* Breakfast is back in 2010.

* Cereal tallies for new cereal products are at an all-time high.
* Cereal bars--in all variations--remain strong.

Nutritionists like to say breakfast is the most important meal of the day, an adage taken to heart by cereal and cereal bar manufacturers in the U.S. in 2010.  After a dismal 2009, new product launches rebounded in 2010, and several high-profile launches showed that breakfast was back.

Datamonitor's Product Launch Analytics logged a 32.7% uptick in new cereal product stock keeping units in 2010, vs. 2009's tally, with 377 new breakfast cereals in the U.S.  Historically speaking, that tally was the highest for at least the last five years.

Cereal bars--a market encompassing everything from breakfast and snack bars to sports nutrition and meal replacement barsñalso rallied. Some 550 new cereal bar SKUs made their way to the U.S. market in 2010, a 37.2% gain from 2009's sum, says Product Launch Analytics. That total was the strongest since 2005, when 562 new cereal bars debuted.

Consistent with a market firing on all cylinders, breakfast cereal launches were varied and well distributed between ready-to-eat (RTE) cold cereals and hot cereals. PepsiCo's Quaker Oats unit, the standard-bearer in hot cereals, had a trio of major launches in 2010 to jump-start a market that has had about half the sales growth rate of RTE cereals (per Datamonitor).

Hot Breakfast Cereals

Hot cereal tends to be marketed on the intrinsic nutritional value of oatmeal, but 2010 saw more focus on novel flavors and textures. Quaker True Delights advanced the trend with flavors like Hazelnut Latte, but not at the expense of nutrition--since this product boasts significant fiber, protein, calcium and iron contents, plus 24g whole grains.

Coffee-inspired flavors, like Hazelnut Latte, tap a new vein of flavor innovation for hot cereals, and Quaker further upped the ante with Hearty Medleys Fruits and Nuts Instant Multigrain Hot Cereal in 2010. The addition of nuts facilitates a new focus on mouthfeel for hot cereal, leveraging the chewy and crunchy texture of ingredients like almonds, apples and tart cranberries.

And, just to show that kids were not being ignored in its push toward adult-oriented flavors to its hot cereal portfolio, Quaker added some fun with Mix-Up Creations Instant Oatmeal. Each box contains 16 packets of oatmeal in assorted Cinn-O-Man, Apple-tastic and Mapl-icious flavors. Consumers can mix any two packets to create a custom blend.  This is a concept Kellogg also leveraged in its RTE cereal portfolio in 2010, with Pops MiXit Limited Edition Cereal. In Kellogg's case, this cereal debuted in five flavors (Chocolate, Graham, Marshmallow, etc.)--all in 5oz packets--which consumers mix and match to create combinations that would make Clark Griswold blush with pride.

 Flavor customization is a trend food experts have been monitoring for years; however, it is hard to execute in packaged foods (or drinks). Given the obstacles of customizing a packaged product, it is impressive that two major cereal brands toyed with the concept in 2010, suggesting 2011 may bring more activity.

Other noteworthy hot cereal launches included Cream of Wheat Cinnabon Instant Hot Cereal, bringing the popular Cinnabon pastry brand into hot cereals. Kellogg extended its Kashi GoLean brand into the market with a creamy, all-natural instant hot cereal with elevated levels of protein, fiber and whole grains.

Red Engine Foods struck off in a different direction, with its BetterOats line featuring oatmeal packaged in new five-pouch Space Saving Pantry Packs. These boxes are slimmer than traditional oatmeal packaging, with a smaller footprint on-shelf. 

This introduction is reminiscent of similar efforts in beverages to create "refrigerator-friendly" packaging over the years, like Garelick Farms' Kidsmilk, a 2000 debut in something called the "SmartJug." These packaging developments eventually brought the ubiquitous Fridge Pack soft drink packaging.

What does the future hold for hot cereal? More indulgent flavors, like those now common in cup yogurts could be on tap for 2011. If that transpires, look for dessert-inspired flavors, such as cinnamon roll, cheesecake, banana cream pie and maybe even chocolate chip cookie dough to debut. 

At the other end of the spectrum, products pushing the nutritional envelope with probiotics or omega-3s are likely to proliferate, as debuts like Pop Culture Probiotics Oatmeal illustrate. This entry contains live probiotic cultures in a product that is shelf-stable. As for omega-3s, the percentage of new cereals (all types) in the U.S. containing the heart-healthy fatty acids more than doubled--from 6.8% in 2009 to 14.6% in 2010, per Datamonitor.

Ready-to-eat Cereals
Turning to RTE cereals, 2010 was a robust year for product launch numbers, but less so for truly new and different products.

Cinnamon was arguably the hot-button flavor of the year, popping up all over the place.  "Cinnamon, spice and everything nice" may be a well-worn clichÈ, but there is something to the fact that cinnamon has health properties that are only now coming to light. For instance, how many consumers know cinnamon has one of the highest antioxidant levels of any spice?

Less exotic than most spices, cinnamon uniquely works for consumers of all ages. That helps explain the breadth of cinnamon-flavored cereals in 2010, like Kellogg's Cinnabon Crunchy Cinnamon Multigrain Cereal, Corn Flakes Simply Cinnamon and FiberPlus Antioxidants Cinnamon Oat Crunch, as well as Post Honey Bunches of Oats Just Bunches Cinnamon Cereal.

Fiber was also hot in 2010, with 38% of (hot or cold) U.S. cereal launches touting elevated fiber contents, per Datamonitor. The trend was also evident in Canada, where Kellogg's All Bran Buds with Fibres of Psyllium provides 44% of Canada's recommended daily fiber requirement in just one 1/3-cup serving.

Industry veterans remember the late 1990s, when psyllium fiber was touted as the next wonder ingredient. Kellogg's ill-fated Ensemble line (cereal, pasta, frozen entrees, snack cakes, cookies, etc.) was built around psyllium seed-husk fiber. Will psyllium ride today's fiber wave to future glory? Time will tell.

Time also figures in the grain-based ingredients used for some of 2010's most noteworthy cereals--time, as in ancient grains. Spelt is one example, featured in Bohlsener Muehle Matinee Muesli offered in Germany in a Spelt Chai Crunchy flavor. Quinoa is another ancient grain to watch, showing up in Organ Super Grain Multigrain O's with Quinoa in the U.S. 

Harvested from some of the most desolate land on earth, high in the Andes Mountains of South America, quinoa is not really a grain, but is a seed that has emerged as an unlikely "Supergrain." Quinoa's popularity among food makers has helped push the wholesale price of the seed up sevenfold just since 2000, according to Associated Press reports. The torrid popularity of gluten-free foods has helped quinoa, since it is naturally gluten-free. The seed's versatility that has enabled it to be used in everything from breads and pastas to cookies, tortilla chips and frozen entrees is also a factor.

Another grain to watch is flax, which contains alpha-linolenic acid (ALA), a plant-based omega-3 that has become a familiar addition to an array of packaged foods. General Mills' Total 100% Nutrition Plus+ Omega-3s Cereal launched in 2010 in a Honey Almond Flax flavor containing 160mg of ALA per serving.  Also formulated with flax were Barbara's Bakery High Fiber Flax & Granola Cereal, plus Hodgson Mill's Apples & More Muesli Cold or Hot Cereal. The latter is uniquely positioned as a cereal that can be consumed hot or cold.

What other fortifiers should be watched?  As with cereal bars, probiotics appear to have a promising future for RTE breakfast cereals. Attune Foods would concur. Best known for the probiotic bar of the same name, Attune introduced Probiotic Granola Munch in 2010, containing Attune probiotic yogurt chips. Like the firm's bars, Attune suggests the product be refrigerated to extend the shelflife of the yogurt cultures.

Taken to an extreme, these fortification approaches may lead to symptom-specific breakfast cereals. That is exactly what is happening in Australia, where Goodness Super Foods recently launched Digestive 1st and Heart 1st cereals.  Each features BarleyMax, a non-GMO, natural whole grain with a higher fiber and protein content than usual. The BarleyMax ingredient reportedly was the result of more than 12 years of research and development.

If there was a signature cereal bar trend in 2010, it was a move toward pure, natural and so-called "naked" bars. This is part of a larger effort to move away from formulations perceived as being highly processed.

This trend was pronounced in the sports and energy bar sector, a market Datamonitor expects to post nearly 7% sales growth in 2011, better than any other cereal bar sector.  How else to explain the proliferation of branding like PowerBar Pure & Simple, Balance Pure Energy Bar and Balance Bare Energy Bar? All three, along with Kraft Foods' Planters Nut-rition Energy Bars, allow consumers to see what is inside--without biting into the bar or analyzing it with a mass spectrometer.

Not necessarily going in this direction were cereal brands like Kellogg's Special K and Quaker's Life.  Special K Fruit Crisps look more like icing-drizzled toaster pastries than cereal bars, all with a cracker-like crisp texture. Weighing in at 100 calories each, they are pegged as the "new fruity, crispy way to manage your weight." Quaker Life Soft Baked Nutrition Bars for adults are definitely more bakery-like and tout "bakery-inspired taste & texture" in flavors like Banana Walnut Bread.

Indeed, the concept of a "cereal bar" has proven to be sufficiently elastic, in that some entries are dropping the "bar" descriptor altogether. General Mills' Nature Valley Granola Thins Crispy Squares look more like chocolate-topped crackers than snack bars.  Quaker True Delights CafÈ Squares appear more bakery than bar. This is one tactic for dealing with bar fatigue.

An even more novel approach is innovative flavors and tastes. Brazil is where one finds Ritter Cereal Bars in a new Caipirinha flavor that contains no alcohol (thank goodness), but is said to give the mouth a "warming sensation." Will it lead to more alcoholic beverage-inspired flavors?

Another way of livening up the category is to incorporate the latest health trend or fad.  Superfruits fit the bill, thanks to introductions like Kellogg's Nutri-Grain Superfruit Fusion in Strawberry Acai and Cherry Pomegranate flavors. The brand that started the whole pomegranate Superfruit craze--POM Wonderful--recently leveraged into cereal bars with the PomX Bar, a dipped bar in flavors like Espresso Dipped in Chocolate.

What comes after Superfruits? Resveratrol, possibly, though the substance is much more widely used in supplements than food products, and efficacy remains a question mark.  Attempting to change that is the Winetime Resveratrol Bar, billed as the first-ever nutrition bar with resveratrol. One bar contains more resveratrol than is found in 50 glasses of red wine. Resveratrol could be an ingredient to watch, with consumer awareness jumping four-fold to 23% in 2009, says MultiSponsor Surveys.pf

For more information on this topic, type "cereals" or "cereal bars" in the search field at www.PreparedFoods.com.