Warren Buffett Finances Candy Maker – Betting on Old School Eating Trends

USA (SANEPR.com) April 30, 2008 -- POINT ROBERTS, Wash., Delta B.C., www.InvestorIdeas.com, a leading online global investor resource covering over 30 sectors including environmental and food and beverage, features a report on trends in organic, natural foods as Warren Buffett makes headlines financing Mars Inc. is purchase of confectioner Wm. Wrigley Jr. Co. (NYSE: WWY) for an estimated $23 billion in cash. With the growing trends of consumers going back to basic, healthy organic food, Investorideas.com poses is Warren finally wrong for the long term, or will the sugar addicts continue to consume Snickers and Skittles over an organic apple?

Warren Buffett, an admitted sweet tooth, buys what he knows and he knows sugar and candy. Berkshire Hathaway Inc. will purchase a $2.1 billion minority equity interest in the Wrigley subsidiary and offered $4.4 billion of subordinated debt to fund the purchase.

Investorideas.com founder Dawn Van Zant reports. “As a former life long sugar addict that thought candy was equivalent to happiness, I lived with the same foggy sugar brain and would have applauded this venture up until recently. Last year I woke up out of my sugar coma and found the benefits of organic food, so as much as I respect Mr. Buffett, I am hoping he is wrong with this one.”

Food prices and commodity prices are on the rise including sugar. Will the shift in food and eating run in parallel with energy and renewable energy? In the initial stages renewable energy is more expensive than oil but as oil reaches $120 a barrel and is predicted to possibly go to $200, will the same transformation take place in the food industry for the better good? We may be forced to live better, cleaner and healthier lives based on decisions forced by the wallet. As the shift takes place, the organic food industry will face short-term challenges as overall food prices rise and consumers become price conscious.

Organic milk, one of the success stories within the organic food industry, was able to compete with a competitive edge and profit over traditional milk for years is now being hit with rising feed and fuel costs.

The direct relationship with food and fuel prices as well as the changing and disruptive trends will result in a power shift on all levels, with the consumer taking the brunt of the hit until the transition settles.

According to recent research by RedOrbit.com “One of the few certain and consistent trends for American grocers has been the growing popularity of organic food; in fact, from 1997 to 2006, sales of organic food have grown by nearly 80 percent to $17.7 billion.”
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According to the Organic Trade Association (OTA), a membership-based business association for the organic industry in North America, the Canadian organic market is booming with annual growth above 20%.
As of Market close, April 28th. 2008- Sugar wins for the day…
William Wrigley Jr. Co. (WWY) spiked like an insulin high to $76.91, up $ 14.46 (23.15%) http://www.wrigley.com. http://www.mars.com.
Berkshire Hathaway Inc. (BRK-A) closed at $128,460.00, up $1,585.00 (1.25%) on the day.
Organic and Health Sector Stocks Close up:

HAIN CELESTIAL GRP (NasdaqGS: HAIN), a leading natural and organic food and personal care products, closed at $25.02, down 0.22 (0.87%).

SUNOPTA, INC (NASDAQ:STKL) primarily operates in the natural and organic food sectors of the food industry in the United States and Canada and closed at $5.43, up 0.08 (1.50%).

SUPERVALU (NYSE: SVU), recently a significant player in the organic food industry, closed at $ 31.34,up 0.38 (1.23%).

UNITED NAT FOODS (NasdaqGS: UNFI) serving a wide variety of retail formats including conventional supermarket chains, natural product superstores, independent retail operators and the food service channel, closed at $ 20.19, up 0.06 (0.30%).

WHOLE FOODS MARKET INC. (WFMI) a retail chain of organic foods in the USA. Ended the day at $ 31.76, up 0.57 (1.83%).


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