Thursday, January 08, 2009

Comfort Food Making a Comeback in 2009 Agricultural Commodities Take Hit in 2008

The recession is making home kitchens happy as consumers are opting for inexpensive, comfort foods such as beans, pasta and chicken cooked in the comfort of their own homes.

"People are looking at the family table in a new way, and trying to save as much as possible," said Susan Stockton, senior vice president of culinary production at the Food Network in New York. "This will be the year of the home-cook."

The move to economize has benefited food makers like Campbell Soup Co. and General Mills who have seen sales gains as consumers eat more cereal and canned soups.

However, the eat-at-home trend has turned up the heat on U.S. restaurants whose sales suffered since the summer. Sales growth slowed to a slim 0.8 percent in November on a year-over-year basis, according to data from SpendingPulse, a retail research subsidiary of MasterCard, Inc., although some eateries have seen sales drop as much as 20 percent.

Consumers are expected to look for better value when they eat out, heading to neighborhood bistros, wine bars and noodle bars. Serious food lovers may still splurge on higher cost, local organic ingredients but will be more selective.

Agricultural Commodities Take Hit in 2008

Commodities sealed their worst year on record with accelerating losses in the fourth quarter of the year, data showed Jan. 1.

Industrial metals, crude oil and even grains stumbled as the world fell into recession, wiping out six years of nearly unbroken gains in the space of months.

Commodities led the charge lower over the second half of the year with more than 50-percent plunge since July, double the decline in the U.S. Dow Jones stock index, and some analysts predict a lag in recovery until the second half of 2009.

"At the moment, confidence in the commodity market is short, definitely short. That confidence would start to be restored when we start to see a rebound in equity markets again," said Mark Pervan, head of Australia & New Zealand Bank Research.

The five commodity indexes used most heavily by investors to gain exposure to raw material prices—tracking energy, metals and agriculture markets—showed an average 40.5 percent dive in the fourth quarter, taking the full-year fall to 42.35 percent.

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