Food Business News - June 18, 2013 - (Page 9)

Editorial EDITORIAL STAFF Editor-in-chief Morton I. Sosland Executive editor, markets Neil N. Sosland Editor L. Joshua Sosland Executive editor Keith Nunes Senior editor, markets Jay S. Sjerven Managing editor Eric J. Schroeder KEITH NUNES Proposed SNAP cuts will be felt throughout the food sector Senior editor, markets Ron Sterk Associate editor Jeff Gelski Assistant editor, markets Laura Lloyd Internet editors Allison Gibeson Erica Shaffer Monica Watrous Graphic designer, market graphics, data Christina Sullivan PUBLISHING STAFF Chairman Charles S. Sosland Vice-chairman L. Joshua Sosland President and publisher Mark Sabo Associate publisher G. Michael Gude David DePaul Bruce Webster Vice-president, chief financial officer Melanie Hepperly Audience development director Don Keating Advertising manager Nora Wages Director of design services Sadowna Conarroe Circulation manager Judith Arnone Digital systems analyst Marj Potts Manager of advertising design Becky White Director of e-Business Jon Hall Director of on-line advertising and promotions Carrie Fluegge Promotions manager Lon Davis WE’RE EAGER TO RECEIVE YOUR FEEDBACK: E-mail or write to us at Food Business News, 4800 Main Street, Suite 100, Kansas City, Mo, 64112 June 18, 2013 s the farm bill makes its way through the is 15% for other consumers, according to NPD. legislative process it is becoming clearThe research firm noted that 29% of shoppers er that the Supplemental Nutrition As- participating in assistance programs visit the sistance Program may see its funding reduced. grocery store every two weeks or less, while How much of a reduction will depend on nego- other consumers shop more frequently, which tiations that will take place between the Senate is considered a function of when the assistance and the House. Many of the most vulnerable in- program debit cards are issued. These shopdividuals in the U.S. population are going to be ping patterns are reflected in the timing of food squeezed if funding for the program is reduced. company and retailer promotional programs. Further up the chain, food and beverage proThe NPD Group study added that nutrition cessors as well as retailers will feel the effects of the cuts. In 2012, supercenters and traditional grocery stores The U.S. Senate passed its version of the farm bill on June 10. The accounted for more than $60 billion in SNAP benefit Senate legislation reduces the SNAP program by an estimated $4 billion redemption. over 10 years. The House is considering a much steeper reduction — $21 billion over the next decade. The House is expected to debate its version of assistance recipients have a higher propensity the farm bill the week of June 17, and the two to skip meals compared to non-participants. branches of the government are expected to These may be considered lost opportunities for meet in conference to discuss the legislation the food industry. The consequences of nutrition assistance during the summer. Approximately 46 million Americans cur- program reductions will be widespread. Conrently receive SNAP benefits. As the U.S. sumers in the United States that are on the economy has slowly recovered from the eco- edge of poverty and participate in nutrition nomic recession that began in 2008, the num- assistance programs will be the group hardber of people receiving assistance benefits has est hit. They may find themselves with little grown. The program is designed for the exclu- or no access to benefits and challenged to sive purchase of foodstuffs such as bread, ce- source foodstuffs that will allow them to rereals, fruits, vegetables, meats and dairy. Any main food secure. Such a situation will be felt elsewhere as funding reductions will ripple throughout the retailers adjust to the reduction in foot traffic supply chain. From 2007 through 2010 the SNAP program and, in turn, adjust the stock-keeping units on pushed more than $70 billion into the entire store shelves. Food companies also will have to grocery retail sector, according to the U.S. adjust to the reduced demand. Darren Seifer, a food and beverage industry Department of Agriculture’s Economic Research Service. In 2012, supercenters and tra- analyst who wrote the NPD Group study, said ditional grocery stores accounted for more that food marketers would be wise to underthan $60 billion in SNAP benefit redemption, stand the eating habits of SNAP/WIC recipients accounting for approximately 82% of all re- since they are a large customer base. “Using messaging and merchandising that is demptions. While much of the media attention regard- relevant, aligning in-store strategies with the ing potential program reductions is rightly on card refill cycles, and providing nutrition eduthose individuals that may lose benefits, food cation are among the ways in which marketers and beverage executives must consider the can yield the best results when connecting with these consumers,” he said. ramifications as well. Food marketers also would be wise to unA report published by the market research firm the NPD Group found that consumers par- derstand how federal funding reductions may ticipating in SNAP and the Women, Infants and affect their marketing efforts before the SNAP Children program purchased approximately cuts go into effect, because the reductions will 25% of foodstuffs from supercenters. The figure be felt throughout the supply chain. FBN A FOODBUSINESS NEWS ® 9

Table of Contents for the Digital Edition of Food Business News - June 18, 2013

Food Business News - June 18, 2013
Diamond Foods challenged by walnut supply and Emerald relaunch
Market Insight: Mid-year commodity outlook
Fruitful ice cream options
Table of Contents
Web Contents
Editorial - Proposed SNAP cuts will be felt throughout the food sector
Flavored milk to grow at double the rate of white milk
Smucker exits bulk coffee, remains bullish on K-Cups
C.e.o. in unsolicited takeover bid for Dole
Heinz acquisition completed, new c.e.o. takes over
Mondelez to offer coffee pods compatible with rival’s system
Tyson Foods expands prepared foods portfolio with acquisition
Nielsen honors Breakthrough Innovation winners
Taco Bell taking charge of breakfast
Expanded breakfast helps lift McDonald’s May sales
McCormick & Company sees growth ahead from innovation and acquisitions
Wal-Mart doubles-down on fresh produce promise
Morningstar buy may be just the beginning for Saputo
Target delves deeper into organics
PepsiCo hires chief marketing officer
Wenner sees winner in Pirate Brands acquisition
Single-serve coffee' harbinger of things to come at TreeHouse'
Washington - Senate passes farm bill, stage set for debate over SNAP cuts
Sports Nutrition - Improved performance
Ingredient Innovations - Diverse Dynamos for Digestion
I.F.T. to convene in Chicago
New Food Products
Ingredient Market Trends - Imports from Mexico send U.S. sugar stocks to record highs
Ingredient Markets
Supplier Innovations and News
Ad Index
Food Business in the News

Food Business News - June 18, 2013