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UPDATE 2-Kellogg's CEO Bryant steps down, Nature's Bounty exec to take over

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Sept 28 (Reuters) - Kellogg Co replaced chief executive John Bryant with food industry veteran Steven Cahillane on Thursday as the world's largest cereal maker continues efforts to halt 2-1/2 years of declining sales.

Kellogg, like other packaged food makers, has been struggling with falling demand as consumers shift to healthier alternatives, and Bryant has cut jobs and sought to streamline production over the past four years to bolster profits.

But his zero-based budgeting plan - which requires expenses to be justified for each new period - has also seen sales decline steadily since the start of 2015.

Kellogg on Thursday also reaffirmed a full-year 2017 forecast for a 3 percent decline in currency-neutral comparable net sales this year and earnings of $3.97-4.03 per share.

Cahillane, who will be paid an annual base salary of $1.3 million in his role as Kellogg's CEO, most recently served as the chief executive at Nature's Bounty and has held senior roles in Coca-Cola Co and Anheuser Busch Inbev NV.

The company's shares were marginally lower at $63.03 in morning trading on Thursday. (Reporting by Gayathree Ganesan in Bengaluru; Editing by Savio D'Souza and Patrick Graham)