SINGAPORE (Bloomberg): Olam International Ltd, one of Asia’s biggest agricultural firms, is splitting its food business from the rest of its commodities trading in a move to profit from rapidly shifting consumer tastes.
The reorganization reflects the growing recognition among the world’s biggest agriculture companies of the value of tapping into demand for specialty products from consumers who are becoming increasingly picky about the ingredients and origins of what they eat and the shift in emerging markets toward more protein-based diets.
While trends including the plant-protein craze have allowed niche food companies like Beyond Meat Inc to thrive, traditional bulk commodities trading has struggled to make money in recent years as bumper crops have curbed volatility.
Many of the world’s biggest commodity houses have been forced to restructure.
Chief Executive Officer Sunny Verghese said Olam is making the split after recognizing two distinct themes as part of a strategic review announced a year ago -- firstly a "growing disposition” for more healthy, nutritious and sustainable food and secondly a shift in demand in Asia and Africa to more fat and protein-based diets from carbohydrate and cereal-based products.
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