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SunOpta: More Headwinds Than Tailwinds At This Time

Gary Bourgeault profile picture
Gary Bourgeault


  • Inventory management will remain a challenge: internally, with its business customers, and the retail end-user.
  • With food prices expected to continue increasing above historical levels in 2023, it's questionable as to how high the company can continue to raise prices to offset higher input costs.
  • Modest volume growth could point to its overall customer base starting to level off.

Buying Vegan Alternative Milk


As input costs have risen SunOpta Inc. (TSX:SOY:CA) (NASDAQ:STKL), a company that manufactures and sells plant-based and fruit-based food and beverage products, has had to increasingly raise prices in order to offset the inflationary impact on

This article was written by

Gary Bourgeault profile picture
I am a former investment advisor and owner of several businesses. These days I invest only for myself while continuing to write on a variety of financial and economic topics.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (4)

I've owned shares in the past but don't currently and just saw your article. Your focus on volumes was helpful to my understanding about where things are. The new Texas plant is a huge question mark for me as over-building of capacity has been a problem in the past IMO.
The comments about some private label exposure to offset branded pressure in an inflationary environment suggests there may be some confusion about STKL’s business. 1) a minimal amount of SunOpta’s revenue is derived from brands owned by SunOpta—the bulk is contract manufacturing and private label.
2) the lack of volume growth with sales driven by price is not unique to SunOpta—if one looks at scanner data this is common across food manufacturers—4) while consumers under economic pressure work down pantry stock and substitute some items…that only goes so far. This pantry de-load is also not relevant to their good service business.
Consumers under stress may not make as many trips to Starbucks, but unless Starbucks uses another supplier or stops mixing in plant-based milks, they will need to reorder. This is not to say 2023 doesn’t brings risks, though hopefully helps frame some concerns raised by the author.
I meant third point not “4” and am speaking of food service, not good service business for those who were confused by typo
my understanding was that they are sold out oat milk pending the opening of a new facility
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