SunOpta to expand plant-based capacity; close frozen fruit processing unit

Canadian speciality foods company SunOpta is making an undisclosed additional capital investment in a plant-based manufacturing unit in Allentown, Pennsylvania, US, to expand its capacity.

Additionally, it has shuttered its Santa Maria, California, US, frozen fruit processing plant, effective 1 February.

SunOpta CEO Joe Ennen said: “I’m pleased to announce the further expansion of our Plant-Based Foods and Beverages production capacity. This project, in our Allentown, Pennsylvania, plant, follows the completion of three large projects in the fourth quarter of 2020 to accelerate the growth of our plant-based business.

“We expect this new capacity to come online in the fourth quarter of 2021. We remain pleased with our sales pipeline efforts to deliver $100m of revenue growth by the end of 2022 from the three 2020 projects.”

By increasing the production capacity of its Allentown plant, SunOpta intends to support its customers’ growth in 2022 and beyond.

The two initiatives are said to be in line with SunOpta’s multi-year supply chain optimisation strategy to drive growth.

Ennen added: “We are closing our frozen fruit processing plant located in Santa Maria, California, effective February 1, 2021. This closure will reduce the cost basis in our frozen fruit business while leaving ongoing relationships with growers intact and ensuring adequate capacity to service demand for years to come.

“The highly successful automation and productivity efforts made over the last two seasons have created the ability for us to operate the same size business, with fewer assets. Lowering our cost structure will improve gross profit, which we expect will make us more competitive as we seek to add new business.”

Last November, SunOpta agreed to divest its global ingredients segment and related assets to Amsterdam Commodities (ACOMO) for a €330m ($390m) consideration.

Under the agreement, ACMO will acquire SunOpta’s processing facilities in Amsterdam in the Netherlands, Silistra in Bulgaria, as well as Addis Ababa and Yirgalem in Ethiopia.