Developing an Alberta Food Cluster & Global Plant Protein Network
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1 Developing an Alberta Food Cluster & Global Plant Protein Network People around the world are eating more protein. In higher income countries, people are increasing their protein consumption to help manage their weight, build strength and avoid age-related muscle loss. A New York research firm, NPD, found that 71 per cent of US consumers want more protein in their diets. While consumption of animal protein meat, dairy and eggs is growing rapidly in developing countries, new forms of plant protein are catching on and creating increasing demand for products. Alberta s global reputation for producing quality feed stocks, the need to innovate and diversify our economy, availability of investment capital and access to world-class research and development facilities, provides the key building blocks to establish a global specialty food ingredient cluster.
2 Eat food. Not too much. Mostly plants Author Michael Pollan s oft repeated phrase speaks to the appetite for a healthy plant-based diet. Increased demand for more plantbased foods is driven by consumer concerns about their health, the environment and methods used in intensive livestock production. People are searching out natural, simple and healthy food. In 2014, the global non-meat protein product market was led by soy (38 per cent), followed by dairy (35 per cent), non-soy plant protein such as peas, grains, legumes, nuts, and seeds (26 per cent) and algae (1 per cent). Non-dairy dairy milk-based products--such as almond and coconut milk are seeing unprecedented growth. In praise of the pulse The United Nation Organization declared 2016 the Year of the Pulses to heighten public awareness of the nutritional benefits of pulses and their role in sustainable food production. It s the ideal time for Western Canada to show the world our impressive credentials in production and processing of plant protein. The specialty food ingredient sector provides sophisticated micro-ingredients that add specific and quantifiable benefits to our food and beverage products such as food colours, flavours, acidulants, food and beverage enzymes, amino acids, specialty starches, food emulsifiers, food and beverage starter cultures, sugar substitutes, food preservatives, hydrocolloids, and functional food/nutraceuticals. This highly specialized part of the global food industry is outperforming other sectors in growth and profitability. It has sales of US$65 billion annually and is anticipated to grow by US$25 billion over the next 3 to 4 years. Consumers are showing strong preferences for more natural, plant-based ingredients and plant proteins as well as clear, clean and minimal ingredient lists.
3 The case for value-add As demand for plant protein increases around the world, there is a growing opportunity for Western Canada to add economic value to our domestic and export markets by processing a variety of crop ingredients here at home. The Prairies is one of the world s largest and richest agricultural regions and has many key assets. We could do more much more value add. The 2014 study, Towards a Western Canadian Crop Ingredient Strategy, summed it up this way: As a region, Western Canada exports the majority (65 per cent) of its crop and agricultural resources into global food, beverage, and personal care markets to be broken into ingredients and finished products, which are then imported back into the region. Raising the innovation bar: The specialty food ingredient sector Many of the top players in specialty food ingredients are based in Europe in fact 15 per cent of the entire global sector is comprised of companies headquartered in the little country of Denmark. Danish companies work closely with local universities on research and collaborate with innovative SMEs to develop ideas. The Danish players invest between 6 and 14 per cent of their revenues in research and development every year. In comparison, the global food industry invests less than 1 percent. This high level of investment close to levels you see in the pharmaceutical industry creates innovation that delivers measurable benefits to customers and, therefore, allows for a price premium. Critically, these innovations can be patented; ownership of intellectual property typically delivers high returns.
4 Back here in Alberta Over the last century, Alberta s ingredient industry has focused on the manufacturer of whole grains, minimally processed grains (rolled, pearled, flakes, etc.), flours, and flour blends. In the past decade, a small segment of the industry has started to get into the higher valued commodities (proteins, starches, oils, and fibers) and the specialty ingredient sector (natural colors, flavors, texturizers, modified starches, antioxidants, etc.). Dozens of Alberta SMEs are entering into specialty ingredient manufacturing and processing. They re working with locally produced pulses, algae, hemp, cereals, sorghum and fractions thereof to create products for the food, beverage, nutrition, personal care and industrial markets. In Western Canada, we have identified more than 2,700 organizations and individuals that are active in the ingredient industry, an excellent start. In Alberta, the specialty ingredient sector is comprised primarily of SMEs that can benefit from clusters that offer economies of scale usually reserved to large enterprises. The cluster is bigger than the sum of its parts We must share knowledge and collaborate. Western Canada is too large and each province too locally focused to create a pan-prairie cluster. Rather, an Alberta-specific ingredient cluster, with a strong regional inter-provincial network, is a better solution given the nature of the industry and our shared resources. The larger network would facilitate the required collaboration and information sharing. Three regions in Alberta have unique strengths or areas of specialization, good access to transportation and logistics and world class researchers and facilities. Furthermore, they each have regional economic development organizations to encourage and fast track the activities essential to stimulating ingredient sector growth: Lethbridge-Taber (SouthGrow Regional Initiative) Edmonton and the Capital Region Board Calgary and the Calgary Regional Partnership
5 A push from private than and public sector The explosion in demand for plant-based proteins and more natural ingredients gives Alberta and Western Canada a unique opportunity to add substantial value to our world-class production base for cereals, pulses, oilseeds and other plant products. But this will not happen without a big push from key private and public sector players. And the Prairie provinces will need to cooperate and collaborate. We are in this together. Next steps in developing an Alberta Food Cluster We have most of the necessary building blocks to establish a specialty food ingredient cluster in Alberta, but it will be important to have international linkages as well. While Asia maybe the première long-term target, it makes sense to start working with the Europeans before turning our attention to emerging markets like China. Linking in to Denmark and the Netherlands, countries that have the jump on the rest of the world with specialty ingredient processors, would be beneficial. These firms recognize Canada has ample raw materials produced within high integrity supply chains. And they see Canada with our substantial plant production capacity, track record of innovation and abundant commonsense as a good place to seek business partners. In an extensive tour of Denmark s ingredient industry in November 2015, linkages were made with the major ingredient companies and cluster organizations (Agro Food Park) these are businesses that are very interested in creating linkages to our region. The Dutch, while not as dominant in ingredients as the Danes, have some key organizations like Royal DSM and the much-admired Food Valley, one of the premier food clusters in the world. The Dutch have much knowledge about global food markets and a long history of investing in Canadian food companies. There is a strong historical connection between Canada and the Netherlands and a large number of Dutch farmers and business people have migrated to Alberta.
6 Toward our stronger economy We have the knowledge, the assets and the opportunity to create an Alberta Food Cluster & Global Plant Protein Network. All we need now is the will. If you wish to know more, want to get involved in making the Alberta Food Cluster a reality or just lend your support, please send us an .
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