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BY THE NUMBERS

To a certain extent, consumer interest in health and dieting, along with demands for convenience, played a part in boosting -- and deflating -- sales of the fresh foods covered in SN's IRI category review. The low-carb dieting trend may be officially dead, but its impact continues to be felt. Sales of orange juice, the major component of the refrigerated fresh juices category, slumped, as did sales

To a certain extent, consumer interest in health and dieting, along with demands for convenience, played a part in boosting -- and deflating -- sales of the fresh foods covered in SN's IRI category review. The low-carb dieting trend may be officially dead, but its impact continues to be felt. Sales of orange juice, the major component of the refrigerated fresh juices category, slumped, as did sales of refrigerated desserts. Greater emphasis on ethnic marketing translated into big gains for ethnic meat and poultry products. New product introductions pumped up the numbers significantly for some categories. Steep price increases drove sales figures up for dairy categories that actually experienced declines in unit sales. Meanwhile, a sharp drop in egg prices caused steep declines in egg sales figures.

for this high-volume category as a whole may still be tied to low-carb diets that discouraged consumption of fruit juices. Drug stores sales, a tiny portion of the overall category, were generated mainly from single-serve drinks. Sales of relatively new "healthy" juices were up in all channels. Products in the "all other" subcategory make antioxidant claims that they're highlighting in extensive consumer-media ad campaigns.

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets: $3.8 B; -0.4

Drug: $45.7 M; 9.4

F/D/MX: $3.9 B; -0.2

Subcategories

Supermarket Sales 52 weeks ending May 15, 2005

Rfg All other fruit juice: $69.6 M; 100.2%

Rfg Apple juice: $7.9 M; -15.4%

Rfg blended fruit juice: $202.5 M; -10.4%

Rfg cider: $45.7 M; 3.5%

Rfg cocktail mixes: $158,700; -5.0%

Rfg cran. cocktail/drink: $4.5 M; -9.7%

Rfg cran. juice/cran. juice blend: $1.2 M; 29.4%

Rfg fruit drink: $657.9 M; 8.8%

Rfg fruit nectar: $15.7 M; -12.9%

Rfg grape juice: $1.4 M; 47.9%

Rfg grapefruit cocktail/drink: $1.2 M; 16,671.2%

Rfg grapefruit juice: $74.0 M; -14.0%

Rfg juice/drink smoothies: $39.7 M; 39.3%

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets $3.952 B; -5.7; $3.890 B; -1.6; $3.773 B; -3.0

Drug $40.4 M; 10.6; $41.4 M; 2.5; $45.0 M; 8.6

F/D/MX $4.028 B; -5.6; $3.962 B; -1.6; $3.851 B; -2.8

FRESH BREAD & ROLLS

* IRI does not break down this category into subcategories, had no data available for 2002 and no longer tracks the category in the drug and mass channels.

The massive fresh bread category enjoyed modest sales gains, even as unit sales slipped slightly. After enduring several rough years fighting carb-counting trends, the category appears to have stabilized, possibly due to a growing consumer understanding of the benefits of whole grains.

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets: $9.3 B; 2.2

Drug: N/A; N/A

F/D/MX: N/A; N/A

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets: N/A*; N/A; $9.190 B; N/A; $9.236 B; 0.5%

Drug: N/A*; N/A; N/A; N/A; N/A; N/A

F/D/MX: N/A*; N/A; N/A; N/A; N/A; N/A

NATURAL CHEESE

While they're still high, wholesale cheese prices have settled back into almost normal, seasonal patterns from volatility and record highs of last year, when they were affected by the U.S. dollar/euro ratio. That settling has spurred retail promotions, keeping sales momentum up. The top gainer, natural cheese, which includes fresh mozzarella, goat cheese and specialty items generally used as ingredients, isn't surprising given the popularity of recreational cooking.

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets $5.9 B; 9.7

Drug $7.2 M; 45.7

F/D/MX $6.0 B; 9.9

Subcategories

Supermarket Sales 52 weeks ending May 15, 2005

Natural All Other Forms: $8.8 M; 29.1%

Natural Chunks: $2.205 B; 7.2%

Natural Crumbled: $136.6 M; 9.7%

Natural Cube: $85.0 M; 9.1%

Natural Shredded: $2.015 B; 9.3%

Natural Slices: $593.3 M; 22.7%

Natural String: $412.8 M; 17.3%

Rfg Grated: $86.6 M; 7.1%

Ricotta: $176.1 M; 3.5%

SS Grated: $210.3 M; 0.9%

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets $4.863 B; 2.2; $5.178 B; 6.5; $5.768 B; 11.4

Drug $5.3 M; 4.3; $4.9 M; -7.3; $6.0 M; 23.1

F/D/MX $4.902 B; 2.2; $5.217 B; 6.4; $5.816 B; 11.5

MILK

Dollar sales of milk rose on higher pricing during the 52 weeks that ended May 15, but total unit volume fell, even as the drug channel continued to siphon a small but growing portion of that volume from supermarkets. Customers appear to be keeping an eye on health at the dairy door: skim and low-fat milks experienced much milder volume declines than whole milk, while milk substitutes, such as soy milk, continued to grow.

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets: $10.137 B; -3.8; $10.083 B; -0.5; $10.690 B; 6.0

Drug: $242.1 M; 9.0; $259.2 M; 7.1; $326.4 M; 25.9

F/D/MX: $10.539 B; -3.7; $10.484 B; -0.5; $11.174 B; 6.6

52 weeks ending May 15, 2005

Dollar Sales; % Change From Last Year

Supermarkets: $10.9 B; 6.7

Drug: $365.0 M; 30.8

F/D/MX: $11.4 B; 7.5

Subcategories

Supermarket Sales 52 weeks ending May 15, 2005

RFG Skim/Lowfat Milk: $6.574 B; 7.8%

RFG Whole Milk: 3.162 B; 4.3%

RFG Flavored Milk/Eggnog/Buttermilk: $698.5 M; 0.6%

RFG Kefir/Milk Substitutes/Soymilk: $392.0 M; 19.3%

RFG Milkshake/Non-Dairy Drinks: $60.7 M; 24.4%

LUNCHEON MEATS

Leaner offerings and new flavors kept lunch meat sales healthy. Luncheon meats pack convenience and appeal to consumers fond of high-protein foods. Many products are packed in resealable bags, in a variety of sizes. Those factors fueled the category's growth. On the heels of previous years' growth, dollar sales jumped up in all channels, with drug store sales showing a particular surge in sales. A small part of the total category, non-sliced products actually posted a decline in sales.

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets: $3.136 B; -1.6; $3.236 B; 3.2; $3.350 B; 3.5

Drug: $5.9 M; -4.3; $6.1 M; 3.4; $6.9 M; 12.3

F/D/MX: $3.169 B; -1.5; $3.267 B; 3.1; $3.385 B; 3.6

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets $3.4 B; 2.0

Drug $6.9 M; 4.0

F/D/MX $3.4 B; 2.1

Subcategories

Supermarket Sales 52 weeks ending May 15, 2005

Rfg Non-Sliced Lunchmeat $238.4 M; -3.3%

Rfg Sliced Lunchmeat $3.116 B; 2.4%

TOP SALES GAINERS

BUTTER

Dollar sales rose on higher pricing for butter, while unit sales dropped 5% in the past year. In fact, butter prices have been on the rise since at least 2003. Consumption is projected to decline this year, according to the U.S. Department of Agriculture's forecast. In recent years, retailers have added premium butters and European varieties to appeal to consumers with gourmet cooking and dining in mind.

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets $1.3 B; 19.2

Drug $3.0 M; 28.6

F/D/MX $1.3 B; 19.3

Subcategories

Supermarket Sales 52 weeks ending May 15, 2005

Rfg butter: $1.313 B; 19.2%

All other*: $57,000; -23.2%

*Includes products with no UPC information provided.

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets: $1.128 B; -13.3; $1.070 B; -5.1; $1.267 B; 18.4

Drug: $2.3 M; 9.9; $2.3 M; -1.6; $2.8 M; 20.2

F/D/MX: $1.138 B; -13.1; $1.079 B; -5.2; $1.278 B; 18.5

YOGURT

Like yogurt itself, yogurt sales are healthy. Yogurt's rapid growth can be measured in steady, year after year sales increases and new product rollouts. Dairy cases offer a sea of choices including singles, multi-packs, drinkable yogurts, organic varieties, yogurts with sprinkles and other add-ons designed to appeal to kids. Manufacturers see plenty of room for new products, particularly those that offer specific health benefits. Some newcomers launched in the past year include a yogurt line formulated with cholesterol-lowering plant sterols.

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets $2.9 B; 7.2

Drug $5.6 M; 19.6

F/D/MX $2.9 B; 7.4

Subcategories

Supermarket Sales 52 weeks ending May 15, 2005

Rfg Yogurt $2.458 B; 4.7%

Rfg Yogurt Drinks $392.2 M; 26.2%

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets: $2.423 B; 8.0; $2.560 B; 7.3; $2.766 B; 6.4

Drug: $3.8 M; 59.5; $4.1 M; 8.1; $5.4 M; 32.5

F/D/MX: $2.444 B; 8.2; $2.624 B; 7.4; $2.800 B; 6.7

REFRIGERATED SIDE DISHES

Refrigerated side dishes continued to grow this year, as consumers looked for convenient ways to make traditional meals at home. Conventional formats were the preferred channel -- only the drug channel showed signs of declining sales. Prepared salads, such as pasta salad, fruit salads and coleslaw, are new additions to this year's data.

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets: $378.5 M; 12.0; $401.9 M; 6.2; $413.3 M; 2.8

Drug: $41,000; 73.6; $40,000; -2.2; $34,400; -14.0

F/D/MX: $379.3 M; -3.7; $402.9 M; 6.2; $414.1 M; 2.8

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets: $756.2 M; 12.4

Drug: $881,800; -4.8

F/D/MX: $759.2 M; 12.4

Subcategories

Supermarket Sales 52 weeks ending May 15, 2005

RFG Side Dishes: $154.8 M; 42.6%

RFG Appetizers/Snack Roll; $246.7 M; 0.9%

RFG Prepared Salad/Fruit/Coleslaw: $323.3 M; 12.3%

RFG Sauerkraut: $31.7 M; -0.4%

REFRIGERATED MEAT/POULTRY PRODUCTS

Heavier ethnic marketing and merchandising, and possibly consumers' increasing interest in recreational cooking, have contributed to a hefty boost in sales of pork hocks, pigs' feet and related products. The biggest boost, however, comes from the new, convenient case-ready meat products. The category, too, is undoubtedly being propelled by consumers' continued interest in low-carb, high-protein diets. While volume is relatively small, this category has surged ahead each year with double-digit increases.

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets: $948.8 M; 18.9

Drug: N/A*; N/A

F/D/MX: N/A*; N/A

*IRI does not track sales in this category in the Drug and F/D/MX channels.

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets: $638.1 M; 21.1; $721.1 M; 13.0; $899.1 M; 24.7

Drug; *N/A; N/A; *N/A; N/A; *N/A; N/A

F/D/MX: *N/A; N/A; *N/A; N/A; *N/A; N/A

*IRI has not tracked this category in these channels.

MARGARINE/SPREADS/BUTTER BLENDS

The rise in sales of margarine/spreads/butter blends during the past year reversed the steady downward trend of recent years. Improved flavor, new varieties and low price points, held down by big competition among brands, drove sales. While the U.S. Department of Agriculture's new food guidelines advise keeping consumption of trans fatty acids, found in most of these products, as low as possible, the guidelines also advise reducing consumption of saturated fats, which are found in butter. The anti-fat messages may have driven consumers to choose lower-cost margarine, spreads and blends. Drug stores racked up double-digit increases by carrying a selection of the most popular fresh food products.

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets: $1.2 B; 4.6

Drug: $2.7 M; 28.9

F/D/MX: $1.2 B; 4.6

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets $1.202 B; -4.2; $1.181 B; -1.7; $1.221 B; 3.4

Drug: $2.4 M; 4.5; $2.1 M; -15.1; $2.5 M; 22.4

F/D/MX $1.212 B; -4.2; $1.190 B; -1.9; $1.230 B; 3.4

Subcategories

Supermarket Sales 52 weeks ending May 15, 2005

Margarine/spreads/butter blends: $1.232 B; 4.6%

TOP SALES DECLINERS

REFRIGERATED FRESH EGGS

After a year of heady growth, egg prices took a nosedive in the past year, due partly to an oversupply of egg-producing hens. As a result, dollar sales dropped significantly, while unit sales were down only slightly. High-protein diets popularized eggs a few years ago, and consumption remains strong. At the same time, so-called designer eggs with enhanced health benefits have fueled some new growth.

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets: $2.4 B; -15.9

Drug: $14.0 M; -13.6

F/D/MX: $2.5 B; -16.0

Subcategories

Supermarket Sales 52 weeks ending May 15, 2005

Egg Substitutes $197.7 M; 8.8%

Fresh Eggs $2.2 B; -17.8%

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets: $2.209 B; -1.5; $2.630 B; 19.1; $2.748 B; 4.5

Drug: $8.5 M; 20.2; $13.5 M; 59.0; $14.6 ; 8.1

F/D/MX: $2.233 B; -1.4; $2.233 B; 19.1; $2.779 B; 4.5

DESSERTS: RFG PUDDING/MOUSSE/GELATIN/PARFAIT

As Americans struggled to shed pounds, dollar and unit sales of refrigerated desserts fell. Though there have been marketing efforts to lure adults with grown-up flavors and adult-sized portions, there has been little success, as desserts still seem too indulgent for strict dieters. However, manufacturers have been rolling out no-sugar-added products to reach consumers on diets, as well as those with other health concerns such as diabetes.

Subcategory

Supermarket Sales 52 weeks ending May 15, 2005

Rfg Pudding/Mousse/Gelatin/Parfaits: $567.6 M; -3.0%

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets: $552.4 M; 2.4; $570.7 M; 3.3$570.5 M; -0.0

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets $567.6 M; -3.0

* Sales figures not available for the drug and food/drug/mass channels.

REFRIGERATED SEAFOOD

This category's sales have dwindled as more retailers have added service cases in their seafood departments. Indeed, an increasing number have installed service kosher sections in which they merchandise herring in sauce as well as smoked salmon, whitefish and related products, which they hand-slice to order. Previously, these items were available only in refrigerated packages in self-serve cases. In addition, sales that began to slide last year could reflect consumers' waning interest in imitation crab meat. When it first came on the market, imitation crab was eagerly accepted as a reasonably priced

alternative to the real thing. Since then, consumers have discovered other products,

including sushi, in the expanding array of fresh fish and seafood items.

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets: $274.0 M; -2.7

Drug: N/A*; N/A

F/D/MX: N/A*; N/A

*IRI does not track this category in these channels.

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets $255.6 M; 5.2; $268.7 M; 5.1; $257.7 M; -4.1

Drug N/A*; N/A; N/A

F/D/MX N/A*; N/A; N/A

*IRI does not track this category in these channels.

REFRIGERATED BAKED GOODS

Refrigerated baked goods endured a double-digit decline during the past year. Although continued carb watching by diet-conscious consumers likely played a role in the slump, the growth of products such as frozen breads and frozen cookie dough indicates that some sales may simply be migrating to other areas of the store.

Subcategories

Supermarket Sales 52 weeks ending May 15, 2005

RFG Bagels/Bialys $57.6 M; -18.1%

RFG Bread $5.3 M; -7.9%

RFG Cakes (no snack or coffee cakes) $60.8 M; -4.7%

RFG Dinner/Sandwich Rolls/Croissants $1.4 M; 66.3%

RFG English Muffins $28.1 M; 1.2%

RFG Muffins $36,500; -10.0%

RFG Pastry/Danish/Coffee Cakes $4.2 M; -13.4%

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets $189.8 M; -10.6

Drug N/A; N/A

F/D/MX N/A; N/A

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets: $199.7 M; 1.5; $216.2 M; 8.3; $193.9 M; -10.3

Drug: N/A; N/A; N/A

F/D/MX: N/A; N/A; N/A

REFRIGERATED PASTA

A slump in sales, driven by dieting trends, led many supermarkets to prune refrigerated pastas from cramped perimeter sets in recent years. Some retailers, including Cincinnati-based Kroger, have experimented with placing refrigerated pastas adjacent to sauces in coolers in the grocery aisles. However, with frozen pastas also struggling this year, it appears carb-counting may have a broad, lasting impact on these products.

Subcategories

Supermarket Sales 52 weeks ending May 15, 2005

RFG Pasta/Noodle $133.9 M; -2.4%

52 weeks ending May 15, 2005

Dollar Sales; %Change From Last Year

Supermarkets $133.9 M; -2.5

Drug N/A; N/A

F/D/MX N/A; N/A

(Calendar Year) 2002 Dollar Sales; % Change; 2003 Dollar Sales; % Change; 2004 Dollar Sales; % Change

Supermarkets $151.6 M; -1.7; $140.6 M; -7.3; $133.0 M; -5.4

Drugs N/A; N/A; N/A; N/A; N/A; N/A

F/D/MX N/A; N/A; N/A; N/A; N/A; N/A