Grocery Doppio AI Disruptors: 6 Companies Upcycling Wasted Food

Grocers generate a significant amount of waste, categorized as food, plastic, glass, paper, and aluminum waste. While 75-80% of the waste generated is recyclable and compostable, it usually ends up in landfills and incinerators.

Recycling is the answer to this monumental waste problem. The EPA defines recycling as the process of collecting, sorting, and remanufacturing. “Recycling Transformation: 6 Companies at the Forefront of Reducing Waste", discusses the first two components of recycling and highlights companies leading the transformation in the collection and sorting in recycling.

Remanufacturing refers to the sorted recyclable material being manufactured into newer products. In this article, we discuss wasted food that can be recycled to form more unique products and reduce environmental waste.

According to the United Nations Environment Programme’s “UNEP Food Waste Index Report 2021,” 17% of the globally produced food is wasted. Households, retailers, and food service amount to 931 million tons of wasted food. The biggest culprits are consumers (61%), food service (26%), and retail (13%). Data from the EPA reports that Americans discard 40 million tons of food each year. The environmental awareness about wasted food and the rising carbon emissions have made consumers more aware and pressed organizations to do something about the amount of food waste. A circular loop to understand the recycling ecosystem can be shown as:

Consumer - Grocer - Waste Collection - Sorting - Processing - Remanufacturing

To understand the food waste dilema, which globally impacts the food ecosystem socially and environmentally, we must understand the difference between wasted food and food loss.

Difference Between Wasted Food and Food Loss

Wasted Food: The food that is edible and fit for human consumption but gets discarded and not put to its intended use is wasted food. The reasons are usually food nearing expiration, blemished food, left over food, meal kit food, rinds, and spoiled food.

Food Loss: This refers to uneaten agricultural food, forestry products, and meat products. The food is hampered due to adverse weather conditions, fluctuations in the supply chain, or spoilage.

Food Waste Factors

The reasons are natural and societal. Adverse climatic conditions like heavy monsoons, locust invasion, or forest fires can lead to unavoidable climatic disasters. However, consumer preferences, changing attitudes to seasonal foods, aversion to ugly, cosmetically disoriented food, and misinformation about expiration dates are some of the reasons for food spoilage which ultimately leads to its waste.

Food waste is not a harmless biodegradable problem. Data estimates from the EPA suggest that the US wasted 63 million tons of food in 2018, and research from the USDA shows that one-third of produced food is uneaten. Food waste also makes up the largest category of waste, accounting for 24% of material found in landfills and 22% of the material burned in incinerators. The data shows that strategies like donation, anaerobic digestion, animal feed, and composting have helped to eliminate one-third of this harmful waste.  The two-thirds of waste that remains can be transformed into products that could be upcycled, becoming alternative revenue streams and providing profit to grocers, food service, and retailers alike.

As per Grocery Doppio's research “State of Digital Grocery: The Media Monetization Opportunity,” 86% of grocery retailers report that they need to add new revenue streams, and 71% are actively evaluating and implementing new revenue streams.

Food upcycling can be the next frontier for repurposing byproducts and generating newer revenue streams. The environment can benefit from the surplus food waste, and certain inedible foods like egg shells, the pulp of whey, grape pulp, and remnants of vegetables can be processed to make consumables like high protein flour, snacks, granola bars and, in turn, provide opportunities for creating newer food supply chain systems.

As per the world economic forum's “Top 25 Recycling Facts and Statistics for 2022 - EcoWatch,” 10% of the global greenhouse emissions result from food waste, minimizing food waste can have a dramatic impact on the environment.

Food upcycling is a booming business worth $55.1 billion in 2023 and is expected to grow at a CAGR of 5% by 2033, according to a study conducted by Future Market Insights.

The food upcycling industry can translate to profitable opportunities for grocers, CPG, and food service industries with categories in upcycled consumables, beverages, pet treats, and fertilizer and manure for the agriculture ecosystem. Highlighted below are innovative and creative companies who are disrupting the space with sustainable options that can be revenue producers for grocers.

Matriark Foods - A woman-owned social impact business that bridges the gap between local food systems and consumers by using nutritious, blemished, rejected landfill-bound vegetables to produce new food products. The New York-based startup was formed in 2020 by Anna Hammond to address the food waste and hunger crisis by scaling access to healthy food. The company's is certified by the Upcycled Food Association and uses FSC certified packaging, implying the company has an auditable supply chain and its effect on the environment is measurable. It  eliminates food waste by upcycling food remnants into its spicy arrabbiata, gentle marinara, and tomato basil sauce, and a low-sodium broth concentrate. Their products are now available at Whole Foods Market stores in New York, Jersey, and Connecticut.

Renewal Mill - Oakland-based startup Renewal Mill was founded in 2016 by Claire Schlemme and Caroline Cotto to produce climate-friendly nutritious food manufactured from remnants of soybean pulp left over from making soymilk. Their award-winning Okara flour is an innovative ingredient, aiding in creating a circular economy and fighting global food loss. The company has been awarded the Institute of Food Technologists Future Food Disruptor of the Year award. It is on a mission to upcycle ingredients to create high-fiber gluten-free flour by applying the process to the byproducts of oat pulp, potato peels, almond meals, and many more. They have partnered with Whole Foods Market, The Goods Mart, Sur La Table, and Williams Sonoma to launch collections of sustainably sourced upcycled flour and baking mixes.

Barnana - Los Angeles-based startup Barnana was founded by Caue Suplicy, Nik Ingersoll, and Matthew Clifford in 2012 to save imperfect bananas from becoming food waste. A certified B corporation manufacturing plantain chips, brittle, banana bites, and tortilla chips from upcycled bananas grown in central and south America. The company has partnered with Whole Foods Market, CVS, Ralphs, Rite Aid, Costco Wholesale, Duane Reade, and Walgreens and is a finalist for the 2023 N.E.X.T.Y. award. In its mission to save bananas, the company has also partnered with small landholder farmers and provided regenerative agricultural practices that promote healthy soils.

Pulp Pantry - The company transforms the healthiest fiber pulp of fruits and vegetables into homemade snacks that enable prebiotic and digestive benefits without adding any sugar. Los Angeles-based, woman-owned startup founded in 2015 by Kaitlin Mogentale produces healthy snacks which are gluten-free, grain-free, and non-Gmo. Partnered with Hungry Harvest, JUICE PRESS, and Urban Outfitters, the startup has also been nominated as a finalist in the 2022 N.E.X.T.Y. awards in the best new salty snack category.

The Ugly Company - The company was founded in 2018 with a vision to achieve zero food waste at farms. Founded by Ben Moore, a fourth-generation farmer who witnessed food waste for years at Central Valley Farms, the company transforms unsellable food into healthy dried fruit snacks. In 2022 the company prevented 2.17 million pounds of fruits from being destroyed. The company has partnered with Whole Foods Market, Kroger, Sprouts Farmers Market, and Foxtrot, their products are available in locations nationwide. They are also the winners of Kroger Go Fresh and Local Supplier accelerator programs designed to support small and diverse business enterprises to bring regional produce to Kroger stores. The company has recently closed a $9M Series A funding round.

Grain4Grain - San Antonio-based upcycling startup founded in 2018 turns byproducts into consumable flour. The company's innovative technology dries and mills brewers spent grain in just 20 minutes, down from the 6 hours of conventional process, producing low-carb, high- protein flour. The company, founded by Yoni Medhin, is upcycled certified and has upcycled 425,000 lbs of spent grain since 2018. The company has partnered with H-E-B, Central Market, and Amazon.

The power of food upcycling is just starting to be felt, and its reach will only grow in the coming years. The innovative technology reduces carbon emissions and provides grocers and CG companies with innovative and fresh revenue streams.

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