By Trent Gillette, U.S. Agriculture Director of McLarens
America’s food processing sector has evolved into a complex and economically vital component of the national supply chain. Yet much of the infrastructure supporting it dates back more than half a century.
As processing plants have scaled up production and adopted more advanced technologies, the underlying systems have struggled to keep pace. The result is a growing mismatch between modern operational demands and aging physical assets. When faced with a loss event or interruption to production, this means increasingly complex and costly losses.
With more than 36,000 food processing plants across the U.S., the scale of exposure is considerable. Many of these facilities were constructed during the mid-20th century, at a time when design and technology bore little resemblance to modern standards.
While demand and regulatory scrutiny have grown, capital reinvestment in infrastructure has often lagged. The result is an industry reliant on outdated physical assets, incrementally upgraded over time but rarely reconfigured from first principles.
The integration of advanced systems - robotics, thermal scanners, programmable controllers - into legacy environments has created new risks. In many cases, the underlying structure was never designed to support such technologies, and the interaction between old and new systems can introduce latent vulnerabilities. Failures, when they occur, are not isolated. A single malfunction can cascade across multiple processes.
Key risks
Fire remains the most prominent risk. Large plants with dense, interconnected layouts often present significant challenges for fire suppression. Narrow corridors, few breaks in construction, and extensive internal ducting can facilitate rapid spread. The situation is aggravated by under-resourced maintenance regimes and intense production schedules, which increase the likelihood of undetected hazards.
Food processing also carries an inherent time sensitivity. Perishable products must move swiftly through the system to preserve freshness and quality. Any delay can compromise entire product lines. Contingencies are limited; replacement capacity may be geographically distant or simply unavailable. The result is prolonged downtime, substantial spoilage and widespread disruption.
In one loss that McLarens handled, a loss at a poultry facility had consequences far beyond the site itself, affecting not only feed suppliers and transportation networks but also downstream distributors and retailers. The biological nature of the product means delays cannot be absorbed in the same way as in other manufacturing sectors.
Regulatory considerations further complicate recovery. Food processors today operate within an evolving landscape of environmental, safety and building codes, often at federal, state and municipal levels. Facilities built to historic standards must, when damaged, be reconstructed in line with modern regulations, frequently at significant cost.
In one case, the need to determine whether a $20 million air filtration system was required under updated environmental rules delayed both repairs and claims resolution for weeks.
Supply chains introduce additional exposure. The industry has shifted away from smaller, localized operators toward consolidation and interdependency. Many plants now function as critical nodes within broader networks. If one link fails, the impact extends well beyond its walls.
Business continuity
In the context of risk management, traditional continuity plans are proving inadequate. Many focus narrowly on physical infrastructure, such as sprinklers, emergency power, structural integrity, without accounting for the complex interdependencies and vulnerabilities that define the modern processing environment.
A more holistic approach is required. Risk managers should prioritize comprehensive system audits, mapping dependencies across mechanical, digital and supply chain domains. Equipment age, integration complexity and access to spares should be routinely assessed.
Furthermore, a review of regulatory exposures, particularly those linked to environmental remediation and air quality standards, can aid in anticipating potential cost escalations during loss recovery. This, of course, is a fast-moving picture.
Some progress is being made. A number of processors are investing in predictive maintenance technologies, cross-training teams for response readiness and working with external specialists to identify emerging risks. These steps, while not inexpensive, are significantly less costly than prolonged unplanned downtime.
The scale of recent events highlights these challenges. Operational resilience is now a defining factor in performance and, increasingly, in insurability. Addressing aging infrastructure is not simply a matter of modernization; it is a prerequisite for safeguarding business continuity in an industry where delay equates to loss.
Trent Gillette is U.S. agriculture director at global claims services provider McLarens, with over three decades of experience in agricultural claims, loss adjusting and complex risk management. A former farm operator with a background in industrial electronics and construction, he has handled some of the largest food processing and agribusiness losses in the U.S. and regularly speaks at industry events in the U.S. and abroad. Email him at [email protected].
