Fresh produce giant Fresh Del Monte strikes deal to enter high-value specialty ingredients
This story was originally published on Food Dive. To receive daily news and insights, subscribe to our free daily Food Dive newsletter.
Fresh fruit and vegetable giant Fresh Del Monte is buying a majority stake in Avolio, Uganda's leading supplier of bulk crude and edible avocado oil, for an undisclosed amount.
The Florida company said the purchase fits with its long-term strategy to grow its specialty ingredients and innovation business. In this case, Avolio will enable Fresh Del Monte to convert avocados into premium avocado oil. Avocados are one of the few fruits from which oil can be extracted from the pulp.
The purchase places Fresh Del Monte in the fast-growing avocado oil segment. The ingredient is expected to grow to a $1.2 billion business by 2032 from $637 million a year ago, according to Fortune Business Insights.
Fresh Del Monte is best known for its bananas, pineapples and other fresh produce displayed in the grocery store. While the company remains committed to the business, it recently created a biomass and specialty ingredients division to transform agricultural byproducts to boost the company's growth, enhance soil health and support human wellness.
'These efforts not only reinforce our environmental stewardship but also position us to compete in higher-margin categories that drive profitable growth and long-term shareholder value,' Fresh Del Monte Chairman and CEO Mohammad Abu-Ghazaleh said in a statement. 'Acquiring Avolio is a strategic step aligned with our long-term vision to extract greater value across our supply chain while advancing our commitment to sustainability.'
During its 2024 fiscal year, Fresh Del Monte's net sales fell to $4.28 billion compared with $4.32 billion in the prior-year period. The decrease in net sales was primarily due to lower sales volume and per unit selling prices in bananas as well as the negative impact of exchange rate fluctuations. Bananas were responsible for about a third of the company's net sales in 2024.
The purchase of Avolio not only improves Fresh Del Monte's environmental footprint and provides it with faster-growing channels to increase sales but also helps to further diversify the company's business and minimize disruption in other parts of its operations.
Fresh Del Monte said Avolio's extraction technology will be scaled to process 140 metric tons of avocados per day. It added that the technology, coupled with Fresh Del Monte's extensive supply chain expertise 'positions the two companies to lead the market in delivering high-quality, sustainable avocado oil solutions.'
Recommended Reading
Leftovers: Fresh Del Monte pineapples turn red | Little Bites get a little less sweet
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
4 hours ago
- Yahoo
Trump tariffs could hike canned food prices up to 15%, trade group says
This story was originally published on Food Dive. To receive daily news and insights, subscribe to our free daily Food Dive newsletter. The 50% tariff on imported steel levied by the Trump administration could increase canned food prices between 9% and 15%, according to the Consumer Brands Association. The trade group estimated up to 20,000 U.S. food manufacturing jobs could be at risk if tariffs cause consumers to curtail their purchases of higher-priced canned goods and CPG companies opt to switch away from tin-plate steel to cheaper packaging alternatives. The steel tariffs are impacting a slew of products in the food space, including sauces, seafood, soup and vegetables. As the White House doubles tariffs on steel and aluminum, CBA moved quickly to underscore the negative impacts they could have on manufacturing and consumer shopping habits. The CBA, whose members include Coca-Cola, The Campbell's Company and Del Monte Foods, noted that while the majority of ingredients and inputs are sourced from the U.S., there are exceptions. A major one is tin mill steel. Domestic can makers and canned food producers import nearly 80% of the material from foreign trade partners, Robert Budway, president of the Can Manufacturers Institute, said last week. Conagra Brands CEO Sean Connolly said in April his company has 'no choice' but to import the majority of its canned food packaging, estimating about 75% of the tin plate steel lines in the U.S. have been eliminated since 2018. CFO David Marberger said last week that the Hunt's tomato and Wendy's canned chili maker was working through how it will 'mitigate' the higher cost for the material on its business. 'Unfortunately, the domestic steel industry does not produce tin mill steel in the quality or quantities needed by U.S. can makers,' Tom Madrecki, vice president of supply chain resiliency at CBA, said in a statement. 'The Trump administration should fine tune its approach to recognize supply chain dependencies and protect all U.S. manufacturers, workers and consumers.' A handful of other food and beverage manufacturers have warned that tariffs will impact their operations. Campbell's, which imports tinplate steel for cans and canola oil for chips, noted trade headwinds could cut into its fiscal-year earnings by 3 cents to 5 cents a share. Coca-Cola said in February that the Sprite and Dasani maker may shift some products sold in aluminum cans to PET bottles if input costs rise in light of new tariffs. Recommended Reading Conagra seeking to mitigate steel tariffs' impact on cans Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
a day ago
- Yahoo
Cargill invests $90M to automate Colorado beef plant
This story was originally published on Food Dive. To receive daily news and insights, subscribe to our free daily Food Dive newsletter. Cargill said it will invest close to $90 million in computer vision and other cutting edge technologies over the next few years at a Colorado beef plant, which will allow the food giant to get more meat out of each animal. The company plans to implement a proprietary automated solution called CarVe at its plant in Fort Morgan. The technology uses computer vision to measure red meat yield in real time, helping employees improve cutting techniques and reduce waste. The technology allows Cargill to preserve more meat at a time when cattle supply is at its lowest point in decades. Cargill has invested nearly $24 million in tech upgrades at the Fort Morgan facility since 2021. Cargill has looked to automate some of its processes to improve production efficiencies and make operations safer for employees. The company has implemented more than 100 projects across 35 facilities in North America as part of its Factory of the Future initiative. The latest project at Fort Morgan is designed to improve the meat cutting process by allowing for real-time production insights. Frontline managers can use the technology to instantly share feedback with employees, improving processes that can boost meat production per cow. 'Now, we're making decisions in the moment and saving product that would've been lost,' Jarrod Gillig, senior vice president of Cargill's North American Beef business, said in a statement. 'By applying smart technology to the problem, we're getting more meat from every animal, reducing waste, and making protein production more efficient and sustainable from start to finish.' As the U.S. grapples with a significant cattle shortage, meat producers have invested to expand processing capabilities as a way to increase production. Even a 1% yield improvement can save hundreds of millions of pounds of meat, Cargill said in a statement. Cattle prices are expected to reach new highs in 2026 as ranchers struggle to rebuild herds from years of drought and high input costs. U.S. beef production is expected to decline in 2026 by 5% year over year, according to the Department of Agriculture. Cargill competitor JBS, the world's largest meat producer, said in February that it would spend $200 million to expand U.S. beef production as it prepares for supply to eventually rebound. In addition to the technology upgrades at the Fort Morgan plant, Cargill is investing to address labor constraints by backing a $40 million development project for employee housing. Recommended Reading JBS spends $200M to expand US beef production Sign in to access your portfolio
Yahoo
2 days ago
- Yahoo
How Nerds Gummy Clusters became the candy aisle's biggest hit
This story was originally published on Food Dive. To receive daily news and insights, subscribe to our free daily Food Dive newsletter. When Nutella maker Ferrero purchased Nestlé's candy business for nearly $3 billion in 2018, the acquisition added popular brands such as Butterfinger, Baby Ruth and 100 Grand to its enviable roster of sweets. But while much of the attention went to these iconic offerings, it may be Nerds, a product largely seen as an afterthought by its prior owner, that could turn out to be the sweetest brand of them all. Nerds is on track to hit more than $900 million in sales this year, a more than 1,700% increase from the $50 million in sales the brand was generating when it was first incorporated into Ferrara, which is owned by a Ferrero-affiliated holding company. The unprecedented surge is directly attributed to the widely popular Nerds Gummy Clusters, which represented the first meaningful innovation for the once-sleepy brand in years. Nerds Gummy Clusters are now the top sugar confection on the market, overtaking Mars Wrigley's Skittles, according to Ferrara. 'We knew we had something that was kind of special, but we really, truly had no idea how special it was or that it would grow as fast or as big as it has become,' said Katie Duffy, vice president of global brands with Ferrara. But the success of the clusters, which are a gummy ensconced in crunchy Nerds candies, wasn't a given. Initial tests weren't particularly encouraging, Duffy recalled, with consumers struggling to comprehend the multi-textural eating experience. 'We looked at the scores that came back from the concept and it was not all sunshine and rainbows,' Duffy recalled. 'We were really trying to understand, okay, why are they not getting it.' Ferrara remained hopeful that Nerds Gummy Clusters would catch on with consumers, especially after the treats proved to be an early hit with its own employees. After tweaking the visuals and language around how they showcased the treats, Nerds Gummy Clusters finally started resonating with testers. When Nerds was acquired, Ferrara observed that the 35-year-old brand had a high level of consumer awareness but went years without meaningful innovation and minimal marketing, Duffy said. Nerds also were not viewed as a market leader in candy because of their small size and the fact that they were messy. Nerds Gummy Clusters solved many of these problems. The candy has proven to be a hit at movie theaters and airports. Nerds Gummy Clusters also have helped attract older consumers and new snacking occasions to the brand. Most surprisingly, some distance runners and endurance athletes have used them as a booster in place of supplements such as Gu Energy Gel, Duffy said. Despite the recent sales boom, Duffy said there is plenty of growth left for the Nerds brand. Ferrara is rolling out more seasonal Gummy Clusters varieties in the U.S. and has expanded the brand into overseas markets such as the U.K. and Canada. At the same time, the company is hopeful Nerds Gummy Clusters can grab more shelf space at existing stores to better match its product velocity. Ferrara also is planning its next big launch under the Nerds banner later this year with Nerds Juicy Gummy Clusters. The snack contains juice in the center and is three times the size of the Gummy Cluster. 'Nerds Juicy Gummy Clusters is going to give us an opportunity to continue to build momentum that Nerds has already established,' Duffy said. 'It's a different eating experience.' Recommended Reading Leftovers: Nestlé sweetens game day with Cookie Nachos | Godiva doubles down on gourmet chocolate Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
