Analysis: Agroloop buzzing with expansion plans as new insect plant order book fills up

It’s without a hint of irony that Rajmond Percze talks about a “buzzing kind of interest” in the insect protein industry.

The Co-Founder and CEO of 5-year-old Hungarian company Agroloop spoke to GlobalPETS from his office in its recently opened 13,000-square-meter processing plant in the Aerozone Park in Üllő, 26 km southwest of Budapest, to share his insights into an industry with a huge potential to transform the pet food industry.

Clear goal

“We [Percze, Co-Founder István Nagy and their team] initiated this project 5 years ago with a clear goal that we want to bring sustainability to the agriculture of Europe, and we knew that there is biomass which is not polarized at the level where it should have been already,” he explains.

Sustainability is at the heart of turning low-quality byproducts of other production into high-quality protein for pet food. Using, for example, yeast biomass from a local brewery and the voracious appetite of black soldier fly (BSF) larvae, Agroloop has developed an efficient operation.

BSF larvae are so productive because of how they feed. They gorge themselves to gain the calories they need for their entire lives within the first quarter of a typical 45-day lifespan, which is “their superpower,” Percze says. Agroloop harvests the larvae at around 12 days.

Under-utilized byproducts

Using byproducts that are not being utilized means no new biomass products need to be created and sourcing from as close to its plant as possible – just 5 km in some cases and certainly within 100 km – adds to the sustainability of the process.

Percze says the water usage ratio for Agroloop’s protein product versus an equivalent bovine-derived protein is 1 to 40, with a similar ratio for greenhouse gas emissions. Compared to cows, the area needed for production from black soldier flies makes a big difference to the stats.

Even the byproduct of the BSF larvae processing, known as frass, has a valuable use as soil fertilizer, which is sold to farmers locally.

The company is proud of its leadership in sustainability and of showing others what is possible. In 2023, Agroloop was recognized as one of Hungary’s greenest companies at the second Sustainable World Conference.

Expansion plans

Revenue is on a trajectory that satisfies Percze and Agroloop’s investors, which include venture capital firms and strategic partners.

The Üllő plant produces around 8 tons of protein meal daily, with an annual expectation of around 3,000 tons. The process also produces 2 tons of fat per day (around 600 tons per year) as another food source and a similar amount of frass.

However, with an order book that swallows up all of that supply, Percze says the firm is looking at expansion. Some of that can come from the existing plant, but other locations in Hungary and elsewhere in Central Europe are also being considered.

“I think we have possibilities to go beyond Europe as well,” he says. “We have many inquiries that we have to deal with and we have to select which we are going to allocate our resources for.”

Industry potential

Agroloop aims to be the leading player in the insect protein market, but as with any burgeoning industry, greater innovation at pace and scale comes from more participants.

Percze is generous in his wish for more businesses to help fuel the industry while remaining certain of his company’s key part in it.

“Compared to our competitors, I think we’ll be the most effective one in this field today. Hopefully, we will keep up this pace in the future as well, but today, I can say that we are the most cost-effective one on the market,” he says.

“I would like to encourage others that it is an industry worth joining and it is worth doing research and trial and error and whoever wants to join has to listen to the customers’ needs and also to put value on the table for any investors if needed.”

The investment landscape requires the knowledge of those who want to drive innovation and sustainability, and Percze hopes that the industry will see a proliferation of hero investors. As he says, “There is a buzzing kind of interest in the industry.”