Key Facts on the Food Products Machinery IndustryPosted by IndustryNet on Monday, July 8, 2019
3 MIN. READ Regardless of its origin, a large percentage of food consumed in this country and in most parts of the world has been packaged, processed or prepared by specialized machines. Food processing machines may not command as much of the economy as other types of industrial equipment, but their importance cannot be denied. Location and InfluencesAccording to MNI, compiler of the industrial data that powers IndustryNet, the majority of those companies are located in the Midwest near where many of America's most productive farms are located. Of 681 companies in the industry, 263 (39%) are based in the region. The South and the West are nearly tied at 23% and 22%, respectively, while the heavily urbanized Northeast contains only 16%. The food processing machine industry is heavily dependent on food consumers. In a roundabout way, it's closely tied to crop outputs and the nutritional trends that shape people's food choices. That's not to suggest the industry is insulated from international economic turmoil, however. Data compiled by MNI shows that 63% of food processing machine companies distribute internationally. That factor, combined with the other influences places the industry in a very delicate position with regard to potential disruption. Tariff ComplicationsThe 2018 trade war had several effects on the industry. The tariffs on foreign imports of certain U.S. foods such as corn, beef and soybeans meant that other countries either had to change consumption levels or find other providers. A sudden reduction in a given food product results in a change in the amount of processing required in the importing country, and creates a surplus in the exporting nation. For example, China imposed a 70% tariff on pork products imported from the United States. As a result, the U.S. was forced to sell pork domestically at far lower prices than desired. Add to the equation the tariffs on certain machines and raw materials, and one can see how the industry was essentially squeezed from all sides. Despite those obstacles, the food processing machine industry has persevered and shown moderate signs of growth. Only 3% of companies reported a reduction in employment and none a loss in sales since the tariff war began. Revenue was up to $7.4 billion, an increase of just over 2%, while total jobs were up by 1.6% to 27,720. Changes on the HorizonThen there are the forces of technology that affect the industry. Demands for automation, blockchain and even artificial intelligence are pushing manufacturers to include advanced features and functions in the next generation of their machines. By linking machines virtually, production efficiency can be multiplied without an increase in cost or manpower. Critical data such as food temperature can be monitored at any point in the food product's supply chain journey, eliminating the risk of food-borne illnesses. Fault detection and in some cases, self-repair will reduce downtime for maintenance. Blockchain from Field to PlateBlockchain technology can trace the origin of any food item from the very start of its journey to the dinner plate. That can guarantee retailers that an item labeled as organic or non-GMO is true to its namesake. Smart contracts among growers, processors and retailers are able to perform those audits securely so that trade secrets or certain pricing information are not revealed to the general public. The technology also has the power to eliminate virtually all waste from processing operations while allowing company leaders to do more with less. Looking for Food Processing Machinery?IndustryNet has all the information a person needs about food processing machine manufacturers. Its free industrial marketplace for procurement, quoting, sourcing and purchasing contains information on more than 400,000 manufacturers from every concievable industry. IndustryNet also provides a marketing platform for U.S. industrial companies to reach a relevant market for their parts, products, supplies and services. Learn more about our marketing solutions.
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