John K. Borchardt (September 2010)
Processed Food Trends
As the economy has faltered, so, too, has consumers' appetite for dining out. Consumers are buying more pre-packaged chicken and turkey, packaged sandwiches, and deli salads such as potato salad and coleslaw. Increased sales of these and other processed foods have softened the impact of adverse economic conditions on many food processing firms.
Packaged frozen food sales continue to grow. While the number of lunch, dinner, and snack foods continues to multiply, frozen breakfast food products are doing especially strong sales and diversifying their products. Frozen fish products with good taste and texture have long posed a manufacturing challenge. But firms such as Sea Cuisine are introducing improved frozen fish entrees.
As with most other manufacturing industries, energy efficiency is on the lips of most food processors. It not only offers a chance for businesses to save money, but reduces pollution. In early 2010, the U.S. Environmental Protection Agency recognized the first three frozen potato processing plants to earn its Energy Star rating for superior energy efficiency. J. R. Simplot in Aberdeen, Idaho and Othello, Washington and ConAgra Foods Lamb Weston in Quincy, Washington received the designation. These facilities perform in the top 25 percent for energy efficiency nationwide and use an average 20 percent less energy compared to similar plants. These facilities annually save more than $10 million combined, while eliminating nearly 40,000 metric tons of environmentally-harmful gases. That's the equivalent of the annual emissions of 5,000 homes.
Food Processing and Biofuels
U.S. biodiesel production is expected to reach 1 billion gallons by 2012. Fats and recycled vegetable oil from food processing plants will originate nearly two-thirds of those fuels, offering big advantages to processors. Biofuels offer a new market for processors while presenting a way to reduce the cost of disposing byproducts. And converting byproducts into biodiesel reduces the dilemma of diverting crops such as corn and soybeans to biofuels while people go hungry.
Americans generate more than 110 million gallons of waste cooking oil annually, according to the U.S. Energy Information Administration. Converting oil and animal fats into biodiesel reduces the risks of water pollution and overloading landfills.
Producing biofuels enables food processing plants to expand operations and build new biodiesel plants. Agricultural communities are already combining these efforts. High Plains Bioenergy in Guymon, Oklahoma operates a 30 million gallon per year biodiesel plant with waste animal fat from parent company Seaboard Foods' nearby pork processing plant. William Walden, High Plains' yield engineer, said it will eventually expand production to use Seaboard's waste cooking oils as well.
Large oil refineries are also interested in working with food processors to produce biodiesel. Valero Energy plans to build a 135 million gallon per year biodiesel facility using animal fats and waste grease in a joint venture with animal fats producer Darling International. Darling already converts these wastes into tallow and animal feed. The new plant will be located in Norco, Louisiana, adjacent to Valero's St. Charles refinery. The U.S. Department of Energy will extend a loan guarantee under the Energy Policy Act of 2005, which offers $8.5 billion of debt financing guarantees to projects utilizing renewable energy technologies.
Government laboratories and universities are getting into the game, too, with small-scale plants that test new methods to prepare biofuels. Bioenvironmental engineer Ruihong Zhang of the University of California at Davis has invented a more efficient process that uses bacteria to convert food wastes, yard clippings, and farm wastes to biogas, a natural gas substitute that includes methane, carbon dioxide, and occasionally hydrogen. The university has built a $4 million demonstration plant to support the research. While biogas has been made from several food sources, the facility processes mostly food waste from the campus cafeterias and restaurants.
Energy efficiency-minded companies are finding commercial interest in large and small biofuel facilities. Larger plants can be built near urban landfills, while smaller rural plants could help farmers process crop wastes that produce energy to run the farm. Facilities could also be built near food processing plants to convert plant wastes into energy.