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Kellogg CEO: Kashi cereal got too 'mainstream'

[November 04, 2013]  NEW YORK (AP) -- Kashi cereal, once a favorite of the health-food set, has gotten too mainstream.

That's according to Kellogg CEO John Bryant, who said Monday that the company needs to do more to make Kashi popular again with "forward thinkers" on the nutrition front.

"Where progressive nutrition was seven or eight years ago is now mainstream," Bryant said in an interview.

The remarks reflect Kashi's shifting fortunes. The brand had been a bright spot for Kellogg's flagship U.S. cereal unit since the company acquired it in 2000. But more recently, it was criticized for using genetically modified ingredients, which health advocates said was in contrast to Kashi's wholesome image.

Kellogg tried to address the concerns by saying it would move toward using more non-GMO ingredients. But Bryant said recovery has been "slower than expected." Sales started declining about 18 months ago and were still in negative territory in the latest quarter, he said.

Whether Kellogg Co. can put Kashi back on the path to growth remains to be seen. Americans are cutting back on cereal more broadly, given the growing number of on-the-go options they have in the morning. Breakfast eaters are also increasingly turning to high-protein choices such as yogurt.

For Kellogg, which makes Frosted Flakes, Rice Krispies and All-Bran, overall cereal sales were down about 5 percent for the quarter.

Kellogg is touting nutritional benefits to boost sales across its broader cereal portfolio. Bryant cited its new Raisin Bran with omega-3 as an example of a mainstream product that would've been considered "progressive" a few years ago.

With Kashi, he said the company plans to focus on newer trends, citing a line extension with quinoa that will be launched early next year.

Still, Bryant declined to say when he expects Kashi sales to turn positive again.

"I'd rather stay away from that," he said, noting that Kashi is still one of the biggest natural foods brands on the market.

[Associated Press; By CANDICE CHOI]

Follow Candice Choi at http://twitter.com/candicechoi.

Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.