The largest American meat supplier enters the Dutch insect farming industry

Insect farmer Protix has raised €55 million from, among others, the largest meat supplier in the United States: Tyson Foods. This new investor will thus acquire a minority stake in the Dutch company. In a joint venture, the companies plan to build an insect factory in the United States, which is set to be four times the size of the current location in the Netherlands.
18 October 2023

Protein Pioneers

Since 2009, Protix has been breeding soldier fly larvae on a diet of food scraps. In Bergen op Zoom, the company processes the larvae into nutritional ingredients for fish and livestock, producing 14,000 tons of live larvae annually, enough to feed five million salmon.

Global demand for protein is increasing, while available land, water, and emission space are limited. Insects represent a relatively sustainable protein source. The larvae can consume food waste and convert it into proteins. In addition, insects require significantly less water and land compared to other protein sources. “As a result, the ecological footprint is up to 85% smaller than that of soy,” says Protix CEO Kees Aarts.

In 2021, the European Commission legalized the use of insect proteins for poultry and pig feed, which was good news for European players who have been attracting investments for years. For example, Protix’s biggest competitor, the French company Ynsect, raised nearly $400 million in 2020 for the construction of a factory.

Circular Economy

The timing of the collaboration between Tyson Foods, which sells one-fifth of all pork, beef, and chicken in the American market, and Protix is noteworthy. It was this year that Tyson Foods announced its intention to close several chicken processing facilities to cut costs. The company reported a loss of $417 million in its latest quarterly earnings, with a 2.6% drop in revenue to $13.1 billion.

With its stake in Protix, Tyson Foods enters a new realm of proteins. “The role of insects in the circular economy offers the potential for full circularity within our value chain,” says John Ronald Tyson, the Chief Financial Officer of Tyson Foods. The investment by his company is intended to contribute to “a more sustainable food system for the future,” as stated by the largest meat producer in the United States in a press release.

The insect factory in the United States should be operational within the next two years and is expected to become the largest in the world, according to Aarts. “We are still searching for the best location, and for that, we primarily need an area with a lot of food waste nearby.”

Source: FD

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