Food Processing Sector

The food sector from food production through food service and retail remains one of the largest sectors of the economy and one that has continued to grow and create new jobs, but is in the midst of significant changes which are creating substantial new opportunities. Even though large companies control much of this industry, small companies can effectively compete by developing popular products.


Consumer demand divided across a wide range of eating preferences is rapidly fragmenting the industry. Product innovation is being driven largely by evolving consumption desires in variety, health, and convenience. A sample of the developing food categories demonstrates the immense variety in the sector: ethnic, fresh, organics, restaurant-quality frozen, meal kits, handheld entrees, fortified, and gluten-free.


The US food processing industry is large:


  • Over 21,000 companies and $750 billion in revenue
  • The US accounts for 37.5% of all sales
  • Other large markets include Western Europe and Asia, with China growing fastest
  • Population growth is really the biggest driver of food consumption


The California food processing industry leads the nation and is an important and diverse economic sector in California’s overall economy. Building upon the agricultural industry, food processing is a $50 billion industry and is the third largest energy user in the state and the Central Valley is home to over 3000 factory sites and has the world’s largest single factory sites for processing fluid milk, cheese, milk powder/butter, wine, and poultry. Merced County is consistently one of the top three counties in the region for the highest number of core agricultural manufacturing businesses and jobs.


Merced County has a unique opportunity to leverage its agriculture resources, industrial capacity and location to catalyze the economic growth of an important value-added industry in California.


  • Location closer to the consumption market: Merced County sits in the center of the largest consumer market in the U.S. —- California
  • Transportation advantages: Merced County offers well developed transportation infrastructure and connectivity which allows a company to service their customer base quicker and provide more cost-effective transportation
  • Strong utility infrastructure: Excellent county-wide water and sewer capacity
  • Excellent food processing sites: Merced County has a strong ecosystem in food processing and its support industries. There are sites available that offer the proper zoning, the proper infrastructure and fast track permitting