Alongside our daily news coverage, features and interviews, the Just Food team sifts through the week’s most intriguing data sets to bring you a round-up of the week in numbers.
Conagra Brands revealed the US-based food company plans to close a more than half-decade-old frozen food plant in Wisconsin, within days of its latest financial results showing a further sales decline in the category.
The closure of The Beaver Dam factory, inherited by Conagra in 2018 as part of the acquisition of Pinnacle Foods, was not linked to the drop-off in frozen sales.
Nevertheless, the canned tomatoes to cookies maker reported last week that chilled and frozen-food sales fell for a fourth straight quarter.
Hain Celestial, another US food manufacturer, which like Conagra also serves overseas markets, disposed of a sweet biscuits brand to J&J Snack Foods just as the category heads for a $12bn marker.
In another blow for the alternative-protein category, New Zealand plant-based business Sunfed Meats has gone to the wall in what, however, was a relatively small market in value terms within the global context.
Elsewhere, Italian pasta giant Barilla ditched a grain-free brand in the US and Dutch poultry business Plukon Food Group bagged a deal in Poland, where meat volumes have been falling.
Conagra factory freeze
The decision to close the Beaver Dam plant, which dates its origins back to 1972, will help “improve efficiencies”, Conagra said.
Not good news, however, for the 252 workers employed at the facility, which produces the Birds Eye brand of frozen vegetables.
In a brief 8 April notice of intent under the Worker Adjustment and Retraining Notification Act (WARN), Conagra made no mention of the softness in the category, which falls within its refrigerated and frozen business segment.
Nevertheless, organic sales in that division slid 8.1% in Conagra’s third quarter, outpacing a group-level decline of 2%. The business segment remains a significant cash generator, however, at $1.2bn versus a sales total of $3.02bn.
“This decision is not a reflection of the overall performance of our Beaver Dam team,” a Conagra spokesperson told Just Food. “We are committed to treating our employees respectfully and fairly throughout this transition, and we will offer severance benefits to employees.”
Announcing the previous set of quarterly results in January, Conagra trimmed its outlook for full-year organic sales to minus 1% to up 2%, compared to a 1% increase previously. The guidance remained unchanged at the third-quarter stage.
Hain slims down
President and CEO Wendy Davidson has let get of the Thinsters sweet biscuits brand, continuing the SKU rationalisation strategy of predecessor Mark Schiller.
Soon after taking over in January 2022, Davidson pledged to further trim the portfolio, but not in any major respect, to focus resources on three areas of better-for-you in snacks, baby food and beverages. Meal-prep and personal-care remain part of her strategy.
Thinsters fell outside of that remit but the disposal opens up the possibility of using the funds – the amount raised undisclosed – to invest elsewhere. Speaking to Just Food last year, Davidson suggested she could be looking to beef up the better-for-you portfolio.
The outgoing brand was also a culprit for Hain incurring an impairment charge last year, along with the ParmCrisps snacks line.
As the Thinsters new owner, J&J Snack Foods inherits a brand in which the sweet biscuits category is destined for $12bn in sales value.
Davidson said this week: “Divesting Thinsters further streamlines our supply chain network and strengthens our ability to focus our efforts on driving greater reach and scale of our core better-for-you brands across our categories of focus.”
Her counterpart at J&J Snack Foods, Dan Fachner, said: “This acquisition is a natural fit for us, complementing our already vast offering of cookies and baked goods. We look forward to leveraging our strengths to expand distribution and introduce Thinsters cookies to a wider audience.”
Sunfed demise
Sunfed Meats in New Zealand joined a raft of plant-based protein companies to succumb to the global sales slowdown in the category.
Shama Sukul Lee, the founder and CEO of the pea protein range of chicken, pork and beef alternatives, cited the reluctance of investors to provide more funding for the decision to shelve the business.
“Essentially, a lot of VC investors had jumped into the plant-based gold rush, thinking they could get fast valuation returns, similar to what they’re used to in the virtual world,” Lee explained. Investors had “written Sunfed off”.
Over in Europe, a number of similar businesses have suffered the same fate, including VBites in the UK – although the assets were later acquired by founder Heather Mills – and The Meatless Farm Co.
Examples in the US and Canada include Tattooed Chef and The Very Good Food Co.
Plant-based meat sales in New Zealand were valued at just $24m in 2023 and are only expected to grow another $8m through 2028, according to estimates from GlobalData, Just Food’s parent company.
Sunfed’s last capital raise was in 2018, meaning the business “ran very lean for far too long with not much resources for growth activities, such as distribution and marketing,” Lee said, adding that “the plant-based bubble” has burst in recent years, and faces “a reality check”.
Barilla pulls US brand
The Tolerant Foods gluten-free pasta line will no longer be available in the US from May as Barilla focuses resources behind its namesake brands.
“In a rapidly shifting marketplace, we have made the difficult decision to discontinue the Tolerant brand and its products,” a spokesperson for the Italy-based pasta giant said.
“We’re focused on prioritising pasta options that offer a variety of different nutrition benefits under our Barilla brand.”
While the US dried pasta market is expected to reach more than $9bn in 2028, volume growth is anticipated to slow to below 1%.
In the US, the privately-owned business sells pasta-type products made from ingredients such as chickpeas and lentils under the Barilla brand alongside its more conventional fare.
The Tolerant Foods range also includes pasta alternatives made from the two ingredients. Retail stockists have included Whole Foods Market and Sprouts Farmers Market.
In its 2022 financial results, the most recent available from the family-owned business, Barilla said its share of the US pasta market grew by “1.5 percentage points”, adding: “This increase is largely attributable to durum wheat-based products and, to a lesser extent, the better-for-you products.”
Plukon plucks Algas
The Dutch poultry business struck again in M&A, marking its third acquisition or investment in 12 months and the company’s expansion in Poland.
Under the deal, the Algas slaughterhouse and processing facilities based close to the southern Polish city of Katowice will fall into the hands of Plukon, which said the transaction provides opportunities “to invest in further growth in activities in Poland” for both businesses.
Plukon added the acquisition will also improve its “capacity to supply our retail and foodservice customers with high-quality fresh and frozen poultry products in Poland and to various European markets”.
CEO Kees Kraijenoord said bringing Algas into the fold “strengthens our position in Poland and underlines our commitment to growth and leadership in the European poultry market”.
Poland’s multi-billion-dollar meat market, however, is exactly going guns, with volumes forecast to continue to decline over the next fours years or so.
In February last year, Plukon took a majority stake in Dutch poultry business JA Ter Maarten and early in 2024 bagged Spanish chicken major Redondo.
Prior to the Algas deal, Plukon had thirty production sites in Europe - nine in the Netherlands, six in Germany, three in Belgium, seven in France, four in Spain and one in Poland.
