ADM is acquiring non-GMO soy ingredients maker Sojaprotein for an undisclosed amount, the agribusiness giant said in a statement.
Sojaprotein makes vegetable protein ingredients used in food categories such as meat alternatives and protein bars. It had more than $100 million in sales in 2020.
- Interest in the plant-based sector has increased during the pandemic as consumers pay more attention to how their diet impacts their overall health and wellness, boosting demand for ingredients used to make food and beverages.
Similar to food manufacturers, ADM has been increasing its plant protein capabilities to keep pace with increasing consumer demand. An estimated 18% of U.S. consumers purchased their first plant-based protein product during the pandemic, according to ADM’s research, and 92% of them stated they plan to continue making purchases in the segment.
The research mirrors other data seeking to quantify the value of alternative proteins. The segment could reach $290 billion by 2035 while capturing 11% of all protein products sold, according to research from Boston Consulting Group and Blue Horizon Corporation.
In light of this growth, it’s unsurprising that ADM is making heavy investments in plant proteins. One of ADM’s recent plays in the space includes the opening of a pea protein plant in North Dakota. It also belongs to a joint venture called PlantPlus Foods with beef processor Marfrig Global Foods to create plant-based products for North American and South American markets.
Sojaprotein’s extensive market reach and product portfolio provide ADM with a bigger foothold in Europe and an instant boost in its plant protein production capabilities. Acquiring existing companies also offers a much faster route to market expansion compared to expanding production capabilities internally, a key to remaining competitive in a fast-growing category. Its focus on non-GMO offerings also gives ADM more traction in the burgeoning clean label ingredient space.
As the plant protein segment expands beyond beef substitutes with startups and established players launching chicken and pork replacements, having enough plant protein to supply existing and new product launches will be key to remaining competitive in the increasingly cutthroat segment. In the case of Sojaprotein, its ingredients roster hits on a lot of key product attributes that could make its portfolio in greater demand among food and beverage manufacturers going forward.
ADM also is showing a bullish interest in novel offerings in alternative protein. It partnered with Perfect Day to produce dairy proteins through fermentation on a broader scale and invested in Air Protein, a startup that uses fermentation to make a meat alternative out of elements in the air. It also backed edible protein maker Nature’s Fynd, formerly Sustainable Bioproducts, and animal-free ingredient startup Geltor.