Research commissioned by Primary Food Processors Europe and conducted by Wageningen Social & Economic Research highlights the strategic importance of primary food processing within Europe’s food chain and bioeconomy. The study focuses on six major sectors: vegetable oils, vegetable proteins, flour milling, starch products, sugar, and cocoa.
According to the research, primary food processors handle approximately 248.3 million tonnes of agricultural commodities each year, of which 223.5 million tonnes originate within the European Union. The sector generated €78 billion in production value in 2023, representing around 7% of the total value of EU food manufacturing. It directly supports more than 137,500 jobs and contributes to approximately 1.17 million indirect agricultural jobs.
The industry encompasses a diverse range of activities. Vegetable oil processors transform rapeseed, soybeans and sunflower seeds into edible oils, biodiesel and feed ingredients. Vegetable protein producers manufacture protein concentrates and plant based ingredients. Flour millers process cereals into flour products, while the starch sector supplies ingredients used in food, pharmaceutical and industrial applications. Sugar processors convert sugar beet and sugar cane into sugar, bioethanol and biomethane, while cocoa processors transform imported cocoa beans into ingredients for confectionery production.
The study notes that the sector has undergone increasing consolidation over the past decade, improving operational efficiency and economies of scale. Approximately 3,000 companies now generate around 90% of total industry output across Europe.
Production volumes vary significantly by sector. Sugar processing represents the largest share at 110.7 million tonnes annually, followed by vegetable oils at 50.6 million tonnes and flour milling at 47 million tonnes. Together, these sectors account for the majority of Europe’s primary food processing activity.
The employment impact of the industry extends well beyond processing facilities. In addition to more than 137,500 direct jobs, the sector supports nearly 1.2 million agricultural jobs through demand for crops and raw materials. Vegetable oils, flour milling, vegetable proteins, starches and sugar all contribute significantly to farm level employment throughout Europe.
The report identifies several competitive strengths, including large scale processing efficiency, strong domestic demand, reliable sourcing networks, high food safety standards, technical expertise and growing investment in sustainability initiatives. Many companies are investing in biomethane, biomass boilers, regenerative agriculture and bio based materials to support decarbonisation objectives.
At the same time, the study identifies a number of structural challenges. Low profit margins leave the sector highly exposed to energy and commodity price volatility. Many industrial processes remain energy intensive, climate change is increasing pressure on agricultural yields, and growing regulatory requirements create significant compliance costs. The report also notes that the sector often receives limited visibility in policy discussions despite its importance to food security and industrial competitiveness.
Looking ahead, Wageningen identifies several major opportunities, including growth in plant based foods, expansion of the bioeconomy, climate smart agriculture, digitalisation and advances in crop breeding technologies. These developments could improve resource efficiency, productivity and sustainability across the food system.
However, the study also warns of significant risks, including persistently high European energy costs, uncertainty around industrial decarbonisation pathways, geopolitical instability, commodity price volatility, growing competition from lower cost producers and increasingly complex regulatory requirements.
Overall, the study concludes that primary food processors remain a critical but often overlooked pillar of Europe’s food security, rural economy and bioeconomy. It calls for greater policy recognition, more predictable regulation, stronger support for decarbonisation investments, competitiveness safeguards and balanced sustainability transitions.
