The annual FCC Food Report reviews last year’s economic environment and highlights opportunities and risks for Canadian food manufacturers for 2022. This includes an annual sales forecast, grocery sales performance, and a new gross margin index.
Industries featured in the report are:
- Grain and oilseed milling
- Sugar and confectionery products
- Fruit, vegetable and specialty food
- Dairy products
- Meat products
- Seafood preparation
- Bakery and tortilla products
Beverage manufacturers, we didn’t forget about you. We will be releasing a separate beverage report later this year.
Takeaways
Several external factors impacted Canadian food industries in 2021, which have resulted in higher input costs, amplified labour shortages and upended food consumption patterns. In early 2021, there was hope that the pandemic could soon be behind us; however, new variants provoked more disruptions, restrictions and uncertainty. Despite these challenges, food manufacturers’ performance proved to be strong.
Here are three key observations from this year’s report:
1. Industry gross margins bounced back in 2021 but remain below historical levels
Gross margins as a percent of sales in food manufacturing increased in 2021 YoY but remain below historical levels and below 2019 (Figure 1). Manufacturers have struggled to fully pass on higher labour and material costs for almost a decade. But margins improved slightly in 2021. At the individual industry level, results widely differ, which we dive into in the report.
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