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This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n\nArticle content<\/h2>\n The product, called Next Milk, is a blend of oat, coconut, and soy. But the real trick with it, according to one of the people who created it, is the way it uses fat. Silk is owned by the Paris-based yoghurt giant Danone S.A., so its product developers \u201cunderstand milk,\u201d said Pierre Morin, Danone Canada\u2019s vice-president of innovation, who worked on the Next Milk team.<\/p>\n
\u201cWhen you drink milk,\u201d he said, \u201cmilk fat is going to melt in your mouth, cover your mouth, give you that smoothness, that mouth coating, that creaminess.\u201d<\/p>\n
Danone says more than half the households in Canada shun plant-based milk alternatives, and it believes that\u2019s because those households just haven\u2019t found something with the same texture and taste as cow milk. So Next Milk is a plot to convert them, and the company has spent more than two years fiddling with different combinations, trying to get the right mix of coconut cream, coconut oil, and sunflower oil to mimic the way milk fat operates in a mouth. The development team was so fixated on copying milk that it tweaked the U.S. version of the product ahead of its launch in Canada this month, to account for the differences in taste between American milk and Canadian milk. (Canadian milk is sweeter, Morin said, while U.S. milk has a subtle, vegetal taste, which is due to the cow breeds used on either side of the border, and what those cows are fed.)<\/p>\n<\/section>\n
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This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n\nArticle content<\/h2>\n Danone is expecting Next Milk will quickly become one of its top sellers in Canada. \u201cIt\u2019s the highest scoring product we\u2019ve ever tested,\u201d said Jeremy Oxley, Danone Canada\u2019s senior vice-president of marketing, who added that currently, almond milk is Silk\u2019s top selling dairy substitute in Canada, followed by oat milk, then soy. \u201cIt\u2019s unlike the other bases where typically you wouldn\u2019t drink it by the glass.\u201d<\/p>\n Danone\u2019s Next Milk, a plant-based product it says is so close to cow milk that you\u2019ll willingly drink it by the glass.<\/span> Photo by Peter J Thompson\/National Post<\/span> <\/figcaption><\/figure>\nIf Danone is right, and the product really does have the power to convert the holdout milk drinkers, then Canada has yet again missed out on a big opportunity in the plant-based boom. Canada grows lots of oats and lots of soybeans, but Danone imports Next Milk from a factory in the United States, meaning most of the value from a potential blockbuster product \u2014 one that was tailored specifically for Canadian tastebuds \u2014 will accrue elsewhere.<\/p>\n<\/section>\n
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This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n\nArticle content<\/h2>\nFamiliar story<\/h2>\n It\u2019s a familiar story in Canadian agriculture: The crops grow here, but the cool stuff, the innovative processes and the new jobs and the value creation, that all happens elsewhere.<\/p>\n
Danone confirmed that some of the oats \u2014 the top ingredient in Next Milk\u00a0\u2014 are sourced from Canada, which happens to be a global leader in oat production. But those oats are shipped to the United States to be processed into ingredients, then mixed into Next Milk\u00a0\u2014 also in the U.S. \u2014 before being sent back to Canada for sale.<\/p>\n
\u201cIn Canada, yes, we\u2019re a big producer of oat, big producer of soy,\u201d said Morin, at Danone Canada. \u201cWe need to develop the capability to make ingredients out of these crops \u2026 If we still just grow oat and soy and ship it to China, or ship it everywhere to make ingredients, then it\u2019s not helping us.\u201d<\/p>\n<\/section>\n
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This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n\nArticle content<\/h2>\n The federal government is investing millions to try to fix that. Through its innovation supercluster, Protein Industries Canada (PIC), Ottawa has been spending money to entice global ingredient manufacturers to build processing plants in Western Canada.<\/p>\n
In four years, PIC has made some progress. In March, the supercluster announced it had brokered a $4.1-million deal between the Toronto-based oat milk brand Oat Canada and Roquette Fr\u00e8res SA, a French food processor, to develop new ingredients using Canadian oats. PIC is covering half the cost of the investment, and the two companies are splitting the rest.<\/p>\n
Roquette has also invested more than $600 million to build a processing plant in Portage la Prairie, Man., that turns Canadian yellow peas into ingredients for the plant-based protein market.<\/p>\n<\/section>\n
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This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n\nArticle content<\/h2>\nClose to the consumer<\/h2>\n Danone is also looking to build up its in-house processing capacity, so it can make its own ingredients for plant-based milk. The final plans on those investments aren\u2019t set, but Morin suggested it\u2019s more likely that work will happen in the U.S., because it makes more logistical and environmental sense to produce close to the largest consumer base, rather than transport it all from another country.<\/p>\n
\u201cWe think about building these capabilities as close as possible to the consumer,\u201d Morin said. \u201cSo in a way, it makes more sense for us to make it in the U.S. where you have a lot of people around.\u201d<\/p>\n <\/p>\n\n Trudeau government stands firm on new dairy rules despite anger from U.S. milk lobby <\/span> <\/h3>\n<\/li>\n Soaring dairy prices drive steepest rise in food inflation in 13 years <\/span> <\/h3>\n<\/li>\n Ontario\u2019s Ace Hill takes on Bud Light to become king of carb-free beer <\/span> <\/h3>\n<\/li>\n<\/ol>\n <\/section>\n<\/section>\n\n
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This advertisement has not loaded yet, but your article continues below. <\/p>\n<\/p><\/div><\/div><\/div><\/div>\n<\/section>\n<\/div>\n\nArticle content<\/h2>\n It\u2019s that logic that has historically prevented Canada from building up its domestic processing capacity, according to Bill Greuel, CEO of Protein Industries Canada. \u201cWe don\u2019t have it because traditionally we haven\u2019t had the population to support it,\u201d he said. \u201cIt\u2019s the classic challenge in Canada.\u201d<\/p>\n
But he\u2019s been pushing against that logic, trying to convince manufacturers that it actually makes more sense to process crops into ingredients close to the fields.<\/p>\n
Greuel isn\u2019t under the illusion that Canada can one day produce all the world\u2019s oat milk, or even all North America\u2019s oat milk. The gravitational pull of the American consumer base is just too strong. But the real opportunity is in those high-value ingredients, which can be sold to large factories in the U.S. and elsewhere.<\/p>\n
\u201cNow the challenge is, we need critical mass and enough volume to be relevant,\u201d he said. \u201cI just think it\u2019s a matter of time.\u201d<\/p>\n
But there\u2019s isn\u2019t a lot of time. Plant-based brands and ingredient manufacturers are looking to build up extra processing capacity now to meet growing demand. And once it\u2019s built, wherever it\u2019s built \u2014 it\u2019s built.<\/p>\n
\u2022 Email: jedmiston@nationalpost.com | Twitter: