With a presidential election in the rearview mirror, the industrial baking industry seems to be finally emerging into the light after a long dark tunnel of challenges. Not all of those challenges were bad. Who could deny higher demand for baked goods? But labor and supply chain issues and the rising costs of raw materials made it difficult for bakers to capitalize on that demand. 

Baking & Snack’s 2025 Capital Spending Study, conducted by Cypress Research and sponsored by BEMA, revealed a baking industry brimming with optimism as it enters a year that will see the industry gather for iba in Düsseldorf, Germany, May 18-22, and the International Baking Industry Exposition (IBIE), Sept. 13-17, in Las Vegas. In fact, 65% of bakers reported they or a colleague plan to attend IBIE, and 7 in 10 plan to shop for equipment at the trade show. 

Cypress Research fielded the study in November and December of 2024, right after the election, and the sigh of relief at the knowledge of what kind of business environment to expect for the next few years is visible in the study results. 

“We’re trending back to the positive, the extreme positivity we saw back in 2022, which was also an IBIE year,” said Marjorie Hellmer, president of Cypress Research. 

In contrast, the BEMA Intel Q3 results were fielded just before the election and show a cautiously optimistic industry on the supplier side. Eighty percent of equipment manufacturers in the Q3 member pulse survey reported a positive outlook for the industry for the next six months. When looking ahead to the next 12 months, 53% of equipment suppliers expected their overall sales to increase, and only 10% expected sales to decrease. 

“A year ago, we had inflation and uncertainty with the upcoming election, and that seems to be behind us now,” said Kerwin Brown, president and chief executive officer of BEMA. “Things have settled down and feel a bit more on firmer ground, and I think bakers feel like they can move forward.”

Baking industry sales remain a mixed bag but relatively stable, according to BEMA Intel’s Industry Indicators report from Q3 2024. According to Circana data from Q3 2024, categories in the commercial aisle and in-store bakery remain unchanged or show modest growth or declines. While sales for bread, buns and rolls remained relatively stable, donuts experienced strong growth while cake and snack cakes saw declines.

Despite this, industrial bakers are ready for 2025 and incredibly optimistic about both their companies’ and the industry’s outlook for the year. Fifty-three percent of those surveyed were very positive about their company outlook for 2025, compared to 46% who said the same thing for 2024. Combined with the 40% of bakers who said they were somewhat optimistic, that’s 93% of respondents who are feeling good about their company’s future. When asked about the US industrial baking industry as a whole, 92% expressed some level of positivity, though only 27% were very positive. Hellmer is always quick to note that bakers tend to be more optimistic about their own company’s outlook. This overall positivity, however, is still better than 2024’s outlook, which saw 87% expressing a positive outlook for the industry, though 30% of that share were very positive. 

“The expectations, while they may have softened, they’re still very strong, and many companies are coming off of consecutive record years,” said Clay Miller, chairman of BEMA and president of Burford Corp., a Middleby Bakery company. “We have to keep that in perspective because even though sales have slightly softened, it was still a very strong year.” 

Brown agreed, saying, “You can’t have record year after record year.” 

As Hellmer pointed out, the baking industry hasn’t seen these levels of positivity for the overall industry since 2021 (92% positive) and 2022 (89% positive), with the former being post-presidential election and the latter an IBIE year. In fact, when asked if the baking industry would perform better, the same or worse in 2025, 60% of bakers said the industry would perform better and only 5% said it would perform worse. Capital spending study results haven’t been this bright since 2021. In 2024, only 42% of baker respondents expected the industry to perform better and 9% expected the industry to perform worse. 

This article is an excerpt from the February 2025 issue of Baking & Snack. To read the entire feature on Capital Spending Study, click here.