Responsible Investing A-Z: U is for Urbanization

This article is sponsored by Nuveen

There have been numerous urban consumer food trends over the last decade, from the Keto diet to a growing list of tech-enabled food delivery options. One of the more prominent has been rising demand for convenient, healthy foods. Consumers are increasingly seeking proteins and on-the-go food options that have not undergone extensive processing and therefore do not contain added and often hard-to-pronounce ingredients.

This change in demand patterns has been driven by a better understanding of the health benefits of protein in a balanced diet. Alongside this, there is a growing global middle class that is able to buy higher-value protein-rich snacks and on-the-go meals. The intersection of these trends has created a rising global demand for healthy, convenient animal and plant proteins. AGR Partners, Nuveen’s agribusiness investment specialist, is keenly aware of these trends and has made several investments that are expected to benefit from them. On the animal protein side, AGR has an ownership stake in Almark Foods, one of the largest producers of hard-cooked eggs and related egg products. Independent research has shown that eggs are a high-quality source of protein and other nutrients, and their relatively low price point has made them a staple of the American diet for decades.

The company’s eggs are cooked, not boiled, which is a more cost efficient and hygienic method that results in better uniformity and uses less water. The eggs are then automatically peeled, passed through a saline solution as an additional food safety step, and placed into vacuum-sealed packages which have extended shelf life (thereby reducing food waste). Almark’s six-pack product is ideal for home consumption, while its two-pack is suited to on-the-go consumers.

AGR’s investment and operational assistance helped the company grow its footprint in the US south-west by constructing a new plant in Yuma, Arizona in 2018. This increased the company’s production capacity while reducing greenhouse gas emissions and freight charges to West Coast customers.

In plant proteins, AGR has invested in a leading almond processor, Treehouse California Almonds. Treehouse doesn’t grow almonds; it efficiently provides the essential processing step needed to transform raw field almonds into a wide variety of value-added almond products. Hulled and shelled almonds are a key part of mixed-nut and fruit-and-nut trail mixes – both are categories that have grown in line with increased demand for convenient, healthy proteins. Treehouse also produces almond products (such as roasted, sliced and diced almonds) that are important ingredients in many confectionary and cereal products.

Over the last few years, one of Treehouse’s fastest growing product lines has been almond meal, which is used in almond milk and as a wheat flour substitute. Another has been almond butter, a common replacement for peanut butter and an ingredient in many snacks and beverages. These newer uses have been growing strongly as they address nutritional, allergen and convenience attributes increasingly demanded by today’s consumers. AGR’s investment has helped provide the capital and governance needed to facilitate continued growth in this expanding plant protein segment.