Kellogg recall drags down cereal sales
The recall last June of 28 million boxes of Kellogg cereal was one of the factors in a downturn in ready-to-eat cereal sales, according to a financial research analyst. David Palmer of UBS Securities named Kellogg’s voluntary recall of four brands of cereal due to contamination of the liner bags as a factor in declining volume for branded RTE cereal. Kellogg reported a 15% drop in profit for the latest quarter, citing the recall as a major factor. Another reason for the general downturn in RTE cereal, according to Palmer, is a lack of innovation in the category.
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