OMAHA (DTN) -- Two major food companies are taking a dive into a $5 billion retail market for plant-based foods, as Marfrig and Archer Daniels Midland on Monday announced a joint venture called PlantPlus Foods.
Mafrig, one of the largest beef and beef patty producers in the world, is the majority owner at 70%, while ADM is 30% owner in the Chicago-based venture focused on markets in North America and South America.
Plant-based food sales in the United States have grown by about 29% since 2017, according to the Good Food Institute.
In 2019, the largest growth in retail sales were in plant-based milk at about $2 billion, or about 38% from 2018, and in other plant-based dairy products at $1.4 billion, or about 26% growth since 2018. Sales in plant-based meats totaled about $939 million in 2019, or about an 18% increase.
Plant-based meat accounted for about 2% of all retail-packaged meat sales in 2019, according to the Good Food Institute.
Marfrig is expected to be responsible for finished product production and distribution, according to a news release announcing the venture, from its facilities in Varzea Grande, Mato Grosso, and from its facilities in the United States.
ADM is expected to supply its technical expertise in application development in an array of plant-based ingredients, flavors and systems from its specialty protein complex in Campo Grande, Mato Grosso do Sul, and its network of U.S.-based ingredient and flavor facilities, including its new pea protein plant in Enderlin, North Dakota.
"PlantPlus Foods is born of two companies that had a common vision to create a new venture offering a complete portfolio of delicious, sustainable plant-based foods for consumers across the Western Hemisphere," Marfrig founder and Chairman Marcos Molina, said in a news release.
ADM Chairman and Chief Executive Officer Juan Luciano said in a statement that consumers want foods that are better for the environment.
"Backed by the vast capabilities of ADM and Marfrig, PlantPlus Foods brings together a unique blend of innovation, scale, insight and expertise in this exciting, fast-growing market," he said.
Marfrig manages 13 beef production units in Brazil that produce canned beef, beef jerky, sauces and sachets. The products are sold in the domestic market through the retail, wholesale and foodservice channels and exported to about 100 countries.
Marfrig also runs five production units in Argentina, where it is the country's leader in beef patty production and sales. In Uruguay, the company is the country's largest cattle processor and beef exporter. In Chile, Marfrig is the leading importer of beef and operates a lamb primary processing unit.
National Beef, a Marfrig subsidiary in the U.S., exports to more than 30 countries and has a daily processing capacity of 13,100 head of cattle. It sells products in the U.S. market through the retail, wholesale and foodservice channels and is the country's leading exporter of chilled beef, with a focus on the Japanese and South Korean markets.
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