Less turnover growth and fewer bankruptcies food sector

In the first six months of 2023, turnover growth in the food industry declined significantly, recent CBS figures show. Whereas in the first quarter the industry still reported a 20.7% turnover growth compared to 2022, in the second quarter this dropped to only 2.7%. This trend was seen in both the domestic and export markets.

One of the main reasons for this decline is declining price increases. Sales prices rose less sharply in the first half of the year. In January we still saw an increase of 18.3%, but by June this growth had slowed to 4.4%. Sectors such as the edible oils and fats industry and the dairy industry even showed price declines of 16.1% and 2.4%, respectively, in June. On the other hand, the fruit and vegetable processing industry and the flour and bread industry saw their output prices rise by as much as 26.2% and 15.5% in June.

Confidence

Confidence among entrepreneurs in the food and beverage industry suffered. Producer confidence dropped to -0.5% in July, mainly due to negative expectations regarding activity (-3.0%) and order positions (-1.6%).

Bankruptcies low

Despite these challenges, there are also positive developments to report. Bankruptcies within the food industry have remained rare, with only 18 declared bankruptcies through July. Moreover, the number of active companies in the food industry has increased. From the beginning of the year to July, the number of companies grew by 6.5%, from 7180 to 7650. Sectors such as the animal feed industry, the fruit and vegetable processing industry, and the fish processing industry even saw growth rates of 19.5%, 14.1% and 12.1%, respectively.