UPDATE 3-Kellogg 3rd-quarter profit rises, tops Street view

* EPS $0.94; Wall Street view $0.84 view

* Raises full-year earnings forecast

* Shares up 2 percent (Adds analyst comment; updates share move)

CHICAGO, Oct 29 - Kellogg Co posted a quarterly profit that topped Wall Street forecasts and raised its full-year outlook, helped by lower commodity costs and curbs on expenses, sending its shares up 2 percent.

Like many food companies, Kellogg has benefited from higher prices and consumers eating more meals at home instead of at restaurants during the recession.

The world's largest cereal maker has also consistently invested in product development and cost-cutting, moves that analysts think will help boost earnings even as Kellogg laps the price increases it took last year when prices for commodities like wheat and oil were soaring.

"You have to give the company credit for all these upfront investments to make the company more efficient going forward," Edward Jones analysts Matthew Arnold said.

He said Kellogg and rival General Mills Inc have been among the leaders in the industry in terms of investing for future growth.

Kellogg said it would spend 14 cents to 16 cents a share on such initiatives in 2010, down from 26 cents in 2009.

The maker of Frosted Flakes cereal and Keebler cookies said profit was $361 million, or 94 cents a share, in the third quarter, up from $342 million, or 89 cents a share, a year earlier.

Analysts on average had forecast 84 cents a share, according to Thomson Reuters I/B/E/S.

The earnings beat came despite pressure on sales from strength in the dollar and sluggish growth in North America.

Sales dipped 0.3 percent to $3.28 billion but were slightly ahead of analysts' average forecast of $3.27 billion.

Selling, general and administrative expenses were nearly flat at $873 million.

Kellogg said it now expects full-year earnings to increase 10 percent to 12 percent, excluding the impact of currency rate fluctuations. It previously forecast a rise of 8 percent to 10 percent.

For 2010, it forecast a 2 percent to 3 percent sales increase, excluding currency fluctuations and acquisitions. Its sales forecast for 2009 is a rise of 3 percent to 4 percent.

The company forecast a 10 percent to 12 percent increase in 2010 earnings per share, excluding currency fluctuations.

Kellogg shares were up 99 cents, or 2 percent, to $50.98 in early New York Stock Exchange trading.