NEW YORK • Global commodities trader Olam International is building a cocoa powder manufacturing facility outside Chicago, according to a company spokesman and a local official.
The plant marks the latest step in the transformation of the large Singapore-based cocoa trader into a bean processing heavyweight.
In 2015, Olam scooped up the cocoa assets of rival Archer Daniels Midland (ADM) for about US$1.2 billion (S$1.6 billion). That did not include ADM's chocolate plants in the United States.
Olam is building the 183,000 sq ft facility, which is expected to be fully operational by the middle of the year, said Mr Matt Eastman, a planning and zoning administrator for Bolingbrook, Illinois, where the plant will be located.
Olam spokesman Levi Hensel confirmed it was building a new facility, but declined to provide details.
Olam sources beans in Africa, Asia and South America and processes about 700,000 tonnes of cocoa powder, liquor and butter in 12 facilities worldwide, its website says. That is a chunk of a global grind of 4.3 million tonnes in the 2016/17 crop year, International Cocoa Organisation data shows.
The global cocoa market has been consolidating into the hands of fewer players, including Cargill, Barry Callebaut and Blommer Chocolate, most recently with the bankruptcy of mid-sized trader and processor Transmar Group.
Olam acquired eight cocoa processing facilities from ADM with the 2015 purchase. It sells into North American and European markets from processing facilities in Canada, Germany, Spain, the Netherlands and Britain, according to its website.
Last year, Olam opened an "innovation centre" in nearby Willowbrook, Illinois, where it assists customers on recipe development, but this would be its first US manufacturing site, the website shows.
The Bolingbrook facility will create 50 jobs in a town where companies such as Goya Foods and Lindt & Spruengli's Ghirardelli also have facilities, said Mr Eastman.
Cocoa powder is used in food products such as cookies, ice cream and snack bars. Processing margins have risen as cocoa prices have tumbled for two straight years on excess supply, said industry sources.
Cocoa grinding, a gauge of demand for chocolate's key ingredient, in North America fell to a five-year low last year, while in Europe it rose to a six-year high.