Smucker will switch production at fruit spreads plant in Memphis to peanut butter

Smucker will switch production at fruit spreads plant in Memphis to peanut butter

US food group JM Smucker has reversed plans to close a plant in Tennessee as it looks to grow its nut butter's business, which centres on the Jif brand.

The company yesterday (19 February) confirmed it will convert its fruit spreads factory in Memphis into a facility of nut butters. The plant had been earmarked for closure as part of a shake-up of JM Smucker's fruit spreads production set out in 2010.

According to data released by JM Smucker, the company's peanut butter sales of increased at a compound annual growth rate of 7% a year since 2008.

JM Smucker is expanding its nut butter product range. Earlier this year, the company launched a hazelnut under the Jif brand and it plans to roll out cashew and almond lines

Director Mark Smucker said JM Smucker's plant in Lexington had been sufficient but the company needed more capacity if it is to meet its forecasts for growth in sales of nut butter products.

"The expectations we have to grow the peanuts and nut butter businesses require us to further expand capacity in Lexington while adding a third facility," Mr Smucker told analysts at the Consumer Analyst Group of New York investor conference.

The company's plans also include moving production of its "speciality" nut butters that are co-packed elsewhere into another of its sites in Pennsylvania. That plant makes JM Smucker's "natural" peanut butters, which will move to the Memphis site.

The supply chain shake-up announced three years ago set out plans to close four plants, including the site in Memphis. The three other factories either have been closed or will shut. The plans also included the building of a new fruit spreads facility, which is "nearing completion", Mr Smucker said.

He also told CAGNY the company was spending US$80m on increasing the capacity of a bread and sandwiches plant in Kentucky as it looks to grow its Uncrustables frozen sandwiches business.

Mr Smucker added: "Our manufacturing facilities, consisting of 21 plants primarily in the US, are more efficient and more agile than ever before, and strengthen our innovation and our other growth objectives."