Baking industry leaders who thrive on change will have plenty of opportunities in 2023. The industry will face ongoing hurdles with supply chain, shifting developments on the government and workforce fronts, and new openings on consumer trends and sustainability.
Topic experts from the American Bakers Association have identified what’s on the radar for next year and how the industry can navigate to make progress.
1. Government Front and Center
ABA is anticipating a very busy 2023 on the federal legislative and regulatory fronts, following a midterm election that resulted in razor-thin party margins in Congress. The association’s political action committee contributions to the 2022 election cycle resulted in an 85% success rate.
“It will be more important than ever for ABA and the baking industry to be focused on our messaging to Congress and federal agencies to paint a picture of how policy initiatives will impact bakers, workers and consumers,” said Lee Sanders, ABA’s Senior Vice President, Government Relations and Public Affairs.
The Farm Bill will be a major area of focus for bakers in 2023. Discussions will address issues including federal feeding programs, the Conservation Reserve Program, sugar reform, wheat quality issues, and regenerative agriculture.
The Renewable Fuel Program will stay in the spotlight with a proposed rule from EPA on the 2023-2025 Renewable Volume Obligation levels for biodiesel and renewable diesel, a development that ABA is closely watching as it will impact the availability of vegetable oil for the food industry. The association is also focused on the recently proposed definition of “healthy” from FDA, because of its impact on baked goods labeling and formulations.
Separately, ABA will move ahead on commitments it made for the White House Conference on Hunger, Nutrition and Health. These include helping to further enhance the industry’s focus on battling food insecurity and refreshing the association’s Food Equity Toolkit for the USDA My Plate Strategic Partners and sharing this strategy with other stakeholders.
2. More Supply Chain Hurdles
A perfect storm of challenges with supply chain, commodities and inflation rocked the baking industry in 2022 and the expectation is for more hurdles ahead. The problems are exacerbated by the war in Ukraine, weakness in the U.S. wheat crop and the ongoing diversion of agricultural land for soybean and corn for biofuels. ABA has been communicating the industry’s supply chain concerns to the White House, Congress and regulatory agencies to prioritize these issues in the federal government.
There’s no single magic bullet so industry leaders need to take multi-pronged approaches as they attempt to alleviate the pressures. “The industry should take opportunities to educate consumers about the reasons for supply problems and higher prices and engage in 2023 Farm Bill discussions to make progress with commodities and other areas,” said Robb MacKie, who will be closing out his tenure as ABA’s President and CEO at the end of the year.
3. Workforce Imperatives
Workforce issues will be prominent on the regulatory landscape in 2023. The Biden administration’s new proposed rule on independent contractors is a key area of concern and focus, and ABA is commenting on the proposal, said Lauren Williams, Director, Government Relations for the association. Also on the radar is the possibility of new overtime proposal being issued next year.
Workforce will be a major focus of ABA’s 2023 industry strategies, including on efforts related to DEI (Diversity, Equity and Inclusion), NextGenBaker and expansion of the potential workforce pool through enhanced outreach and messaging, said Christina Donnelly, ABA’s Director, Industry Relations and Strategic Initiatives.
4. Consumer Lens
The baking industry will need to stay on top of shifting consumer perspectives and behaviors in 2023. ABA recently unveiled a consumer study called Life Through the Lens of Bakery, in partnership with 210 Analytics and made possible by Corbion, which shows that consumers view baked goods as affordable indulgences even in the face of significantly higher food prices. This insight opens the door for the industry to consider how to reach consumers in ways that drive further penetration in the foodservice and grocery channels, including through online shopping, said ABA’s Donnelly.
5. Regenerative Agriculture
Regenerative Agriculture is an emerging issue of growing importance to the baking industry. The concept centers on the need for growers to enhance practices to leave the soil in better condition. An educational session by Ardent Mills at the latest IBIE updated the industry on this topic. Rasma Zvaners, ABA’s Vice President, Regulatory and Technical Services, said, “There’s an opportunity to come together, find synergies and determine what role each part of the baking sector — from grower to miller to baker – can play.” ABA is surveying its members to determine how to further enhance overall industry sustainability efforts in 2023 and beyond.
In Conclusion
The upshot for all these topics is the baking industry will face major obstacles and opportunities in 2023. Leaders will need to absorb all the lessons from the past few years and develop creative strategies to tackle this highly dynamic period.