Packaging material price hikes continue to challenge, finds FoodProductionDaily survey

By Jane Byrne

- Last updated on GMT

Related tags: Cent, Investment, Packaging and labeling

The results of the inaugural FoodProductionDaily.com survey gauging the outlook for the food and drink processing industry reveal that commodity and packaging material price increases, the bugbear of the past few months, are proving a challenge for 80 per cent of the survey participants.

However, the poll also shows cautious optimism for the year ahead, with just over 63 per cent of respondents bullish about market conditions for the sector in 2011 and the results also indicates that over half of the respondents plan to increase production capacity in 2011.

Interestingly nearly 40 per cent of participants expect to plough more cash into robotics systems in the next 12 months.

That said, a near equal amount of survey participants reckon that cash flow will continue to impact their production in 2011.

Pathogens prioritised

Plant safety remains critical. Over 42 per cent of readers surveyed revealed that they will invest in new methods for pathogen control in 2011 and well over half said they will change plant layout and design to improve safety next year. Moreover, over 64 per cent of those polled revealed that hygienic design of equipment will be a strategy next year.

Third party audits are now standard for a larger majority of food and drink manufacturers, with nearly 40 per cent of respondents saying they will opt for third party audits such as FSSC 22000 in 2011.

However, some readers have revealed that they may have to defer independent assessment due to the current cost considerations and others are “still investigating options.”

Sustainability initiatives

Two thirds of the survey’s respondents still report that energy efficiency in the plant remains a top priority for the year ahead. However, some readers noted that while such sustainability initiatives remain on the agenda, it is “difficult to achieve further savings beyond a specific point.”

Again, water savings remain a central focus, with 67 per cent of respondents claiming programmes related to this efficiency for 2011 but one manufacturer reported: It is unlikely further water savings can be done with out significant investment - for which cash is not available as there are more pressing priorities linked to keeping production going.”

Respondents said they will be evaluating a broad range of packaging savings in the next 12 months, with over half opting for thinner materials and nearly 52 per cent expecting to incorporate more recycled than virgin polymers in their packaging next year.

Recruitment on hold

Staffing levels look to remain relevantly static in the food and drink processing sector next year, according to our poll response, with over half the respondents not planning to recruit in the coming months.

Fifty-three per cent of those surveyed said that they have vacancies in technical and engineering roles, with some respondents commenting that they would not be filling those vacant posts in the near future.

But respondents report regular investment in staff training and 64.2 per cent said that they will spend more on skilling up production personnel in the year head. The question on salary increases at plant level generated a mixed response with 33 per cent of manufacturers polled said they plan to implement a payment hike but nearly 40 per cent do not intend to boost pay.

One manufacturer said salaries would be raised but “not on a uniform level for all, [increases will be] much more dependent on the job level and impact of the position to the bottom line.”