The US and EU Bakery Markets: A Challenged Friendship
With a shared estimated value of over USD250bn, the US and EU bakery markets are facing challenges with the newly agreed tariffs that affect both the final products and the industrial development that supports the market. Let’s look at some of the implications of this situation.
On May 19 2025, at iba Düsseldorf, three industry leaders participated in a panel on inflation and tariffs in the baking industry. Frank Kleiner, CEO of Harry-Brot GmbH, Sebastian Gooding CEO of Ditsch, and Eric Dell, President & CEO of American Bakers Association, brought together two perspectives, one European, one American, on how the expected new tariffs would influence their businesses and their market. They discussed the challenges faced by bakers on both sides of the Atlantic – inflation, decrease of volume – but also opportunity – “we all want that treat,” said Dell, hopeful that consumers will still want to enjoy life and celebrate birthdays and life events.
Tariffs, however, were seen as hitting the industry differently in Europe. “Any equipment we buy, any buildings we would introduce, are substantially higher in cost than the machinery and the equipment and the buildings we have running today,” said Ditsch’s CEO, “which means that future production is automatically more expensive than current production. And this is a challenge we really have to deal with. And that makes our investment strategy, which is clear, much more difficult at the moment to fund, invest and, and accelerate.”
The two European business leaders vocalized concerns that became true with the final trade agreement that the EU negotiated with the US Administration in July. But first let’s look at the way the two markets are entering this deal.
The US baking industry in 2025 is robust, economically significant, and evolving rapidly in response to both consumer trends and mounting operational challenges.
The Two Markets
The US bakery market is valued at approximately USD95.2bn in 2025 and is projected to reach USD140.8bn by 2032, with a strong compound annual growth rate (CAGR) of 5.8%, according to two market research companies, Persistence and Cognitive.
In-store bakery (ISB) sales alone account for USD22.6bn in 2025, reflecting sustained demand for fresh, high-quality, and accessible baked goods.
Nearly 800,000 Americans are employed in the baking sector, which contributes over USD186bn annually to the US economy and pays over USD42bn in wages, according to American Bakers Association.
The EU bakery products market is valued around EUR161bn (USD157bn) in 2025, with forecasts projecting growth to about EUR232bn (USD231bn) by 2033, reflecting a compound annual growth rate (CAGR) of approximately 3.1% to 4.1% over the next decade, according to Market Portal Analytics and Cognitive Market Research. Some forecasts (Future Market and Statista) suggest a slightly higher CAGR of around 5.2% to 5.6% in particular segments like bakery mixes.
The Tariffs