Dive Brief:
- Cargill is positioned as a solutions provider in an industry that is ripe for reformulations as consumers demand change in the ingredients found in the products they buy.
- When manufacturers need a new ingredient to cut out trans fats or reduce salt or sugar, Cargill works with them at the Cargill Food Innovation Center in Plymouth, MN, to identify and/or develop the ingredients to make those changes while retaining characteristics like texture, flavor, and color.
- Cargill has also been able to help manufacturers weather instances like last year's bird flu outbreak, which led to egg shortages and price hikes across the industry. The company provided three egg replacement solutions for bakery products.
Dive Insight:
Cargill's recent ingredient forays have helped manufacturers deal with new FDA regulations, such as non-PHO emulsifier replacements for bakery products, and adjust to consumers' changing taste for sweeteners, such as with Zerose erythritol, a calorie-free sugar alcohol that helps mask the off-tastes of high-intensity alternative sweeteners. Another recent development, C☆CreamTex 06329 modified starch, is a texturizing starch for yogurt that can reduce fat with little effect on taste and mouthfeel.
Many of these ingredients come from the innovation center, which Cargill invested $5.5 billion into a 2014 expansion. Cargill works closely with its customers and their ingredients problems to find solutions that will help their customers in the short term and bring in sales in the long term. Other companies have had similar ideas to open or expand R&D centers, including Nestle and Diamond Foods last year.
Innovation and product development are key for food and beverage manufacturers as consumers' preferences continue to change and companies find their legacy products don't always suit those preferences anymore. Whether it's developing or discovering new ingredients for existing product reformulations or coming up with completely new products and product lines, innovation is central to growth at the moment for many companies.
Aside from ingredients development, Cargill has also made a series of acquisitions and sell-offs in the past year to bolster and focus its portfolio, including selling the hot dogs and sausages brand Schweigert to Bakalars Sausage Co. and its pork business to JBS USA Pork. Cargill has also acquired ADM's chocolate business and Norwegian fish feed producer EWOS.