SINGAPORE- Agrocorp International Pte Ltd, a Singapore-based global agricultural commodities company recently announced plans to partner with Japan-based diary firm Megmilk Snow Brand Co., Ltd. on a joint venture to manufacture and market plant-based food ingredients.
This recently announced partnership will be named Agro Snow Pte Ltd and will establish a joint-venture company in Singapore and a wholly-owned subsidiary in Malaysia where a plant will be set up to manufacture plant protein and starch isolates to meet the rising demand for plant-based foods and beverages.
AgroCorp will have a 51% ownership interest in the JV, and Megmilk will hold 49%. The initial capital stock is valued at US$21 million.
According to the announcement by the companies, Agrocorp has been considering further expansion of its downstream business capacity in plant protein extraction and already has another facility in Saskatchewan, Canada.
On the other hand, this partnership will be part of Megmilk’s strategic entry into the plant-based food business, in line with its growth strategy.
“We are excited to partner with Megmilk Snow Brand, one of the largest dairy companies in Japan, to further our capabilities downstream in the plant protein extraction business,” said Vishal Vijay, director of Strategic Investments, Agrocorp International.
“This is our second major investment in protein extraction after our first facility in Saskatchewan, Canada, and we hope to be able to service the growing demand in Asia for plant-based food,” he added.
Agrocorp specializes in selling staple food products such as wheat, pulses, and sugar to the leading food manufacturers in the Asia Pacific and the Middle East, and has been in this business for the last three decades.
The Singaporean firm is one of the leading pulses traders in the world and has pulses processing facilities in Australia, Canada, and the United States.
On the other hand, Tokyo-based Megmilk has been involved in Japan’s dairy farming industry for more than 90 years.
Megmilk resulted from a 2011 merger between Snow Brand Milk Products Co., Ltd. and Nippon Milk Community Co., Ltd. which developed a business centered on milk and dairy products.
This joint venture is seemingly a timely endeavor as investments in plant-based foods continue to increase worldwide and especially in Asian countries.
According to the Good Food Institute- a nonprofit that promotes plant-based and cultivated meat, eggs, and dairy- investments in alt protein startups in APAC and Australasia rose 43% to US$562m in 2022 against a global backdrop of double-digit declines.
“In Singapore, total alternative protein investments doubled from US$85 million in 2021 to US$170 million in 2022,” GFI provides.