SunOpta makes ‘huge bet’ on oatmilk as new extraction facility set to become operational

By Elaine Watson contact

- Last updated on GMT

SunOpta CEO Joe Ennen: 'There’s been a seismic shift among consumers' (picture credit: SunOpta)
SunOpta CEO Joe Ennen: 'There’s been a seismic shift among consumers' (picture credit: SunOpta)

Related tags: Sunopta, oatmilk, plant-based, plant-based milk, Organic ingredients

With oatmilk muscling ahead of soymilk to become the #2 player in the plant-based milk category, SunOpta is aggressively building capacity to meet growing demand, with a new oat extraction facility in Alexandria, Minnesota, due to come online in the fourth quarter of this year.

The plant uses enzymatic hydrolysis to break down oats into the oat base used in most commercially-produced oatmilks (manufacturers just add water), said SunOpta​ CEO Joe Ennen, who was speaking to FoodNavigator-USA as SPINS shared data showing that US retail sales of oatmilk​ – a relative newcomer to the US plant-based milk segment – surged 303.7% in the 52-weeks to September 6 vs the previous 52-week period.

There’s been a seismic shift among consumers ​[towards plant-based products] and I want to make sure that when the dust settles 20 years from now that we were sufficiently aggressive at this point in history in our aspirations and the bets that we’re placing," ​said Ennen.

“We’ve also invested in further aseptic processing capabilities for shelf-stable plant-based milks because we’re seeing strong growth in every format.”

SunOpta_oat processing facility
SunOpta's new oat extraction facility in Alexandria, Minnesota

‘Apart from the produce aisle, everywhere else fruit shows up in the grocery store, it’s junk’

SunOpta’s fruit business - which was struggling when Ennen took the helm in April 2019 – is now firing on all cylinders, he said. “We’ve righted the ship and delivered on all of our expectations since Q3 of last year and we’re now delivering pretty significant year over year growth in that business.

“We’ve got a number of pretty exciting innovations coming out in fruit,​ added Ennen, who joined SunOpta from Columbus Meats (where he was CEO) but has also held senior roles at Safeway, Frito-Lay, ConAgra Foods and Kellogg.

“The thing that candidly really pisses me off about the fruit business, is that you talk to any nutritionist and they say, 'Eat more fruits and vegetables,' but apart from the produce aisle, everywhere else fruit shows up in the grocery store, it’s junk, whether it’s fruit snacks or frozen novelties. Food manufacturers have done a massive disservice to fruit over the past 100 years.

“We said why can’t we just take the goodness of fruit and deliver it to people as purely as possible? So we developed the arbor​ brand, an organic, no sugar added, 100-calorie fruit bar brand with four ingredients on the label, four of which are fruit. It’s literally just fruit in a snackable format​ [launched in 1,200 Walmart stores a couple of months ago].  

“We’ve also got a number of other exciting initiatives we’re in the process of presenting to retailers right now.”

arbor bars
SunOpta recently moved into the snack bar segment with the nationwide launch of certified organic arbor fruit bars made from dried fruit with zero added sugar. The 30g bars, which come in three flavors – Apple + Berries, Apple + Blueberry, and Apple + Raspberry – contain 3g fiber and 100 calories.

Organic ingredients business has grown from $100m to $500m in 10 years

SunOpta’s Tradin Organic​ ingredients business, meanwhile, has grown from $100m to $500m in the last 10 years, said Ennen, who remains “incredibly bullish about organic​,” despite the economic slump.

“I see more and more people translating their concernsabout climate change into purchase behaviors and there’s an appreciation for things like organics and plant-based.

“Changing your diet is one thing most people can actually do in their everyday lives to make an impact.”

COVID-19

As for COVID-19, he said, “Knock on wood, we’ve had no major disruption in our plants, but we weren’t waiting for the government to tell us what to do.

“As it relates to the organic supply chains, there has been a bit of a slow down in some exports and shipping but nothing material.”

Foodservice: A mixed bag

The foodservice side of the business, meanwhile, has “come back quicker than we thought," ​said Ennen.

"There are some customers that have fared pretty well through the whole thing; some have even grown, believe it or not, but others are down 5-10%, and others are way down.”

FREE webinar Oct 28: Kids and the plant-based trend

FFK20_Plant-based-Trend_Social-Banner

Plant-based meat, dairy and egg products are gaining traction, from the next generation of burgers and nuggets to oat milk lattes.

But are these just for adults? Where is the opportunity in plant-based for kids, from a new generation of ‘hybrid’ products combining meat and plants, to new plant-based milks with added protein and DHA?

Find out on October 28 at our FREE webinar, 'Kids and the plant-based trend​,​' the second installment of our virtual FOOD FOR KIDS series.

  • Kyle Gaan,​ research analyst, The Good Food Institute
  • Adam Lowry​​​, co-founder and co-CEO, Ripple Foods​​​ 
  • Kristie Middleton​​​, VP business development, Rebellyous Foods​​​​​
  • Hema Reddy ​​​founder and CEO, Crafty Counter (Wundernuggets) ​​​
  • Marlena Hidlay, ​​early life nutrition segment lead, DSM North America​​
  • Mark Fahlin,​​ business development manager, Cargill

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