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Processors Plan Major Expansion and Greenfield Projects, Plus a Cannabis Market Update

Mondelēz International, Cattlemen’s Heritage, and American Peanut Growers Group are expanding operations next year. Also on today's video: Dosage control, speed of onset, and flavors are essential for product in this growing cannabis drinks sector.

Quick hits:

  • Equipment makers for craft brewers look to cannabis market for new customers.
  • Gen Z and millennials shift from alcohol to cannabis.
  • Cannabis beverages “will never be the cheapest way to get high,” says market researcher.
  • MondelÄ“z International is planning to invest $122.5 million in its Henrico County, Virginia, supply chain operations, over the next three years.
  • Cattlemen’s Heritage is building a 500,000-sq-ft beef processing plant, in northern Mills County, just south of Council Bluffs, Iowa.
  • American Peanut Growers Group is investing $85 million to expand its food processing operations.

Related to this episode:

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Joyce Fassl: I’m Joyce Fassl, senior executive editor of ProFood Worldwith an industry news update. 

As 2021 comes to a close, several food and beverage processors announced major expansion plans or greenfield projects. Let’s take a look at some highlights.

Mondelēz International is planning to invest $122.5 million dollars in its Henrico County, Virginia, supply chain operations, over the next three years. The investment includes a 68,000-sq-ft expansion of its Richmond Biscuit Bakery, which will support the company’s Richmond manufacturing operations, and enable the site to house a high-speed, modern Oreo production line. Near the Richmond Biscuit Bakery, the company will be opening a new sales fulfillment center, which will support Mondelēz sales and distribution in the U.S. Scheduled to open next year, the center will create approximately 80 new jobs.

Cattlemen’s Heritage is building a 500,000-sq-foot beef processing plant, in northern Mills County, just south of Council Bluffs, Iowa. The plant will harvest 1,500 head per day and employ up to 750 people. Groundbreaking is scheduled for the spring of 2022, and ESI Group has been selected to design and construct the greenfield facility.

Georgia-based American Peanut Growers Group is investing $85 million dollars to expand its food processing operations, enabling the company to manufacture peanut paste, granules, peanut butter, and roasted peanuts. In addition to expanding its current Donalsonville shelling plant, American Peanut Growers Group will open a new 135,000-sq-ft food processing facility on its 45-acre campus in Seminole County. The company will also invest in additional shelling equipment as it expands its operations, which will create 90 jobs.

Aaron Hand: Hi, I’m Aaron Hand, editor-in-chief of ProFood World. And this is Take Five.

Today I’d like to take a moment to talk about the cannabis beverage market. I had the opportunity recently to explore this sector at the Cannabis Drinks Expo in Chicago, so I want to share a bit of what I learned. 

I talked with several beverage companies trying to make a go of this market. Some come to the space with great tasting drinks ready to be infused. Some come with the lab experience needed to infuse THC or CBD without hurting that flavor. And some come with co-packing experience, which is pretty dear in this emerging market.

There were also several canning and bottling companies in attendance. It seems that most of the equipment suppliers in the cannabis drinks space have a fair bit of experience in the craft beer market and are hoping to find a way to make up for the recent slowdown from the beer sector.

About that dip in alcohol consumption… We’ve heard a fair bit lately about more and more consumers turning away from alcohol or at least looking to reduce their alcohol consumption. But what hadn’t occurred to me is that it’s not just a shift away from alcohol but also a shift toward cannabis.

There is huge potential in cannabis drinks, which so far make up about 2% of the overall cannabis market in the U.S. according to Bethany Gomez, managing director at Brightfield Group. Cannabis drinks tend to be expensive, and it’s primarily high-end consumers that are turning in that direction. As Gomez puts it, “This is never going to be the cheapest way to get high.”

Corrections that need to happen going forward are toward dosage adjustments and flavors. Gomez emphasizes the need to think about the consumer and understand what their dosage levels are for different needs. Flavors early on were pretty rudimentary, but suppliers are beginning to get into seasonal trends and more exotic flavor combinations.

Finally, speed of onset is essential. Imagine having a couple drinks at a barbecue, and then getting stoned two hours later on your way home. That won’t cut it. Gomez emphasized the need for fast-acting formulas. VanaLabs was one exhibitor showing off its capabilities in this area, with nanoparticles that can achieve true water solubility. When infused into a beverage, the effects of the CBD are felt typically within 3-6 minutes of ingestion.

This will certainly be an interesting segment to pay attention to as it comes into its own.

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