Merger and acquisition deals are also slowing. There were 178 announced food sector deals in 2015 as of November 4, compared to 236 in 2014 and 265 at the peak in 2012. The Federal Reserve interest rate expectations have raised the outlook for borrowing costs ahead.

The five-year drop in commodity prices, which has helped reduce costs on many food ingredients, is starting to stabilize.

Additionally, some observers believe food stocks are growing expensive relative to the broader market. The S&P 500’s Food Product Index trades at a 22.6 times companies’ past 12 month earnings, compared to the S&P 500 Index’s 18.5 P/E ratio. The XLP has a 21.4 P/E and PBJ shows a 18.5 P/E.

Consumer Staples Select SPDR

For more information on the consumer sector, visit our consumer staples category.

Full disclosure: Tom Lydon’s clients own shares of XLP.

Max Chen contributed to this article.