Brief Excerpt from Industry Overview Chapter:
Companies in this industry manufacture and process a wide variety of foods, including meat, seafood, dairy products, fruits and vegetables, milled grains and oilseeds, baked goods, and candy. Major companies include US-based Archer-Daniels-Midland, ConAgra Foods, Frito-Lay, General Mills, Kellogg, Kraft Heinz, Mondelez International, and Tyson Foods; along with Grupo Bimbo (Mexico), Danone (France), JBS (Brazil), Maruha Nichiro (Japan), Nestlé (Switzerland), and Unilever (The Netherlands).
Worldwide, retail sales of processed foods total about $2.5 trillion. China, the US, and Brazil are the largest packaged food markets, according to Euromonitor International. Global industry revenue is increasing, but economic slowdowns in key emerging markets have curbed growth in recent years.
The US food manufacturing industry consists of about 27,000 establishments (single-location companies and branches of multi-location companies) with combined annual revenue of about $790 billion.
Demand is driven by food consumption, which depends on population growth. The profitability of individual companies depends on efficient operations, because products are commodities subject to intense price competition. Companies compete largely based on cost and their ability to distribute the finished product. Large companies have economies of scale in purchasing and distribution. Small companies can compete effectively in local or regional markets and by developing popular products. The industry is concentrated: the 50 largest companies account for about 50% of industry revenue.
The US exports processed foods mainly to Canada, Mexico, Japan, China, and South Korea. Exports account for 9% of production. Imports, primarily from...
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