Milling & Baking News - July 29, 2008 - (Page 1)

THE NEWS WEEKLY OF GRAIN-BASED FOODS JULY 29, 2008 / Wheat prices tumble from record highs as harvest expands Atkins-sponsored weight-loss study favors low-carbohydrate dieting Story on Page 14 LATE NEWS Bunge quarterly net income up dramatically WHITE PLAINS, N.Y. - Net income of Bunge Ltd., in the second quarter ended June 30, was $751 million, equal to $5.45 per share on the common stock, up 347% from $168 million, or $1.30 per share, in the second quarter last year. Net sales were $14,365 million, up 73%. Gross profit at Bunge more than doubled from the second quarter last year in three of the company's divisions - Agribusiness, up 183%, to $745 million; Fertilizer, up 232%, to $521 million; and Milling Products, up 122%, to $80 million. Second-quarter profits in the company's remaining division, Edible Oil Products, climbed a "modest" Continued on Page 10 KANSAS CITY - Wheat prices in the last several weeks fell sharply from alltime highs as the expanding Northern Hemisphere harvest bolstered forecasts for a bumper crop in the United States and record world wheat production in 2008-09. While wheat prices could move yet lower this summer, they were likely to remain historically high for the current year and perhaps for years to come because of relatively tight world stocks of wheat and other basic agricultural commodities in the face of rising demand. The price of 12%-protein hard red winter wheat in Kansas City (based on the price of the basic K.C. wheat future and the cash premium applying to 12% protein) on July 18 was $8.86 a bu, down from a mid-March high near $14. A year earlier, the mid-July price of 12%-protein hard red winter wheat was around $6.30 a bu, and in 2006, it was $5.39 a bu. Price movements in 14%-protein hard red spring wheat in Minneapolis were even more dramatic. The price dropped to $10.10 on July 18 from a mid-March high near $25 a bu. A year earlier, in mid-July 2007, 14%-protein hard red spring wheat was trading near $6.55 a bu and in mid-July 2006 traded near $5.64 a bu. The cash price of soft red winter wheat in St. Louis on July 18 was about $6.14 a bu (based on the Chicago September wheat future and local mill bids on Continued on Page 21 Sara Lee to revise labeling on Soft & Smooth Made with Whole Grain White Bread DOWNERS GROVE, ILL. - Sara Lee Bakery Group last week agreed to revise packaging on its Soft & Smooth Made with Whole Grain White Bread products by the end of the year, a move that effectively ends a dispute with the Center for Science in the Public Interest (C.S.P.I.) over allegations that Sara Lee was misrepresenting the healthfulness of the bread. The action comes a little more than seven months after the C.S.P.I. issued a "notice of intent to sue" against Sara Lee Corp. for what the organization called an attempt "to put a whole grain halo on a bread that is not whole wheat." Sara Lee has adamantly denied the allegations made by the C.S.P.I., saying the claims on the packaging accurately reflect the transitional nature of the product, which is made from a blend of 30% whole wheat flour and 70% enriched wheat flour. "That name (Sara Lee Soft & Smooth Made with Whole Grain White Bread) was chosen while we were working with the federal Food and Drug Administration," Sara Lee said in December. "We Continued on Page 13

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Milling & Baking News - July 29, 2008