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In the past century, the food and beverage industry has significantly taken off. What first started as a collection of privately owned mom-and-pop eateries has expanded to include some of the biggest names in retail and hundreds of franchises. Farming, processing, distribution and other subsets of the industry make up the food and beverage market as well. The main concentration for the food and beverage industry is increasing global demand and steadily raising food prices. Before, only developed nations could indulge in this industry. Today, though, economic growth has let countries including Brazil, China, India and Vietnam get involved in the market as well. Having more consumers in the global food and beverage market means a fast rise in inflation.
The farming portion of the food and beverage industry includes businesses that handle production and the collection of raw commodities, like soybeans, rice, wheat and corn. The processing sector of the industry turns raw materials into foods that are to be distributed to consumers. This includes some of the most recognizable brand names, like the Kellogg Company and the Campbell Soup Company. Distribution companies make sure that finished food products reach the consumer either through grocery stores and supermarkets or restaurants. While some restaurants prepare foods in-house, others serve a large percentage of already-prepared foods.
As ethanol and bio-diesels have seen rising energy prices, the topic of food inflation has become even more prevalent. While some markets, like farming and agriculture, benefit from higher prices, other markets like huge corporations do not. Instead of seeing positive outcomes, these large businesses often find that the cost of doing more and more business actually takes away from their profit. Plus, the more people have to spend on individual products, the less money they’re going to be willing to spend overall.