- U.S.-based Bunge is investing 30 million Canadian dollars ($22.8 million) in Canada-based Merit Functional Foods, giving it a minority stake in the company, according to a release.
- The partnership will include the construction of a commercial plant protein production facility expected to be completed in December. Merit will produce pea and canola protein ingredients and Bunge will help accelerate its product launches.
- Merit’s Co-CEO Ryan Bracken said Bunge has a “deep knowledge of international commodity markets” that will help reinforce his company’s canola business with customers globally.
Merit, which was founded in 2019, already has an extensive plant-based protein portfolio with two varieties of pea protein, three varieties of canola protein and a blend of the two, according to Food Business News. By forging a relationship with Bunge, the Canadian startup is not only getting access to deep pockets, but several years of experience in the ingredients space and a global distribution network.
Bunge, on the other hand, is gaining access to more plant-based protein ingredients, one of the most popular categories in the food and beverage space right now. The U.S. conglomerate’s portfolio is currently built around edible oils, milled corn, rice, ancient grains, sugar and bio energy. With this multi-million dollar investment, Bunge is now tapping into the pea protein market, which is projected to grow to $176 million by 2025, according to Allied Market Research. Bunge is no stranger to plant-based proteins. It was an early investor in Beyond Meat that it later divested.
Bunge, one of the leading processors of canola in Canada, has extensive experience with the commodity and will be a major supplier to help Merit in canola protein. As canola protein is a newer category, Merit is smart to be partnering with Bunge. According to Food Navigator, canola protein can be used in formulations ranging from meat to dairy alternatives and, when combined with pea protein, contains a complete amino acid profile that lends itself to high digestibility. The protein also is highly soluble, making it less gritty and more neutral tasting than pea protein.
Merit created its proteins to focus primarily on taste while also aligning it with a host of other consumer demands, including clean label, allergen-free, gluten-free, non-dairy, non-GMO and vegan certifications, according to Dairy Foods. The profile of Merit’s raw proteins with their 90% purity profile caught the interest of Nestlé earlier this year when the Switzerland-based company entered into a joint development agreement with the startup to scale production for use in its own food and beverage products.
Although Merit has received a lot of attention from investors recently, it is not alone in the race to improve plant-based proteins. Cargill invested $100 million into Puris, a pea protein manufacturer that supplies Beyond Meat. Ingredion has made plant-based proteins, including peas, one of its five platforms for growth. There also is Roquette, Kerry and ADM in the space that Bunge and Merit will compete with going forward. As more ingredient companies enter the fray to develop new and better plant-based ingredients, food manufacturers that used them to produce more realistic meat-like offerings should emerge a big winner.