SunOpta is planning to construct a new soymilk processing and packaging plant in California, which it says will enable it to meet growing demand for the beverage.
The company already has aseptic packaging facilities in Alexandria, Minnesota. When the new factory in Modesto, California, is complete and working at full pace, total annual capacity will be between 250 and 300 million quarts a year.
According to Allan Routh, president of the SunOpta grains and food groups, annual growth of the company's soymilk and alternative beverage portfolio is growing at some 20 per cent per year.
Thirst for soymilk
While the company says that a major driver of this growth is demand from food service, the trend also underscores a general growing thirst for products of this ilk from the US consumer.
The soymilk market experienced 52 percent growth at retail between 2002 and 2007, reaching $464m, according to Mintel.
This was way ahead of the general market for soy products during this period, according to Mintel's report Soy-based Food and Drink - US- October 2007, which placed current retail sales at $1.4bn, or $1.9bn with Wal-Mart and natural food store sales taken into consideration. Although this is 16 percent higher than 2002 sales in current prices, it is only a modest increase of two percent after factoring inflation.
Routh pointed out that the strategic sense of the new plant's location, especially in context of preferences for locally produced and sourced products.
He said it will drive "social, economic and environmental sustainability via geographic production in close proximity to consumers, and reduced packaging waste and distribution costs".
According to a study conducted in 2005 by researchers at Ohio University and published in the May issue of the American Journal of Agricultural Economics, consumers may be prepared to pay up to twice as much for locally sourced produce, compared to that flown in to supermarkets.
While co-author Marvin Batte said he did not think that all food should necessarily be produced locally, the indication is that there is a strong market for this. His research was based around consumers' preparedness to buy strawberries.
SunOpta soy logistics
For its soy bean products, SunOpta conducts initial processing at two plants in Hope and Moorhead Minnesota, as well as at third party plants.
From here, they are transferred to the ingredients plants in Alexandria, Minnesota, Heuvelton, New York, and Afton Wyoming. This is where they are converted into liquid concentrated soy base, or other soy-based soy ingredients (such as soy fiber for a range of snack, bakery and beverage uses).
Finally, the soy base for beverages is sent to SunOpta's aseptic packaging plant, or third party partners, for blending, packaging, and distribution to customers.
The company says that the addition of the new facility represents a new foothold in the Southwest of the United States.