ADM aims for strategic growth in the pet food industry

Through new leadership and acquisitions, ADM is expanding its reach.

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Bill Schoenherr, director of pet food business for ADM Animal Nutrition, sat down at Petfood Forum 2017 to discuss ADM's future in the pet food industry. | Lindsay Beaton, Petfood Industry
Bill Schoenherr, director of pet food business for ADM Animal Nutrition, sat down at Petfood Forum 2017 to discuss ADM's future in the pet food industry. | Lindsay Beaton, Petfood Industry

ADM (Archer Daniels Midland) Animal Nutrition Director of Pet Food Business Bill Schoenherr joined the company in July 2016 and says he did so in part because he was intrigued by ADM’s recent moves to become a larger presence in the pet food industry. “I’ve been in the industry for many, many years,” says Schoenherr. “I worked at Hill’s Pet Nutrition for 18 years in R&D. The last several years I’ve been working with DuPont, and then this position came open at ADM. When I saw what they described as the job, I thought, well this could be very interesting, because ADM has finally made a decision to be a player in the pet food industry.”

The pet food industry would seem to be a natural fit for ADM, says Schoenherr. “They’re close to a US$70 billion company on the agribusiness side, and have sold commodity ingredients to the pet food industry — soybean meal and corn gluten meal and starch and those kinds of things, which are part of the mix of making pet food,” he says. “But you always wondered why they didn’t have a bigger presence than what they did.”

ADM changes direction and refines focus

In the last several years, ADM has made a number of strategic acquisitions to expand its portfolio and provide expansion opportunities in both the human and pet food arenas. “There was a change in upper management a couple years ago,” says Schoenherr. “And with that also came a directional change with regard to the focus and what our business was going to be about. ADM has always been a very strong commodity company. But they have seen a great opportunity to get into the human food industry, so they have made strategic purchases that have also got us into a position where we could actually service the pet food industry better than we’ve ever done.”

In 2014, the company completed its acquisition of WILD Flavors GmbH, a natural food ingredient manufacturer; and Specialty Commodities Inc., an originator, processor and distributor of healthy ingredients such as nuts, fruits, seeds, legumes and ancient grains. In 2015, it agreed to acquire Eatem Foods Co., a developer and producer of premium traditional, natural and organic savory flavor systems. “We’ve always had what we call our legacy ingredients (soybean meal, corn gluten meal, etc.), but then with the addition of these brand new ingredients, that portfolio just changed dramatically,” says Schoenherr. “So that, to me, when I looked at this position, was a matter of saying, wow, that’s a neat portfolio to be able to come to the pet food industry with.”

ADM’s most recent acquisition, Crosswind Industries, a producer of dry-expanded, dual-texture, semi-dry and semi-moist treat products for pets, will give ADM yet another way to serve the pet food industry. “Crosswind has a great desire to expand their footprint and to serve the industry better than they’ve ever done in the past,” says Schoenherr. “The intent is to make sure that we have the additional resources to do that.”

But as the company expands, ADM wants to be sure it's not overstepping its self-imposed bounds. “What needs to be understood is that we have no desire to name brand anything ADM,” says Schoenherr. “The last thing we want to do is compete with our customers. The purchase of Crosswind is truly of a service nature. It gives us an avenue for finding extra value in our ingredient base because now we can start using a portion of our ingredients in the manufacture of those treats.”

The future of ADM: private label, international, acquisitions

Crosswind is obviously a significant focus for ADM right now. “Our belief is that Crosswind will continue to grow in its footprint and its size,” says Schoenherr. “It’ll become a bigger portion of the treat manufacturing that happens here in North America. I would expect them to expand to more international markets as they continue to grow, because that need is worldwide. The private label portion of that will probably be where we expand the most, meeting the needs for the grocery stores and the Walmarts of the world. They want something that they can brand themselves, and I see Crosswind filling a big niche there.”

ADM is also planning to focus more heavily on growing its international presence. “We have a very strong presence in the US, and we have a bit of presence in Canada, but that’s about it,” says Schoenherr. “So you think about ADM as a global company, you think, why haven’t we touched anything beyond that? So as I look at the long-term plans for us, it’s about expanding into other geographies. South America, Asia and whether we go to Europe or not — I think we’ll have a presence in Europe, but that market is pretty well developed at this point, and we’d be a new player on the block as far as the pet food side.”

That means, says Schoenherr, that there will be further acquisitions. “We have people who are actively looking at other opportunities for us to find adjacencies that would fit well to serve the pet food industry without truly getting into the manufacturing side of our own products into any of those geographies,” he says. “That is the long term, where this can all go. I think the next five to ten years will be a pretty exciting place to be with ADM in regard to their long-term vision for this.”


Petfood Forum 2017 

Record attendance, sold-out Exhibit Hall floor and countless connections made

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