It’s springtime, and while other farmers debate whether to plant corn or soybeans, Frank Wolf has been debating how much of his farm in Washington to commit to chickpeas.
“We started out with about 1 percent of our acreage in production,” said Wolf. “It’s now approximately 25 percent of our production.”
Why? Chickpeas are the main ingredient in hummus, a Mediterranean staple which is starting to compete with salsa, onion dip and guacamole as the best way to garnish a chip. But hummus could soon give peanut butter, ketchup and even mustard something to worry about, too.
“It’s only the beginning,” said Ronen Zohar, CEO of Sabra, the dominant player with more than half the U.S. hummus market.
Sabra is a 50-50 joint venture between PepsiCo and Israel-based Strauss, and the company said it expects in six years annual sales to grow to $800 million from $16 million. Zohar said sales could reach $1 billion in a few years. “People are looking for all kinds of new solutions, healthier foods,” he said. “They are willing to try new things, and hummus is one of them.”
Sabra isn’t the only large-scale hummus manufacturer on the market, but its sales dwarf other players like Kraft-owned Athenos.
Zohar credits much of the success to PepsiCo. “They have a lot of knowledge about consumer habits and how to approach the consumer, so we leverage the Pepsi capabilities, its consumer research, transportation, all kinds of support we get from Pepsi,” he said.
While the top line is growing double digits annually, Zohar will not report what’s happening with the bottom line, other than to say, “We are very happy with our results.”
Some of the company’s profits have been plowed into an $86 million expansion of Sabra’s facilities in Virginia, including a research and development lab. Here the company is figuring out what new flavors might entice Americans to eat hummus, and what chickpeas will bring the best yields in the U.S. to help Sabra ramp up to meet demand.
“One of the reasons we started doing all kinds of research is to find how to grow chickpeas in other places in the states, like in Virginia, where we are right now,” said Zohar. Sabra has approached local tobacco farmers to talk about replacing their traditional crop with chickpeas.
How much growth is left? The CEO said hummus has only penetrated about 20 percent of the U.S. market. “The next step is to try to introduce (hummus) to children as a spread and to take the 20 percent and make it 40 percent.”
The company’s success has not gone unnoticed in other parts of the Middle East. The Huffington Post reports some Lebanese are grumbling that Israel has co-opted what they consider a Lebanese staple.
“To quote a saying that has surfaced on the Internet, ‘First our land, then our hummus,'” reported Saki Knafo, who added that Zohar replied, “I am very happy if Lebanon is going to fight about the hummus and not about anything else.”
—Follow Jane Wells on Twitter @janewells.