FAO Predicts 2.6% Drop in Global Cereal Supply

The United Nation’s Food and Agriculture Organization’s latest forecast for world cereal production in 2012 has been revised downward slightly— 0.4% to 2.286 million tons—since the previous update in September. The latest adjustment reflects a smaller maize crop in central and southeastern parts of Europe, where yields are turning out lower than earlier expectations following prolonged dry conditions.

At the current forecast level, world cereal production in 2012 would be 2.6% down from the previous year’s record crop, but close to the second largest in 2008. The overall decrease comprises a 5.2% reduction in wheat production, and a 2.3% reduction for coarse grains, while the global rice crop is seen to remain virtually unchanged.

Severe droughts this year in the United States and across a have been the main cause of the reduced wheat and coarse grains crops. However, the very early indications for wheat crops in 2013 are encouraging, with winter wheat planting in the northern hemisphere already well advanced under generally favorable weather conditions.

World cereal utilization in 2012/13 marketing season is forecast at 2.314 million tons, down marginally from the previous season, but 2% below the 10-year trend. Global wheat utilization is likely to reach 687 million tons, pointing to a 1% decline from the previous season, mostly on reduced feed use after the previous season’s exceptionally elevated use of wheat for animal feed. Total utilization of coarse grains is forecast at 1.154 million tons in 2012/13, also down slightly from the previous season, with most of the reduction reflecting a decline in maize utilization to 866 million tons, down nearly 1% from the revised estimate of 874 million tons in 2011/12. The decline in maize consumption reflects an anticipated contraction in industrial usage of maize, largely because of an anticipated drop of 10% (13 million tons) in the crop usage for production of biofuels in the United States. By contrast, world rice utilization is set to increase by 1.2% to 474 million tons, resulting in stable per caput food consumption.

The forecast for world cereal stocks at the close of crop seasons ending in 2013 now stands at 499 million tons, down 4 million tons from September and as much as 5% (28 million tons) from their opening level. This month’s downward revision reflects the worsening of the global production outlook. Compared with the previous season, the fall in world inventories would stem from lower wheat and coarse grain carryovers.

At the current forecast levels, the world cereal stock-to-use ratio is projected at 20.7%, which compares with 22.8% last season and with the low of 19.2% registered in 2007/08. Global wheat inventories are foreseen to reach 172 million tons, down 11% (21 million tons) from the previous season and almost 2 million tons less than in the September forecast.

The reduction in wheat inventories is likely to be most pronounced in Kazakhstan, the Russian Federation and Ukraine, but stocks are also anticipated to end lower in mainland China, the European Union and the United States. As a result, the world wheat stock-to-use ratio is projected at 24.8%, down from 28.1% estimated in 2011/12, though still 2.9 percentage points above the all-time low of 21.9% in 2007/08.

World inventories of coarse grains are forecast to reach 162 million tons, 9% (16 million tons) less than in 2012 and 2.5 million tons below the September forecast. Most the decline from the previous season reflects shrinking maize supplies in the United States that may curb the country’s maize stock-to-use ratio to an all-time low of 7.3%. By contrast, given the expectation of another bumper rice crop, global rice inventories at the close of seasons in 2013 are expected to surge by 6% (9.3 million tons) to a record of 165 million tons. This would lift the rice stock-to-use ratio by 1.6 percentage points to a comfortable 34.5%, or 10 percentage points higher than the 24.5% registered in 2006/07.

Eating Alone Occasions Create Opportunities For Food Marketers

A new analysis from the Hartman Group reveals that while 46% of adults report eating meals alone, up from 44% in 2010, many companies are missing the opportunity to market to the eating alone occasion for adults by continuing to market to family occasions and iconic meals of the past.

According to the Hartman Group, what constitutes a "meal" today has transformed from traditional, sit-down "meat and potatoes with the family" into a constantly shifting assortment of snacking and eating alone occasions. Consumers are giving up meal occasions with others or combining eating with other tasks as the need for productivity compels them to move forward.

Rules no longer really apply for eating occasions, especially when it comes to eating alone. Statistics reveal more than half adult-alone eating occasions take place in the home, and marketers need not cede the sourcing for alone occasions to QSR or other foodservice channels. Within food retail, significant opportunities exist to develop single-portion-oriented baked, prepared and refrigerated stations that enable those shoppers assembling meals-for-one to mix and match new tastes and cuisines. Prepared foods sections found in supermarkets can be masterfully constructed for this behavior.

Hartman also notes marketers are missing the opportunity to connect with consumers on these solitary occasions—both with marketing and product innovation. CPG food manufacturers can connect with consumers relevantly by creating new forms of packaging and ingredients that encourage interactivity and a sense of personalization. Trader Joe’s is often praised by consumers for its two-person meal solutions.

Finally, food retailers also should keep in mind that consumers are cooking for themselves, and retailers need to provide them with meal components they need to enjoy the occasion.

Magic in a Nutshell: Going Nutty

The almond is an energy-boosting, low-fat, protein-packed nut. Almonds are extremely versatile. No matter the meal course or ethnic cuisine, there is an almond form that delivers the needed flavor, crunch or thickening properties.

While almonds are great on their own for munching, especially seasoned or flavored with sweet or savory mixtures, they add distinctive flavor and a healthy halo to a variety of dishes. For example, a pancake batter made with half wheat and half almond flour, as well as diced and toasted almonds, creates a morning grill dish with a healthy crunch. Serving with grilled or griddled seasonal fruit elevates this morning breakfast dish into an anytime meal or even a special after-dinner dessert. .

Diced or chopped almonds can be used in stuffing and coatings, or used to encrust chicken or fish. Almond butter can adds rich, nutty flavor and hints sweetness to smoothies. Further, almond milk can substitute for dairy milk in most applications—think almond milk “ice cream." It is delicious to enjoy alone, but it’s also great in coffee, smoothies and frozen desserts. Consider a marzipan-inspired hot chocolate made with almond milk and cocoa. And of course, almonds’ creamy flavor is a natural in confectionary applications.

In addition to almonds, many other nuts find culinary use including popular varieties, such as walnuts (the more common English variety as well as black walnuts), pistachios, pecans, hazelnuts, macadamias and Brazil nuts. Less-common, but equally delicious include: chestnuts, which can be steamed, boiled or roasted, and used in a variety of dishes from traditional stuffing to less-traditional hummus; and hickory (shagbark), which can be treated like a pecan, because they are close cousins; just to name a couple. Also pine nuts and cashew nuts are considered nuts in the culinary world and are often seen in Indian and Mediterranean cuisines, respectively.

There are countless applications for nuts, but following are a few ideas. For a sweet and spicy nut snack, mix walnuts or pecans with sweetened egg whites and spices, such as cinnamon, all spice, cardamom and chili. Place the mixture on a sheet pan and bake at low temperature until crunchy. Or, just a quick sauté with a small amount of butter or peanut or almond oil brings out the nut flavors.

Nut flours play a flavorful role in gluten-free desserts, breads and even pizzas. Yale University, for example, offers gluten-free, high-protein breakfast options—like milk chocolate and peanut butter ganache muffins—as well as desserts—including dark chocolate-peanut pound cake—where lightly toasted, golden peanut flour substitutes for traditional wheat flour. Special menu items have also been created for Cornell University, including a selection of healthful, protein-packed, gluten-free products, and even a hot beverage—Power Peanutccino—a protein-packed hot drink worthy of Starbucks. For the school’s resident halls and student stores we developed peanut-butter, strawberry and chocolate cannoli; peanut meringue roundies; milk-chocolate peanut-butter whoopie pies; and peanut-butter shortbread.

Sliced or slivered, seasoned nuts are perfect in salads or as topping for hot or cold vegetables. You can create a trio of salad, soup and vegetable toppers as a healthy replacement for croutons. Think about nuts flavored with roasted garlic, toasted onions and baked Parmesan cheese.

Any nut is a natural in granola. Just a sprinkle of roasted and sliced nuts, toasted oatmeal and dried cherries or cranberries adds crunch and flavor to a breakfast cereal, low-calorie snack or an attractive topping for ice cream or desserts.

For bakery applications, sprinkle a few nuts atop muffins or other pastries just before baking. Increasingly, chefs and food product developers are incorporating crushed nuts in stuffings and coatings.

Private-Label Food Sales to Hit 30% Market Share by 2025

Private-label food brand sales are predicted to achieve market penetration of between 25% and 30% in the next decade, up from their current market share of just less than 20%, according to new market data from Rabobank. The projected growth translates to one in every three food product purchases in the United States being a retailer-branded product by the year 2025.

According to the report, "What Would Apple Do? How Can U.S. Branded Food Companies Withstand the Retailer Brand Onslaught?", retailer brands have grown 6% over the past five years, compared with the sales of national branded packaged food manufacturers that have grown just 2%. Increasing competitive strength of private-label brands reflects a power shift from consumer packaged goods companies (CPGs) to food retailers, as well as the growing trust and loyalty consumers have to today's innovative and high-quality retailer brands.

"Retailer brands have matured from their original positioning as 'cheap and cheerless' generic products into a more diverse range of national brand equivalents and, more recently, highly innovative premium products," said Nicholas Fereday, Rabobank analyst and author of the report. “On grocery shelves around the U.S., from convenience stores to upscale supermarkets, retail brands now compete successfully and often win against national brands, earning consumer trust in terms of pricing, quality, image and value."

The report also proposes strategies for consumer packaged goods companies to defend their national brands and/or to compensate for the loss of market share to retail brands.

"Many national brand owners need to be bolder in their thinking and strategizing," Fereday said. "Instead of opting for low-cost, low-risk, conservative solutions, they need to think and act more like the Apples of the world, innovating new game-changing food products and entering new categories. Alternatively, national brand owners should consider downsizing brand-building efforts and diversifying their manufacturing into B2B activities."