Grain and Oilseed Milling
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 572 grain and oilseed milling companies in the US produce flours, edible oils, and breakfast cereals from grains and oilseeds. Firms also sell byproducts of the milling process as animal feed or fertilizer. Major product categories are flour milling, rice milling, malt manufacturing, wet corn milling, soybean and other oilseed processing, refining and blending fats and oils, and breakfast cereal manufacturing.
Stricter Food Labeling Requirements
Grain and oilseed manufacturers must comply with a variety of food labeling regulations.
Shifts in Demand Due to Dietary Trends
Grain and oilseed milling companies can face swings in demand due to changing consumer diets and food fads.
Industry size & Structure
The average grain and oilseed milling company has about 102 employees, operates at 1-2 locations and generates $143 million in annual revenue.
- The grain and oilseed milling industry consists of about 572 companies that employ 58,600 employees and generate $82 billion in annual revenue.
- There are about 204 flour milling firms with over 13,800 employees, along with about 56 rice milling firms with about 5,400 employees.
- There are about 35 malt manufacturers with about 950 employees, and about 57 breakfast cereal manufacturers with 12,500 employees.
- There are about 35 wet corn milling companies with about 6,200 employees, along with about 108 soybean and other oilseed processors with 10,400 employees.
- There are about 77 fats and oils refining and blending companies with about 9,100 employees.
- The grain and oilseed milling industry is highly concentrated - the top 50 companies account for 87% of industry revenue.
- Large US flour milling companies include Ardent Mills. Archer Daniels Midland, Grain Craft, Miller Milling, Bay State Milling Co, and General Mills. Large US edible oils producers include Archer Daniels Midland, Bunge, Cargill, and CHS.
Industry Forecast
Grain and Oilseed Milling Industry Growth
Recent Developments
Mar 6, 2023 - Mexico Bans Some Imports of US Corn
- The Mexican government has shelved its January 2024 deadline for banning imports of biotech corn for animal feed and industrial uses, but is moving ahead with a ban on biotech corn for human consumption, the National American Millers’ Association (NAMA) reports. “Regarding the use of genetically modified corn for animal feed and industrial use, the date for prohibiting its use has been eliminated,” Mexico’s Economy Department said, noting the decree “prohibits the use of genetically modified corn for dough and tortillas.” Mexico is the top destination for US corn exports. The proposed ban is expected to drive up tortilla prices by roughly 40%, adding to food security challenges during a time of record food price inflation. The ban would also reduce US economic output by $16.5 billion and shrink GDP by $7.95 billion over ten years, according to NAMA.
- Farm income is expected to ease this year compared to 2022 but remain strong, The Wall Street Journal reports. High prices for crops and increased Chinese demand for crop imports are expected to boost farm income. “We expect the market environment to be similar to 2022,” the CEO of agribusiness and food company Bunge Greg Heckman said on a recent analyst call, adding “That includes a globally tight crop supply, strong demand.” Farmers are expected to increase plantings this year to capitalize on high grain prices and offset higher input costs. Corn acres are expected to surpass 90 million, up about 2% from 2022, according to Farm Progress. US net farm income is projected at $137 billion in 2023, down 16% from last year, when it hit its highest level in decades, according to a February report from the US Department of Agriculture.
- High food inflation is forecast to persist in 2023, Successful Farming reported in January. The 9.9% food inflation rate of 2022 will be followed by a 7.1% rate this year, the highest rates in three decades, according to USDA economists. Grocery prices are expected to rise by 8% this year, according to the USDA. Egg prices are forecast to rise 27% , on top of a 32% increase in 2022 due to bird flu outbreaks that began about a year ago and killed 43 million egg-laying hens. Prices on eight other food categories including fats and oils, cereals and bakery products, and sugar and sweets, are forecast to rise by 16.5%, 12%, and 10.6%, respectively, according to USDA’s Food Price Outlook, 2023. The USDA forecast that prices would fall this year for three food categories: beef, pork, and fresh fruit.
- US farmers in 2023 are expected to plant about 5,000 to 7,000 acres of hybrid wheat from seeds developed without genetic engineering by Syngenta, Reuters reported in December. Hybrid technology enables breeders to choose the best traits from two parent seeds to produce offspring that contain the positive characteristics of both, with yields increasing through a phenomenon known as hybrid vigor. The higher yielding wheat arrives at a time of diminishing global grain supplies due to severe weather and the war in Ukraine. Moreover, because Syngenta developed the wheat without genetic engineering, it could be key to boosting wheat output while avoiding the "GMO" label. Chinese state-owned agricultural chemical giant Syngenta beat out rivals BASF SE and Bayer AG that are planning their own launches of higher yielding wheat by the end of the decade.
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