Pushing the buttons on pasta

by Eric Schroeder
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When Todd Hale, senior vice-president of consumer and shopping insights for North America at Nielsen Co., addressed participants at the National Pasta Association’s annual meeting earlier this year in Palm Beach, Fla., he encouraged pasta companies looking to drive change and growth at retail to look to “hot buttons” for guidance.

He described “hot buttons” as areas where retailers are specifically putting a lot of focus today. At the time of the meeting, Mr. Hale identified convenience, private brands, right-sized box and health and wellness as trends resonating with consumers. One trend that didn’t receive much mention in that April presentation but that has clearly emerged in recent months as a “hot button” is gluten-free.

Going gluten-free

Barilla Group, which is the world’s largest pasta company, posted a 4% increase in dollar sales and 7% gain in unit sales within its Barilla America Inc. spaghetti/macaroni/pasta (no noodles) business in the 52 weeks ended Sept. 8, according to data from Chicago-based market research firm Information Resources, Inc.

Bannockburn, Ill.-based Barilla America, Inc. hopes to continue the sales surge with a new line of gluten-free pasta that debuted earlier this fall in select markets. The pasta, which combines non-bioengineered corn and rice, is made in a dedicated gluten-free facility in Italy and is available in four varieties: spaghetti, penne, rotini and elbows. Each 12-oz box has a suggested retail price of $2.39.

The pasta is set for a national roll-out in 2014. Barilla said the introduction of the gluten-free pasta is “a strategic addition to the Barilla pasta portfolio and to the pasta category overall.”

The nation’s second-largest pasta company, New World Pasta, Harrisburg, Pa., earlier this month introduced Ronzoni Gluten-Free Pasta in three new varieties: spaghetti, penne rigate and rotini. The pastas blend white rice, brown rice, corn and quinoa, and contain 19 grams of whole grains per serving.

“Today’s consumer is looking for new and unique products to suit their dietary lifestyle needs, and we want to be there to answer that call,” said David Heimbecker, senior director of marketing for New World Pasta Co.

Gluten-free also was behind a new line launch at DeCio Pasta. The Tempe, Ariz.-based company in late August said it spent more than two years planning the product launch. Made in a dedicated, stand-alone facility, the pasta is available in seven varieties: garlic and chive fettuccine, sweet potato fettuccine, tomato basil garlic fettuccine, lemon pepper, spinach basil garlic, sweet potato orzo and wild mushroom.

A partnership inked in May between Heartland Harvest, Kankakee, Ill., and Indianola, Iowa-based Harvest Innovations is expected to deliver new gluten-free pasta to the market as well.

“The two companies will join forces in their manufacturing and technical capabilities to provide exciting new gluten-free pasta options to the market that are not only gluten-free, but nutritious and great tasting,” said Dennis Bunck, chief operating officer of Heartland Harvest.

Post, Smucker into pasta category

While gluten-free may be dominating new product trends in the pasta category, a potential acquisition looms that will alter the landscape for one large player. In mid-September, St. Louis-based Post Holdings, Inc. entered into an agreement to acquire Dakota Growers Pasta Company, Inc. from Viterra, Inc. for $370 million. Dakota Growers Pasta manufactures a full line of dry pastas for retail, food service and food processors, including whole grain and organic items. Product lines include Dakota Growers Pasta, Dreamfields and Pasta Sanita.

Post said Dakota Growers will be managed independently from other Post businesses by its existing management team.

The company anticipates closing the transaction in January 2014, but it is subject to closing conditions and the expiration of waiting periods required under antitrust laws.

In the 52 weeks ended Sept. 8, Dakota Growers had spaghetti/macaroni/pasta dollar sales of $32,369,020, up 9% from the same period a year ago, according to I.R.I. Unit sales were 15,460,260, up 15%.

A smaller transaction in mid-August saw J.M. Smucker Co., Orrville, Ohio, enter the pasta category with the purchase of Enray, Inc., a Livermore, Calif.-based manufacturer and marketer of organic, gluten-free grain products.

Enray offers three varieties of ancient grains pastas under the TruRoots label: elbows, penne and fusilli. The pastas combine quinoa, amaranth and brown rice.
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