After experiencing volatile commodity prices throughout the first three quarters of 2012 due to weather and drought conditions, economic and energy policies and global effects, the fourth quarter was more stable. Because of the commodity shortage the food and beverage industry faced, farmers are likely planning higher harvests in 2013, which, assuming normal weather conditions, could theoretically lower commodity prices. From an M&A perspective, the food and beverage industry is experiencing trends consistent with the overall market. Corporate buyers are flush with cash as the top food and beverage companies on the S&P 500 have over $35 billion of cash and short-term investments. Coupled with a desire for shareholder returns, these companies, and likewise, smaller private companies, remain acquisitive. The private equity industry continues to have significant raised equity to invest and favorably views food and beverage companies. Valuations remain at a premium for food and beverage companies compared to the S&P 500, trading at a 29.6 percent premium in total enterprise value to EBITDA.