# Cargill opens new Brazil pectin factory, first outside Europe
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2021-09-03
Category: BUSINESS
Category URL: https://financedigest.com/category/business
Meta Title: Cargill boosts pectin production in Brazil
Meta Description: Cargill's Brazilian unit finishes construction of new pectin plant, becoming the world's second largest producer of this versatile food ingredient
URL: https://financedigest.com/cargill-opens-new-brazil-pectin-factory-first-outside-europehtml

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By Ana Mano

SAO PAULO (Reuters) – The Brazilian unit of U.S. commodities trader [Cargill](https://www.financedigest.com/the-food-grade-gellan-gum-market-to-grow-on-an-astute-note.html) has finished [building a new facility](https://www.financedigest.com/li-cycle-to-build-french-battery-processing-facility.html "Li-Cycle to build French battery processing facility") to produce pectin, a fruit by-product used in jams, beverages, dairy products and confectionery, the [company](https://www.financedigest.com/dksh-sells-its-25-stake-in-swiss-luxury-watchmaker-bovet.html) said on Friday.

The [plant is Cargill’s only pectin facility outside of Europe](https://www.financedigest.com/germanys-uniper-to-restart-coal-fired-power-plant-as-gazprom-halts-supply-to-europe.html "Germany’s Uniper to restart coal-fired power plant as Gazprom halts supply to Europe"), where it owns three such units.

It will make Cargill the [world’s second largest producer of the food](https://www.financedigest.com/world-food-prices-hit-record-high-in-2022.html "World food prices hit record high in 2022") ingredient, Laerte Moraes, Cargill’s director for starches and sweeteners in South America, said in an interview.

Located close to Brazil’s orange belt – where [Cargill](https://www.financedigest.com/the-food-grade-gellan-gum-market-to-grow-on-an-astute-note.html) will [source orange peel as the raw material – the factory should help trim company production costs as currently two of its plants](https://www.financedigest.com/exclusive-foxconn-woes-could-hit-at-least-30-of-iphone-nov-shipments-from-china-plant-source.html "Exclusive: Foxconn woes could hit at least 30% of iPhone Nov shipments from China plant – source") in Europe have to import orange peels for processing there.

The Brazilian [unit will mainly cater to export markets](https://www.financedigest.com/fan-coil-unit-market-growth-sturdy-at-3-6-cagr-to-outstrip-us-8339-9-mn-by-2027-tmr.html "Fan Coil Unit Market Growth Sturdy at 3.6 % CAGR to Outstrip US$ 8,339.9 Mn By 2027 – TMR"), particularly clients in Asia, and will employ 120 people, the [company](https://www.financedigest.com/dksh-sells-its-25-stake-in-swiss-luxury-watchmaker-bovet.html) said.

Cargill’s move reflects a need to balance large-volume businesses that have lower [margins while boosting its presence in market segments with smaller volumes but higher](https://www.financedigest.com/maserati-aims-at-driving-margins-higher-before-any-spin-off-talk.html "Maserati aims at driving margins higher before any spin-off talk") prices.

It is also a response to evolving industrial [customer and consumer](https://www.financedigest.com/consumers-in-the-covid-era-can-learn-to-embrace-strong-customer-authentication.html "Consumers in the COVID era can learn to embrace strong customer authentication") dietary requirements. Global demand for pectin, a natural ingredient that can be used as an emulsifier, stabilizer and thickener agent in cooking and baking, is expected to [grow by up to 4% per year](https://www.financedigest.com/the-next-upcoming-years-to-see-the-gastric-electric-stimulators-market-grow-kinetically.html "The Next Upcoming Years To See The Gastric Electric Stimulators Market Grow Kinetically"), [Cargill](https://www.financedigest.com/the-food-grade-gellan-gum-market-to-grow-on-an-astute-note.html) said.

The company, one of the largest soy and corn traders in Brazil, announced [construction of the new plant](https://www.financedigest.com/uk-gives-go-ahead-for-edfs-sizewell-c-nuclear-plant-construction.html "UK gives go-ahead for EDF’s Sizewell C nuclear plant construction") in 2018. Though the work was slightly delayed in 2020 due to the pandemic-related restrictions, the plant will begin operations this month, Moraes said.

The new plant can produce some 6,000 tonnes per [year of the high-value product](https://www.financedigest.com/myfirmsapp-shortlisted-for-top-accountancy-practice-product-of-the-year.html "MyFirmsApp Shortlisted for Top Accountancy Practice Product of the Year"), a kilogram of which can cost between $15 and $20, Moraes said.

Cargill [invested 550 million](https://www.financedigest.com/nissan-renault-to-invest-600-million-to-make-6-new-models-in-india.html "Nissan, Renault to invest 0 million to make 6 new models in India") reais ($106.52 million) in the factory, according to Moraes.

($1 = 5.1632 reais)

(Reporting by Ana Mano; Editing by Sandra Maler)


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