- By Lynda Kiernan-Stone, Global AgInvesting Media
Organic and Non-GMO Supply Chain Company Pipeline Foods Acquires ADM Elevator
Pipeline Foods, the first U.S.-based food supply chain company focused solely on establishing sustainable global supply chains for organic and non-GMO food and feed, has acquired a 3.4 million bushel grain elevator from Archer Daniels Midland (ADM) located in Atlantic, Iowa, for an undisclosed sum.
In response to consumer demand, major players have been increasing their sourcing of organic and non-GMO ingredients, or have been making changes to their product lines, according to Civil Eats. However, while demand dynamics have been changing, large scale supply chain models have not kept pace. Minneapolis-based Pipeline Foods plans to fill this gap, and provide a complete solution to these and other food companies that are expanding their organic and non-GMO business through a procurement strategy that secures a transparent, long-term, socially responsible, and sustainable supply of ingredients.
GAI News first reported on Pipeline Foods in February 2017 when AMERRA Capital Management and Pipeline Opportunity Partners announced their partnership to launch the company. Months later, in September, Pipeline announced the official launch of its global operations and its plans to invest between $300 million and $500 million over the next three to five years in assets to support its growth.
Within weeks, on September 20, the company announced the acquisition of two grain elevator facilities in Wapella and Gull Lake, Saskatchewan, Canada. A third acquisition occurred in October of last year, this time in the U.S., when the company announced the acquisition of a grain elevator in Lignite, North Dakota, from Cenex Harvest States (CHS) for an undisclosed amount. The facility has a capacity of 3,500 metric tons, and dual access to the Burlington Northern Santa Fe (BNSF) and Canadian Pacific Railway.
“Pipeline Foods is eager to invest in supply chain solutions that bring value to the organic and non-GMO grain and oilseed industry,” said Eric Jackson, CEO of Pipeline Foods, in a company release in September of last year. “We will put more profits back into the hands of the farmers, create dependability and transparency for food companies, and offer unique investment opportunities for financial partners.”
Jackson told the Non-GMO Report that the company has set goals in place to see 25,000 acres of farmland being transitioned to organic production next year, and 250,000 acres by 2019.
Toward this end, Pipeline has established additional regional headquarters in Winnipeg, Canada, and Buenos Aires, Argentina – giving the company a presence in three of the world’s top grain producing regions.
The purchase of the ADM elevator in Iowa, which brings Pipeline’s ownership to six organic processing facilities across the U.S. and Canada, is another move by Pipeline to bring the company closer to fully supporting the growing demand from protein producers for U.S.-grown organic grain.
"This acquisition is a key component in Pipeline Foods' mission to increase organic supply chain efficiency and transparency," said Jackson. "In owning and operating another facility dedicated to organic grains and oilseeds, Pipeline Foods will have a direct relationship with farmers in the region, helping to ensure identity preservation of the product and allowing us to take ownership at the farm gate, thereby increasing transparency and traceability for all stakeholders."
Pipeline has signed a purchase agreement with ADM and is currently making capital investments in new equipment and upgrades necessary for the elevator to test, clean, grade, dry, store, and ship organic grain. The elevator will be open and operating as of mid-September and will be accepting its initial organic grain deliveries at that time.