Milling & Baking News - August 5, 2014 - (Page 1)

THE NEWS WEEKLY OF GRAIN-BASED FOODS AUGUST 5, 2014 / FEATURE Rail performance issues taking toll on grain industry King's Hawaiian brings aloha spirit to buns category Bun and rolls segment sales see pre-summer boost Story on Page 32 LATE NEWS Kellogg hires new leaders for cereal, Kashi BATTLE CREEK, MICH. - In an effort to turn around its struggling cereal and Kashi businesses, the Kellogg Co. has put new leaders in charge. Paul Norman, who is chief growth officer for the company, is now leading cereal, and David Denholm is returning to lead Kashi. Mr. Denholm ran Kashi in the 2000s and is returning to become c.e.o. of the business. Kellogg also announced that the Kashi business will be moving back to La Jolla, Calif. In March 2013 Kellogg announced it was moving the Kashi business to Battle Creek and that the move would best position the business unit for growth. For the quarter Continued on Page 8 KANSAS CITY - Rail performance has improved from abysmal levels in the United States and Canada earlier in the year, but logistics for agriculture in general and grains and grain products in particular, including flour, remain highly problematic in some key regions with slow deliveries and high costs running through the spring and into the summer. And with bumper fall harvests expected across the Corn Belt and Upper Midwest, concern about rail car availability during harvest is driving freight values into the stratosphere. The milling industry has clearly felt the effects of rail logistics problems, from delayed inbound shipments of wheat to outbound flour and millfeed movement, which has affected cash grain basis levels, operating schedules, grain and flour prices, profit margins and earnings, in some cases since last fall. "There is no question it's increasing costs," said Jeff Zyskowski, vicepresident of supply chain at Ardent Mills, Denver. "It affects everyone in the supply chain." Mike Miller, vice-president of risk management at Ardent Mills, added, "Any Continued on Page 36 Bimbo executives cite impact of surprising bread market dynamics MEXICO CITY - While prepared for a more competitive environment with the return to the marketplace of bread and cake brands formerly owned by Hostess Brands, Inc., executives of Grupo Bimbo S.A.B. de C.V. said market dynamics have shifted in ways not entirely expected. In a July 23 conference call with investment analysts, Bimbo leadership offered insights into the U.S. baking market. Operating income of the U.S. and Ca- nadian baking business of Grupo Bimbo was 1,033 million pesos ($80 million) in the second quarter ended June 30, flat when compared with 1,031 million pesos in the second quarter of 2013. Net sales were 21,548 million pesos ($1,668 million), up 7.8%. Net majority income of Grupo Bimbo in the second quarter was 1,617 million pesos ($125 million), up 73% from 937 million pesos in the same period last year. Consolidated sales were 45,540 million pesos ($3,525 million), up 5%. Daniel Servitje, Bimbo's chief executive officer, described the quarter as "showcasing the strength of our most recent acquisition just five weeks post consolidation, trending volume improvement in Mexico, meaningful progress on the transformation plan in the United States Continued on Page 12

Table of Contents for the Digital Edition of Milling & Baking News - August 5, 2014

Milling & Baking News - August 5, 2014
Rail performance issues taking toll on grain industry
Bimbo executives cite impact of surprising bread market dynamics
Late News - Kellogg hires new leaders for cereal, Kashi
Table of Contents
News/Comment - Recalling a friend of this journal, grain-based foods
Editorial - Flour output data from new source
Late News
Maker of European-style bread to expand capacity in New Jersey
Business - Following lab testing, Schwebel resumes production at Youngstown
GrainCorp acquires equity stake in leading Egyptian flour miller
Federal judge orders Kellogg to end lockout in Memphis
New milling company to feature organic, specialty ingredients
Doritos leading PepsiCo charge into food service market
Financial Results - Corn flour operations boost U.S. sales volume at Gruma
Weston Foods looks to address declines in fresh volume
Panera Bread to get ‘surgical’ with pricing
People - Dale Lecrone, founder of LeMatic Inc., dies at age 88
Mel Sjerven, former senior editor of Milling & Baking News, dies
Flowers Foods names senior v.p. for Northeast region
Bunge Ltd. names John McGlade to board of directors
Data - C.P.I. for baked foods, cereals eases in June
White pan bread price down, wheat bread up in month
Food Ingredient Solutions - A full assault on partial hydrogenation
Taking the non-bioengineered oils challenge
Buns and Rolls Update - King’s Hawaiian brings aloha spirit to buns category
Rudi’s debuts organic pretzel rolls
Weather Outlook - July Europe weather raises wheat quality issues
Supplier Innovations
Ingredient Market Trends - International Grains Council raises wheat crop forecast
Ingredient Week
Marketplace Business Network
Ad Index

Milling & Baking News - August 5, 2014