Food safety legislation drives up overseas food processing equipment market

Slow, steady revenue growth is the outlook seen for the€13.14 billion European industrial food processing equipment market, a recentFrost & Sullivananalysis indicates. Recent legislation supporting improvements in product quality and subsequent replacement sales are expected to push this mature market to€15.12 billion by 2009.

Consumer concerns over hygiene and food safety has led the European Commission (EC) to pass a series of directives to safeguard consumer health. The stringent new regulations are prompting food manufacturers to invest in more advanced machinery. As traceability has become a more important consideration, manufacturers have begun to incorporate tracking systems in their machines. Food safety standards are also spurring an increase in software-based industrial processing equipment.

“Intense competition has put customers in a good bargaining position,” warns Frost & Sullivan. “They want higher specification/better equipment, namely higher output and more flexible machinery for the same amount of money. The challenge for manufacturers is to remain price-competitive and retain market share in this highly charged environment.”

Nearly 80 companies are active in the fragmented European industrial food processing equipment market. However, a low total of companies account for a significant market share. Competitive pressures are expected to remain strong over the long term, placing enormous pressure on prices and eroding profit margins.

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—Jeanine Katzel, senior editor, Control Engineering,jkatzel@reedbusiness.com

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