Anheuser-Busch invests $100M to upcycle barley used to make beer

Source: fooddive.com

Dive Brief:

  • AB InBev’s Anheuser-Busch operation is investing $100 million and creating 50 jobs in St. Louis to expand the production capacity of its subsidiary that takes barley after it is used to make beer and repurposes it to be incorporated into food and other beverages, executives at the company said in an interview. The funding came as part of Anheuser-Busch’s pledge in February to invest more than $1 billion in its U.S. facilities during the next two years.
  • The maker of Budweiser and Michelob Ultra said it is renovating a building at its brewery in St. Louis that will allow its wholly owned subsidiary EverGrain to transform more of the saved grain on a commercial scale. Most of the barley will come from the St. Louis brewery.
  • The focus on repurposing barley after it’s used to make beer is the latest step by AB InBev to minimize its impact on the environment and meet its broader sustainability goals. In the past, it has worked to curtail water use, increased its consumption of renewable energy and entered into a partnership to create more sustainable cans.

Dive Insight:

For the U.S. division that makes up a key part of the world’s largest brewery, the raw materials that are core to making it signature beers are a logical place to start when it comes to reducing its environmental footprint and meeting its sustainability commitments. It’s also crucial to maintaining a thriving business.

“Protecting the environment in which we operate and from which we source those ingredients is an absolute prerequisite for us to make sure we can continue to brew” our beers, said Ingrid De Ryck, chief procurement and sustainability officer, at Anheuser-Busch. “That’s why sustainability is so core to everything we do.”

EverGrain also appears to make good business sense, too. Its barley protein is currently available in products such as Take Two, a plant-based barley milk line, and Nestlé plans to add it to its nutritional food supplement Garden of Life brand later in 2021. Other products are reportedly on the way. 

“We’re in discussion with all the major CPGs and small companies and startups too,” said Greg Belt, AB InBev’s former global vice president for sustainability and CEO of EverGrain. “We anticipate there will be massive demand for our product and St. Louis is the very first step to do that.”

The company is currently making its products at its $15 million small-scale production facility at Anheuser-Busch’s Newark, New Jersey, brewery. It will continue to be utilized for small-batch production and testing once the St. Louis facility comes online.

EverGrain takes the spent barley, and then uses technology it developed to separate out the fiber and the protein. The company found keeping them together created a grainy consistency in beverages that was off-putting when the product was consumed. 

Consumers consider plant-based products to be healthier alternatives, and it’s a big reason why a growing number of large CPGs are innovating internally, partnering with upstarts or acquiring brands to increase their awareness in the category. The ability to use a grain like barley twice — first to produce beer and then followed by its incorporation into a food or beverage product — not only stretches the land, water, nutrients and other inputs needed to produce it, but helps the sustainability mission of two companies.

Nearly half of consumers say the pandemic has made them more concerned about the environment, according to a survey released last year by global management and consulting firm Kearney. In 2019, 71% took that into consideration at least occasionally. Last April, after several weeks where most people were at home to deter the coronavirus spread, 83% of consumers said they considered the environment.

In the past, barley used by Anheuser-Busch at the brewery was either sent to the landfill or incorporated into animal feed. Once the new facility is up and running in the fourth quarter, the saved barley will be redirected into food or drink offerings.

​Popular ingredients commonly used in making plant-based products include soybeans and peas. But Belt said they can often affect the taste, texture or may not be soluble enough to be included into beverages — the barley protein EverGrain makes is immune to these challenges, increasing its attractiveness for potential users, he said. 

Belt said consumers want products that are great tasting, healthy or sustainable. “Often times, even some of the best plant-based products today sacrifice one or two of those, and so we think our ingredients enable all three,” he said.

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