be less appealing to the public.

So the trick is seems like find salt alternatives that appeal to consumers' palettes.

This brings up the issue of making food without salt, which is often part of the chemical reaction necessary for leavening, food preservation, and more. Altering production lines to accommodate lower salt varieties can be challenging.

So, how can--and should--food manufacturers cut back on salt? Right now it appears that only a small portion of the public is actively seeking lower-sodium alternatives. Regardless, food ingredients suppliers like us are well aware of the trend and have various salt alternatives for you to try for your production line.

When it's time to offer low-sodium alternatives to consumers who'll be watching their salt intake (and how you use salt in your products) when they shop and dine out, it may take some experimentation, but good alternatives are available.

Sugar Prices Facing New Contender

2010-02-05T19:17:00.000-08:00

Just when we thought that we'd figured out the story on sugar prices, there's a new player in the game.

Well, technically the EU isn't a new player, but their decision to export higher quantities of sugar this year is a new play on a market usually dominated by Brazil, Thailand, and Australia.

Historically the EU has been limited in their exportation of sugar by the World Trade Organization, but in response to the sugar shortage we've been facing in the last 6 months and more, they've decided to send more.

In fact, in a move that BusinessWeek predicts will definitively impact worldwide sugar prices, the EU approved the export of 500,000 metric tons of sugar above the WTO's annual limit.

Now, that's a lot of sugar cubes and soda pops!

Brazil, Thailand, and Australia have asked the EU to abandon their plan to ship the extra sugar, no doubt influenced by the fact that they'll lose money on the subsequent lowering of sugar prices.

However, whether or not the WTO will do anything hasn't been addressed, particularly with sugar prices double their usual rates.

It's still too early to say what effect this will really have on sugar prices, and it's likely to start to push sugar prices down a bit, even if it doesn't make the price bubble "pop."

Sugar Prices Look Sweet After May

2010-02-01T20:43:00.000-08:00

If you're in food manufacture or distribution, you're likely aware of the ongoing saga surrounding sugar prices as it's been unfolding in recent months.

To make a long story short, sugar prices are currently double their standard, their highest in 29 years, due in part to the sudden sugar supply shortage coming out of Brazil and India.

Both countries, the world's largest and second largest sugar exporters respectively, suffered bad weather that have disrupted crops. Rumors of "rust" or sugar cane mold, have been circulating as well, but at this point only appear to be campfire horror-stories designed to leave a sour taste in your mouth.

But if Businessweek is correct in its analysis of sugar prices, your overhead could begin dropping in the latter half of 2010.

Brazil's next sugar-cane harvest will start in May, and in India, imports will more than double to 6 million tons.

This recovery of India's crop alongside the improved production coming out of Brazil is predicted to bring wholesale sugar prices back down to normal by the end of the year.

And that's something very sweet to look forward to.

Salt Intake and Health: Will Salt Subsitutes Do the Trick?

2010-01-26T08:23:00.000-08:00

Whether it's used to bring the baker's dough together just right, to add just a hint of flavor to a chef's top sirloin, or add the right amount of kick to a bartender's Salty Dog, people love salt.

But it turns out that some of us might love it a little too much.

A recent study published in The New England Journal of Medicine about salt intake and health is getting a bit of attention. According to the study, even small reductions in salt intake could reduce heart disease and stroke by thousands of cases.

And with low salt diets and foods gaining in popularity, many wholesale food ingredients distributors and wholesale food providers might find that salt subsitutes are in greater demand. Most often made of potassium chloride, salt substitutes offer a similar flavor to salt without the same health concerns.

The largest sector in food preparations and marketing where a shift in consumer popularity is likely to be processed foods, where much of American salt intake originates.

This is because, besides being essential for many baked goods and just plain tasty in many meals, salt has been used as a food preservative for centuries. Historically salt has been used for mold prevention and antibacterial purposes and to slow the aging process in foods.

And today, our salt intake is heavily influenced by the use of sodium in spreads, processed meats, and canned goods. Wholesale salt prices aren't likely to see a change anytime soon, but for manufacturers that want to offer their consumers a variety of healthy alternatives, salt substitutes could be a smart idea.

Though we doubt that the "Potassium Chloride Dog" will be making appearances at the local bar anytime soon.

Kraft Foods and Cadbury: A Sweetheart Deal Just in Time for Valentine's Day

2010-01-22T08:40:00.000-08:00

It's a typical romance story for Valentine's Day, and it even comes with chocolate.

After months of hemming and hawing, food giant Kraft Foods has successfully won over Cadbury, purchasing the 190-year-old British confectionary company for almost $19 billion dollars.

This is quite a change from Cadbury's original rejection of Kraft Foods - apparently they were playing hard to get.

It must have worked, since Kraft Foods had originally offered Cadbury only $16 billion back in November of 2009. This original offer was immediately rejected as an undervaluation of a company with worldwide brand recognition.

Not to be deterred, the persistent Kraft company then launched a hostile bid for Cadbury, claiming that it wasn't worth that much and shouldn't be so coy anyway. Their next offer was actually valued at less than the first, based on the loss of value seen in Kraft Foods stock price from September to November of 2009.

But Cadbury wasn't fond of being bullied and stood its ground; Kraft worked very hard to make a deal possible.

In fact, Kraft sold an American pizza unit to Nestle for $3.7 billion earlier this month, and borrowed another $11 billion to finance the takeover. Cadbury was pleased with the new offer, and promised to be worth every penny.

Robert Carr, Chairman of Cadbury, went on to say that the offer represents a good value for Cadbury shareholders, that Kraft Foods had made a powerful commitment [to] our heritage [and] values.

Unfortunately, not everyone sees this as happily-ever-after. British trade groups and organizations have been protesting the acquisition of Cadbury by an American wholesale food distribution company based on their concerns that Cadbury makes up a significant portion of the British economy.

All-in-all, it seems this is unlikely to have a significant effect on things like wholesale sugar prices because the companies are already such large consumers of food ingredients, and their demand isn't expected to change.

How the takeover will play out in the international marketplace has yet to be seen. After all, these celebrity mergers can be very unpredictable, and who knows how long the romance can last?

Could there be a sequel? If so, we'll bring the chocolate.

Oh Nuts! Good News About Roasting Peanuts

2009-12-09T14:02:00.000-08:00

Fans of peanut butter, rejoice!

Peanuts have long been known as being a good, tasty protein source.

Now there's new good news about roasting peanuts:

Agricultural Research Service (ARS) scientists have shown that increasing roast color intensity steadily ramps up the antioxidant capacities of peanuts, peanut flour, and peanut skins.

Since one of the most popular methods of eating these little legumes, peanut butter, requires roasting the peanuts before further processing into "creamy" or "crunchy" varieties, this new data may boost peanut butter's already great reputation.

No mention specifically in the article on how peanut butter fares, but given that it's made from roasted peanuts, it's likely that many manufacturers are going to pay close attention to how these findings will impact sales and develop campaigns for consumer awareness of the benefits of peanuts and peanut butter.

"The researchers characterized changes in antioxidant levels of roasted peanuts and the corresponding blanched skins across an industrially relevant range of roast treatments.

"For the study, peanuts were incrementally roasted at 362°F from zero to 77 min.

"The water- and oil-soluble antioxidant activity levels of the roasted peanut product samples were then determined."

As peanut butter is one of our newest products, we're always on the lookout for news about it, how our customers can use it, and any new discoveries being made on it, like this.

If you'd like to try our peanut butter and see how it compares in taste and cost to your current vendor, contact us, and we'll be happy to get you a quote.

In the mean time, a good ol' fashioned PB&J sandwich sounds good right about now... crusts on, thank you.

The Sugar Buzz in India

2009-11-27T14:59:00.000-08:00

There's been a heaping amount of talk over sugar sales in India over the past week and none of it too sweet.

At present, Indian sugar farmers feel the government has fixed too low a minimum price for sugar cane.

In reponse, sugar farmers have rallied in protest at state capitals and have halted sugar cane sales to millers.

The obvious direct results are the crippled production of final sugar product and a dramatic supply and demand imbalance.

To entice Indian sugar growers to sell more sugar cane, Indian sugar mills have volunteered more money to farmers.

Some farmers have accepted and sold sugar supply to mills.

According to Reuters, 47 out of 91 private mills in the state of Uttar Pradesh have started crushing, and almost all are expected to crush by the end of the month.

Still others, who see this as an opportunity to make more profits, are holding on tight.

One example is the farmers' group Kisan Jagriti Manch, which was recently offered 190-195 rupees ($4.1-$4.2) for 100 kg of sugar cane by the Uttar Pradesh Sugar Mills Association, more than 25 rupees (15%) over the state-set price.

Sudhir Kumar Panwar, head of the group, contends that the farmers deserve more (at least 215 rupees) and recently met with government officials and milling organizations to represent sugar cane farmers and their demands.

This (ahem... fabricated) sugar shortage in India has contributed to the major escalation in sugar futures (NYSE) over the past few months (the highest in over 28 years), as well as, disparity between the growers and the millers in India.

Needless to say, when and at what price these farmers decide to sell is of critical importance for the success of India's sugar economy.

If the farmers don't accept a price to sell their sugar cane, India will be forced to import more sugar next year due to the resultant delays in production. (Why am I thinking about building a card castle right now?)

So, while India works this out, perhaps now is a good opportunity to focus on a different aspect of the situation; the surging population (and its resultant worldwide sugar demands) presents great investment opportunity for wholesale sugar sales in the US.

Forward thinking tells us that companies involved in wholesale sugar sales, wholesale food ingredients, chemicals and fertilizers for sugar crops, and sugar milling equipment/manufacturing supplies are likely to see growth over the next decade.

In addition, food preservatives and additives and other food ingredients may reap some benefits as well.

New Sugar Refinery Deal Announced

2009-11-20T16:08:00.000-08:00

Imperial Sugar Company, Sugar Refiners and Growers, Inc., and Cargill, Incorporated have put together what sounds like a pretty sweet deal.

In the announcement of the new sugar refinery, Imperial's CEO, John Sheptor said,

"This transaction enables Imperial to retire its existing refinery with dated technology for a share of the new state-of-the art refinery without a significant capital outlay by Imperial.

"Following the completion of the construction of the LSR refinery and the rebuild of the Port Wentworth facility, Imperial will own or participate in two of the most modern sugar refineries in the country."

For a variety of reasons, no doubt including the high cost of building a modern sugar refinery, these three sugar industry heavyweights decided to join forces, each putting up cash or other assets valued at $145 million.

The new venture dubbed, "Louisiana Sugar Refining, LLC (LSR)," is a big deal for all three firms in their respective long-term strategies.

Given the current sugar supply and demand debates and what has happened this year with sugar prices, the production capacity the new facility will have should help stabilize the long-term sugar prices--even when Imperial's old sugar plant is retired.

As to when the new plant will come online and the old one retired, the piece says, The existing Gramercy refinery will operate during the construction and start-up phase of the new refinery, expected to be 18 to 24 months.

We're really happy for all three companies involved in this deal, wish them the best, and hope it really does turn out to be a sweet deal for everyone involved.

Coke Strategy for Growth "Pop"

2009-11-19T18:48:00.000-08:00

Although it may seem like folks are drinking less soft drinks these days, don't expect manufacturers to just fizzle out.

According to a recent report by Reuters in FlexNews, Coca-Cola has announced plans to double its revenue by 2020... an ambitious but not impossible goal, especially for a company that already boasts $100 billion in revenue.

So if Coca-Cola can do $100 billion, why not shoot for $200 billion?

Given the population boom in Asia, Coke foresees growth of its "incremental sales volume by roughly 60% from emerging markets like China and India."

In addition, Coca-Cola is looking to Mexico and South Africa for around 25% of its volume growth.

At present, people in these countries don't consume many soft drinks, however with more exposure and near exponential population growth (exaggeration, but you get the point), increased sales of "thirst quenchers" are in the horizon.

To complete the package, Coca-Cola has additional plans to ensure success including cost saving measures (i.e. formation of a joint company that aims to cut costs in supply chains and consolidating the servicing of restaurants) and new marketing campaigns for developed markets, like the US and Japan.

These campaigns will target:

females (who typically do the family foodshopping even though it isn't ca. 1955 anymore)
multicultural teenagers
adults (via products and packaging that appeal to wine lovers)

And, while we're on the topic of soft drinks, this will greatly impact wholesale food ingredient sales on products like sugars, crystalline fructose, corn syrup and other sweeteners, sodium citrate, and other food chemicals.

Sugar Supply Estimates Published

2009-11-12T16:20:00.000-08:00

Announced this week were the annual World Agriculture Supply and Demand Estimates.

According to the ISC Newsroom, these estimates (diligently generated by the USDA), [forecast] supply and demand for most U.S. and many global crops and livestock products.

So that we can continue to offer the best wholesale sugar prices, we've been paying close attention to the sugar supply projections (as you might expect), especially given the recent sugar supply and demand environment.

To many industry analysts, there weren't any tremendous surprises, but estimates continue to slide thanks to bad weather.

For those who may have missed the news, the already lower 2009 estimates of the beet crop have dropped,

"... from 4.7 million tons to 4.4, primarily due to frost damage several weeks ago in the northern tier of sugar-growing states, including Montana, Wyoming, Nebraska, Colorado, Minnesota and North Dakota."

Quoted in the ISC Newsroom piece was Pat Hennenberry, Imperial Sugar's Chief of Commodities Management, who said,

"We believe that the market is considerably tighter than the USDA is estimating.

"We worry that this may cause delay in increasing imports into the U.S., and that the market here will remain tight until sufficient imports are allowed."

Whether or not you completely agree with Hennenberry, a lot of analysts do believe that sugar supply will likely continue to be tight for some time.

The following data comes straight from the USDA's November 2009 publication.

[Editor's Note: Worth noting in this report is a procedural change. With this change, imports and demand will be estimated more accurately thanks to better accounting of sugar imported from Mexico.]

U.S. Sugar Supply & Production¹

1,000 short tons, raw value
Item	2007/2008	2008/2009 (Est)	October (Proj)	November (Proj)
Beginning Stocks	1,799	1,660	1,224	1,451

Domestic Sugar Production
Florida	1,645	1,577	1,700	1,700
Hawaii	182	192	160	143
Louisiana	1,446	1,397	1,300	1,300
Texas	158	152	165	170
Cane Sugar	3,431	3,318	3,325	3,313
Beet Sugar	4,721	4,166	4,700	4,400
Production Totals^2,A	8,152	7,484	8,025	7,713

Imported Sugar
TRQ³	1,354	1,370	1,257	1,257
Other Program⁴	565	308	400	400
Other⁵	701	1,404	505	770
Mexico^B	694	1,402	495	760
Imports	2,620	3,082	2,162	2,427

Exports	203	137	200	200

Food⁶	10,506	10,479	10,140	10,140
Other⁷	202	159	235	235
Deliveries	10,708	10,638	10,375	10,375

Miscellaneous	0	0	0	0

Ending Stocks	1,660	1,451	836	1,016

Stock-to-Use Ratio	15.2	13.5	7.9	9.6
¹ Fiscal years beginning Oct 1. Includes Puerto Rico. Historical data are from FSA, "Sweetener Market Data" (SMD) except imports (U.S. Customs Service, Census Bureau). ² Production projections for 2009/10 are based on Crop Production and trend recovery rates. ³ For 2009/10, includes shortfall of 200,000 tons. ⁴ Includes sugar under the re-export and polyhydric alcohol programs. ⁵ For 2009/10, other high-tier (10) and other (0). ⁶ Combines SMD deliveries for domestic human food use, SMD miscellaneous uses, and the difference between SMD imports and WASDE imports. ⁷ Transfers to sugar-containing products for re-export, and for non-edible alcohol and feed. ^A Production Totals are the sum of Beet Sugar & Cane Sugar. ^B Mexico Totals are included in "Other."

If you're concerned about how the sugar supply (and national / international demand) will affect your business, you'd be well served to read the full report.

If you need a quote for your next wholesale sugar order, contact us so we can help provide the best quality food ingredients at the best prices.

The Latest Between Kraft and Cadbury

2009-11-10T22:30:00.000-08:00

Although this is newly old news, it's still pretty bold news.

Yesterday, Kraft Foods (processed foods manufacturing giant and wholesale food ingredients consumer) presented their second offer for the purchase of Cadbury.

And even though it didn't work the first time, Kraft tried it again, leaving Cadbury executives scratching their heads.

According to various reports, Kraft Foods offered Cadbury the same cash price per share (300p and 0.2589 Kraft shares per Cadbury share) and exchange ratio (1.6609 USD/GBP) as their offer on September 7, 2009.

Well, not really the same.

Based on current market values for Kraft Foods shares, the offer was even less attractive.

Since the first offer on September 7, Kraft share prices have fallen. As a result, this new bid is valued at 4% less than the first: the value for each Cadbury share is calculated at 717 pence (based on the Kraft share price on November 6).

Cadbury chairman, Roger Carr, was piqued by the bid,

"The repetition of a proposal which is now of less value and lower than the current Cadbury share price does not make it any more attractive.

"As a result, the Board has emphatically rejected this derisory offer and has strengthened its resolve to ensure the true value of Cadbury is fully understood by all.

"I am confident Cadbury will deliver significant value - which should accrue wholly to our shareholders."

Despite this blatant dismissal and rejection by Cadbury, Kraft Foods remained steadfast.

Kraft Chairman and CEO, Irene Rosenfeld, responded,

"We remain convinced of the strategic merits for both companies of combining Kraft Foods and Cadbury.

"We believe that our proposal offers the best immediate and long-term value for Cadbury's shareholders and for the company itself compared with any other option currently available, including Cadbury remaining independent."

Kraft also reports that the offer "represents an attractive multiple of Cadbury's underlying EBITDA" and reminds Cadbury that "no other potential offeror has publicly declared interest" in acquiring the company.

So, the negotiation remains in states of check mate and deja vu, which coincidentally sound like great names for chocolate bars!

Tate & Lyle to Sell Sugar Stakes

2009-10-29T15:26:00.000-07:00

Tate & Lyle, the London-based food ingredient giant, has agreed to sell its minority stakes in Middle Eastern sugar units to Savola Group, its Saudi-based partner and the Middle East's biggest sugar refinery.

According to information reported in FlexNews, Tate & Lyle currently owns (soon to not own) "a [9.68] percent stake in a 1.2 million tonnes per year sugar refinery in Saudi Arabia and a [3.58] percent stake in a 750,000 tonnes per year sugar refinery in Egypt."

At present, Savola Group holds "a 64.8% stake in the Saudi sugar refinery and a 53.5% stake in the Egyptian refinery."

On the authority of a Middle-Eastern executive who chooses to remain anonymous,

"Tate & Lyle wants to sell because they are dis-engaging from sugar refining and focusing on sweeteners, ethanol and starches.

"We are interested because it suits our strategy of buying minority interests from willing partners in firms where we are the majority owners.

"We are in talks with Tate & Lyle and we hope to close a deal by mid-January."

The price of this sugar sale has not yet been reported, but financial services firm, Shuaa Capital (a Dubai-based company on the Kuwait Stock Exchange and prominent player in the Gulf Cooperation Council [GCC]) claims it could be worth 240 million riyals, which equates to roughly $64 million.

It's also reported that Savola Group has collaborated with Turkish and Saudi partners to bid on several sugar mills for sale by the Turkish government.

Comments from Tate & Lyle representatives weren't included in these linked articles.

This deal will end a 14 year business relationship between Savola Group and Tate & Lyle, but seems to be aligned with the future plans and goals for each of these distinguished companies.

Of course, Tate & Lyle will continue to focus its efforts on starches, sweeteners, and ethanol: quality food ingredients that we love.

Salt Content Changing in ConAgra Brands

2009-10-20T16:22:00.000-07:00

At least one major company is responding to the Salt Initiative, officially launched in the U.S. earlier this year and previously discussed here at Cooperative Purchasers.

This week, ConAgra Foods, Inc., announced plans to reduce the salt content in its food portfolio by 20 percent by the year 2015.

This enormous undertaking attenuates ConAgra's previous efforts at salt reduction in 2006, whereby 2 million pounds of salt was eliminated from many of their well-known brands.

Included, and near and dear to many of our hearts (and stomaches), were Orville Redenbacher's popcorn®, Chef Boyardee® pasta, and the infamous, Healthy Choice®.

Healthy Choice® brand typifies ConAgra's historic commitment to reduce salt content in their processed foods. According to ConAgra, Healthy Choice® is "the only line of meals in the grocery store to earn the 'healthy' label, in part, for meeting the U.S. governments's recommendations for healthy sodium levels," to date.

With the new commitment, ConAgra is taking salt reduction even further. The plan reduces sodium by an additional 8 million pounds.

Do the simple math and we're looking at a goal of 10 million pounds of salt to be eliminated from ConAgra's food products (20 brands and 160 product varieties) in the U.S. market each year.

Al Bolles, Ph.D., executive vice president, Research, Quality & Innovation, ConAgra Foods, comments,

"ConAgra Foods has the ability to make an impact on sodium in a very broad way.

"What that means is that we'll need to use different techniques to keep or enhance the taste of all types of food in our portfolio, from Hunt's® tomatoes to Marie Callender's® convenient meals to Fleischmann's® table spreads.

"This is a definite challenge - but one that is very worthwhile and one we are confident that we can meet."

What are some possible outcomes of salt reduction?

For one, these "different techniques" will likely call on substitute food ingredients and food chemicals to impart the properties and textures that salt provided. A resultant shift may be observed in wholesale food ingredient sales.

Furthermore, if many other large food manufacturers follow ConAgra's direction, the economics surrounding wholesale salt sales will adjust.

Finally, this could effect consumer salt sales at the grocery store. If food tastes different, consumers may be inclined to add salt from the shaker.

Regardless, ConAgra's commitment to reducing salt intake remains unwavering.

Bolles continues,

"We expect to continue to make food better, whether it's through the inclusion of whole grains and other important nutrients, or reducing sodium, far beyond 2015.

"We recognize the critical nature of our role in good health, and we'll continue to make positive contributions.

"Providing good nutrition is essential to consumer and company well-being and is part of our overall commitment to social responsibility."

Sweetener Sales: Moms Sweet on Stevia

2009-10-08T17:14:00.000-07:00

It is commonly said that, "Mother knows best." And, for good reason.

Later this month, October 20th to be exact, full study data will be released about "Stevia (Reb A) awareness" in current society.

The study highlights the opinions of "mothers in the US," about Stevia (Reb A) products.

Recall that Reb A sweetener was granted GRAS status by the FDA back in December 2008.

At present, two major Reb A products (and their respective major marketing campaigns) are on the market:

PureVia (manufactured and marketed by PureCircle and PepsiCo)
Truvia (manufactured and marketed by Cargill and Coca Cola)

The said study was commissioned by PureCircle and the research conducted by LaunchForce, a consulting firm based in Ohio. According to the story in FoodBusinessNews.net, the survey was conducted online: 1,475 surveys were completed; the representative sample was 1,200 mothers.

Apparently, moms are liking what they hear about Reb A, and products that contain the sweet extract of the stevia plant.

Sounds a bit silly at first, but when you really think about it, this is very powerful economic information.

Why?

Because US moms typically do the food shopping. Since they essentially control what families are eating, moms have a major impact on the food industry. If you want to sell your food products, you need to impress the moms of the US with marketing strategies and quality food ingredients.

Obviously, that's BIG business.

According to Jason Hecker, director of marketing for PureCircle in the US,

"The appeal of stevia among mothers is high...

"Nearly 50% of mothers were aware of stevia and have a positive impression of it.

"Overall the ingredient is starting from a very strong place, with room to continue to positively shape the impression of the ingredient in moms' eyes..."

Information about how Reb A (stevia) sales is affecting other sweetener sales and wholesale sugar sales was not included in the article, but you don't need to be a mother (i.e. genius) to see that this trend will make an impact.

If major food and beverage manufacturers have already launched new products (and reformulated old ones) to contain Reb A, a shift in sales volumes for traditional sweeteners and sugar is likely to occur.

So again, we find ourselves listening to our moms.

An Update on the Cadbury Acquisition

2009-10-02T15:58:00.000-07:00

This Wednesday, the WSJ reported on the latest developments between Cadbury and two American companies interested in the purchase of Cadbury: Hershey Co., America's largest confectioner, and Kraft Foods, one of America's largest food manufacturers.

Both companies are enormous consumers of wholesale food ingredients.

Earlier this month, Cadbury rejected Kraft Foods' initial offer (worth ~$17 billion) claiming the cash percentage of the offer was too low. In addition, the business model of Kraft Foods is not in alignment with Cadbury's.

Cadbury prides themselves on being a 'purist confectioner,' while Kraft Foods is a 'conglomerate business model.'

Hershey Co, the largest confectioner in the US, already holds the license to manufacture and market Cadbury products in the US. On the surface, it seems like a Hershey takeover of Cadbury is the ideal acquisition: from one confectioner to another.

According to the WSJ, however, Hershey's will not likely make a competing offer against Kraft foods.

To paraphrase,

"Hershey's executives concede that annual revenues are too small to support the debt load needed to make a competing offer to Kraft's $16.3 billion bid.

"It could only raise about $4 billion from the debt markets without lowering its own investment rating, leaving a huge shortfall to make up."

It's a strange perspective to see Hershey Co. as too small a company... It may sound naive, but seriously, they make those wonderful 'Kisses' and... they have an amusement park!

Be that as it may, Cadbury has already shown that it wants bids to be dominated by cash, and Hershey's just doesn't have enough right now to be competitive.

Kraft, on the other hand, certainly has enough.

Despite claims by Cadbury that they are not too keen on the deal, the UK Takeover Panel is giving Kraft a deadline of November 9th for a formal offer.

How will this affect wholesale food ingredient sales and wholesale sugar sales?

It seems likely that Kraft will be purchasing more wholesale sugar and cocoa in the future.

Food Ingredients Distributor Boasts New Pages/Products

2009-10-01T18:05:00.000-07:00

Cooperative Purchasers, the premier wholesale food ingredients distributor, is pleased to introduce several new pages on our website.

Check out these information rich pages on many of our staple quality food ingredients including:

In addition, there is great information about some of the newer products we now carry, including:

And... stay tuned for more new pages in the future.

Sugar Prices/Candy Prices: Who Will Be the Sucker?

2009-09-25T21:24:00.000-07:00

With the staggering increases in sugar prices this year, it comes as no surprise that US candy makers are starting to see the effects.

While initially hesitant to raise prices on products in the interests of the consumer, US candy makers may reconsider.

According to an article in the Denver Post yesterday, sugar prices have soared 95 percent this year and cocoa beans have been selling near a 20 year high on reports of diminished production in Ivory Coast. This is taking a bite out of confectioners' profits.

Denver Post writer, Steve Raabe, reports comments from multiple local confectioners including Andrew Schuman, president of Hammond's Candies of Denver. Schuman's comments likely represent a microcosm for small local confectioners nationwide.

Since Hammond's candies are handmade, labor costs represent the largest percent of production expenses, exceeding the cost of sugar.

Still, this doesn't mean the company won't be impacted by increased sugar prices; actually, Hammond's predicts a 4 percent cost increase for the upcoming year due to the commodity price.

If we turn our attention to a large scale confectioners, Schuman discusses a greater impact on their business.

Large scale manufacturers (think Nestle, Mars, and Hershey's), have a different proportional breakdown of expenses. Since they have automated systems in place for mass-production, ingredient costs, like those for sugar, represent a larger expense.

This considered, major events like this year's dramatic sugar price increases, have a more detrimental effect on the large company.

If candy prices (for the consumer) are maintained, the confectioners will have to absorb the extra costs, while the consumer gets the same "number of licks to the center of a Tootsie roll pop."

Large candy manufacturers aren't 'suckers,' even though they manufacture them. So, it's probably best to expunge any sugar-coated reveries you may be having of Charlie and The Chocolate Factory, immediately.

As sweet as they are, large confectioners are big business... candy is not free (sigh) and candy manufacturing employees are not Oompa-Loompas.

Expect to see a change in price of your favorite candy at your local convenience mart or market over the coming months.

In addition, like Hammond's in Denver that keeps a two month sugar supply on site, it my be a good idea to stock up on the precious sugar commodity, in case prices continue their upward trend.

Food Ingredients: Danisco Strong in Q1 2009/2010

2009-09-18T12:35:00.000-07:00

Danisco, a world leader in food ingredients, announced results for the first quarter (2009/2010) and things are looking "strong" according to CEO Tom Knutzen.

The Q1 report for Danisco, whose food chemicals and ingredients are used worldwide in bakery and beverages, states that "cultures and Genencor were the drivers of organic growth."

Revenue is up 7% (DKK 3.5 billion) and group EBIT (earnings before interest and tax) increased by 27%, yielding considerable margin versus the same quarter last year.

Knutzen remarks,

"Internal cost containment and positive momentum for several of our products are starting to bear fruit, and we are satisfied that we are able to lift our outlook for the full year.
"Meanwhile, we maintain our focus on optimising the business to meet our financial targets."

Here are a few of the fiscal achievements that the report highlights (click the above link for the full report):

Profit for the Group cam in at DKK 306 million against DKK 271 million last year.

Sweeteners is meeting internal cash flow targets - its key priority for the current financial year.

Enablers saw good demand for both Emulsifiers and GUms & Systems. Price momentum was mixed.

Group organic growth of 2% was made up of stability in Enablers, 11% growth in Cultures, 6% growth in Genencor and weakness in Sweeteners.

According to this and previous reports, the top priority for Sweeteners is "to realign its cash flow," especially in response to the "fierce price competition" in the xylitol market.

Lastly, on August 20, 2009, the following key areas were emphasized at the Annual Corporate Meeting as the corporate focus:

improve customer service
optimize product portfolio
optimize pricing to reflect value
improve logistics and warehouse efficiency
simplify sales structure

Present on Danisco's product roster are fibers (like polydextrose), thickeners and gums (like xanthan gum, pectin, and guar gum), sugars, and sweeteners (like Xylitol).

Many of these great food ingredients can be purchased with us at Cooperative Purchasers.

Kraft Foods Wants Cadbury: Confectioner Not Too Sweet on Deal

2009-09-15T15:25:00.000-07:00

On Monday, Kraft Foods rolled out a bid (cash and shares) to acquire Cadbury, the British confectioner.

According to an article in Reuters, if these companies strike an agreement (and right now that is a big "if"), the acquisition will yield "the world's largest confectioner."

The new mélange will market Dairy Milk Chocolate and Trident gum (from Cadbury's portfolio) and Toblerone chocolate, Oreos, and Philadelphia cream cheese (from Kraft's portfolio), just to name a few sweet treats.

Kraft's offer to Cadbury shareholders was valued at 745 pence per share ($17 billion US dollars): an impressive sum, but it seems like it'll take more than money for Cadbury to agree to a sale.

Reuters stated that Cadbury Chairman, Roger Carr, was not the least bit enchanted.

In a letter to Kraft, Carr rejected the offer, and relayed sentiments that it undervalued Cadbury.

"Under your proposal, Cadbury would be absorbed into Kraft's low growth, conglomerate business model, an unappealing prospect which contrasts sharply with our strategy to be a pure play confectionery company."

Cadbury prides itself on its focused business model as a confectioner. Carr reinforced that an acquisition by Kraft would result in a business structure contrary to that of the Cadbury ideal... more like a "jack of all trades" model.

Carr also expressed apprehension about the value of Kraft shares that would be exchanged (330 pounds and 0.2589 new Kraft shares for every one Cadbury share) as part of the terms. Kraft share prices have dropped this week in conjunction with the value of the US dollar (especially compared to the British pound).

Despite Cadbury's initial dismissal, talks are still in progress.

According to Reuters, many analysts anticipate that Kraft will sweeten the deal, either with more cash or higher bid prices.

Aaah, just imagine owning all of that chocolate... and, if a transaction occurs between these two giants, imagine the wholesale sugar, wholesale salt, and wholesale food ingredient sales that will result!

Naturally Sweet: Coca-Cola & PepsiCo Invest in Coconut Water

2009-09-04T16:31:00.000-07:00

Coca-Cola and PepsiCo are trying something new again this year.

First we had product reformulations with cane sugar seen in Pepsi Raw, Pepsi Throwback, and Mountain Dew Throwback.

We also saw both Coca-Cola and PepsiCo purchase stevia sweetener brands, Truvia and PureVia, respectively.

In keeping with the spirit of competition and their promise to investors, PepsiCo and Coca-Cola are now getting into the coconut water market, reported in a recent article by FoodBusinessNews.net.

Although we've seen those obscure containers at the supermarket, coconut water hasn't really hit the mainstream.

But now that two of the nation's largest beverage companies are adding the naturally hydrating and vitamin-rich nectar to their "Midas" list of products, that is about to change.

In mid-August, PepsiCo bought Amacoco, Brazil's largest coconut water producer.

And just this week, Coca-Cola made a significant investment ($15 million to be exact) in Zico Beverages, L.L.C., a Hermosa Beach, California, based provider of Zico Pure Premium Coconut Water.

Coconut water has been hailed by Zico as a natural sports drink, based on the natural sugar content and abundance of potassium, magnesium and even calcium.

Both Coca-Cola and PepsiCo certainly have the brand recognition and marketing aptitude to benefit the market for coconut water in the United States.

According to the article, the investment in Zico was led by Coca-Cola North America's Venturing and Emerging Brands business unit (V.E.B.).

President and general manager, Deryck van Rensburg, said,

"V.E.B. continues to seek out burgeoning brands that have the potential to change the way consumers look at beverages.

"Combining the natural goodness of Zico... and the brand building expertise of W.E.B. certainly makes for an innovative partnership."

As promised by both companies in press releases this year, Coca-Cola and PepsiCo are making good on their plans for innovation and expansion to maintain growth in the beverage arena, which is great news for food ingredients distributors.

And because no one likes to buy salt or sugar for no reason, it will be interesting to see what new products enter the market as a result of these two investments.

Update on Sale of Sugar Land in Florida

2009-08-31T17:46:00.000-07:00

Back in May, we reported plans for an Everglades restoration project in South Florida involving the sale of sugar land to help reestablish the natural habitat of the wetlands.

In short, the South Florida Water Management District (SFWMD) was to purchase over 72,000 acres of land from U.S. Sugar as part of a comprehensive restoration project.

The total plan, which has been under negotiation for well over a year, involves over $2.2 billion and 110,000 additional acres.

Last week, Reuters reported on a Palm Beach County Circuit decision that will help enable this preliminary sale of sugar land.

According to the ruling, SFWMD will be permitted to sell certificates of participation worth upwards of $650 million to partially fund the deal.

U.S. Sugar, the nation's largest sugar-cane grower, was surprisingly eager to make the transaction, no doubt to the delight of environmentalists, administrators who oversee water operations in the state of Florida, and Florida's Governor Charlie Christ.

Opponents however, such as the Miccosukee Tribe and another sugar company called Florida Crystals, criticize the plan as inefficient and ineffective.

According to Reuters,

"The opponent call the plan a waste of taxpayers' money that will actually slow restoration of the Everglade wetlands, a distinctive ecosystem that is home to 68 endangered species."

A spokesman for the water district expects an appeal of this preliminary victory.

It's interesting that this is happening at a time when sugar prices are climbing, global sugar supply is reportedly dwindling, large food manufacturers are begging for the ease of import quotas on sugar, and...

Cooperative Purchaser's has the best wholesale sugar prices on all types including:

Regardless, neither the Everglades nor the sugar industry is likely to see this project take off at the speed of an airboat.

Should the project get the full go-ahead, terms are in place for a gentle transition.