Interstate Bakeries - Competitors

Interstate Bakeries Competition

Now Viewing Interstate Bakeries's competition in: Bakeries (primary)

Recent Developments

Bakeries' Costs Soar - Several conditions, including drought in some grain-producing regions, demand from emerging markets like China and India, and corn subsidies to encourage ethanol production, have created tough market conditions for bakeries. In March 2007, baking industry executives attended a hearing with the Secretary of Agriculture to discuss possible remedies for the crisis, including freeing 8 million acres of federally protected land for farming. Wheat prices increased 106.5 percent in April 2008 compared to a year earlier; rye prices increased 17.6 percent.

Gluten-Free Sales Increase - Sales of gluten-free retail goods increased 20 percent in February 2008 compared to a year earlier, according to The Nielson Co. About 3 million people in the US have celiac disease, a condition that prevents them from eating products containing gluten. As awareness of gluten intolerance grows, further development and marketing of more gluten-free food choices is expected. The FDA is working on more stringent labeling standards for gluten-free products.

US House Approves Farm Bill - Congress has passed the $300 billion Farm Bill with veto-proof margins. Some food interests argue that the bill rewards wealthy grain planters with subsidies at a time of record crop prices. Bipartisan supporters claim that it maintains a strong safety net for farmers in the form of subsidies; detractors say that the bill is full of taxpayer-funded special earmarks and pork projects.

Competitive Landscape

Demand is related to eating trends and to the changing structure of the grocery industry. Profitability for individual companies is determined by efficiency of operations. Large companies have scale advantages in procurement, production, and distribution. Small companies can compete by offering specialty goods or superior local distribution services. Despite high automation, the low value of the product produces a fairly modest $150,000 in annual revenue per employee for commercial bakers.

Full Industry Overview For Bakeries

Bakeries Industry Forecast

from Hoover's/D&B subsidiary First Research

The output for US bakery and pasta products is forecast to grow at an annual compounded rate of 3.8 percent between 2007 and 2012.

Bakery Products Growth Steadies

First Research forecasts are based on INFORUM forecasts that are licensed from the Interindustry Economic Research Fund, Inc. (IERF) in College Park, MD. INFORUM's "interindustry-macro" approach to modeling the economy captures the links between industries and the aggregate economy.