A world-first Kiwi-developed food technology that upcycles horticultural waste into high-value products is set to reduce NZ’s dependence on imported food ingredients, cut greenhouse gas emissions, increase grower returns and boost regional employment.

The waste valorisation system, developed by sustainability venture Powered by Plants (PbP) with support from Government-backed New Zealand Food Innovation Network (NZFIN), diverts thousands of tonnes of perishable horticultural produce from landfill and processes it into shelf-stable, high-value powders, concentrates and extracts for use in the food, nutraceutical and supplement sectors.

The model, which can be scaled internationally, also produces bioenergy, fertiliser and even high-protein insect meal from previously unrecoverable waste.

Dr Andrew Prest, director of Powered by Plants, says the concept was born out of frustration with the current food production model, where around a fifth of harvested produce is routinely discarded before it ever leaves the farm gate or is sold at unsustainable prices.

He says with New Zealand’s $7 billion export horticulture sector producing over 6.2 million tonnes of fruit and vegetables each year, the opportunity to address the environmental and economic cost of waste is significant.

Prest says the onion industry alone produces around 110,000 tonnes annually and has export earnings of approximately $170 million. However, up to 20% of this is sent to landfill, costing growers around $15 million each year, a loss compounded by the missed opportunity to upcycle this waste into high-value food ingredients or bio-products. 

He says the zero waste technology can produce powders and concentrates from almost any fruit and vegetable surplus and processed off-cut waste, including carrots, mushrooms, capsicum and blueberries, and can be adapted to other horticultural crops like kiwifruit and stone fruit.

“Growers are stuck in an unsustainable commodity cycle where they’re selling most of their crop fresh and dumping the rest, either to landfill or as low-value stock feed.

“At the same time, New Zealand imports thousands of tonnes of processed food ingredients and extracts, including 1,100 tonnes of onion powder, which could be locally manufactured from existing crop surpluses and processing off-cuts.

Grant Verry, Co-CEO of NZFIN, says the new waste valorisation method is globally significant and an example of the smart food system transformation that New Zealand urgently needs to meet agricultural export goals.

He says IP protection will be essential to help scale the model internationally.

“This technology has the potential to dramatically reduce food waste and increase returns for Kiwi growers and processors by turning what was once a loss-making by-product into a premium product.

“For some growers, this could be the difference between profit and loss. It offers them options so instead of sending unsold produce to landfill or stockfeed, they can now receive more revenue by choosing to sell into a higher-value, local, circular and sustainable bioprocessing food system.”

Verry says the innovation is a fully circular “bio-loop” model designed to unlock value at every stage of the waste cycle.

He says recoverable food waste is processed through a biostabilisation process to create high-value ingredients, while unrecoverable biomass is used to produce biogas or converted into insect protein via black soldier fly farming. The by-products, such as liquid digestate and frass, are blended into organic fertilisers, offering a substitute for synthetic imports.

Prest says the company is now looking to build regional ‘spoke and hub’ biorefinery networks, starting in areas like Gisborne, Pukekohe and Hawke’s Bay.

“Our goal is to process 8,000 tonnes of produce surplus and waste annually at full scale, with locally staffed facilities supporting everything from produce sorting to ingredient processing.

“The goal is not just to reduce waste but to give growers a better, more resilient, future-proof business model and in turn,  help future-proof the nation’s food security.”

“AI will be used to scan and detect spoilage or non-conforming product early in the process. That means fewer rejections and a cleaner, more consistent output, which is critical when you’re supplying high-end food and supplement markets.”

Prest says the upcycling model offers significant economic potential, particularly in high-waste crops like onions, where the process could generate up to $52.8 million from the biostabilisation phase alone.

“Additional revenue streams could also be created through insect farming and biogas and bio fertiliser generation. The process also yields renewable heat and electricity, which can be used onsite or further refined and fed into the grid.”

Prest says the model was piloted in the Franklin region, which produces a significant share of the country’s fresh produce but remains vulnerable to climate-related disruptions.

“Cyclone Gabrielle wiped out large volumes of crop in the region, highlighting just how urgently we need localised, flexible waste recovery infrastructure to become resilient.

Verry says the model has the potential to address imbalances in the supply chain that leave many producers without bargaining power.

“Growers have very little negotiating weight under the supermarket duopoly. The grower has no real alternative to sell through this channel because produce is perishable and low term chilled and frozen storage costs are high and will only increase. This new system gives them back some leverage.”

“This is not just for New Zealand, countries across the Asia-Pacific region face the same problem with small block growers, high food loss and low returns. We believe this is a scalable solution to global food system challenges.

“We’re not going to double our food exports by raising more cattle or increasing fishing quotas, with physical production capacity in New Zealand nearing its limits, adding value is the only way forward,” says Verry.

Prest says that with early support provided by industry partners, the next phase will require seed funding for a pilot commercial production run and to bridge the project toward a full-scale plant capable of processing thousands of tonnes annually, with a network of rural sorting sites operating as part of the wider system.

He says the response from the market has been positive, with major food manufacturers and food service providers around New Zealand looking to reduce their need for imported ingredients.

“Many growers are on the brink, and cannot afford to pay high salaries and wages for the hard work and long hours that are required. This in turn is failing to attract the next generation of growers. 

“Whilst automation does offer some efficiency and cost benefits, we still need to employ and pay humans in order to support local economies and communities.  If we can help growers and fresh produce processors to diversify and add value to what they grow, and manufacture we can keep people working in the horticultural industry – and keep healthy, fresh produce affordable in the supermarkets.

“Instead of earning $20 a tonne for waste onions sent to a dairy farmer or burying in landfill, our process can earn $3,000 per tonne from food-grade product. That shift alone can revitalise an entire sector.

“Growers are telling us they’re excited about the revenue potential, the crop ‘optionality’, the waste reduction and the chance to pay higher wages to local people in their communities.

“Our vision is to see sorting hubs in key growing regions around the country, staffed by locals and powered by smart tools. We want to revitalise these communities and create a circular food economy that benefits everyone.

“We’ve proven the model is financially viable and has the potential to grow horticultural exports, we just need the investment to unlock this national, and potentially global, opportunity.”