North American Consumers Demanding Cleaner Labels and These 4 Food Stocks are Dishing Them Up

September 13, 2022 -

According to the International Food Information Council’s (IFIC) 2022 Food and Health Survey, consumer preference for products labeled as “clean” and “natural” have continued to increase in 2022. Meanwhile, a survey conducted by the University of Minnesota found a growing “trust gap” among American adults, showing less than 25% strongly trust information about where their food is grown and how it’s produced. Here now are FOUR food stocks that are working to provide clean-label natural foods to appease these changing consumer tastes and diets: United Natural Foods, Inc. (NYSE:UNFI), Conagra Brands, Inc. (NYSE:CAG), The Hain Celestial Group, Inc. (NASDAQ:HAIN), and Ingredion Incorporated (NYSE:INGR).

United Natural Foods, Inc. (NYSE:UNFI)

United Natural Foods recently announced the addition of two new meal solutions to its offerings to better allow retailers to meet growing demand for quick, restaurant-quality meals. The new meal solutions are available nationwide to the more than 30,000 customer locations UNFI services.

"With consumers continuing to favor eating at home versus away, retailers are looking to offer delicious and effortless products to time-challenged consumers that replicate the restaurant experience at budget friendly pricing," said Jody Barrick, Vice President of Bakery/Deli at UNFI.

The new on-trend meal solutions, which include a fresh meal kit from Cook-Able and flash-frozen meals from Cadence Kitchen, allow UNFI to quickly deliver additional high quality product choices which help customers differentiate their offerings at a time when consumers increasingly rely on their local retailer for meal options.

"These chef-inspired offerings from Cook•Able and Cadence Kitchen give retailers a fast, delicious and reasonably priced turnkey experience, affording their teams additional time to focus on serving their customers," added Barrick.

Conagra Brands, Inc. (NYSE:CAG)

Working to improve its production capabilities, Conagra Brands announced earlier this year it was opening a new state-of-the-art vegetable processing facility for its Birds Eye brand. The announcement came with a $300 million investment price tag attached to bring about a new 245,00 sq ft facility in Waseca, MN to modernize its production. For reference, in FY2021, Conagra's Birds Eye brand generated more than $1.5 billion in retail sales.

The new facility is meant to support Conagra’s frozen meals business as well as the Birds Eye brand, and replaces a 92-year-old facility in Waseca while providing approximately 20% more capacity for processing vegetables.

"Our teams looked at every aspect of the facility to identify automation opportunities to improve productivity and modernize food safety practices throughout our operations," said Ale Eboli, Executive VP and Chief Supply Chain Officer at Conagra Brands. "The state-of-the-art design and uniquely designed equipment featured in the facility process fresh vegetables in the most efficient and responsible way possible."

The peas and corn processed at the new facility come from a network of nearby growers who use a variety of actions to help fight climate change, such as smart practices to save water, support biodiversity and improve soil health.

The Hain Celestial Group, Inc. (NASDAQ:HAIN)

From a packaging standpoint, leading organic and natural foods company The Hain Celestial Group recently joined forces with the How2Recycle label program. The program enables companies to clearly communicate how to recycle a package, improving the reliability completeness and transparency of recyclability claims.

In its 2021 Global Environmental, Social and Governance (ESG) Report, Hain publicly committed to improve packaging sustainability and announced two goals: 1. Adding standardized recycling labels to 100% of Hain products by the end of 2025 in order to provide reliable transparent recycling information for consumers; 2. Publish a sustainable packaging strategy by 2023.

“The packaging inventory is a crucial first step for developing a portfolio wide packaging strategy that will enable our teams to make more sustainable packaging decisions,” said Hain Senior VP of R&D, Jeff George. “Our goal over time is to develop more sustainable packaging, without compromising quality and functionality for our consumers.”

Ingredion Incorporated (NYSE:INGR)

Helping to provide the right types of ingredients for these cleaner products, Ingredion has been meeting demands from clientele through its specialty ingredients arm. Through the company’s Q2 2022, Ingredion saw a 16% increase in net sales.

“In response to continued strong demand for clean label texturizing starches, we accelerated the commissioning of new capacity at our Indianapolis facility,” said Ingredion President and CEO, James P. Zallie. “In addition, our Sugar Reduction and Specialty Sweetener platform had another excellent quarter, growing net sales by more than 20% led by a double-digit top-line increase of PureCircle’s stevia franchise.”