CJ, ADM plan joint venture for feed-grade amino acids

USA – CJ CheilJedang and ADM have agreed to form a joint venture to manufacture and market feed-grade amino acids, combining CJ’s fermentation technology with ADM’s production and feedstock infrastructure to strengthen supply across the Americas.

The proposed venture will bring together CJ’s fermentation facilities in Fort Dodge, Iowa, and Piracicaba, Brazil, with ADM’s feed-grade amino acid plant in Decatur, Illinois. 

CJ will contribute its Mexico, Brazil and US sales offices and license its feed-grade amino acid intellectual property to the new company.

CJ will hold the majority stake in the joint venture, which will receive exclusive rights to manufacture and sell feed-grade amino acids across North and South America.

The companies have not disclosed the agreement’s financial terms.

The companies said the venture aims to create a more reliable, long-term supply of amino acids used in livestock feed, particularly amid competitive global market conditions affecting domestic production.

“By combining CJ’s industry-leading fermentation technology to produce amino acids for animal nutrition and technical marketing with ADM’s US manufacturing footprint and strong feedstock supply, the joint venture is positioned to seek enhanced cost competitiveness and support stable domestic production for North America,” said Lance Haeryong Choi, senior vice president of CJ CheilJedang.

CJ and ADM will use the new company to develop, manufacture and market fermentation-derived amino acids. 

CJ will retain ownership of its intellectual property and global fermentation businesses outside the venture, while ADM will retain its other Decatur operations and global fermentation assets.

“Customers know that challenging global market conditions are putting continued US domestic production of feed-grade amino acids, particularly lysine, at risk,” said Kris Lutt, ADM’s vice president of Innovation and Growth.

“This joint venture will strengthen US production, creating a more reliable US source of supply by bringing together the right assets, products and capabilities to support continued production in a highly competitive environment,” Lutt added.

The proposed venture follows recent US trade actions concerning Chinese lysine imports. 

ADM said the decisions by the US Department of Commerce and US International Trade Commission to address what they described as unfair trade practices affecting US lysine imports provide additional support for the planned investment.

The joint venture remains subject to customary closing activities and regulatory approvals before it can launch.

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