Even as consumption of carob is growing globally, orchards are shrinking, leading CarobWay’s founder to seek a new and more sustainable model.

Carob—once known as a 70s replacement for chocolate—has come into its own, with consumption growing at 5 percent a year. However, orchards are shrinking and there is an increasing shortage of quality ingredients in the market. This has opened up a whitespace not only for supply, but to do so in a new and more sustainable way. Udi Alroy, CEO and co-founder of CarobWay, has taken up the challenge to develop carob intensive cultivation orchards and to produce ingredients using 100% of the carob fruit—from seeds through pods. With decades of experience in the global food and nutraceutical industry, and a passion for supply chain transparency and sustainability, Udi has identified cultivars that produce well in arid climates, and yield abundant ingredients.

Tune in to hear more about:

• Market opportunities for carob—both for food and beverage products and nutraceuticals.
• How utilising all parts of the carob fruit yields unique new ingredients.
• Why an eco-supportive model based on long-term partnerships has overt and underlying benefits to business.
• Inspiration to make greater sustainability commitments across the supply chain.

Guest: Udi Alroy, CEO and co-founder, CarobWay

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Welcome to the Vitafoods Insights Sustainability series podcast. From responsible sourcing to supply chain logistics. This dedicated podcast addresses some of the industry's greatest challenges and champions the stories of sustainability success. Today's host is Heather Granato, Vice President of content.

My guest today is Udi Alroy, the Co-founder and CEO of CarobWay. Udi's had more than 20 years in the global food and nutraceutical industry with extensive networks in the EU, Asia and the United States. And now he's bringing those years of experience to CarobWay. Just founded last year, this innovative firm is developing carob intensive cultivation orchards, and producing carob based ingredients utilising 100% of the carob fruit from seeds through pods. And given there is a shortage of carobs, and the orchards are shrinking even as consumption is increasing at a rate of 5% per year, there's a great story for meeting market whitespace in a very sustainable way. So that's where I started with Udi, was this big issue of sustainability and crop production.

First of all, sustainable crops are crops that we look at them as highly climatized to the area where they're being cultivated, first of all. Carob of has been done for more than 3000 years in Israel, so it's highly climatized. It's well known for its minimum use of water, and does not like to be cultivated in intensive ways, does not require a lot of labour, does not require training, and so forth. The third thing is, also being sustainable is the ability also to use 100% of the crop itself. We are using 100% of the carobs, we are not throwing anything. And we are really looking how to take all the health out of the carob with its variety of sugars, variety of fibres, and so forth.

Wonderful. When I ran into you in Geneva, just a bit ago at Vitafoods Europe, I mentioned I was interested in talking about the market opportunities for Carob, both for food and beverages and nutraceuticals, because my parents were very well meaning back in the 1970s and tried to feed me carob instead of chocolate, it wasn't great. So I'd love a little bit of how we're bringing it into the now and kind of that market positioning for care of?

First of all, the carob itself, the structure is very quite beneficial to our health. It has about 50% of sugars, which are low GI sugars, which can be used in a wide variety and in different culture, it is being used for different application from beverages to spreads, and more and more. The main issue about carob is always been the flavour and the smell of the carob. And therefore, we looked into 1000s of trees, looking how to get the most beneficent, not only the most efficient one to be cultivated in order to make it this sustainable business as well. But also how to bring carobs that are very tasty, not only sweet. It's a different structure between the fibres and the sweets of the carob, but they have to be very tasty. In my view, everything that goes into the food industry has to be tasty, and with variety of application that we already started like non gluten pasta, or it's a non-allergenic application, so you can use it in variety of foods in most of the application to the use the carob powder. But we're looking furthermore not to do it all as a carob powder, but to look into the polyphenols, into the D‐pinitol, into variety of extracts that can benefit the health of consumers while attracting the new flavour within the market.

So it really can be used then in different types of products, whether food or beverage or even for nutraceutical applications?

Out of the carob, you can make about 20 byproducts of the overall. Carob powder takes all of it in, beside the seeds. So taking out the seeds, that we too are making, locust bean gum come out of the seed which is a different economical structure and also composition. The main thing is really how to take the extracts into the dietary supplements, such as the D-pinitol, looking at the beneficial of the polyphenols like the tannins. The carob is high in tannins and has a wonderful business structure, the more efficient with in tannins production. So we are looking furthermore, not only into the main foods are in the, a lot into the beverage industry, fruit sugars, low GI fruit sugar, but also we're looking at variety of foods from pasta to variety of meat alternative, or dairy alternative as well.

Wonderful. Now, CarobWay has this eco supportive model that is founded on long term business relationships. So could you talk a little about how long term partnerships impact the supply chain, from produce to products and the underlying benefit?

So first of all, in order to enter the food and the food and beverage industry, you need a long term supply availability of the ingredient themselves, and therefore, we have vertically integrated solution for the carobs from the cultivars of the growers all through the food manufacturers, where we offer a 10 year agreement for cultivation with the growers. We are bringing the seeds and we are bringing the carobs that we chose out of 1000s of them to be the most economical on one hand side, and we are committed to buy all the produce from them for 10 years. And we have already few manufacturers that have signed 10 years agreement with us for the full supply of the carob of itself. There is a lot of shortage within the market in carob seeds, but not only. There is no sustainable and long term relationship within the market and we're trying to stabilise this supply chain issue. And to stay away of shortages within food and beverage and also dietary supplement are not acceptable anymore within the industry.

Now,what are some of the sustainability commitments of CarobWay and how do you and the team hope to drive the industry to become more sustainable?

First of all the cultivation is highly sustainable. We're using soils that are currently, are not economical to cultivate or not used non arable land, carobs can grow anywhere. So for the growers, they're using non arable lands, they're using very little water. It should all depends on the rain because the carob consume little water as much as it can. We're using variety of pollination technology, variety of irrigation technology, all through fertilisation. So we are optimising the cultivation process. Plus, we optimise the type of trees, the mothers of the trees, that they will be really targeted into specific industrial use. So the cultivation is focused on industrial application. Okay, seed? so these are trees for seeds; taste? these are trees for taste, and so forth. High D‐pinitol? high D‐pinitol. So the idea is really to focus from, once you know how to define the industrial use, you can take it all the way to the farm and then take it back from farm to fork. The second thing that we're doing as a sustainability, we do not use any paper whatsoever. But it has to do with a carob, not with a paper because we have a zero waste strategy. We're using 100% of the carob so why waste anything? So therefore, why do we need any paper? I mean, even business cards, everybody knows everyone. And if not, you give them your mobile and then you have all the details and not necessarily you don't have to plug in no data entry, and really everything is digitised. I mean accounting, everything is digitised, you're taking everything, all the invoices are being digitised. So why bother in use any maze? The third thing is that we decided that we will invest. In the last three years, we invested heavily within defining the right tree for the right application. So we're not using all types of carobs, there are 200 types all around the world. And in each country, you have highly efficient species within what we have. In Israel, we have five species, not all of them are right for us. So we searched out of the 6000 hectares that we have in Israel, so we know how to target the right orchard for the right industrial application. That really reduces a lot of waste, but makes the orchard more efficient, industrialised. I would say that building such a structure overall, A to Z, plus the use of every type of water that we have in Israel. In Israel we desalinate, but we really have great water, about recycled about 70% of the water that we use. So the limit is not in the use of water. It's the cost of water. In Israel, water are extremely expensive in comparison to the world. So, the environment provide us the ability to be highly sustainable and look for every piece of energy that we are looking, and today we are looking also for solar application as well. So that will enable us to do solar panel within the orchard and then take the solar to our plants and industrial plants will be used the solar energy that it is made by those orchards as well.

I so appreciate the fact that you really took a comprehensive look at this from the beginning of the business. And that could be an interesting model, I'm sure for other businesses to look at every aspect of what they're producing and how they're producing it.

Yes, it is. I think for the long run, it's highly beneficial and very profitable from what we're looking today. So sustainability, it's not only a thing, I think, economically, it's viable in the carob business. Okay, not in any business. But the carob looks like, it is highly viable as a highly profitable crop, when you're using it to the right place. And when you're growing it in a sustainable environment.

Anything else that you think would be important for our listening audience to understand about the market demands and opportunities for sustainably grown and produced ingredients in general and carob in particular?

I would say today, what me as a consumer, I would definitely look at natural products. And this is really key issue for me. And not only looking at natural product, is looking the way that they have been made through the years. It's not only synthetic versus natural. Not all natural are really natural. So it's very important for us to see what is the process that we took from the farm to the fork, because for example, in the carob business, we're using low temperature processing technologies just to save some energy. When you're making variety of natural products so cold, you're using extensive high temperature, or I would say, not so friendly processes to the environment. And I think that we as consumer, we have to look into the overall process of what we eat and not only what we eat.

I couldn't agree more. Well, thank you again for joining me today Udi and best of luck with this new initiative around CarobWay.

Thank you very much and have a wonderful week.

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