Meat Product Manufacturing

Meat Product Manufacturing

Brief Excerpt from Industry Overview Chapter:

Companies in this industry slaughter animals and prepare meat products. Major companies include Tyson Foods, Smithfield Foods, and Pilgrim's Pride, all based in the US, along with JBS (Brazil), Danish Crown (Denmark), Nippon Meat Packers (Japan), and Shuanghui Group (China).

About 245 million metric tons of pork, poultry, and beef are manufactured worldwide each year, including about 42 million metric tons manufactured in the US. The US, EU, Brazil, and China are the largest meat producers.

The US meat product manufacturing industry includes about 3,000 companies with combined annual revenue of about $175 billion and is forecast to grow moderately over the next two years. Key growth drivers include trends in consumption of convenience and case-ready products.

COMPETITIVE LANDSCAPE

Demand is driven by consumer income and by exports. Because meat is largely a commodity, the profitability of individual companies depends on efficient operations and an effective distribution network. Large companies have big economies of scale in production and distribution. Small companies can compete effectively in a local area or by producing unique products.

The slaughtering segment of the industry is highly concentrated: the 50 largest companies generate about 90 percent of segment revenue. The secondary processing segment, meat processed from carcasses, is also concentrated: the top 50 companies generate about 65 percent of segment revenue. Poultry processing is highly concentrated: the top 50 companies generate more than 90 percent of revenue.

Imports, primarily from Canada, Australia, and New Zealand, account for...