60%
of consumers find the concept of upcycling appealing
according to a report from FMCG Gurus
Upcycling—taking would-be waste and turning it into a usable or edible product—is on the rise, although it’s better known globally than it is in the U.S., where manufacturers are still working to educate customers.
Natural brands are doing their part. Take UP TO GOOD Energy: “Upcycling is not widely known and understood by consumers yet,” says Lars Oltmanns, CEO and Co-Founder. “We use short phrases that explain upcycling or refer to the solution of preventing food waste. These marketing phrases could be Upcycling is the new recycling or #LessWasteGoodTaste. Becoming Upcycled certified by the Upcycled Food Association is our goal for the coming months. That will allow us to use the certification logo on products and marketing material. A visual claim will surely support the education of the positive impact of upcycling.”
While there are other terms for the same concept, "upcycled" seems to be the best option. “In 2018, Drexel University conducted a study amongst 1,000 participants to gauge perception around terms associated with value added surplus products,” says Wholly Veggie Co-founder & CEO Johnathan Bonnell. “Upcycled was the clear winner, followed by re-processed and re-claimed. What we’ve learned ourselves, though, is that the terms are still very niche, and whenever we talk about upcycling, we always include secondary content to describe what the term means.”
Globally, the concept is well-known. A global 2022 study conducted by FMCG Gurus found that not only do people on a global scale know what upcycling is, but they’re willing to pay for it. “A recent global survey reported that six in 10 consumers found the concept of upcycling appealing and more than one-third say they are willing to pay a premium for products with upcycled ingredients,” explains Jan Jongsma, NutriLeads’ Chief Operations Officer. “Formulating natural products with upcycled ingredients may give marketers a powerful way to distinguish their products, particularly among consumers concerned their health and the well-being of the planet.”
Quality Assurance Struggles
Upcycled products offer unique challenges. Christina O’Keefe, Director of Sustainability in North America at Kerry, points out that as upcycled ingredients are typically byproducts of food manufacturing, there can be issues with taste, texture, and/or nutrition. And that’s not to mention safety: “Does the upcycled ingredient pass quality assurance checks in safety, hygiene?” asks Dr. Silke Middendorf, CCO at Biomega. “Is the raw material regulated and by which bodies, how stringent is the legislation? Has there been a double materiality assessment performed or even considered?” Plus, Dr. Middendorf points out, just because a product is upcycled doesn’t mean it’s sustainable. “Does the biomanufacturing process used include chemicals? How much resource (water, energy) is it using, is that energy being recirculated?” Biomega, which upcycles rest-raw salmon materials into peptides and oils, uses continuous enzymatic hydrolysis to produce sustainable products, while annually evaluating suppliers on raw material handling processes to ensure quality products.
Kerry has seen these challenges, O’Keefe says—but productive partnerships can overcome them. “There can be sourcing challenges depending on if we are sourcing an established upcycled ingredient or if you are exploring new ingredients. Some challenges we have come across include the transparency from the supplier, how to ensure food safety, and the quality of the materials. With our Kerry chicken stock we were able to work with our suppliers to overcome these challenges. We are continuing to explore new opportunities both internally and external of our organization and each opportunity has its own set of challenges. When Kerry embarked on this journey it was important that we collaborated upfront with our trusted suppliers to ensure we have a consistent supply of upcycled raw materials. Our procurement team are focused on supplying our business with sustainable raw materials that are good for the planet and our communities.”
Supply Chain Challenges
The first and main struggle with upcycled products is supply chain: No one is producing materials explicitly for upcycled products, therefore no one can scale up production to meet increased demand. So how do producers ensure that they will have enough ingredients to make their product? WholeFoods asked suppliers and manufacturers alike to tell us what it takes.
NutriLeads’ Jongsma opines: “It is critical to verify the existence of multiple waste or byproduct streams to ensure sustainable and scalable sources for upcycled products. For example, NutriLeads BV produces BeniCaros from upcycled carrot pomace. Carrots are one of the world’s most popular vegetables and millions of pounds of carrots pomace are produced each year as a side stream from juicing. The abundance of carrot pomace has enabled NutriLeads to secure a consistently high quality and sustainable supply chains for manufacturers. NutriLeads immediately captures the fresh carrot pomace from the juicing process and begins its natural extraction process of BeniCaros, a prebiotic fiber, from carrot cell wall. We know which farms, fields and carrots are sourced in the production of BeniCaros. This ensures high quality and product consistency.”
Rather than working with the direct producers of an ingredient, the nature of Stratum Nutrition’s upcycled product means that the company can work with a secondary industry. “Our approach to tackling the supply chain challenge revolves around the distinct nature of our upcycled material, derived specifically from commercial egg breaking operations,” shares Danny Long, Director of Quality. “Unlike conventional upcycled products that rely on uncertain cast-offs or nonconformances from various sources, our upcycled material stems directly from the egg breaking industry. This industry inherently involves the breaking of eggs, and as a result, we consistently have access to the raw material required for our upcycling process. To bolster the reliability of our supply chain further, we have fostered strong partnerships with commercial egg breaking facilities. These partnerships not only grant us consistent access to the necessary raw materials but also allow us to collaborate closely with the egg-breaking industry to ensure the efficient and sustainable utilization of their by-products.
“By focusing on a specific and reliable source for our upcycled materials,” Long continues, “we have been able to establish a stable supply chain that circumvents the uncertainties often associated with traditional upcycling processes. This strategic approach not only enables us to consistently produce high-quality upcycled products but also contributes to reducing waste in the egg-breaking industry, fostering a more sustainable and circular economy.”
That kind of work on the supplier’s end makes things easier for manufacturers. Bonnell shares: “When we set out to create our first upcycled product, we knew that key to us maintain supply chain integrity was to partner with a supplier that had already built out a fully upcycled supply chain that we could audit. Our work led us to the team at Outcast Foods. They had already developed a network of partners that were discarding imperfect and short coded vegetables, and had built out the first facility in Canada to clean, cut, chop and turn the items into delicious upcycled powders.” The results of this partnership include, for instance, Wholly Veggie’s Mozzarella Style Sticks, which feature a crust made from upcycled vegetables.
Oltmanns, on the other hand, explains that UP TO GOOD Energy created its own supply chain to source the coffee fruit—cascara—for its cascara-based energy drink. “In coffee farming there is a steady waste stream of potential Cascara to be upcycled—120 billion pounds of coffee berries are harvested globally every year, leaving around 85 billion pounds of coffee fruit as waste, if not upcycled to Cascara. The amount of discarded coffee fruit is immense and there is no shortage of ingredient supply, if planned ahead. We work closely with coffee farms that produce Cascara for us. We contract the ingredient supply before the harvest. We also warehouse plenty of supply for future months of production at our central warehouse, limiting the risk of running low or out of ingredient supply. Alternatively, Cascara is starting to be traded by specialized wholesalers. If extra supply is needed, you find it on the open market.”
Looking at other fruits, RIND notes that for them, there’s absolutely no concerns about ingredient shortage. “RIND proudly and exclusively sources rescued, upcycled fruit that would otherwise go to waste, and gives these fruit ‘seconds’ a second life by transforming them into innovative zero-waste snacks that consumers crave,” says Founder & CEO Matt Weiss. “The size of the secondary market for this type of fruit is massive—with overripe and cosmetically imperfect produce representing an estimated 1/3 of all food waste each year in the U.S or 10 billion pounds of unnecessary loss. Put simply, there is no shortage of raw fruit for RIND to rescue and create value-added products while also creating a profitable side stream for small and independent farmers. We believe our efforts to fight food waste and to further quantify that effort by measuring our overall waste reduction initiatives each year helps us gain consumer trust and demonstrate our core value of building a sustainable snacking brand that is good for both people and planet.”
Of course, from an upcycler’s point of view, there’s a lot more to fruit than just fruit. Fruit d’Or, for instance, has long worked to use the rest of it. “There is so much effort put in the fields to optimize our cranberry yield, it’s only natural for us to optimize as much of the entire fruit as possible when we transform it,” explains Patrick Lemaire, Senior Director of Sales, Nutraceuticals and Co-products. “With that vision in mind, we’ve been freezing inventory for many years, hoping our R&D team would be able to develop upcycled products that we can manufacture. Our team now has that deep expertise in upcycled product development. Managing the supply of upcycled products also requires thorough demand planning. We meet weekly to monitor our inventory. We also do master planning to capture longer term market opportunities. But because Fruit d’Or has built an inventory of products, such as cranberry seeds, cranberry seed oil and fine particles of fruit, we have materials on hand to ensure a supply chain for our clients.”
That said, Lemaire notes that supply is always a concern—as natural products, there can be variation in yield year-to-year, even besides the fact that upcycled products are sourced from the main supply chain. To this end, Fruit d’Or works closely with both the producers in order to maximize yield, and with manufacturers in order to understand their yearly needs.
The Final Word: Sustainability
“Manufacturers should consider using an upcycled ingredient to support reducing food loss/waste in our food systems,” says O’Keefe. “Using an upcycled ingredient stretches the use of an agriculture commodity to be fully utilized for beneficial human and pet consumption, moving towards a more valuable circular economy. A co-creation partner is a great way to start looking at how to incorporate the use of upcycled ingredients into a brand and/or new products in the market.”
Stratum’s Long seconds this: “By incorporating upcycled ingredients thoughtfully, manufacturers can contribute to waste reduction, promote sustainability, and meet the growing consumer demand for environmentally friendly products.” WF
3 Upcyling Problems and Solutions
Danny Long of Stratum Nutrition, highlighted three specific struggles manufacturers face when working with upcycled ingredients—and provided guidance on how to address them:
Problem #1: Consistency and Availability.
Unlike traditional supply chains where raw materials can be easily procured, upcycled materials often come from variable sources.
Solution: Establish strong relationships with suppliers, waste management facilities, or other sources to guarantee a steady flow of upcycled materials.
Problem #2: Quality Control.
Upcycled ingredients may vary in quality due to their origin from discarded or by-product sources.
Solution: Manufacturers should implement robust quality control measures to assess and maintain the desired standard of their products. This may involve thorough testing, inspection, and verification procedures.
Problem #3: Traceability.
Traceability is always important, especially when the product was previously considered waste.
Solution: Manufacturers should prioritize transparency and traceability in their supply chains. Seeking third-party certifications for upcycled ingredients can help build trust with customers and demonstrate a commitment to sustainable practices.
