Perspectives On Innovation: Ingredient Companies Provide Appetizing Growth Potential | Seeking Alpha
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By Jim Madden, Tony Tursich, and Beth Williamson
The global population is expected to reach 9.7 billion by 2050, and with it, the demand for food and beverage products will grow. This creates opportunities for ingredient makers to provide the value-added inputs needed to meet demand.
For example, ingredients are used to improve the taste, texture, and shelf life of food products. They are also used to make bread rise, to curdle milk, and to break down starches in fruits and vegetables.
Ingredients can enhance product quality, reduce environmental impacts, improve safety, and lead to significant cost savings.
Global Population Growth Sets the Table for Ingredient Innovators
Source: FAO. 2018. The future of food and agriculture – Alternative pathways to 2050. Rome.
Three Reasons Why Ingredient Companies are Well Positioned for Future Growth:
Our investment process emphasizes high-quality companies with track records of profitability and continued growth potential. Ingredient companies have tended to have strong financial performance, with high profit margins and stable revenue streams – providing an attractive hunting ground for our approach.
Case Studies in Innovation: Kerry Group
Headquartered in Ireland, Kerry Group (OTCPK:KRYAY, OTCPK:KRYAF) develops ingredients that food companies need to be competitive and mitigate risk. Kerry stands out as a global leader in the ingredients space because of its unparalleled breadth of technologies and its holistic approach to innovation.
Kerry has led the industry transformation into a total solutions supplier. The company now provides ingredients for the entire product spectrum and its collaborative partner model cultivates a customer ecosystem that gives Kerry a head start on the competition and locks in long-term demand.
Also, the company has a large group of scientists targeting changing consumer behavior. As a result, Kerry is at the forefront of secular growth trends, including sustainable and plant-based foods, local food production, food waste reduction initiatives, and healthy living.
Kerry Group: Business Strategy Aligns with a Global Focus on Sustainability and Human Development
Source: Kerry Group, www.kerry.com, “CAGNY 2023 Conference, Inspiring Food, Nourishing Life.” Nutritional reach by consumer. * Reduction versus 2017 baseline (Scope 1 and 2 carbon reduction).
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