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Jan 2009
Volume 7, Number 1
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Food Trends
Developing new products and anticipating trends in the food industry has always been difficult. New food products, technologies are always emerging, and consumer tastes constantly change. However, some of our most popular food items stay favorites every year. With so much turmoil in the global economy, it's a good time to reexamine emerging trends and what we might find in 2009.
The major macro trends are familiar. First, the global economic slowdown is forecast to continue through 2009. This has multiple impacts. Consumer spending is expected to decline, and this impacts both retail and restaurant volumes. Energy costs impact production, and commodity demands tend to shift in periods of economic recession. Food prices will continue to rise by at least 4%, and the impact of the corn harvest being increasingly diverted for biofuel is still being felt. The current forecast is that 25% of corn will be used for fuel production versus feed, which has an impact on grain, beef, and poultry prices.
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Second, interest in "green," or environmentally sensitive production and preparation methods is expected to increase. In past years, this has meant more focus on organic foods, and more locally produced ingredients. Now, there is more momentum for environmentally-friendly operated restaurants, and more consumer awareness. In one example, a restaurant is offering sparkling tap water as an alternative to bottled sparking water, since it reduces waste.
Organic foods continue to be popular, with sales climbing another 10% in 2008 to $24 billion. Many retail stores are offering wider varieties of organic food items, both fresh and prepared. Restaurants that feature organic dishes or ingredients are seeing their popularity climb. In a tougher economic climate, some restaurants are opting for a few showcase organic items or ingredients, and using these to market higher menu prices.
A major initiative in 2009 will be to improve food safety and security. The number of incidents of food safety scares increased significantly over the last two years, and produce from Mexico has turned out to be one of the major sources of concern. Right now, it is not clear whether the U.S. FDA and Mexican authorities will increase oversight and safety for farm production.
Third, there is continued focus on ethnic foods and combining foods from different origins to make new dishes. Peruvian food has gotten the most recent attention as a new ethnic cuisine to bring to more mainstream audiences. With the recent economic downturn, classic "comfort foods" have gotten more attention as a way to evoke both nostalgia and provide good consumer value.
In the restaurant industry, operations are becoming increasingly tough. The credit crunch has significantly affected some operators and chains, limiting inventory and capital spending. As credit loosens, there will be greater flexibility for both expansion and simpler revamping of existing facilities. However, with reduced discretionary income, many consumers are turning to prepared foods, eating at home, or at less expensive restaurants as choices.
One challenge for restaurants is whether the high growth in unit density and increasing number of choices will successfully weather the current economic storms. Over the past few years, many chains have opened more units and had increases in menu variety and prices. Even while economic growth was positive, some players struggled to maintain same store sales growth through increased traffic, versus increased menu prices. Now, with economic pressures negatively affecting both consumer spending and operating costs, the challenges for restaurants operators are complex. Early indications are that reductions in portion size and food cost and quality will be commonplace. However, with consumers becoming more selective over where they allocate scarce dollars for restaurant meals, food quality and service will become important differentiators for success.
While there have already been some closings and bankruptcies, the shakeout will continue through 2009. Chains that have stronger real-estate holdings are expected to perform better than those without. On the hotel front, many properties featuring celebrity-chef restaurants are expected to scale back or potentially close outright. Luxury restaurants will begin converting menu options into more bistro-type offerings, and more heavily promoting themselves to maintain traffic.
The line between casual dining and quick-service restaurants (QSR) is becoming blurrier. At the height of the economic expansion, many casual dining chains were bumping up menu prices and elements of the guest experience to rival some fine dining options. Now, many casual dining operators are retrenching to their core market segment, and competing for the classic $10-check dinner. The "Two Dinners for Twenty Dollars" promotion is becoming common in casual dining. QSR's are also fighting for scarce dollars, showing how $20 can feed a family of four, not just two.
There are a few major restaurant menu trends emerging for 2009. One is offering breakfast items, often with a savory twist, all day. Another is creating indulgence or luxury menus with specific items separate from the main courses. This way, diners can choose a dessert, a wine, or a specialty appetizer, which adds to the sense of luxury at significantly less expense. Often these indulgent choices are marketed as "chef-crafted" or "farm fresh," which adds to their appeal.
Other interesting twists from the chefs and restaurants include menu items that feature noodles, ginger, smoked items, and more rustic menu preparations. Regional sourcing continues to grow, particularly in crafted coffee and beers. And, with pricing pressure, mini-plates are becoming a more popular way to serve a variety of foods while keeping both costs and prices down.
Flavors are another area where new trends are expected, including persimmon, starfruit, and lavender. Latin favorites cactus and chimichurri should continue to cross over into mainstream dishes, as will African peri-peri and Indian masala.
One trend that we will guarantee in 2009 is our continued appreciation of your business. At Kingston, we are honored by the trust you place in us to bring you the highest quality produce at competitive prices. Our goal is to make it effortless for you to do business with us, as we manage your supply of produce every step of the way, from planting to plate.
For more information, please contact your Customer Service Representative or Jody Boline.
Sources: Wall Street Journal, National Restaurant Association, National Restaurant Consultants, Epicurious, Los Angeles Times, Chain Leader, The Food People UK, Mintel
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Red Potatoes
Red potato shippers across the country enjoyed record high prices this summer and early fall. Since then, markets have softened somewhat. Currently, there is a balance between supply and demand.
In most growing regions, growers have experienced good quality and increased quantities. North Dakota, Washington, Wisconsin, and Idaho had perfect growing and digging conditions.
Total acres harvested this year were fewer than 2007; demand and markets have been higher. We expect markets to hold steady throughout the rest of 2008. There may be a slight drop at the end of January and into February 2009.
At present, supplies on hand look good heading into January. Red Potato shippers will end their season as follows:
Wisconsin
North Dakota
Florida and East Coast
Idaho
Washington
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February
May
June
July
August
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For more information, please contact your Customer Service Representative or Jody Boline.
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Rail Information
UPRR Fuel Surcharge
The per mile surcharge for January drops to 16 cents per mile!
2009 Energy Outlook ~ Good News!
The current global economic slowdown is now projected to be more severe and longer than anticipated, leading to further reductions of global energy demand and additional declines in crude oil and other energy prices.
The monthly average price of West Texas Intermediate (WTI) crude oil has fallen by more than half between July and November, reflecting the fallout from the rapid decline in world petroleum demand. The annual average WTI price is now projected to be $100 per barrel in 2008 and $51 in 2009.
The average U.S. prices for regular-grade gasoline and diesel fuel, at $1.70 and $2.52 per gallon respectively on December 8, had both fallen more than $2 per gallon from their highs in mid-July. With the assumption of a fragile economy throughout 2009, along with lower projected crude oil prices, annual average retail gasoline and diesel fuel prices in 2009 are projected to be $2.03 and $2.47 per gallon, respectively.
For more information, please contact your Customer Service Representative or Chris Taylor.
Source: Energy Information Agency
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Each month in the E-News, we will share insights into the activities of the Kingston Quality Assurance team as they visit growers, packers, and distributors. We hope this will help give you more information on our commitment to food safety and security. This month's report is from Cindi Thompson, Food Safety/Quality Assurance Supervisor.
Imported Food Safety
Each year, approximately $2 trillion dollars worth of products enter the United States from more than 150 countries and territories around the world. This amounts to about 25,000 shipments each day.
The Food and Drug Administration (FDA) regulates a large number of these products and is responsible for ensuring that they meet U.S. standards for safety and quality and do not jeopardize the public health and national security. The number of shipments that are FDA-regulated has tripled from 500,000 in 1971 to 1.5 million today.
Unfortunately only approximately 3 percent of all imported products are physically inspected. Currently the FDA places the remaining burden on the importers to demonstrate that the products they want to bring to the United States comply with the FDA rules and regulations. A sample regulation reads: "All food imported products are required to be pure, wholesome, safe to eat, and be manufactured, processed or produced under sanitary conditions." Importers must provide sufficient proof to the FDA that they are in compliance with this rule.
The FDA will issue an Import Alert on regulated articles if it appears they are in violation of safety regulations. An Alert can be issues based on either sampling, inspection, or information that a risk or violation may exists. Future shipments of that product will not be allowed entry into the United States unless the importer can demonstrate that the product is in compliance. For example, an Alert will be issued if it appears that the product has been manufactured, processed or packed under unsanitary conditions. An Alert identifies the manufacturer, shipper, importer and geographic area (country and/or region) as being the source of the alerted product.
The FDA can also tag product as "Detained Without Physical Examination" which puts a stop to any movement of product. The product will not move until the violation is corrected. The FDA will only cancel an Alert after the receipt of evidence establishing that future product shipments will be in compliance and that the condition that gave rise to the appearance of a violation no longer exists.
For more information, please contact your Customer Service Representative or Cindi Thompson.
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Each month, one of our associates will share one of their favorite recipes using different Kingston products. We hope you will try one or all of our family recipes, and all of the great ways to enjoy our high-quality, wholesome products.
Stephanie's Broccoli Salad
1 large bunch of Kingston broccoli crowns
6 slices of bacon, cooked and crumbled
1 cup shredded medium cheddar cheese
½ cup finely diced Kingston red onions
Sauce
1 cup mayonnaise
2 tablespoons red wine vinegar
4 tablespoons sugar
Combine the sauce ingredients with a wire whisk until smooth.
Combine all salad ingredients in a large bowl.
Mix sauce in with the salad ingredients just prior to serving
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Kingston Service Anniversaries
Join us in congratulating our team members on their many years of service.
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| Kevin King - 8 years |
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SAVE THE DATE - Kingston's Annual Invitational Golf Tournament
Kingston's Fifth Annual Invitational Golf Tournament will be held on Friday, February 6th, 2009. We will return to the Duke at Rancho El Dorado. More information will be available shortly from Jody Boline or your Customer Service Representative.
Kingston Celebrates the Holidays
All of the team at Kingston recently gathered at Dave Kingston's home in Rexburg to celebrate the holidays.
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Visit KingstonMarketing.com
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