Maple Leaf Spends $ 100 Million on Indianapolis Tempeh Plant

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Maple Leaf Spends $ 100 Million on Indianapolis Tempeh Plant

Diving letter:

  • Greenleaf Foods will purchase and build a 118,000 square foot food processing facility in Indianapolis to ramp up production of Lightlife tempeh products in response to growing demand from the parent company Maple Leaf Foods announced. The company expects the purchase To close in early April.
  • The Indianapolis facility will have an initial production capacity of approximately 99.2 million pounds of tempeh. Greenleaf Foods estimates the project – including the acquisition costs – – a total of around 100 million US dollars. The company expects the facility to be fully operational in the first half of 2022.
  • This is the second Indiana manufacturing facility that Chicago-based Greenleaf has planned since its launch in 2018. The company announced plans to build the largest plant-based protein factory in North America in Shelbyville, Indiana in 2019. The company said in the tempeh plant’s announcement that the pandemic and other factors have delayed the project. With the acquisition of the Indianapolis facility, the company hopes to quickly ramp up tempeh production in the short term while continuing to develop plans for the future of Shelbyville.

Dive Insight:

Despite its centuries-old history as a packaged meat supplier, Maple Leaf Foods has pursued vegetable protein for additional growth in recent years. It acquired Lightlife Foods and Field Roast Grain Meat Co. founded their Greenleaf subsidiary in 2017 and accelerated the innovation pipeline.

The Canadian meat company has succeeded in bringing trendy plant-based products to the shelves in the USA. In 2019, Lightlife introduced its first plant-based burger made from pea protein. The brand tried to differentiate itself with a clean label appeal and even called on Impossible Foods and Beyond Meat to simplify their ingredient lists. In 2020, Field Roast Grain Meat, best known for its plant-based sausages and hot dogs, deli slices, celebration roasts, and chao cheese, launched its first vegetable-based chicken product, Nuggets, formulated with wheat and pea proteins are.

But it’s tempeh, a centuries-old fermented soybean-based protein related to tofu, that Greenleaf focuses on at this Indianapolis factory. Tempeh is low in fat and high in protein with a chewy texture and a nutty taste. In recent years, tempeh has seen a surge in sales as many consumers have turned to herbal options to help them stay healthy. Tofu and tempeh sales were $ 128 million in 2019, up 15% over the past two years. This comes from the most recent full SPINS and IRI data shared by the Good Food Institute and the Plant Based Foods Association. The pandemic increased sales even further. Retail sales for tofu and tempeh rose during the peak of panic buying in April 88% year over year, the Plant Based Foods Association reported, citing SPINS and IRI data.

Lightlife Foods, which was first established as Tempeh Works in 1979, accounted for more than 80% of US tempeh sales in 2020, according to the company. Today, the company’s tempeh range includes traditional cake pans, flavored strips and fiber-rich flax and cereal mixes. Last November, Lightlife’s Tempeh made its Walmart debut, bringing its total distribution to 18,500 retail locations. And it was subjected to its own brand. Lightlife brand retail sales grew more than 44% in the 52 weeks ending October 4, 2019, according to the company including IRI and SPINS.

This dominance in tempeh gives Greenleaf Foods a strong differentiator in a challenging time. For one thing, the vegetable space is becoming increasingly dense, and new players, proteins and brands are battling for consumer attention. The Tempeh from Lightlife is Organic, GMO-free, kosher certified and contains 12 to 19 grams of protein per serving. It’s also more versatile than many newer plant-based proteins. Consumers can eat it raw or cooked, crumbled, diced, or sliced ​​in sandwiches, salads, and other dishes.

But the pandemic has also hit Greenleaf hard. Despite an increase in plant-based revenue of more than 9% last quarter – to $ 68.5 million compared to $ 66.6 million last year – the plant-based gross margin declined more than 66% to $ 4.5 million $ 13.3 million a year ago based on earnings report dated September 30th. In a presentation to investors, Maple Leaf admitted that it was struggling to meet demand as it struggled with downtime, labor problems and delays in new product distribution during the pandemic. The company highlighted plans to leverage Greenleaf’s established brands like Lightlife, strategic acquisitions and accelerating innovation to grow its vegetable protein business in the coming year.

This is what makes time critical to expanding tempeh production. For Greenleaf, the biggest promise is to stay one step ahead of supply problems, to meet growing demand, to get over the trip wires of the pandemic – and to take advantage of the tailwind.