The Low-carb Trend: Death Knell for American Pasta Companies?



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Code : BSM0010

Year :
2004

Industry : Food, Diary and Agriculture Products

Region : USA

Teaching Note:Available

Structured Assignment :Available

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Introduction:The US Center for Disease Control and Prevention announced that the obesity rate in the USwas rising at an "epidemic rate".With calorie and carbohydrate intake on the rise since the past three decades, about 61%of the US adults and 15% of the kids aged between 6-19 years are either overweight or obese. American consumers have adopted and later discarded several kinds of diets in their effort towin the battle of the bulge. In the early 1990s, the low-fat diets became popular, and since 1992, low-carb diets, advocated by Dr. Robert Atkins, became de rigueur. Low-carb diets prescribe cutting down on carbohydrates, especially starchy foods like potatoes, pasta, bread and rice, but encourage people to eat foods high in protein likemeat, beef and eggs. The popularity of low-carb diets (35%of American adults are carb-conscious) has led to a decrease in the consumption of certain food categories like pasta and bread. At the same time, there has been an increase in demand for low-carb versions of pasta.

Pastamakers in America saw sales decreasing by 7% in the first quarter of 2004. In America, while some companies like Dakota Growers and American Italian Pasta have taken steps towards creating low-carb versions of their pasta brands, others are waiting for what they call a ‘fad’ to pass out. Pastamanufacturers face the dilemma ofwhether to invest in product development or not, since it is hard to predict whether low-carb products will be successful. With the help of nutritionists, industry players are taking steps to educate consumers of the benefits of pasta and dispelling themyth that it is detrimental to their dieting efforts. At the same time, companies like American Italian PastaCo. are trying to offer healthier versions of their existing products. But, whether low-carb diets are a passing fad still remains uncertain.

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