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1. To make gnocchi, bring the 1-1/4 cups water, the 3 tablespoons butter, the garlic, sage, the 3/4 teaspoon salt, the 1/2 teaspoon pepper and the nutmeg to a boil in a medium saucepan. Stir in 1 cup of the flour with a wooden spoon. Continue to stir vigorously over medium heat, 1 minute or until the mixture forms a smooth dough and pulls away from side of pan.
2. Remove pan from heat; whisk in eggs until smooth. Stir in remaining 1-1/3 cups flour, the parsley and 1/4 cup Parmesan.
3. On floured surface, roll 1/4 cup of the dough into a 15-inch rope (1/2 inch thick). Cut into 1/2-inch pieces; place on cookie sheet. Repeat with remaining dough.
4. Bring a large pot of water to boil. Drop half of the gnocchi into boiling water, stirring gently to separate. Cook just until gnocchi rise to the surface, 2 to 3 minutes. Remove with slotted spoon and place in 2-quart baking dish. Repeat with remaining gnocchi.
5. To make porcini sauce, heat oven to 400 degrees F. Pour boiling water over porcini in a small bowl; let stand 10 minutes. Meanwhile, heat the 2 tablespoons butter in large skillet over medium heat. Add onion; cook until softened, 4 to 5 minutes. Add white mushrooms, the 1/2 teaspoon salt and the 1/4 teaspoon pepper; increase heat to medium-high and cook until vegetables are browned, 5 to 7 minutes. Stir in the 1/4 cup flour. Gradually stir in milk; bring to boil.
6. Drain porcinis, reserving liquid. Strain liquid through sieve lined with damp paper towel. Finely chop porcinis. Stir porcinis and strained liquid into sauce; simmer 2 to 3 minutes.
7. Pour Porcini Sauce over gnocchi; stir gently to coat. Top with fontina and 1/4 cup Parmesan. Bake 15 minutes or until bubbly. Sprinkle with parsley. Makes 6 servings.