The food industry is holding its own, but profitability is falling. And once again, the way forward lies in exports
Analysis from the 12th Observatory report by the University of Pollenzo and Ceresio Investors: companies are squeezing their margins in order to avoid losing market share during these difficult economic times. There is a need to improve governance and merger processes
Key points
The food industry continues to demonstrate ‘strong resilience in a complex macroeconomic environment’, but ‘growing pressures on profitability’ are beginning to emerge. This, in a nutshell, is the economic overview and outlook set out in the twelfth edition of the Food Industry Monitor, produced by the University of Gastronomic Sciences in Pollenzo in collaboration with Ceresio Investors.
Mixed results
According to the Observatory – which analyses the accounts of 820 companies across 14 sectors, with an aggregate turnover of around 85 billion euros – the sector is still growing, but at a more moderate pace: in 2025, food sector revenues rose by 3.3 per cent, ‘a figure lower than expected but in line with the trend in the Italian economy’. This figure is expected to be replicated in 2026, though there is a risk it may remain ‘merely nominal’ due to rising inflation. For 2027, however, the Observatory forecasts a return of inflation to more normal levels, around 1.9 per cent, thereby strengthening the sector’s growth momentum. “In this scenario, the food sector continues to prove itself to be counter-cyclical, but it is not immune to the macroeconomic pressures affecting household purchasing power and domestic spending,” explain officials at Pollenzo.
Profitability is weakening, ‘reflecting squeezed margins and an increase in capital employed’: according to the analysis, ‘many companies have chosen to defend their sales volumes and market presence in Italian distribution channels, even at the cost of squeezed margins’ .
The sector’s financial strength remains high, “but there has been a slight deterioration in the level of debt”.
Exports are also slowing, but the path forward is clear
The path to exports remains open, after 2025 saw a figure below 5 per cent – the worst since the Covid-19 pandemic – provided that the international situation does not become more complicated again: for the two-year period 2026–2027, the Observatory estimates growth of over 7 per cent annually.
“It is the only way forward for companies for whom the stagnant domestic market is no longer sufficient,” comments Carmine Garzia, Professor of Management and Scientific Director of the Food Industry Monitor. “The sector remains counter-cyclical, but the outlook calls for a cautious approach. To consolidate their results, companies need a shift in governance, and to grow in size so they can organise themselves more effectively. This does not mean becoming multinational giants, but finding the right scale to optimise processes whilst maintaining the quality typical of ‘Made in Italy’.”
