OMAHA, NEB. — Scoular’s announcement in Nov. 2021 of the $75 million expansion of its Petsource by Scoular freeze-dry manufacturing facility is the largest investment Scoular has made in a facility to date. The investment demonstrates the company’s commitment to the industry as well as its confidence in and breadth across the pet food space.

Known by many worldwide as a grain ingredient supplier across the human food, pet food and animal feed industries, Scoular has also supplied animal protein ingredients for several years. In Sept. 2020, the company launched Petsource as a wholly owned subsidiary of Scoular to co-manufacture freeze-dried ingredients, treats and complete and balanced diets for the pet food industry. Scoular expected to eventually expand the Petsource facility but the need for that occurred more quickly than expected.

Amy Patterson, president of Petsource. (Source: Scoular)

“We designed the layout in order to expand,” said Amy Patterson, president of Petsource. “We anticipated doing that in three to five years but based on significant demand, the growth that our customers are seeing in their brands and our desire to continue to be a support and a solution for them, we are launching into the expansion far faster.

“Initially we anticipated doubling our footprint but, again because of capacity needs and the knowledge that we have built, we have the confidence to actually triple the capacity of the facility,” Patterson shared. “That’s specific to freeze drying but it also allows us to triple all of our raw processing and our refrigerated food solutions for our customers. We’re excited to bring that to the marketplace far earlier than we anticipated and to continue to help grow with our customers. It will be one of the largest [freeze-drying facilities] dedicated to pet food through this expansion.”

It's unique for the established ingredient supplier to offer finished product manufacturing.

“Traditionally, full-scale manufacturing isn’t a space where Scoular has spent a lot of time, but we had confidence that we could,” said Paul Maass, chief executive office of Scoular. “We reached out to Amy for her experience, and she’s done a terrific job.

Paul Maass, chief executive office of Scoular. (Source: Scoular)

“The foundation for Petsource started with listening to our customers and what solutions they needed,” Maass explained. “There was capacity constraint in the marketplace, and somebody had to step in there. So, we looked at it and said why can’t Scoular take that step and solve that for our customers and that’s where the creation of Petsource came from. We’ve had a long history of listening to customers and looking for solutions.”

With the pet food industry’s sustained growth, Scoular customers were reporting inadequate capacity in the marketplace in several areas including the freeze-dry marketplace, particularly capacity in freeze drying dedicated to pet food manufacturing. The Petsource facility in Seward, Neb. is an end-to-end solution from ingredients entering the raw side of the facility through meat processing, freeze drying and finished packaging solutions.

“High value proteins and the ability to offer a finished manufactured solution was an opportunity for us to not only be confident in the raw material supply but now also in the manufacturing of those finished goods, and knowing that we had control over each of the steps was really important to us,” Patterson said. “At the end of the day, the freeze-dried product is still a raw feeding option for pets. To control the process from the frozen protein state all the way to the freeze-dried finished good is important from a food safety perspective. We married the knowledge we had around the raw material side and our manufacturing expertise to deliver what we believe is a really exciting and high-trust product to our brand owners.”

Designed for raw safety

Patterson emphasized that Petsource believes, as does many of its brand partners, in raw food options for pets. To maintain the quality and confidence in its raw formats, Petsource employs high pressure pasteurization (HPP), stringent quality testing protocols and hold-and-release processes at each stage of the manufacturing.

“Some manufacturers may see that as cumbersome and unnecessary,” Patterson said. “We see it as absolutely critical to ensure that each step of our process builds that confidence before product goes out our door.”

The Petsource facility is designed with two sides, a raw side and a ready-to-eat side. Even though the finished product is considered a raw state, there are different handling standards within each side of the facility. All the color schemes on the raw side of the building are red, from the floor to the sanitation sites to the clothing the operators wear. And similarly on the ready-eat side, a gray color scheme is used. All employee welfare areas – the locker rooms, the break rooms, the production rooms – are specific to employees’ work zone.  Everything is duplicated within the facility in order to maintain that separation between raw and ready to eat.

“With high pressure pasteurization, that is a multi-log step reduction and we have that done outside of our facility,” Patterson explained. “That is the only part of our process we do offsite. But the product enters in through separate dock doors. It goes through specific handling so that it can enter into the ready-to-eat side of the facility with the clear separation and segregation of not only our people but also the environment, with the air handling units and the temperature control managed independently in the two portions of the facility.”

Less than six months after manufacturing began, Petsource received an SQF audit and scored an excellent rating.

“These are our four-legged family members that we are feeding,” Patterson said. “Every decision we make ensures that a food safety mindset is top of mind and building that within a team that is brand new was a collective effort with our operations, our food safety and our quality teams. I’m extremely proud of that third-party validation.”

Investing across all market segments

Recent investments by Scoular specific to the pet food industry include the opening of Petsource in Sept. 2020 plus its planned expansion announced Nov. 2021; the opening of the Emerge™ facility Dec. 7, 2021, which produces concentrated barley protein for use in pet food and aquafeed; and a new partnership to build an Encompass™ fishmeal processing facility in Warrenton, Ore., which will provide fishmeal and fish oil to pet food and aquaculture manufacturers.  

Maass pointed out that these are just a portion of the company’s overall investments across its core business segments. Notable projects include last year’s opening of its new high-speed flax processing facility  in Regina, Canada, the move to a new global headquarters in Omaha, Neb., on Dec. 15, 2021, and  expansion of several  grain handling and storage facilities in Nebraska, Kansas and Missouri.

“We have a lot of investments that we are making to support our businesses and the growth opportunities that we see,” Maass said. “These investments, including those in the pet segment, speak to the broad depth of what we have going on across the entire company. We are absolutely all in on pet food. We’re investing in it and love it. And we’re equally as invested in our other core businesses and we’re investing in them as well.”

Maass says Scoular strives to be a trusted partner providing innovative solutions to the industries it serves.

“We are listening to our customers,” Maass explained. “We have curiosity about what’s really going on in their world and we are a trusted partner to deliver an answer for them. In the freeze-dry space, we’ve taken the steps to offer something that is very unique from a safety and quality perspective, and we continue to see more demand than there is supply.”

That steady demand is what prompted Scoular to quickly move ahead with the Petsource expansion and triple its capacity.

“We have a lot of confidence in our customers, and we have a lot of confidence in our team,” Maass said. “We couldn’t triple our capacity [at Petsource] if we didn’t believe in both. As a team, we make sure we are engaging externally, have a pulse on what’s happening and make informed decisions of how best to offer solutions that will help our customers. We recognize the pace of change is accelerating every day. We’ve got to be agile.”

Patterson attributes the company’s longevity and success to being a responsive company to both its customers and its team members, as well as embracing flexibility.

“Having the ability to be responsive to customers’ needs and to do it in a responsible way has guided Scoular through the last nearly 130 years,” Patterson said. “We lead with that mindset of integrity and doing the right things in the right ways. It’s why I’ve been so proud to be part of Scoular the last several years.”