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Low-Carb Food Sales Wane

LOS ANGELES -- The clock is ticking for makers of packaged foods aimed at low-carb dieters as more U.S. consumers are abandoning the protein-heavy regimens, reported Reuters.

In just a few months, a barrage of new low-carb products like Kraft Foods Inc.'s Oreo CarbWells and Unilever Plc's Ben & Jerry's Carb Karma ice cream have crowded supermarket shelves, and even mainstream food publications are scrambling to cater to carb-wary consumers.

Martha Stewart Living magazine has recipes for "breadless stuffing" in its Thanksgiving issue, TV's Food Network launched a show called "Low Carb and Lovin' It," and Bon Appetit magazine added a low-carb option to its menu guide.

But behind such reinforcement of the "low-carb lifestyle," the percentage of Americans following diets like Atkins and South Beach dropped to 4.6 per cent in September from 9 percent in January, according to research firm The NPD Group.

"The bloom is off the rose," said Bob Goldin, executive vice president of food industry consulting firm Technomic. "It doesn't look like the market has any staying power."

The fall-off in interest has been accompanied by slower sales of products aimed at enhancing low-carb diets. Dollar sales of such foods rose 6.1 per cent during the 13 weeks ended Sept. 25, down from double and triple-digit gains in the previous six periods, according to ACNielsen LabelTrends.

NPD vice president Harry Balzer attributed the continued sales growth to consumers' willingness to try new things, but said the challenge is to get them to keep buying products often seen as costing more while not tasting as good as than the original versions.

"That's where the problem lies," Balzer said, adding that he did not expect the low-carb trend to last any more than another two years. "We'll see a lot of (food companies) discover that this just isn't selling."

Some of those companies are already feeling the brunt of low-carb backlash. American Italian Pasta Inc., grain processor MGP Ingredients Inc. and dairy company Dean Foods Co. all recently said disappointing sales of their low-carb products would hamper future profits.

Saturation in the low-carb market has taken the biggest toll on smaller niche players, the most high profile of them being the company behind the Atkins Diet. Atkins Nutritionals Inc. said in September it hired a turnaround specialist and will cut jobs due to stiff competition from the growing number of low-carb products.
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