BOCA RATON, FLA. — The key trends driving innovation in food and beverage manufacturing — prepared foods, plant-based proteins, sugar reduction and clean label — also are driving change throughout the supply chain. Ingredient supplier Ingredion, Inc., sees growth opportunities supplying its customers, both large and small, with the raw materials needed to drive change and potentially disrupt the marketplace.
Investments made by Ingredion to align its portfolio with consumer trends include the commissioning of a pea protein isolate plant in South Sioux City, Neb., that will open later this year; a joint venture to produce pulse-based protein concentrates and flours; and a manufacturing arrangement with Matsutani Chemical Industry Co. Ltd. to manufacture Astraea allulose in Mexico and market it throughout the Americas.
“We have built out our platforms of capability at a time of unprecedented change in the food industry,” said James P. Zallie, president and chief executive officer of Ingredion, in an interview with Food Business News during the Consumer Analyst of New York conference in Boca Raton, Fla.
In fiscal 2019, Ingredion sales were $6.2 billion and specialty ingredients made up 30%, or $1.9 billion, of sales. By fiscal 2023 the company is forecasting specialty ingredients will make up 34% to 36% of net sales, or $2.5 billion.
“We look at products that provide a unique value to our customers and demonstrate higher growth as well as higher margins and also have some differentiation versus other ingredients in the marketplace as specialty,” said James D. Gray, chief financial officer, during the company’s presentation on Feb. 18. “As we look forward, we think that the growth from specialty is in the mid- to high-single digits combined with stable net sales in our core and other businesses.”
Meeting management’s goals will require Ingredion to serve both large and small customers.
“Small, mid-size guys are driving an incremental amount of growth as well as introducing most of the new products that are driving incremental sales in the food industry,” Mr. Zallie said. “That’s affording us an opportunity to pivot to small- and medium-size customers with what we call a systems first approach, which is a more comprehensive suite of ingredients, and then also work with large customers who want to compete with those companies and be more nimble, but leverage their scale.”
In fiscal 2020, Ingredion said net sales and adjusted operating income are expected to be up. Adjusted earnings per share (e.p.s.) are forecast to be in a range of $6.60 to $7.20 per share. In fiscal 2019, adjusted e.p.s. was $6.65 per share.