Food Business News - Jul 07, 2009 - (Page 1)

FoodBusinessNews ® NEWS, MARKETS AND ANALYSIS FOR THE FOOD PROCESSING INDUSTRY Clean labels: Pure and simple July 7, 2009 Difficult recovery seen Joseph Glauber, chief U.S.D.A. economist, experiences breathtaking swings in agriculture during first months on the job 23 Product development cost reduction 27 Cookie innovation 30 MARKET WATCH Processed vegetable prices WASHINGTON - Joseph W. Glauber became the U.S. Department of Agriculture's chief economist in 2007 after serving 15 years as deputy chief economist under his predecessor, Keith Collins. During his first several months as chief economist, Dr. Glauber has advised the Secretary of Agriculture and Congress during one of the most tumultuous periods in U.S. agricultural history marked by surging crop and food prices in 2008 and a global recession in the current year. Food Business News visited with Dr. Glauber in his Washington office in midJune to hear his observations on a range of topics, including the ailing livestock and dairy sectors, a rebounding ethanol industry, agricultural trade, continued price volatility and controversial new farm programs. In assessing trends in agriculture, Dr. Glauber said it was clear the meat, poultry and dairy sectors have suffered the most in recent months. "These sectors faced feed prices that were never higher as crop prices rose to record levels last year," he said. "Then with the collapse in the global economy, demand for more income-sensitive commodities such as meat and dairy was adversely Continued on Page 20 wholesale, annual change 1998-2007 2008 +2% +8% Jan.-May 2009 +14% Source: U.S. Department of Agriculture January-May 2009 increase is the largest since 1989. Shares of food spending at home, away from home steady in 2008 WASHINGTON - Contrary to a perception largely fed by the media that the recession has driven a sharp increase in food consumption at home and a drop in restaurant business, newly-issued data indicate that the balance between food expenditures at home and away from home changed very little in 2008. This was the finding from data issued June 17 by the Economic Research Service of the U.S. Department of Agriculture. Meanwhile, total expenditures on food last year exceeded $1 trillion for the first time ever. Expenditures for food at home totaled $598.2 billion in 2008, up 3.4% from $578.6 billion in 2007. For food away from home, expenditures totaled $422.1 billion in 2008, up 3.2% from the year before. As a result, the share of spending between at home and away from home was unchanged in 2008, at least to the nearest tenth of a percentage point, with 58.6% dollars spent on at home food and 41.4% away Continued on Page 16

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Food Business News - Jul 07, 2009