It's been a tough year for income-seeking investors. More dividend cuts -- led by banks and other financials -- and fewer payout enhancements are expected to drive down the S&P 500's 2009 dividend by 21.4%. Can Fools still find safe dividends in this market?

You bet we can.

Delivering the goods -- and the cash
Behold the consumer-staples sector, home to makers of toothpaste, tea, and tomato sauce. I touted the merits of such companies throughout 2009, identifying names that offer stability, market-beating growth, and exposure to international consumers, among other attributes.

Now, the sector as a whole has taken the title of "leading and most consistent [dividend] payer" in the S&P 500, according to Standard & Poor's. Through early December 2009, 33 of the 34 dividend actions taken by consumer-staples companies in the index were increases.

I expect the sector's dividend dominance to continue for years, rather than quarters. Sure, this year's S&P 500 dividend increase is forecast to outpace the historic 5.6% growth rate, but that still won’t help payouts regain their former glory anytime soon.

So instead of waiting for Bank of America (NYSE:BAC) and Citigroup (NYSE:C) to magically replace their recent one-penny quarterly paydays with the respective $0.64 and $0.32 largesse they demonstrated in 2008, why not run with the clear winners?

To help you on your hunt, I've assembled a short table featuring some of the highest-yielding consumer-staples names:

Company

Market Cap

Product Categories

Dividend Yield

Dividend 5-Year CAGR

Altria (NYSE:MO)

$41 billion

Tobacco

6.9%

(14.0%)

Kimberly-Clark (NYSE:KMB)

$26.7 billion

Tissue & paper, personal care, disposable health care devices

3.8%

9.1%

H.J. Heinz (NYSE:HNZ)

$13.5 billion

Sauces, snacks, packaged meals

3.9%

25.3%

Kraft 

$42.5 billion

Packaged foods & beverages

4.3%

9.3%

Oil-Dri (NYSE:ODC)

$110.9 million

Cat litter, industrial sorbents

3.9%

24.6%

Data from Yahoo! Finance and CapitalIQ, a division of Standard & Poor's, on Jan. 5. 

Admittedly, bagging a yield greater than 3.5% isn't as easy it was in early 2009. But this table should provide a sufficiently diverse selection of ideas -- not to be taken as formal recommendations, of course, but to kickstart further research.

Soaking up growth?
Given that the first four companies are well-known heavyweights, I'm most interested in getting the scoop on small-cap Oil-Dri. In addition to a private-label cat-litter business, the company sells its own products under the Cat's Pride and Jonny Cat names, while also manufacturing the Fresh Step brand for Clorox. Throughout the first part of calendar 2009, these businesses helped offset some of the softness in the industrial segment.

The second part of the year, however, dealt Oil-Dri a slippery hand. The company's largest customer, Wal-Mart Stores (NYSE:WMT), cut back on its Oil-Dri products as part of a larger brand-management program. Accordingly, net sales worsened, from a drop of 6% in the fiscal-2009 fourth quarter to a decline of 15% in the recently completed first quarter.

On the upside, though, smaller retailers are now pouncing on the company's Cat's Pride products, and that enthusiasm could ultimately make up for the volume lost at Wal-Mart. Moreover, in the long run, management is upbeat about its relationship with the Bentonville big-box retailer. And given that Wal-Mart was selling 8 million-plus units of Cat's Pride scoopable per year, the retailing goliath could come slinking back -- tail between legs -- in the coming year.

In the end, Oil-Dri's not a pure consumer-staples play. The company doesn't break out its exposure to the industrial sorbent business, which makes it impossible to judge the cyclicality of results. Of course, investors seeking some exposure to a possibly stronger economy may be perfectly comfortable with this unknown. Meanwhile, the company's dividend growth rate and bargain-basement price-to-sales ratio of 0.5 bodes well for the future of both the business and the stock.