While commercial and institutional food service industries have had a hard time the past few years, it hasnt experienced as much difficultly as many other industrial segments and is now in turnaround mode.
This is good news for stainless, Markus A. Moll, managing director and senior market research analyst at Steel & Metals Market Research GmbH, Reutte, Austria, said, noting that the entire food service marketcatering, appliances (including home appliances), food processing and food preparationis expected to consume about 900,000 tonnes of stainless in the Americas (the United States, Canada, Mexico and South America), accounting for about 36 percent of the regions total stainless steel usage. Globally, the food service market consumes about 11.9 million tonnes of stainless steel annually, or almost half of all stainless usage, he said.
While the U.S. food service market did see a roughly 10- to 15-percent drop in 2009, it really wasnt affected as much as other sectors, many of which saw falls of 20 percent or more, Moll said.
"It has been recovering, although that recovery clearly has not been a V-shaped recovery. In 2010 it had come back to about halfway where it had been prior to the recession, and many companies do have ambitious plans for growth this year," he said.
While industry demand could rise as much as 10 percent this year, it wont return to pre-recessionary levels for at least another few years, Moll said.
This is definitely the case for restaurants, according to a spokeswoman for the National Restaurant Association, who said that after a three-year period of negative real sales growth, industry sales are expected to rise 3.6 percent to a record $604 billion in 2011.
"As the national economy is slowly improving, the restaurant industry is climbing out of its most challenging period in decades," Hudson Riehle, senior vice president of the National Restaurant Associations research and knowledge group, said. "The U.S. restaurant industry is an economic juggernaut whose annual sales are larger than 90 percent of the worlds economies." If the restaurant industry were a country, it would be the 18th largest economy in the world, he said. "While pockets of challenges remain, we are looking forward to a brighter future in 2011."
The institutional food service market has been seeing a similar, but not quite as strong, growth pattern, a spokesman for the Specialty Steel Industry of North America said, and there wont be any significant movement until there is a marked pickup in the housing market.