SIC 2041 Flour and Other Grain Mill Products
SIC 2041
This industry comprises establishments primarily engaged in milling flour from wheat, rye, and other grains except rice. Rice millers are categorized in SIC 2044: Rice Milling. Establishments involved in corn milling by the wet process are categorized in SIC 2046: Wet Corn Milling.
Products of this industry include plain flour or mixes and doughs prepared from milled ingredients. Establishments that supply mixes and doughs prepared from purchased ingredients are categorized in SIC 2045: Prepared Flour Mixes and Doughs.
311211
Flour Milling
In the flour milling industry, explosive growth during the mid-1990s had been tempered by growing environmental and health concerns, as well as a weakening economy, by the turn of the century. Shipments of flour and other grain mill products fell from a record high of $8.045 billion in 1997 to $6.650 billion in 2000, then slowly recovered to $6.9 billion in 2002, according to the U.S. Census Bureau and the Economic Census results from the Department of Commerce. Most of the industry's value was derived from wheat flour, while corn mill products accounted for the next highest value in shipments.
While the industry has expanded, its customer base and marketing focus have changed radically. Domestic flour-consumption patterns shifted away from household consumers and toward commercial bakers, including fast-food outlets, especially after World War II and accelerating rapidly beginning in the 1970s. Due to general lifestyle changes and economic expansion, household baking has declined considerably as individual consumers increasingly tend to purchase their bread, dough, and mixes prepared from grocery stores and bakeries. Flour use has become more and more institutionalized. Consumer demand also waxes and wanes according to the latest health and environmental concerns such as uncertainty about genetically-modified (GM) grain and negative reports about refined carbohydrates found in white flours and sugar, etc. The United States remained the world's leading exporter of flour and grain mill products, and exports were the industry's lifeline.
According to the U.S. Census Bureau's Economic Census, there were 340 reporting mills in the United States in 2002, down from 385 in the late 1990s. However, this reflected the trend of prior few decades to fewer mills, and highlighted milling companies' optimistic investment patterns. The industry employed approximately 11,600 people in 2002.
Consolidation was perhaps the most consistent trend in flour milling. Since the 1980s, the number of mills declined, while market shares of the top companies escalated rapidly. In 1973, the top four milling companies controlled 34 percent of the nation's capacity, while the top ten accounted for 61 percent. In the early twenty-first century, six of the former top ten companies were no longer in business. The largest flour miller, Archer Daniels Midland Milling, held nearly a quarter of total capacity. The top four firms controlled two-thirds of the market, and the top ten accounted for 83 percent.
Average milling capacity also expanded enormously, increasing about 80 percent between the early 1970s and late 1990s. By the early 2000s, most mills held a capacity of more than 45 tons. The trend toward corporate mills was driven by the goals of reducing labor and transportation costs and increasing profits, favoring those companies with large production facilities that can create economies of scale. The efficiency of the mills in place escalated along with consolidation, evidenced by the 90 percent capacity at which most mills in the United States now operate. Finally, the pace of this expansion continues to grow, particularly as a faltering global economy forces companies of all kinds to implement new cost cutting initiatives.
Although any grain, including rice, oats, barley, corn, millet, sorghum, and wheat, can be ground into flour, most of the world's flour is produced from wheat. Using standard milling procedures, 100 pounds of wheat yields approximately 72 pounds of white flour. In addition to flour, the milling process produces millfeeds, which are made from pieces of bran and other portions of the wheat kernel. Millfeeds are used as ingredients in livestock food.
Flour can be packaged for sale to household or bakery markets or used as an ingredient in bakery mixes, breads or doughs, and pastas. Different bread varieties are made with varying recipes but an average of 100 pounds of flour can make about 150 one-pound loaves of bread. The bread and cake industry uses approximately 75 percent of the flour milled in the United States. Other flour products include cookies, cereals, gravies, soups, whiskeys, and beers. Flour products are also used in nonfood applications such as the manufacture of plywood adhesives, industrial starches, fertilizers, paving mixes, polishes, and cosmetics. Approximately 85 percent of the flour used by industrial users is milled from hard and durum wheat varieties.
In addition, mills use a process called fractionation to separate the flour according to the fineness of its particles. Course fractions are reground. Intermediate fractions are used in applications requiring low amounts of protein, and fine fraction flour is blended with other flours or used alone in applications where high protein content is necessary. White flour is often bleached with agents such as potassium bromide, methyl bromide, methyl iodide, iodate, acetone peroxide, azodicarbonamide, ascorbic acid, and chlorine dioxide. In addition to providing consistent coloring, bleaching improves the condition of the...
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