Food industry shows growth, but supply chains remain fragile

Volume growth is returning to the food industry, but international developments are causing turbulence. Supply chains remain fragile due to import tariffs, disruptions in maritime shipping, and fluctuations in commodity markets.

Cautious growth in a tense market

According to ABN AMRO, food industry volume is expected to grow by 1 percent in 2025, following an earlier decline. No growth is forecast for 2026. At the same time, prices continue to rise. By April 2025, food prices had increased by 3.5 percent, non-alcoholic beverages by 8.8 percent, and alcoholic beverages by 1.8 percent.

Consumption of food, beverages, and tobacco rose in the first quarter. Supermarket data from Circana show a 1.1 percent volume increase in food and drinks through April compared to the same period in 2024. This rise is mainly driven by unprocessed vegetables and fresh bread. Export volumes and out-of-home consumption are also seeing slight growth.

International pressure on exports and raw materials

The sector views commodity market volatility and shipping disruptions as ongoing risks. Import tariffs from the United States are putting additional strain on exports. The Netherlands exports more than €2.3 billion in food and beverage products to the U.S. each year. A 10 percent tariff could reduce this export volume by 23 percent.

The EU is considering countermeasures on products such as corn, whiskey, orange juice, and cranberries. Volatile exchange rates further add to cost uncertainty. Crop failures are leading to price volatility for products such as cocoa, vegetables, and coffee.

Sustainability remains a key focus

The simplification of CSRD and CSDDD temporarily eases workload pressure. At the same time, requirements like the Water Framework Directive will remain relevant from 2027 onwards. Buyers and society continue to expect progress on sustainability.

Abnamro.nl