Thursday, January 22, 2009

Pasta to the Rescue of Budget Tight Consumers

The ANNOTICO Report

Struggling consumers turn to pasta to stretch their food dollars, in very dire times, after many years of pasta being overshadowed by the low-carbohydrate fad that showed to not be that effective in the long run.

 "It's simple and cheap and I have kids and that's something they like," and "It is still an incredibly great value, For about $5, you can feed a family of four." said two consumers interviewed.

Pasta's Value Rediscovered

The Seattle Times

From The Associated Press

By David Twiddy

January 21, 2009

As struggling consumers turn to casseroles, soup, pasta salad and good old macaroni and cheese to stretch their food dollars, the nation's pasta makers are returning to a rolling boil after many years overshadowed by the low-carbohydrate fad.

Sales of pasta products in the United States including frozen and refrigerated pasta, canned pasta, soup mixes and prepared dinners rose 5 percent last year to $6.4 billion, according to Kansas City, Mo.-based American Italian Pasta, the nation's largest manufacturer of dry pasta.

Most of that increase came as manufacturers passed along a stiff jump in the price of wheat and other costs.

But Peter Smith, chief executive of Harrisburg, Penn.-based New World Pasta, which makes such brands as Ronzoni, American Beauty and Creamette, said he was amazed commodity-price increases last year didn't dampen pasta sales the way they did sales of other consumer goods.

"I think what happened this past year is with all the inflation running rampant through the stores," he said, "it's like a certain number of people rediscovered pasta."...

The volume increase is particularly welcome because pasta consumption had been falling 1 or 2 percent annually for years because of high-protein diet fads, said Carol Freysinger, spokeswoman for the National Pasta Association.

"There's this renewed vigor, this renewed energy in the pasta companies," Freysinger said. "They really got beat up by the low-carb diets, which showed to not be that effective in the long run.

"Pasta has been vindicated," she said. "And (now) the economy is driving consumers to more cost-effective options."

Judy Donnellan, 45, was shopping for macaroni at a grocery store in Kansas City on Tuesday and said her family eats pasta about three or four times a week.     "It's simple and cheap and I have kids and that's something they like," Donnellan said.

She said she couldn't tell if she was buying pasta more than before but said the staple's price and flexibility "is basically why I use it...

The U.S. division of Italy-based Barilla Group, the world's largest pasta manufacturer, saw a 15 percent boost in pasta volume and a 22 percent increase in sales, said the division's president, Kirk Trofholz...

In 2008, consumption of dry pasta hit its highest level since 2003, according to American Italian Pasta, which makes consumer brands such as Ronco, Mueller's and Pennsylvania Dutch and supplies pasta for in-house grocery store brands and for manufacturers who use pasta in prepared dishes.

Annual sales at American Italian Pasta soared 42 percent to $569 million in 2008, and its net profits more than tripled to $19.1 million ....

"It is still an incredibly great value," Kelly said of pasta. "For about $5, you can feed a family of four."

http://seattletimes.nwsource.com/html/businesstechnology/2008651640_pastaboom210.html

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