There are some commodity processors that dominate the Top 100, with meat processing top of the list. There were 17 meat processors on this years list, and 27 if you include poultry (7 companies) and acquaculture (3). There's 12 dairy companies and five sugar companies also on the list.
Meat Processing
The food manufacturing sector encompasses a variety of industries, with meat processing being one of the largest.
In this year’s rankings there are 17 companies involved in the meat processing industry, with JBS Australia (2) and Teys Australia (7) topping the list.
The industry’s performance has been under pressure over the past year. Despite relatively consistent demand from foreign markets for Australian meat, herd rebuilding activities have at times resulted in an oversupply of meat, which lowered output prices and led to an overall decrease in revenue.
Unstable production levels and disruptions due to the COVID-19 pandemic have also lowered profit margins for meat processors over time.
For Australian meat processors most income derives from exports, with the beef segment contributing the greatest value.
Over the past year, there has been significant growth in exports to key markets, including the US and South Korea, presenting an opportunity for meat processors to expand their operations.
Sugar Manufacturing
In recent years, sugar manufacturers have grappled with unstable commodity prices and unpredictable weather conditions. Changes in how milled sugar is marketed and exported have resulted in changes to supply chain processes, causing uncertainty within the industry.
Considerable fluctuations in the prices of sugar, both globally and locally, have raised profitability concerns as exports now make up a little over 70 per cent of the industry’s revenue.
Global sugar supplies and pricing typically hinge on major sugar-producing countries like Brazil and India. At the same time, an increase in demand from large Asian economies like Japan and South Korea is promoting growth in export volumes.
Variations in global demand and supply and domestic sugar cane production are likely to continue influencing sugar manufacturers’ performance going forwards.
Dairy
Despite an unstable environment in the domestic market, revenue from milk and cream processing has grown significantly in the past few years. This stems from increasing demand and high prices for Australian milk in foreign markets. The industry’s annualised revenue growth rate is expected to be 3.2 per cent over the five years through 2022-23.
Intense price wars among major supermarkets at the start of the decade led to competitively priced private-label milk products, which transformed milk processing operations. With this development, it became crucial for milk and cream processors to secure private-label milk deals.
Increasing demand for fresh Australian milk and cream in Asian markets, including China, Malaysia, and Singapore, has contributed to a rise in export revenue. In contrast, domestic raw milk production has plummeted over the past decade due to unstable weather conditions, leading to some processors exiting the industry.
This shortage in the milk supply has resulted in increased farmgate prices, reducing profit margins and leading to the closure of smaller, less competitive processors.
Top 100: The 2023 Top 10
Top 100: The climbers in 2023
Top 100: The falls of 2023
Top 100: 2023's new arrivals
Top 100: Key sectors
Food & Drink Business, in collaboration with IBISWorld, presents this year’s Top 100 companies, a ranking by revenue of Australia’s largest players in the food and beverage sector. The report is sponsored by Foodmach.
The Top 100 reflects financial reporting from calendar year 2022 and financial year 22/23. The list is only inclusive of manufacturers and looks at total revenue of the highest reporting ANZ entity of the company.
