South Korean food and biotechnology group CJ CheilJedang and agribusiness merchant ADM have entered an agreement to establish a joint venture dedicated to the development, production, and commercialisation of fermentation-derived feed-grade amino acids.
The proposed venture is structured to secure a domestic supply of essential amino acids for livestock nutrition across North and South America, addressing supply chain vulnerabilities and reinforcing animal feed security.
Under the agreement, CJ CheilJedang will hold majority ownership of the joint venture entity, which will hold exclusive commercial and manufacturing rights for feed-grade amino acids across the Americas. The closing of the transaction remains subject to standard closing conditions and regulatory clearances.
"By combining CJ’s industry-leading fermentation technology to produce amino acids for animal nutrition and technical marketing with ADM’s U.S. manufacturing footprint and strong feedstock supply, the joint venture is positioned to seek enhanced cost competitiveness and support stable domestic production for North America," said Lance Haeryong Choi, Senior Vice President of CJ CheilJedang.
"Together, CJ and ADM will help to strengthen global food security and supply chain resilience as well as supporting American communities and manufacturing jobs."
Operational Assets and Industrial Footprint
The joint venture unites fermentation infrastructure, intellectual property, and regional sales distribution networks from both companies across the Western Hemisphere.
The combined operating asset base includes:
CJ Fermentation Plants: Industrial production facilities located in Fort Dodge, Iowa, and Piracicaba, Brazil.
ADM Manufacturing Facility: Dedicated feed-grade amino acid processing plant situated in Decatur, Illinois.
Commercial Sales Network: CJ’s regional commercial sales offices situated across the United States, Mexico, and Brazil.
Proprietary Technology Licences: CJ will licence its proprietary intellectual property covering feed-grade amino acid fermentation to the joint venture for exclusive deployment within North and South America.
Both parent companies have outlined clear boundaries regarding the scope of the joint venture. CJ CheilJedang will retain full ownership of its underlying intellectual property and maintain its global biotechnology and fermentation operations outside the Americas. Concurrently, ADM’s remaining production operations in Decatur and its broader global fermentation assets remain excluded from the joint venture transaction.
Trade Dynamics and Domestic Lysine Production
The transaction lands amid challenging global trading conditions that have placed downward margin pressure on domestic amino acid manufacturing in the United States, particularly for feed-grade lysine.
Lysine serves as an essential building block in commercial swine and poultry diets, optimising protein synthesis and feed conversion efficiency. Recent competitive pressures from overseas producers have challenged domestic production economics, prompting scrutiny from federal trade authorities.
The commercial rationale for the partnership is reinforced by trade policy developments from the US Department of Commerce and the US International Trade Commission (ITC), which recently enacted regulatory decisions to counteract unfair trade practices regarding imports of Chinese lysine into the domestic market.
"Customers know that challenging global market conditions are putting continued U.S. domestic production of feed-grade amino acids, particularly lysine, at risk," said Kris Lutt, Vice President of Innovation and Growth at ADM. "This joint venture will strengthen U.S. production, creating a more reliable U.S. source of supply by bringing together the right assets, products and capabilities to support continued production in a highly competitive environment."
Lutt added: "Recent decisions by the U.S. Department of Commerce and U.S. International Trade Commission to eliminate unfair trade practices affecting U.S. imports of lysine by China give us even greater confidence that this is the right step. ADM will continue to use its global fermentation capacity and expertise to meet customer needs and as a platform for growth as we explore new ways to serve food, feed and industrial markets through precision fermentation."
Long-Term Supply Chain Integration
By coupling CJ CheilJedang’s biological fermentation strains and downstream extraction technologies with ADM’s domestic agricultural feedstock supply and bulk processing infrastructure, the joint venture seeks to establish a competitive cost basis against imported volumes.
The operational integration allows the enterprise to secure consistent raw material flows for fermentation media, notably dextrose and agricultural inputs supplied by ADM, while expanding regional distribution to animal feed compounders and livestock producers across the Americas.
