Food Business News - Oct 30, 2007 - (Page 1)

FoodBusinessNews ® NEWS, MARKETS AND ANALYSIS FOR THE FOOD PROCESSING INDUSTRY Little relief on energy front seen 20 Transporation challenges stir debate 25 Nestle promotes Polman 59 MARKET WATCH October 30, 2007 Vegetable oils prices soar on demand for no trans, biodiesel KANSAS CITY - Vegetable oil prices have been strong for months, boosted by the shift toward no trans fat oils and increased demand for biodiesel. But prices of some products have soared in the past couple of weeks as crude oil prices hit record highs. Despite the shift away from soybean oil to edible oils with no or low trans fat the past two years, soybean oil futures at the Chicago Board of Trade climbed to 23-year highs in the past two weeks. The surge was attributed to increased demand for soybean oil to make biodiesel fuel as crude oil futures prices hit record highs, topping out at $90.50 a barrel at the New York Mercan- tile Exchange on Oct. 25. December soybean oil futures prices posted a recent high of 40.99c a lb on Oct. 18, up 47% from a year ago. July 2008 and other forward soybean oil futures contracts traded above 42c a lb last week. Paul Meyers, vice-president of commodity analysis for Connell Purchasing Services, Berkeley Heights, N.J., expected nearby soybean oil futures to continue to trade in the 39@41c a lb range for the next five to six months. "I don't see a lot of downside from 39c," Mr. Meyers said. He noted strong demand for biodiesel and exports were supportive. Shrinking world stocks and Continued on Page 24 Top pumpkin producing states production in million lbs 500 value in million $25 400 Senate ag committee passes farm bill $20 300 Like the House bill, the Senate legislation could invite veto threat 200 $15 100 0 Illinois Ohio Pennsylvania California $10 Source: U.S. Department of Agriculture The U.S. pumpkin crop was valued at just over $100 million in 2006. WASHINGTON - The Senate Committee on Agriculture, Nutrition and Forestry overwhelmingly passed its version of the 2007 farm bill, The Food and Energy Security Act, last Thursday after a markup that lasted less than two days. "After months of negotiations, we were able to work within a very strict budget allo- cation to complete our work and pass a farm bill that is good for agriculture, good for rural areas and good for the health of Americans," said Senator Tom Harkin of Iowa, chairman of the agriculture committee. Senator Saxby Chambliss of Georgia, ranking republic member of the panel, added, "This is a good bill and it deserves the support of the entire Senate. The package we put together is notable in that it does not raise taxes to pay for new programs or deny our farmers and ranchers a strong safety net." The farm bill next will be considered by the full Senate, which also will be asked to consider an alternative bill sponsored by Senator Richard Lugar of Indiana and Senator Frank Lautenberg of New Jersey (see related story on Page 63). Like the farm bill passed by the House Continued on Page 30

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Food Business News - Oct 30, 2007