Food and Beverage Manufacturing Trends to Watch in 2023

Food and beverage manufacturing, like all sectors of the U.S. economy, is facing uncertainty in 2023 with a looming recession on the horizon.

“Uncertainty—both in the short term and long term—will require bold decision-making from manufacturing industry leaders. Those who proactively invest in digital capabilities and processes to drive value from data will reap the benefits—in their operations, supply chain, workforce, revenue generation, and drive toward a sustainable future,” says West Monroe in its 2023 Outlook: The Future of the Manufacturing Industry.

Like a Locomotive: Food & Beverage Industry Keeps Rolling

Drilling down to food and beverage, companies have shown their resilience, overcoming hurdles such as the COVID-19 pandemic, rising inflation, high-interest rates, labor shortages, and supply chain woes.

“Like a powerful locomotive, the food and beverage manufacturing industry has incredible forward momentum, driven by innovative new processes and products. Consumer attitudes continue to evolve and people are more willing than ever to try new products and to embrace the use of science in food production,” wrote Jason Robertson, Vice President, Food + Beverage & Tony Moses, Ph.D., Director, Product Innovation for CRB Insights.

Nestle Professional in “Top 2023 Food & Beverage Industry Trends” agreed with CRB.

“Led by experience, cautious optimism, and undaunted determination to succeed, the food service industry stands ready to play to its strengths as it navigates the sometimes rocky and largely unpredictable road ahead,” concluded the white paper.

Sustainability Remains on the Manufacturing Menu

The CRB Insights article says that “consumer pressure continues to grow for the food industry to eliminate its reliance on single-use plastics, reduce waste, and produce food in a sustainable way.”

While sustainability has been on the manufacturing menu for many years, the topic apparently grows in importance each year with an IDC industry survey showing that nearly 30 percent of food and beverage decision-makers consider customer demand for eco-friendly products and offerings the top factor motivating organizational change towards greater sustainability.

“While sustainability has been top of mind for food and beverage processors and consumers for many years, this is expected to be an even greater priority in 2023,” reported Industry Today. “Positive climate action is increasing in urgency and consumers are growing ever more conscientious about how their own decisions, including the brands they support, are impacting the environment and the health of the planet.”

Some of the food and beverage manufacturing industry trends to watch in 2023 include:

• Reducing Package Waste: CRB Insights says there is a science to food packaging with companies ensuring food safety and consumer satisfaction while balancing product quality, appearance, functionality, cost, and environmental impact. Some large companies are moving towards using only recyclable, reusable, or compostable packaging within the next three years.
• Upcycling: Many companies are upcycling – the value-added process of turning food that would have been wasted into products for consumption. This new trend has ancient roots.

“Upcycling food is an ancient tradition based on the philosophy of using all of what you have. It's about doing more with less and elevating all food to its highest and best use. Most of all, upcycled food is about reducing food waste, by creating high quality, nutritious food products out of the nutrients that slip through the cracks of our food system,” says the Upcycled Food Association, which says that the sales of upcycled certified products grew 1,046 percent between 2021 and 2022.

• Indoor Vertical Farming: More fruits and vegetables will be grown in greenhouses in 2023, allowing them to be consumed closer to where they are produced. This trend has environmental advantages such as reduced shipping, and some indoor vertical farming firms say they can grow produce on 1 percent of the land required by conventional agriculture using 95 percent less water, less fertilizer, and no pesticides.
  
  
• Water and Energy Efficiency:  Industry Today says that electricity and fuel are costly and major contributors to carbon footprints, representing significant food and beverage manufacturing costs. Companies are investing in efficient equipment, technology, and processes to help reduce emissions. Water scarcity is becoming an alarming issue, which will accelerate the adoption of steaming technology, and water reuse systems to reduce overall usage.
• Extend Shelf Life to Reduce Food Waste: The Intergovernmental Panel on Climate Change estimates that up to 10 percent of global emissions between 2010 and 2016 were attributed to food waste. Technological innovations can help with new solutions to reduce food waste by extending the shelf life of products.
• Innovation in Cell-Based Proteins: Two comprehensive new studies found that cell-based meat could cause up to 92 percent less global warming, 93 percent less air pollution, and use up to 95 percent less land and 78 percent less water compared to conventional beef production. More food companies are offering these culture-based protein products to meet growing consumer demand.

High-Pressure Processing (HPP) and Other 2023 Food & Beverage Manufacturing Trends

The CRB Insights article, in addition to the sustainability issue, pointed towards these other trends to watch in food and beverage manufacturing in 2023:

• Innovating Process, Products, and Packaging: CRB says one of the most exciting new food and beverage manufacturing trends is the use of high-pressure processing (HPP):

“This low-temperature pasteurization technique is gaining traction among food producers for more natural applications, such as naked juice, ice cream, and cookie dough,” wrote Robertson and Moses in the CRB article.

Food Engineering magazine called HPP processing is a relatively young but growing industry with roots in food safety and shelf-life goals.

HPP is one of the ways that food processors are developing and marketing novel processing techniques, products, and packaging to appeal to consumer demand.

• Increasing Food Manufacturing Automation: CRB contends that the shortage of labor in the food and beverage industry is an ongoing issue and will speed up the transition to more automated facilities.

“The supply of raw materials and available land is often most abundant in rural areas where it can be hard to adequately staff production and packaging lines without bussing people in from a distance,” said CRB Insights.

A move toward automation is a way for food and beverage manufacturers to future-proof their facilities. Automation allows for increased flexibility and efficiency of production, improved management of the supply chain, and better record-keeping for regulatory requirements.

• Emphasizing Health Claims on Packaging and Marketing: CRB says that consumers want to be more informed about what goes on their dinner table, which has resulted in a push toward clean labels listing fewer and simpler ingredients, including those that come with health claims.

“Functional ingredients—like pro- and prebiotics, antioxidants, and vitamins—require an intimate awareness of product qualities and the processing conditions they can withstand. This is driving the trend toward minimally processed foods,” said CRB.

• Rising Cost Pressures Due to Supply Chain Challenges: Shortages of raw materials and rapid changes to how consumers shop continue to affect the supply chain. A long-term supply chain trend to watch is the move to e-commerce and curbside pickup. The food and beverage industry is focusing on the need for efficiency and speed of transport to support digital ordering. All of this will put pressure on the trucking industry, and distribution centers and spur the use of automation along the supply chain.
• Evolving Workplace Quality of Life to Attract Workers: Food and beverage manufacturing facilities in rural areas -- competing for employees with e-commerce and other newer industries that appeal to younger workers by offering competitive pay in more relaxed and comfortable settings – are utilizing retrofits and new construction to add features such as improved break rooms and lounge areas to attract workers.