Prepared Foods - August 2008 - (Page 9)

editorial views Commodity Crisis R&D Applications Seminar CHICAGO PREPARED FOODS Tracking Techniques, Tactics & Trends Prepared Foods’ fourth annual R&D Applications Seminar—CHICAGO, with nearly 80 technical sessions, will be held October 20-22, 2008, at the Englewood Resort & Spa in Itasca, IL. Following on the heels of the highly successful 2007 conference, presentations are designed with the information needs of bench-level formulators in mind. Applications and subjects covered include healthy ingredients, baked goods, sports and energy drinks, new emerging ingredients, organics, allergen-free labeling, prepared meals and processed meats. The interactive Applications Lab Sessions will feature the use of product samples to more effectively demonstrate an ingredient’s functionality, or its application in a finished consumer product or model system. For example, one track may showcase a series of hydrocolloid gum samples to more vividly demonstrate the ingredients’ functionality under varying physical conditions (temperature, viscosity, acidity, etc.). OR A culinary presentation will highlight key consumer trends and how specialty starches help deliver foods that satisfy this trend. The 2008 R&D Applications Seminar—CHICAGO will feature separate Applications Lab sessions on Monday and Tuesday and four Application Lab sessions only on Wednesday morning. For more information, see www.PreparedFoods.com/rd or contact Marge Whalen at 630-694-4347 or whalenm@bnpmedia.com. The slowing U.S. economy is affecting virtually all sectors of the food and beverage industry, but the future could be far bleaker, as commodity costs are taking an ever-increasing toll. William G. Lapp, principal with Advanced Economic Solutions, explored commodity costs in detail during Technomic’s Restaurants 2008: Trends & Directions Conference. “Commodity prices have basically doubled since 2002, but we have yet to see the increase in protein prices that, make no mistake, are coming.” Every man, woman and child in the U.S. is responsible for the consumption of 3.2 pounds of corn per day—be it directly or indirectly via feed, ingredients, etc. This year will see U.S. corn stocks at their lowest levels in decades. Corn prices have doubled since just last summer, and poor weather and flooding will likely serve to increase these higher still. There is a one in five chance that corn yields will be off 10%, history suggests. If that 10% decline in the 2008 U.S. corn crop comes to pass, Lapp predicts a number of consequences: ■ Livestock margins would need to become extremely negative. ■ Corn prices would need to rise sharply, possibly over $8 (a bushel) for much of the next year. ■ A (bearish) government response of some sort will occur if the U.S. is “running out” of corn in 2008-2009. ■ Smaller corn supplies would not only drive up the price of corn, but nearly all food inputs. With a rise in feed prices, protein costs would likely be impacted. Cattle producers are currently losing $1 billion per quarter, estimates indicate, and those costs have to be passed to the consumer at some point. Likewise, chicken producer margins are now in negative territory, as feed costs have surged. Further complicating matters, the trend is for higher inflation rates over the next two years. Between 2008-2012, food inflation is forecast to hit 7.5%, a mark unseen since the 8.7% rate in the 1970s. Worse, between 2009-2012, Lapp predicts a 9% food inflation rate, due to even higher commodity costs. What strategies might be employed to weather this troubled market? Perhaps Lapp’s most prescient advice is to stock up whenever prices decline 5-10%, as this market will not be for the timid. Lapp recommends realistic expectations for costs and to ask what your company cannot afford to have happen. An honest evaluation and considered response could make all the difference. William A. Roberts, Jr. Business Editor pfeditors@bnpmedia.com www.PreparedFoods.com ● August 2008 9 http://www.PreparedFoods.com/rd http://www.PreparedFoods.com

Table of Contents Feed for the Digital Edition of Prepared Foods - August 2008

Prepared Foods - August 2008 Table of Contents Hitting the Shelves Promoting Craveable Foods and Beverages It’s a Small World MarketWatch Regulations: Safety Dance A Taste of Southeast Asia Flavor Secrets: Asian Five-spice Flavor Secrets: The Well-seasoned Potato On the National Menu To Serve and Protect: Flavor and Nutrition Protection Fat Applications in Transition: Creation of Good vs. Bad Fats A Tasteful Formulation Balance Nutrient Density and Dairy Foods R and D Applications Seminar: Formulation Information R and D Applications: Some Flavors Like it Hot R and D Applications: Prebiotics from a Conifer? R and D Applications: Seeing Red (Foods) R and D Applications: A Probiotic with Survival Skills Abstracts

Prepared Foods - August 2008

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