The low-carb diet phenomenon sweeping the US is forcing the food industry to scramble to meet the trend, although some analysts say the trend has peaked.
Despite a fierce debate over health and safety issues, tens of millions of Americans are watching their carbohydrates to combat bulging waistlines, prompting a rash of new offerings from fast-food eateries, traditional restaurants, food makers and retailers.
Coca-Cola and PepsiCo are rolling out low-carb beverages. Low-carb beers are on the rise. And low-carb specialty stores are cropping up in various communities.
Market research firm Mintel estimates that 40 percent of the US adult population, some 83.6 million people, have reduced their carbohydrate intake through the popular Atkins diet or other schemes.
That includes seven percent or 14.6 million US adults who are on a low carb diet and another 69 million who are "carb aware."
"Consumers report that they are eating less pasta and potatoes and consuming more meat, seafood, and poultry," the research firm said.
Analyst Bill Pecoriello at Morgan Stanley contends that the low-carb craze appears to have peaked but still is having an enormous impact on the US food industry.
"Low-carb diets appear to have a profound impact on eating and drinking behaviors," he noted. "Experience with a low-carb diet appears to radically change many consumers' awareness of nutrition issues, self-discipline, and even taste preferences."
Morgan Stanley estimated 11 percent of US adults were on low-carb diets in the first quarter, up from 10 percent late last year. This could have peaked to as much as 13 percent in January as a result of New Year's resolutions and a spike in sales of the South Beach Diet book.
"Collectively, the number of people directly impacted by the low-carb craze rose from 40 percent in December to 42 percent in late March," Morgan Stanley analysts said in a research note.
Companies are moving quickly to get in on the trend, they noted. This ranges from Kellogg's new low-carb cereals to low-carb Doritos crisps from PepsiCo.
Steven Anderson, president and chief executive at the National Restaurant Association, noted that the industry is trying to meet the challenge of providing healthier options, and that with tens of millions of consumers watching carbs, "that's a pretty target-rich environment."
Research group NPD has found nearly three out of four people are aware of the Atkins diet, 17 percent have tried it and about 4 percent of adults are currently following the popular diet.
"The low-carb phenomenon has made many industries sit up and take notice. I have never seen the food industry jump on board to a fad as quickly as this low-carb craze," said NPD vice president Harry Balzer.
The losers from the low-carb craze include bakeries, potato producers and the onetime high-flying doughnut company Krispy Kreme, which has warned of lower profits for the upcoming fiscal year as a result of the low-carb craze.
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