U.S. Food and Beverage Industry Planning Over $2.7 Billion in Capital Expenditures in 4Q06

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Researched by Industrial Info Resources (Sugar Land, Texas). The Food and Beverage Industry in the U.S., with over 6,000 operational plants and 45 planned grassroot plants on record, has over $2.786 billion in proposed capital expenditures that will begin construction in the fourth quarter of 2006. Industrial Info is tracking 75 active projects, each with a total investment value (TIV) ranging from $1 million up to $359 million.

Click on the image at right to view a chart showing the breakdown of projects by market region.

As the quarter unfolds, combined figures for October reveals $1.41 billion spread out over 41 projects slated to get underway. November has the lowest figures relative to TIV with $344 million spread across 20 projects. Construction starts for thirteen grassroot plants are scheduled for December. These thirteen projects represent an aggregate investment value of $990 million, while spending at operational plants for the month totals $36 million.

Fourth quarter expenditures are mainly concentrated in the Midwest and Great Lakes market regions with figures totaling $764 million and $624 million, respectively. In the Midwest region, spending is marked by several grassroot projects including a $260 million wet corn milling plant in Iowa, an expansion of a soybean oil mill in Missouri, and a $100 million grassroot canola oil refinery. In the Great Lakes region, a beverage plant and distribution center by Nestle USA will amount to a $359 million capital investment and is the largest expenditure for the quarter across all regions.

Compared to proposed expenditures for the previous quarters of 2006, the fourth quarter has the highest projection of expenditures, and in part, may be a result of project delays that rolled over to the end of the year. The measurement of proposed project expenditures compared to projects that remained active for the first three quarters of the year is as follows: 1Q06 - $758 million vs. $718 million; 2Q06 - $1.7 billion vs. $1.5 billion; 3Q06 - $1.7 billion vs. $1.6 billion.

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Industrial Info Resources (IIR) is a Marketing Information Service company that has been doing business for over 23 years. IIR is respected as the leader in providing comprehensive market intelligence pertaining to the industrial processing, heavy manufacturing, and energy-related industries throughout the world.